Mar 31, 2016
INDEPENDENT AUDITORâS REPORT
To the Members of M/s. SHREE KARTHIK PAPERS LIMITED Report on the Financial Statements
We have audited the accompanying financial statements of M/S. SHREE KARTHIK PAPERS LIMITED ("the company"), which comprise the Balance Sheet as at March 31, 2016, Statement of Profit and Loss and the Cash Flow Statement for the year then ended and a summary 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) of the Companies Act, 2013 ("the Act") with respect to the preparation and presentation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes the maintenance of adequate accounting records in accordance with the provision of the Act for safeguarding of the assets of the Company and for preventing and detecting the frauds and other irregularities, selection and application of appropriate accounting policies, making judgments and estimates that are reasonable and prudent and design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. While conducting the audit, we have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.
We conducted our audit in accordance with the Standards on Auditing specified under section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the company has in place an adequate internal financial control system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for audit opinion on the standalone financial statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the Accounting principles generally accepted in India:
(a) in case of the Balance sheet, of the state of affairs of the Company as at March 31st, 2016;
(b) in case of the Statement of Profit and Loss, of the Profit of the Company for the year ended on that date
(c) And its Cash Flows for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2016 (the Order) issued by the Central Government of India in terms of Sub Section (11) of Section 143 of the Companies Act 2013, we give in the annexure A, a statement on the matters specified in the paragraph 3 and 4 of the order, to the extent Applicable.
2. As required by section 143(3) of the Act, we report that:
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 account as required by law have been kept by the Company so far as appears from our examination of those books.
c) The Balance Sheet and the statement of Profit and loss and the Cash Flow Statement dealt with by this Report are in agreement with the books of accounts.
d) In our opinion, the aforesaid Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement comply with Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014
e) On the basis of the written representations received from the directors as on March 31, 2016, taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2016, from being appointed as a director in terms of Section 164(2) of the Act.
f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in "Annexure B"; and
g) With respect to the other matters included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us :
i. The Company has disclosed the impact of pending litigations on its financial position in the financial statements. Refer Note.
ii. The company has made provisions as required under the applicable law or Accounting Standard, for material foreseeable losses, if any on long term contracts.
iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company
The Annexure "A" referred to in Independent Auditors'' report to the members of M/s. SHREE KARTHIK PAPERS LTD on the standalone financial statements for the year ended 31st March, 2016, we report that:
i) In respect of Fixed Assets :
a) In our opinion and according to the information and explanations given to us during the course of audit, the Company is maintaining proper records showing full particulars including quantitative details and situation of its fixed assets.
b) In our opinion and according to the information and explanations given to us during the course of audit, fixed assets have been physically verified by the Management at reasonable intervals, and in our opinion, physical verification of fixed Assets followed by the management are reasonable and adequate in relation to the size of the company and nature of its business. The discrepancies reported on verification were not material and have been properly dealt within the books of accounts.
c) In our opinion and according to the information and explanations given to us during the course of audit, the title deeds of immovable properties are held in the name of the company.
ii) In respect of Inventories :
The inventories have been physically verified during the year by the management. In our opinion the frequency of verification is reasonable.
iii) In our opinion and according to the information and explanations given to us and records examined by us during the course of audit, the Company has not granted loans, secured or unsecured, to Companies, firm, LLP''s or other parties, listed in the Register maintained Under Section 189 Of the Companies Act,2013 but the Company has not taken loans unsecured from the parties, listed in the Register maintained Under Section 189 Of the Companies Act, 2013, the terms and conditions are not prima facie pre judicial to the interests of the company and the terms of arrangement do not stipulate repayment schedule and the loans are repayable on demand. Refer Note No.2.24(b) for details.
iv) According to the information and explanations given to us, In respect of loans, investments, Guarantees and security the provisions of section 185 and 186 of the Companies Act, 2013 have been complied with.
v) The Company has not accepted any deposits from the public.
