WEBEL COMMUNICATION INDUSTRIES LIMITED
ANNUAL REPORT 2008-2009
1. We have audited the attached Balance Sheet of WEBEL COMMUNICATION
INDUSTRIES LIMITED as at 31st March 2009 and also the Profit and Loss
Account and the Cash Flow Statement of the said Company for the year ended
on that date, both annexed thereto. These financial statements are the
responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audit.
2. We conducted our audit in accordance with auditing standards generally
accepted in India. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audit
provides a reasonable basis for our opinion.
3. As required by the Companies (Auditors' Report) Order, 2003(Amendment)
as amended by the Companies (Auditors Report) (Amendment) Order, 2004
issued by the Central Government of India in terms of sub-section (4A) of
section 227 of the Companies Act, 1956, we enclose in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the said Order.
Further to our comments in the Annexure referred to above, we report that:
i) We have obtained all the information and explanation, which to the best
of our knowledge and belief were necessary for the purposes of our audit.
ii) In our opinion, proper books of account as required by law have been
kept by the Company so far as appears from our examination of those books,
iii) The Balance Sheet, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of Account.
iv) In our Opinion, the Balance Sheet, Profit and Loss Account and Cash
Flow Statements except Accounting Standard-2 regarding' 'Valuation for
Inventories'; Accounting Standard-15 (revised) regarding 'Employees
Benefit'; Accounting Standard-22 regarding 'Accounting for Taxation on
Income, Accounting Standard-28 regarding 'Impairment of Assets' &
Accounting Standard-29 regarding 'Provisions, Contingent Liabilities and
Contingent Assets' comply with the requirements of the Accounting Standards
referred to in sub-section (3C) of section 211 of the Companies Act,
v) On the basis of written representations received from the directors as
on 31st March, 2009 and taken on record by the Board of Directors, we
report that none of the directors is disqualified as on 31st March, 2009
from being appointed as a director in terms of clause (g) of sub-section
(1) of section 274 of the Companies Act, 1956.
vi) In our opinion and to the best of our information and according to the
explanations given to us, the said accounts read with the significant
accounting policy and notes on accounts in schedule-17 subject to:
i) The Company has incurred substantial losses in the last few years and
its net worth has been fully eroded. The accounts of the company has been
prepared on going concern assumption considering the Company will get
financial support and restructuring of its loan from its existing lender or
would be able to make alternative arrangements and would be in a position
to meet its financial obligations. However, if the company is unable to
continue its operations and loses its going concern assumption, then
adjustment may be required to the reported amount of assets and
classification of its liabilities. We are however unable to comment on the
ii) Note No. B-3 in Schedule 17 regarding non-provision of Gratuity and
Leave Accrued Liabilities on actuarial basis amounting to Rs. 71.39 Lacs
and Rs. 32.15 Lacs including Rs. 5.46 Lacs and Rs. 2.49 Lacs respectively
for the year;
Hi) Note No. B-9 in Schedule 17 regarding Non Provision of Doubtful Debts
amounting Rs. 5.38 Lacs resulting in understatement of Losses and
overstatement of Sundry Debtors by equivalent amount. Balances of Sundry
Debtors are old debts and in the absence of confirmation we are unable to
comment on the recoverability of the same.
iv) Note No. B-12 in Schedule 17 regarding Non ascertainment and Provision
of Impairment of Assets.
v) In the absence of any confirmation we are unable to comment on the
unsecured loan of the company at the year end.
vi) No interest income has been booked on Fixed Deposit Of Rs.25.56/- lacs
kept with an Overseas Bank for the reasons mentioned in the note No. B-19
in Schedule 17. The Fixed deposit balance is also unconfirmed at the year
vii) Balances of Sundry Creditors as on 31.03.2009 are subject to
viii) Stock of Inventory has been valued at cost instead of at lower of
cost and net realizable value as market value of such stock is not
available. We are unable to comment on ultimate realization from such
Impact of Paras No. (i), (iv), (v), (vi), (vii) and (viii) are not
ascertainable. However, had our observation made in Para No. (ii) and (Hi),
been considered the Loss for the year would have been Rs. 150.90 lacs (as
against the reported Loss figure of Rs.137.57 lacs) and carried forward
losses would have been Rs. 1756.53 lacs (as against the reported figure of
Rs.1743.20 lacs), Current Liabilities & Provisions would be Rs. 147.49 lacs
(as against the reported figure of Rs. 38.57 lacs) and read with the other
notes particularly Note No B-22 in Schedule No '17' give the information
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, of the state of affairs of the Company as
at 31st March, 2009;
(b) In the case of Profit and Loss Account, of the Loss of the Company for
the year ended on that date and;
(c) In case of Cash Flow Statement of the Cash flows for the year ended on
For SINGHI & CO.
IB, Old Post Office Street
Kolkata - 700 001
Dated the 1st day of September 2009
1. (a) The Company has maintained proper records showing full particulars,
including quantitative details and situation of fixed assets. However
company has not updated the same from the last few year.
