Niraj Petrochemicals Limited
The Members of
Niraj Petrochemicals Limited
We have audited the attached Balance Sheet of M/s. Niraj Petrochemicals
Limited as at 30th September,1997 and the Profit and Loss Account for the
year ended on that date annexed thereto and report that:
1. Further to our comments referred to in paragraph II, below we report
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 accounts as required by law , have been
kept by the Company so far as appears from the examination of these books.
c. The Balance Sheet and Profit and Loss Account referred to in this report
are in agreement with the books of accounts
d. In our opinion and to the best of our information and according to the
explanations given of us, the said Balance Sheet and profit and Loss
Account read together with the significant accounting policies and 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.
i. In so far as it relates to the Balance Sheet of the state of affairs of
the company as at 30th September, 1997 and
ii. In so far it relates to the Profit and Loss Account of the loss of the
company for the year ended 30th September, 1997.
II. As required by the Manufacturing and Other Companies (Auditors' Report)
Order, 1988 issued by the Company Act, 1956 and in terms of information and
explanation given to us and on the basis of such checks as we considered
appropriate we annex hereto a statement on the matters specified in
paragraph 4 & 5 of the said order.
1. The Company has maintained proper records showing particulars including
quantitative details and situation of fixed assets. These fixed assets
have been physically verified by the management at reasonable intervals
during the year and no material discrepancies have been found on such
2. None of the fixed assets have been raveled during the year.
3. The stock of raw material have been physically verified by the
management at the end of the year. The stocks of work in progress and
finished goods, having been valued at NIL, have not been physically
4. In our opinion and according to the information and explanation given to
us, the procedure of physical verification of stocks followed by the
management is reasonable and adequate i relation to the size of the Company
and nature of its business.
5. No material discrepancies have been noticed on physical verification of
stock as compared to book records.
6. In our opinion and on the basis of our examination, the valuation of
stock is fair and proper in accordance with the normally accepted
accounting principles and is on the same basis as in the preceding year.
7. In our opinion the rate of interest and other terms and conditions on
which loans have been taken from companies, firms and other parties listed
in the register maintained under section 301 of the Companies Act, 1956 and
from the companies under the same management are not prima facie,
prejudicial to the interest of the company
8. The company has not granted any loans, secured or unsecured to
Companies, firms or other parties listed in the register maintained under
section 301 or to the companies under the same management.
9. In respect of interest free loans and advances in the nature of loans
given to employees and others, recovery of principle amounts have been as
10. In our opinion and according to the information and explanations given
to us during the course of the Audit there are adequate internal control
procedures commensurate with the size of the company and nature of its
business for the purchase of stores, raw material including components,
plant and machinery, equipments and other assets.
11. According to the information and explanations given to us, there is
no transaction of purchase of goods and materials aggregating during the
year of Rs. 50,000/- or more in respect of each party made in pursuance of
contracts or arrangements entered in the register maintained u/s 301 of the
Companies Act, 1956.
12. The stocks of work in progress and finished goods have been damaged by
efflux of time and necessary provision has been made.
13. According to the information and explanations given to us the Company
has not accepted any deposits as defined u/s 58 of the Companies Act, 1956
and the rules framed thereunder.
14. In our opinion the Company is maintaining reasonable records for the
sale and disposal of scrap. The Company has no by products.
15. In our opinion the Company has an internal audit system commensurate
with the size and nature of its business.
16. According to the information given to us, the maintenance of cost
records has not been prescribed by the Central Government u/s 209(I)(d) of
the Companies Act, 1956 for the Company.
17. The Company has not paid the PF of Rs. 1,11,719/- and ESI of Rs.
35,585/- and Professional Tax Rs. 9,650/- which have fallen due for deposit
with the appropriate authorities.
18. According to the information and explanations given to us there are no
undisputed amounts payable in respect of Sales Tax, Custom Duty and Excise
Duty outstanding for a period more than six months from the date they
19. According to the information and explanations given to us, no personal
expenses have been charged to revenue account.
20. The Company is a Sick Industrial Company within the meaning of Section
3(1)(O) of the Sick Industrial Companies (Special Provision) Act, 1985.
for D.S.P. Reddy & Co.
Place: Hyderabad K.N. Ravi
Dated: 12.01.1998 Partner