vi) The Central Government has not prescribed the maintenance of cost records under section 148(1) of the Companies Act, 2013 for the goods manufactured by the company.
vii) a) In our opinion and according to the information and explanations given to us and records examined by us during the course of audit , the undisputed statutory dues including provident fund, Income Tax (TDS) and other statutory dues, have been regularly deposited with the appropriate authorities and there have no delays and arrears outstanding for a period of more than 6 month as on the last day of the financial year ended 31st March,2016.
b) In our opinion and according to the information and explanations given to us and records examined by us during the course of audit, the following dues have not been deposited on account of disputes. The Company is confident of getting these claim quashed as the demands have been raised only on technical grounds.
Sl. No. |
Name of the Statute |
Nature of Dues |
Forum where dispute pending |
Amount Rs. |
a. |
Sales Tax 1995-1996 |
Penalty |
Sales Tax Appellate. Tribunal (AB) (Appeal pending) |
2,21,858 |
b. |
1999-2000 (CST) |
Tax Penalty |
The Appellate Asst. Commissioner(Ct.)Cbe., (Appeal pending) |
15.88.951 17.99.951 |
c. |
2000-2001 (CST) |
Tax Penalty |
The Appellate Asst. Commissioner(Ct.) Cbe., (Appeal pending) |
27,61,182 29,43,768 |
d. |
2003-2004 (CST) |
Tax |
Sales Tax Appellate Tribunal (AB) (Appeal pending) |
4,44,575 |
e. |
2004-2005 (CST) |
Tax Penalty |
The Appellate Asst. Commissioner(Ct.)Cbe., (Appeal pending) |
15,25,088 16,02,309 |
f. |
2004-2005 (TNGST) |
Tax Penalty |
The Appellate Asst. Commissioner(Ct.)Cbe., (Appeal pending) |
1,17,030 58,515 |
g. |
2006-2007 (Income Tax) |
Tax |
Income Tax Appellate Tribunal, Chennai |
58,40,144 |
viii) In our Opinion and according to the information and explanations given to us and the records examined by us, the Company has not defaulted in repayment of dues to financial institutions and banks as at Balance sheet date.
ix) The company did not raise money by way of initial public offer or further public offer and term loans during the year. Accordingly, paragraph 3 (ix) of the Order is not applicable.
x) According to the information and explanations given to us, no fraud by the company or fraud on the company by its officers or employees noticed or reported during the year.
xi) According to the information and explanations given to us and the records examined by us, managerial remuneration of Rs.18 Lacs has been paid during the year by the company.
xii) In our opinion and according to the information and explanations given to us, the Company is not a nidhi company. Accordingly, paragraph 3(xii) of the Order is not applicable.
xiii) According to the information and explanations given to us and the records examined by us, all transactions with the related parties are in compliance with sec.177 and 188 of Companies Act 2013 and the details have been disclosed in the financial statements as required by the applicable accounting standards.
xiv) According to the information and explanations given to us and the records examined by us, the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review.
xv) According to the information and explanations given to us and based on the records examined by us, the company has not entered into any non cash transactions with directors or persons connected with him during the year. Accordingly, paragraph 3(xv) of the Order is not applicable.
xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act 1934.
ANNEXURE - B TO THE AUDITORS'' REPORT
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act")
We have audited the internal financial controls over financial reporting of M/S. SHREE KARTHIK PAPERS LIMITED as of 31 March 2016 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.
Management''s Responsibility for Internal Financial Controls
The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (''ICAI''). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.
Auditors'' Responsibility
Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the "Guidance Note") and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls Over Financial Reporting
Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31 March 2016, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
For Giri & Co.
Chartered Accountants
F.R. No. : 006702S
(Sd./-) R. Giri BCom fca fcma
Place : Coimbatore Senior Partner
Date : 13.08.2016 Membership Number : 025458
Jun 30, 2015
We have audited the accompanying financial statements of M/s. SHREE
KARTHIK PAPERS LIMITED (Âthe companyÂ), which comprise the Balance
Sheet as at June 30, 2015, and the statement of Profit and Loss for the
year ended, and a summary of significant accounting policies and other
explanatory information.
