The Members of
RAJ OIL MILLS LIMITED
Report on the Financial Statements
We have audited the accompanying financial statements of RAJ OIL MILLS LIMITED (the"Company") which comprise of the Balance Sheet as at March 31 2015 theStatement of Profit and Loss and Cash Flow Statement for the year then ended and asummary of significant accounting policies and other explanatory information.
Management's Responsibility for the Financial Statements
The Company's Board of Directors is responsible for the matters in section 134(5) ofthe Companies Act 2013 ("the Act") with respect to the preparation of thesefinancial statements that give a true and fair view of the financial position Financialperformance and cash flows of the Company in accordance with the accounting principlesgenerally accepted in India including the Accounting Standards specified under Section133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014. Thisresponsibility also includes the maintenance of adequate accounting records in accordancewith the provision of the Act for safeguarding of the assets of the Company and forpreventing and detecting the frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of internal financial control thatwere operating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror.
Our responsibility is to express an opinion on these financial statements based on ouraudit.
We have taken into account the provisions of the Act the accounting and auditingstandards and matters which are required to be included in the audit report under theprovisions of the Act and the Rules made there under.
We have conducted our audit in accordance with the Standards on Auditing specifiedunder section 143(10) of the Act. Those Standards require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetherthe financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the financial statements. The procedures selected depend on the auditor'sjudgment including the assessment of the risks of material misstatement of the financialstatements whether due to fraud or error. In making those risk assessments the auditorconsiders internal financial control relevant to the Company's preparation of thefinancial statements that give true and fair view in order to design audit procedures thatare appropriate in the circumstances. An audit also includes evaluating theappropriateness of accounting policies used and the reasonableness of the accountingestimates made by Company's Directors as well as evaluating the overall presentation ofthe financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the financial statements.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by the Actin the manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India;
a) in the case of the Balance Sheet of the state of affairs of the Company as at March31 2015;
b) in the case of the Statement of Profit and Loss Loss of the year ended onthat date; and
c) in the case of the Cash Flow Statement of the cash flows for the year ended on thatdate.
Emphasis of Matters
We draw attention to the following matters in the Notes to the financial statements:
a) In the financial statement which indicates that the Company has accumulated lossesand its net worth has been fully eroded the Company has incurred a net cash outflowduring the current and previous year (s) and the Company's current liabilities exceededits current assets as at the balance sheet date. However the financial statements of theCompany have been prepared on a going concern basis for the reasons stated in the saidNote.
b) The Company is required to maintain the cost record for the manufacturing processbut has not maintained the cost of material consumed on actual consumption basis insteadaccounted for the difference of inventory as "presumed to be consumed " againstproduction cost of unit produced resultantly all the normal and abnormal losses (if any)are adjusted in the production cost.
Our opinion is not modified in respect of this matter.
Report on other Legal and Regulatory Requirements
As required by section 143(3) of the Act we report that:
a) We have sought and obtained all the information and explanations which to the bestof our knowledge and belief were necessary for the purpose of our audit.
b) In our opinion proper books of account as required by law have been kept by thecompany so far as appears from our examination of those books.
c) The Balance Sheet the Statement of Profit and Loss and Cash Flow Statement dealtwith by this Report are in agreement with the books of account.
d) In our opinion the aforesaid financial statements comply with the AccountingStandards specified under Section 133 of the Act read with Rule 7 of the Companies(Accounts) Rules 2014.
e) In our opinion Directors of the Company are disqualified as on 31st March 2015 frombeing appointed as Director in terms of clause (b) of sub-section (2) of section 164 ofthe Companies Act 2013 on account of non-payment of public deposit.
f) With respect to the other matters included in the Auditor's Report and to our bestof our information and according to the explanations given to us :
i. The companydid not have any long-term contracts including derivatives contracts forwhich there were any material foreseeable losses.
ii. There are no amounts which required to be transferred to the Investor Education andProtection Fund by the Company.
For B. M. Gattani & Co.
B. M. Gattani
Membership No. 047066
Annexure to the Auditors' Report
The Annexure referred to in our Independent Auditor's report to the Members of Raj OilMills Limited on the financial statements for the year Ended 31st March 2015. We reportthat:
(i) (a) The company has maintained proper records showing full particulars includingquantitative details and situation of its fixed assets;
(b) The Company has a program of verification of fixed assets to cover all the items ina phased manner which in our opinion is reasonable having regard to the size of theCompany and the nature of its assets. Pursuant to the program certain fixed assets werephysically verified by the Management during the year. According to the information andexplanations given to us no material discrepancies were noticed on such verification
(ii) (a) Physical verification of inventory has been conducted at reasonable intervalsby the management.
