TO THE MEMBERS OF
SHREE NARMAOA ALUMINIUM INDUSTRIES LIMITED
Report on the Financial Statements
We have audited the accompanying financial statements of Shree Narmada AluminiumIndustries Limited ("the Company") which comprise the Balance Sheet as at March31 2014 and the Statement of Profit and Loss and Cash Flow Statement for the year thenended and a summary of significant accounting policies and other explanatory information.
Management's Responsibility for the Financial Statements
The Management is responsible for the preparation of these financial statements thatgive a true and fair view of the financial position financial performance and cash flowsof the Company in accordance with the Accounting Standards referred to in sub-section (3C)of section 211 of the Companies Act 1956 "the Act") read with the GeneralCircular 15/2013 dated 13th September 2013 issued by the Ministry of Corporate Affairswith regard to section 133 of the Companies Act 2013. This responsibility includes thedesign implementation and maintenance of internal control relevant to the preparation andpresentation of the financial statements that give a true and fair view and are free frommaterial misstatement whether due to fraud or error.
Our responsibility is to express an opinion on these financial statements based on ouraudit. We conducted our audit in accordance with the Standards on Auditing issued by theInstitute of Chartered Accountants of India. Those Standards require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether the 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 control relevant to the Company's preparation and fair presentation ofthe financial statements in order to design audit procedures that are appropriate in thecircumstances but not for the purpose of expressing an opinion on the effectiveness ofthe Company's internal control. An audit also includes evaluating the appropriateness ofaccounting policies used and the reasonableness of the accounting estimates made bymanagement as well as evaluating the overall presentation of the financial statements. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our audit opinion.
Basis of Qualified Opinion
a. The Company is a sick Company under Sick Industrial Companies Act 1985.The order ofthe Honorable High Court of Gujarat dated 16.05.2008 for rehabilitation is under theprocess of implementation. Despite net worth of the Company fully eroded the Managementis of the opinion that the Going Concern Assumption is sustainable and accordingly theaccounts of the Company have been prepared on going concern basis.
b. The unsecured loan of Rs. 31305706/- and Trade payables of Rs. 8973203/- aresubject to confirmation receivable from the party.
In our opinion and to the best of our information and according to the explanationsgiven to us the financial statements give the information required by the Act in themanner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India except in respect of consequential possible impactsof the matters mentioned under Para 'Basis of Qualified Opinion1:
(a) in the case of the Balance Sheet of the state of affairs of the Company as atMarch 31 2014;
(b) in the case of the Statement of Profit and Loss of the profit for the year endedon that date; and
(c) in the case of the Cash Flow Statement of the cash flows for the year ended onthat date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order 2003 ("theOrder")issued by the Central Government of India in terms of sub-section (4A) of section 227 ofthe Act we give in the Annexure
a statement on the matters specified in paragraphs 4 and 5 of the Order.
2. As required by section 227(3) of the Act we report that:
a. We have obtained all the information and explanations which to the best of ourknowledge 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 Statement of Profit and Loss and Cash Flow Statement dealt withby this Report are in agreement with the books of account;
d. In our opinion the Balance Sheet Statement of Profit and Loss and Cash FlowStatement comply with the Accounting Standards referred to in subsection (3C) of section211 of the Companies Act 1956 ; read with the Ge.neral Circular 15/2013 dated 13thSeptember 2013 issued by the Ministry of Corporate Affairs with regard to section 133 ofthe Companies Act 2014.
e. On the basis of written representations received from the Directors as on March 312014 and taken on record by the Board of Directors none of the Directors is disqualifiedas on March 31 2014 from being appointed as a Director in terms of clause (g) ofsub-section (1) of section 274 of the Companies Act 1956.
For CHOKSHI & CHOKSHI
(Firm Registration No.: 101872W)
R. S. Chokshi
Membership No. 07498
Date: 29th May 2014
ANNEXURE TO THE AUDITORS1 REPORT REFERRED TO IN PARA 5 (1) OF OUR REPORT OF EVEN DATE
1. (a) The Company is maintaining records showing full particulars includingquantitative details and situations of all the fixed assets.
(b) According to the information and explanations given to us the fixed assets arebeing physically verified by the Management in a phased manner at year end which in ouropinion is reasonable having regard to the size of the Company and nature of assets.According to the information and explanations given to us no material discrepancies werenoticed on such verification.
(c) The Company did not dispose off any substantial part of fixed assets during theyear and hence the going concern status is not affected.
2. (a) The Company is trading for goods only by "sale-in-transit"transactions hence Company did not carry any inventory throughout the year. Consideringthe nature of activity clause 4 (2) (a) (b) and (c) of the Order are not applicable.
3. (a) The Company has not granted any loans secured or unsecured to companies firmsor other parties covered in the Register maintained under Section 301 of the CompaniesAct 1956.
As the Company has not granted any loans secured or unsecured to parties listed inthe Registers maintained under Section 301 of the Companies Act 1956 paragraphs (3)(a)(b) (c) & (d) of the Order are not applicable.
(b) The'Company has taken interest free unsecured loan from one party covered in theregister maintained under Section 301 of the Companies Act 1956.Maximum amountoutstanding at any point of time during the financial year in respect of said party is Rs313057067- and the year end balance is Rs 313057067-.
(c) In our opinion the rate of interest and the terms and conditions of unsecuredloans are not prima facie prejudicial to the interest of the Company
(d) In the absence of specific terms for repayment of the said loans and according tothe information and explanations given to us the management considers that the amountreferred to clause 3(b) is paid as and when demanded and no amount is overdue in thisrespect.