ManagementÂs Responsibility for the financial statements
The Company's Board of Directors is responsible for the matters in
section 134(5) of the Companies Act, 2013 (Âthe ActÂ) with respect
to the preparation of these financial statements that give a true and
fair view of the financial position, financial performance and cash
flows of the Company in accordance with the accounting principles
generally accepted in India, including the Accounting Standards
specified under Section 133 of the Act, read with Rule 7 of the
Companies (Accounts) Rules, 2014. This responsibility also includes the
maintenance of adequate accounting records in accordance with the
provision of the Act for safeguarding of the assets of the Company and
for preventing and detecting the frauds and other irregularities;
selection and application of appropriate accounting policies; making
judgments and estimates that are reasonable and prudent; and design,
implementation and maintenance of internal financial control, that were
operating effectively for ensuring the accuracy and completeness of the
accounting records, relevant to the preparation and presentation of the
financial statements that give a true and fair view and are free from
material misstatement, whether due to fraud or error
AuditorÂs Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We have taken into account the
provisions of the Act, the accounting and auditing standards and
matters which are required to be included in the audit report under the
provisions of the Act and the Rules made thereunder.
We conducted our audit in accordance with the Standards on Auditing
specified under section 143(10) of the Act. Those Standards require
that we comply with ethical requirements and plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The procedures
selected depend on the auditor's judgment, including the assessment of
the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the Company's preparation and
fair presentation of the financial statements in order to design audit
procedures that are appropriateness in the circumstances, but not for
the purpose of expressing an opinion on the effectiveness of the
Company's internal control. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of
the accounting estimates made by management, as well as evaluating the
overall presentation of the financial statements. We believe that the
audit evidence we have obtained is sufficient and appropriate to
provide a basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid financial statements give the
information required by the Act in the manner so required and give a
true and fair view in conformity with the Accounting principles
generally accepted in India:
(a) in the case of the Balance sheet, of the state of affairs of the
Company as at June 30, 2014;
(b) in the case of the Statement of Profit and Loss, of the profit of
the Company for the year ended on that date
Report on Other Legal and Regulatory Requirements
1. As required by the companies(Auditor's Report) Order, 2015 (the
Order) issued by the Central Government of India in terms of Sub
Section (11) of Section.143 of the Companies Act 2013, we give in the
annexure a statement on the matters specified in the paragraph 3 and 4
of the order, to the extent Applicable.
2. As required by section 143(3) of the Act, we report that:
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 account as required by law have been
kept by the Company so far as appears from our examination of those
books
c) The Balance Sheet and the statement of Profit and loss and the cash
Flow Statement dealt with by this Report are in agreement with the
books of account
d) In our opinion, the Balance Sheet, the Statement of Profit and Loss,
and the Cash Flow Statement comply with Accounting Standards specified
under Section 133 of the Act, read with Rule 7 of the Companies
(Accounts) Rules, 2014.
e) On the basis of the written representations received from the
directors as on June 30, 2015, taken on record by the Board of
Directors, none of the directors is disqualified as on June 30, 2015,
from being appointed as a director in terms of Section 164(2) of the
Act.
f) With respect to the other matters included in the Auditor's Report
and to our best of our information and according to the explanations
given to us :
i. The Company does not have any pending litigations which would
impact its financial
ii. The Company did not have any long-term contracts including
derivatives contracts for which there were any material foreseeable
losses
iii. There were no amounts which required to be transferred to the
Investor Education and Protection Fund by the Company.