(b) In our opinion and according to the information and explanation given to us theprocedures of physical verification of inventory followed by the management are reasonableand adequate in relation to the size of the Company and the nature of its business.
(c) On the basis of our examination of inventory records we are of the opinion thatthe Company is maintaining proper records of inventory. The discrepancies noticed onphysical verification of inventory as compared to book records were not material enough.
(iii) In respect of loans the Company has not granted secured and unsecured loan tocompanies firms or other parties covered in the register maintained under section 189 ofthe Companies Act 2013. Accordingly the clause 3(iii) (a) and 3(iii) (b) of the Orderare not applicable.
(iv) In our opinion and according to the information and explanation given to us theCompany has adequate internal control system in place commensurate with the size of theCompany and the nature of its business for the purchase of inventory and fixed assets andfor the sale of goods and services except in some cases materials are purchased foralternative source are not readily available for obtaining comparable quotations. Thecompany needs to take appropriate steps for purchase of material.
(v) In our opinion and according to the information and explanation given to us thecompany has complied with the provision of sections 73 to 76 or any other relevantprovision thereof except for the default in repayment of Principal and payment ofinterest there on during the year for compliance with the 'Companies (Acceptance ofDeposits) Rules1975' with regard to the deposits accepted from the public. According tothe information and explanation given to usorder has been passed by the Company Law Boardor National Company Law Tribunal or any court or any other Tribunal on the company for therepayment of the said deposit along with up-to date interest in respect of complaintsreceived on aforesaid deposits. As per information given to us company has been registeredunder BIFR before 31/03/2015 and already filed a petition with Registrar of Company(ROC)Company Law Board (CLB) and BIFR for repayment of Public Deposit.
(vi) Maintenance of cost records has been specified by the Central Government undersub-section (1) of section 148 of the Companies Act to the company however as perinformation and explanation given to us the company is in the process to compliance withthe prescribed records.
(vii) (a) According to the information and explanations given to us undisputed amountspayable in respect of provident fund income tax sales tax wealth tax service tax dutyof customs value added tax cess and other material statutory dues were in arrears as at31 March 2015 for a period of more than six months from the date they became payable arementioned here under.
|Name of the statute ||Amount outstanding for more than 6 months as on 31/03/2015 (Excluding Interest) (in Crores.) |
|Provident Fund ||0.49 |
|Employees State Insurance ||0.04 |
|Income Tax ||16.03 |
|T.D.S. ||1.39 |
|Professional Tax ||0.11 |
|MVAT ||8.83 |
|Service Tax ||0.16 |
(b) According to the information and explanations given to us the detail of statutorydues of sales tax which have not been deposited on account of dispute is as under.
|Name of the statute ||Nature of dues ||Amount (in Crores) ||Period to which the amount relates ||Fourm where dispute is pending |
|Sales Tax ||Sales Tax ||9.84 ||F.Y 05-06 and 08-09 ||Sales Tax Appeal |
|Income Tax ||Income Tax ||225.22 ||F.Y 05-06 to 11-12 ||CIT Appeal |
|Income Tax ||Income Tax ||16.03 ||F.Y 05-06 to 11-12 ||ITAT |
(c) There are no amounts which required to be transferred to the Investor Education andProtection Fund by the Company in accordance with the relevant provision of the companiesAct 2013 and rules made there under.
(viii) The accumulated losses of the company at the end of the financial year exceedsmore than fifty percent of its net worth (100% networth eroded) and it has generated cashloss in current financial year and incurred cash loss in the immediately precedingfinancial year.
(ix) According to the records of the company examined by us and the information andexplanation provided to us the Company has defaulted in repayment of dues to financialinstitution Bank or fixed deposit holders as at the balance sheet date as follows:
|Sr. No. Particulars ||Principal and Interest (Amount in Crores) |
|Fund Based || |
|1 SVC Term Loan ||0.40* |
|2 Edelweiss Assets Reconstruction Co. Ltd. ||68.07* |
|3 SVC (C/C) ||23.29* |
|4 Public Deposits (inclusive of interest) ||6.84 |
|5 Inter-Corporate Deposit ||0.66* |
|Non Fund Based || |
|1 SICOM (Bill Discounting) ||11.56* |
|2 SIDBI (Bill Discounting) ||2.40* |
|3 IFCI Factors(Bill Discounting) ||9.92* |
* - Exclusive of Interest
(x) In our opinion and according to the information and explanations given to us TheCompany has not given any guarantee for loans taken by others from bank or financialinstitution during the year.
(xi) In our opinion and according to the information and explanation given to us TheCompany has not applied for any term loan.
(xii) According to information and explanations given to us there were no fraud noticedor reported by company for the year under review.
For B. M. Gattani & Co.
Membership No. 04706