4. In our opinion and according to the information and explanations given to us thereare adequate internal control procedures commensurate with the size of the Company and thenature of its business for the purchase of fixed assets and the sale of goods andservices. Further during the course of our audit we have neither come across nor havebeen informed of any continuing failure to correct any major weakness in such internalcontrols.
5. (a) In our opinion and according to the information and explanations given to usthe transactions that need to be entered into a Register maintained under Section 301 ofthe Companies Act 1956 have been entered.
(b) In our opinion and according to the information and explanations given to us asthe transactions entered into a Register maintained under Section 301 of the CompaniesAct 1956 paragraph (5) (b) of the Order which exceed Rupees five lacs have been made atprices which are reasonable having regard to the prevailing market prices at the relevanttime.
6. In our opinion and according to the information and explanations given to us theCompany has not accepted any public deposits and hence directives issued by the ReserveBank of India and the provisions of Sections 58A and 58AA or any other relevant provisionsof the Companies Act 1956 and the rules framed there under are not applicable. As per theinformation and explanations given to us no order has been passed by Company Law Board orNational Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunalin this respect.
In our opinion the internal audit function carried out during the year by a firm ofChartered Accountants appointed by the Company have been commensurate with its size of theCompany and nature of its business.
According to the information and explanations given and to the best of our knowledgethe provisions of The Companies (Cost Accounting Records) Rules 2011' published by theCentral Government under Clause (d) of Sub-Section (1) of Section 209 of the CompaniesAct 1956for maintenance of cost records are not applicable to the Company as the Companyis not engaged in the production processing manufacturing or mining activities. Henceclause 4 (8) of the Order is not applicable.
(a) According to the information and explanations given to us and on the basis of ourexamination of the books of account the Company has been generally regular in depositingundisputed statutory dues including Provident Fund Investor Education and ProtectionFund Income- Tax Sales-Tax Wealth Tax Service Tax Custom Duty Cess and othermaterial statutory dues as applicable with the appropriate authorities. There are noarrears of outstanding statutory dues as at 31stMarch 2014 for a period of more than 6months from the date they became payable except for the following .
|Nature of statutory Due ||Unpaid overdue as on 31stMarch 2014 |
| ||Amount in Rupees |
|Sales tax(deferment) ||17020866 |
|Electricity duty (deferment) including interest ||605778 |
(b) As at 31st March 2014 according to the records of the Company and the informationand explanations given to us the following are the particulars of dues on account ofIncome Tax/ Sales Tax/ Wealth Tax/ Service Tax/ Custom Duty / Excise Duty that have notbeen deposited on account of disputes:-
|Name of the Statute ||Nature of the Dues ||Amount (Rupees) ||Period to which Amount relates ||Forum where dispute pending |
|The Bombay Sales Tax Act ||Sales Tax Interest And Penalty ||114000 ||1991-92 ||Before Honorable Tribunal Filed by Company |
|The Bombay Sales Tax Act ||Sales Tax Interest And Penalty ||2217000 ||1992-93 ||Before Honorable Tribunal Filed by Company |
|The Bombay Sales Tax Act ||Sales Tax Interest And Penalty ||2618000 ||1993-94 ||Before Honorable Tribunal Filed by Company |
|The Bombay Sales Tax Act ||Sales Tax Interest And Penalty ||918000 ||1994-95 ||Before Honorable Tribunal Filed by Company |
|The Bombay Sales Tax Act ||Sales Tax Interest And Penalty ||200000 ||1995-96 ||Before Honorable Tribunal Filed by Company |
|The Bombay Sales Tax Act ||Sales Tax Interest And Penalty ||8000 ||1999-00 ||Before Honorable Tribunal Filed by Company |
10. The accumulated losses of the Company are more than it's paid up capital and freereserves. The Company has not incurred any cash losses during the current year.
11. According to the information and explanations given to us and on the basis of ourexamination of the books of account in our opinion the Company has not defaulted inrepayment of dues to any financial institution or banks or debenture holders.
12. According to the information and explanations given to us and on the basis of ourexamination of the books of account the Company has not granted any loans and advances onthe basis of security by way of pledge of shares debentures and other securities.
13. The Company is not a chit fund nidhi mutual benefit or a society. Accordinglyprovisions of Clause 4(xiii) of the Order are not applicable to the Company.
14. The Company has not entered into any trading in shares securities debenturesandother investments during the year. Accordingly provisions of Clause 4(14) of the Orderare not applicable to the Company.
15. According to the information and explanations given to us and the representationsmade by the management the Company has not given any Guarantee for loans taken by othersfrom any bank or financial institutions.
16. In our opinion and according to the information and explanations given to usDuring the year the Company has not raised any term loans.
17. According to the information and explanations given to us and based on the overallexamination of the Balance Sheet of the Company funds raised on short term basis haveprima-facie not been used for long term investment.
18. During the year Company has not made any preferential allotment of shares toparties and companies covered in the Register maintained under Section 301 of theCompanies Act 1956.
19. The Company has not issued any secured debentures during the year.
20. The Company has not raised any money by way of public issues during the year.
21. To the best of our knowledge and belief and according to the information andexplanations given to us no fraud on or by the Company has been noticed or reportedduring the year.
For CHOKSHI & CHOKSHI
(Firm Registration No.: 101872W)
R. S. Chokshi
Membership No. 07498
Date: 29th May 2014