ANNEXURE TO THE AUDITORSÂ REPORT
The Annexure referred to in our report to the members of M/S. SHREE
KARTHIK PAPERS LIMITED ('the CompanyÂ) for the year ended June 30,
2015. We report that:
i) In respect of Fixed Assets :
a) The Company has maintained proper records showing full particulars
including quantitative details and situation of its fixed assets.
b) As per the information and explanations given to us, fixed assets
have been physically verified by the Management at reasonable
intervals, and No discrepancies were noticed on such Verification.
ii) In respect of Inventories :
a) As per the information and explanation given to us, the inventories
have been physically verified by the management at reasonable intervals
during the year.
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 were reasonable and adequate in relation to
the size of the company and the nature of it's business.
c) The Company is maintaining proper records of inventories. No
material discrepancies were noticed on physical verification of
inventory.
iii) a) According to the information and explanations given to us, the
Company has not granted loans, unsecured, from or to Companies, firm or
other parties, listed in the Register maintained Under Section 189 Of
the Companies Act,2013 ('the Act'),but the Company has taken loans,
unsecured, from the parties, listed in the Register maintained Under
Section 189 Of the Companies Act,2013 ('the Act'), the terms and
Conditions are not prima facie prejudicial to the interest of the
Company and the terms of arrangements do not Stipulate and repayment
Schedule and the loans are repayable on demand.
During the year the company has financial transactions with the
Directors as detailed below:
Name of the Directors Balance as on Balance as on
01.07.2014 30.06.2015
M.S. Velu Rs.15,93,19,850/ Rs.13,61,01,378/-
Managing Director
S.S. Velu Rs.2,12,42,544/- Rs.1,77,00,623/-
Director
Vignesh Velu Rs.1,67,96,408/- Rs.2,06,15,976/-
Executive Director b) There are no overdue amounts in respect of the
loans granted to the bodies Corporate listed in the register maintained
Under Section 189 of the Act.
iv) In our opinion and according to the information and explanations
given to us, there is an internal control System Commensurate With the
Size of the Company and the nature Of its business with regard to
purchase of inventory & fixed assets and Sale of goods and Services.
v) The Company has not accepted and deposits from the public.
vi) We have broadly reviewed the books of accounts maintained by the
company pursuant to the order made by the Central Government for
maintenance of cost records under section 148(1) of the act and are of
the opinion that prima facie, the Prescribed accounts and records have
been made and maintained, However, we have not made a detailed
examination of the records.
vii) According to the records of the Company and the information and
explanations given to us in respect of Statutory and other dues:
(a) The Company was regular in depositing Provident Fund and Employee'
State Insurance dues, Excise duty, Service tax, customs duty, CESS,
Investor Education & Protection Fund, Income Tax , Sales Tax and all
other applicable Statutory dues with the appropriate authorities and
there were no arrears outstanding for a period of more than 6 month as
at 30th June,2015
(b) According to the information and explanation given to us, the
following dues have not been deposited on account of disputes. The
company is confident of getting these claim quashed as the demands have
been raised only on technical grounds.
Sl. Name of the Nature of Dues Forum where dispute
No. Statute pending
a. Sales Tax Penalty Sales Tax Appellate.
1995-1996 Tribunal (AB) (Appeal pending)
b. 1999-2000 Tax Penalty The Appellate Asst.
(CST) Commissioner(Ct.)Cbe.,
(Appeal pending)
c. 2000-2001 Tax Penalty The Appellate Asst.
(CST) Commissioner(Ct.) Cbe.,
(Appeal pending)
d. 2003-2004 Tax Sales Tax Appellate
(CST) Tribunal (AB) (Appeal pending)
e. 2004-2005 Tax Penalty The Appellate Asst.
(CST) Commissioner(Ct.)Cbe.,
(Appeal pending)
f. 2004-2005 Tax Penalty The Appellate Asst.