(b) The fixed assets have been physically verified by the management as per
programme of verification of its Fixed Assets adopted by the company. In
absence of proper details and documents we are not in position to express
our opinion whether the frequency of verification is reasonable having
regard to the size of the Company and the nature of its Assets. As per the
information and explanations given to us, no material discrepancies were
noticed on such verification.
(c) The Company has not disposed off substantial part of its fixed assets
during the year.
2. (a) According to the information and explanations given to us, the
inventories have been physically verified at reasonable interval during the
year by the management.
(b) In our opinion and according to the information and explanations given
to us the procedures of physical verification of inventories followed by
the Management is reasonable and adequate in relation to the size of the
Company and the nature of its business.
(c) In our opinion and according to the information and explanations given
to us, the Company has maintained proper records of its inventories and the
discrepancies noticed on such physical verification of stocks as compared
to book records, which were not materials has been adjusted in the books of
3. (a) According to the information and explanations given to us, the
Company has not granted/accepted unsecured loan to/from Companies covered
in the register maintained under Section 301 of the Companies Act, 1956.
Hence, clauses (iii)(b), (c), (d), (f) & (g) are not applicable.
4. In our opinion and according to the information and explanations given
to us, there are adequate internal control procedures commensurate with the
size of the Company and the nature of its business for the purchase of
inventory and fixed assets and for the sale of goods;
5. (a) As the Company has not taken/accepted any secured/unsecured loans
from/to the parties listed in the register maintained u/s 301 of the
Companies Act 1956, so the transaction that needs to be entered into the
said register does not arise.
(b) As per the information and explanations given to us, there are no
transactions of purchase of goods, materials and services aggregating
during the year to Rs 5.00 lacs or more in respect of each party, made in
pursuance of contracts or arrangements entered in the register maintained
under section 301 of the Companies Act, 1956.
6. The Company has not accepted any deposit during the year from the public
within the meaning of the provisions of Section 58A and 58AA of the
Companies Act, 1956 and rules made there under.
7. In our opinion, the company has internal audit system commensurate with
the size and nature of its business of the Company.
8. The Central Government has not prescribed maintenance of cost record
under section 209(1)(d) of the Companies Act, 1956 for the products of the
9. (a) As per the information and explanation given to us, The Company has
been generally regular in depositing undisputed statutory dues, Provident
Fund, Employees' State Insurance, Income Tax, Service Tax, Cess and any
other statutory dues with the appropriate authorities during the year
except West Bengal Sales Tax of Rs. 52963/-, Purchase tax of Rs. 4917/-
Central Sales Tax of Rs. 6,20,603/; and Surcharge for Sales Rs. 2,81,515/-
Which has not been deposit and outstanding as at 31st March, 2009 for a
period of more than six months from the date they became payable.
(b) According to the information and explanations given to us, there are no
dues of sales tax, Wealth Tax, Service Tax, Income tax, Custom duty, Excise
duty and Cess outstanding an account of any dispute other than Sales Tax
for the Asst. Year 1988-89 amounting to Rs.139.30 lacs and Rs.10.83 lacs on
account of Sales Tax Grant for the Asst. Year 1994-95 which are under
appeal before the Commissioner of sales Tax. However there is no deposit
under protest against that amount. (Ref. Note No. 8-l(a) and 8-11 of the
10. The Company has accumulated losses at the end of the year and its net
worth is fully eroded and has incurred cash losses during the current
financial year and immediately preceding financial year.
11. Based on our audit procedures and on the basis of information and
explanations given by the management, we are of the opinion that the
Company has not defaulted in the repayment of dues to financial
institutions, banks and debenture holders.
12. According to the information and explanations given to us, the Company
has not granted loans or advances on the basis of security by way of pledge
of shares, debentures and other securities.
13. The Company is not a chit fund/nidhi/mutual benefit fund/society.
14. According to the information and explanations given to us, the Company
is not dealing or trading in shares, securities, debentures and other
15. According to the information and explanations given to us, the Company
has not given any guarantee for loans taken by others from banks or
16. According to the information and explanations given to us, the Company
has not raised any term loan during the year.
17. According to the information and explanations given to us, on an
overall basis, funds raised on short term basis have prima facie, not been
used during the year for long term investment and vice versa.
18. The Company has not made any preferential allotment of shares to
parties or companies covered in the Register maintained under Section 301
of the Companies Act, 1956, during the year and hence the question of
whether the price at which shares have been issued is prejudicial to the
interest of the Company does not arise.
19. The Company has not issued any debentures during the year.
20. The Company has not raised monies by public issues during the year.
21. To the best of our knowledge and belief and according to the
information and explanations given to us, no fraud on or by the Company was
noticed or reported during the year.
For SINGHI & CO.
IB, Old Post Office Street
Kolkata - 700 001
Dated the 1st day of September 2009