(TNGST) Commissioner(Ct.)Cbe.,
(Appeal pending)
g. 2006-2007 Tax CIT (Appeals) Cbe.,
Sl. Name of the Amount
No. Statute Rs.
a. Sales Tax 2,21,858
1995-1996
b. 1999-2000 15.88.951
(CST) 17.99.951
c. 2000-2001 27,61,182
(CST) 29,43,768
d. 2003-2004 4,44,575
(CST)
e. 2004-2005 15,25,088
(CST) 16,02,309
f. 2004-2005 1,17,030
(TNGST) 58,515
g. 2006-2007 58,40,144
(Income Tax)
(c) According to the information and explanations given to
us, there were no amounts which required to be transferred to the
Investor Education and Protection Fund by the Company in accordance
with the relevant provisions of the Companies Act,2013 and rules there
under
viii) The Company has accumulated losses at the end of the financial
year and has not incurred cash loss in the financial year and in the
immediately preceding financial year.
ix) According to the information and explanations given to us and the
records examined by us, the Company has not defaulted in repayment of
dues to financial institutions or banks.
x) In our opinion and according to the information and the explanations
given to us, the Company has not given any guarantee for loans taken by
others from banks of financial institutions.
xi) As informed to us, the term loans were utilized by the Company for
the purpose for which they were obtained.
xii) According to the information and explanations given to us, no
material fraud on or by the Company has been noticed or reported during
the Course of our audit.
For Giri & Co.
Chartered Accountants
(Sd./-) R. Giri BCOM FCA FCMA BL
Place : Coimbatore Senior Partner
Date : 14.08.2015 Membership Number : 25458
Jun 30, 2014
We have audited the accompanying financial statements of M/S. SHREE
KARTHIK PAPERS LIMITED ("the company"), which comprise the Balance
Sheet as at June 30, 2014, and the statement of Profit and Loss for the
year ended, 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 that give a true and fair view of the financial position and
financial performance of 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 General Circular 15/2013
dated 13th September, 2013 of the Ministry of Corporate Affairs in
respect of Section 133 of the Companies Act, 2013. This responsibility
includes the design, implementation and maintenance of internal control
relevant to the preparation and presentation of the financial
statements that give a true and fair view and are free from material
misstatement, whether due to fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Charted
Accountants of India. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The procedures
selected depend on the auditor''s judgment, including the assessment of
the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the Company''s preparation and
fair presentation of the financial statements in order to design audit
procedures that are appropriateness in the circumstances, but not for
the purpose of expressing an opinion on the effectiveness of the
Company''s internal control. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of
the accounting estimates made by management, as well as evaluating the
overall presentation of the financial statements. We believe that the
audit evidence we have obtained is sufficient and appropriate to
provide a basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the financial statements give the information
required by the Act in the manner so required and give a true and fair
view in conformity with the Accounting principles generally accepted in
India:
(a) in the case of the Balance sheet, of the state of affairs of the
Company as at June 30, 2014;
(b) in the case of the Statement of Profit and Loss, of the profit of
the Company for the year ended on that date
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 (the
Order) issued by the Central Government of India in terms of Section
227(4A) of the 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 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 the Company so far as appears from our examination of those
books
c) The Balance Sheet and the statement of Profit and loss dealt with by
this Report are in agreement with the books of account
d) In our opinion, the Balance Sheet, the Statement of Profit and Loss,
and the Cash Flow Statement comply with Accounting Standards notified
under the Act read with the General Circular 15/2013 dated 13th
September, 2013 of the Ministry of Corporate Affairs in respect of
Section 133 of the Companies Act, 2013 and other accounting principles
generally accepted in India; and
e) On the basis of the written representations received from the
directors as on June 30, 2014, taken on record by the Board of
Directors, none of the directors is disqualified as on June 30,2014
from being appointed as a director in terms of Section 274(1)(g) of the
Act.
ANNEXURE TO THE AUDITORS'' REPORT
(Referred to our report of even date)
1. The Company has generally maintained proper records showing full
particulars including quantitative details and situation of fixed
assets.
2. As per the information and explanations given to us, fixed assets
have been physically verified by the Management at reasonable
intervals, and discrepancies (if any) noticed on verification during
the year have been properly adjusted in the books of accounts.
3. The company has not disposed off substantial part of fixed assets
during the year under review.
4. As per the information and explanations given to us, inventories
have been physically verified at reasonable interval during the year by
the Management.
5. The procedures of physical verification of inventory followed by
the management are reasonable and adequate in relation to the size of
the company and the nature of its business.
6. a) The Company has not granted any loans secured or unsecured loan
to companies , Firms or other parties covered in the register
maintained under Section 301 of the Companies Act, 1956.
b) The company has taken Unsecured loans from the parties covered in
the register maintained u/s 301 of the Companies Act 1956.
During the year the company has financial transactions with the
Directors as detailed below:
Name of the Directors Balance as on Balance as on
01.07.2013 30.06.2014
M.S. Velu Rs.11,12,63,140/- Rs.15,93,19,850/-
Managing Director
S.S. Velu Rs.81,58,007/- Rs.2,12,42,544/-
Director
Vignesh Velu Rs.33,71,898/- Rs.1,67,96,408/-
Executive Director
7. In our opinion the rate of interest and other terms and conditions
of loans taken/ granted by the company, secured or unsecured from the
parties listed in the register maintained u/s 301 of the Companies Act
1956, are prima facie not prejudicial to the interest of the company.
8. According to the information and explanations given to us, there is
adequate internal control procedures commensurate with the size of the
company and the nature of it''s business, for the purchase of
inventories and fixed asset and with regard to sale of goods and
services. In our opinion, the internal control is required to be
further strengthened.
9. As per the information and explanation given to us, the
transactions that need to be entered have been entered in the register
maintained under Section 301 of the Companies Act, 1956. In our
opinion, those transactions have been made at prices which are
reasonable having regard to the prevailing market prices at the
relevant time.
10. According to the information and explanations given to us the
company has not accepted deposits from the public.
11. In our opinion, the company has an internal audit system
commensurate with the size and nature of its business.
12. According to the information and explanations given to us, the
company is regular in depositing undisputed statutory dues including
provident fund, investor education and protection fund; employees state
insurance, income tax, sales tax, wealth tax, service tax, cess and any
other statutory dues with the appropriate authorities. There are no
arrears of outstanding statutory dues outstanding as at 30th June, 2014
for a period of more than six months from the date they became payable.
13. According to the information and explanation given to us, the
following dues have not been deposited on account of disputes. The
company is confident of getting these claim quashed as the demands have
been raised only on technical grounds.
Sl. Name of the Nature of Dues Forum where dispute Amount
No. Statute pending Rs.
Sales Tax
a. 1995-1996 Penalty Sales Tax Appellate. 2,21,858
Tribunal (AB) (Appeal
pending)
b. 1999-2000 Tax Penalty The Appellate Asst. 15,88,951
(CST) Commissioner(Ct.)Cbe., 17,99,951
(Appeal pending)
c. 2000-2001 Tax Penalty The Appellate Asst. 27,61,182
(CST) Commissioner(Ct.) Cbe., 29,43,768
(Appeal pending)
d. 2003-2004 Tax Sales Tax Appellate 4,44,575
(CST) Tribunal (AB) (Appeal
pending)
e. 2004-2005 Tax Penalty The Appellate Asst. 15,25,088
(CST) Commissioner(Ct.)Cbe., 16,02,309
(Appeal pending)
f. 2004-2005 Tax Penalty The Appellate Asst. 1,17,030
(TNGST) Commissioner(Ct.)Cbe., 58,515
(Appeal pending)
g. 2006-2007 Tax CIT (Appeals) Cbe., 58,40,144
(Income Tax)
15. The Company has accumulated losses. The company has not incurred
cash loss in the current year covered under this report .
17. According to the information and explanation given to us, the
company has not granted loans and advances on the basis of security by
way of pledge of shares, debentures and other securities.
18. According to the information and explanation given to us, the
company has not defaulted in repayment of dues to a financial
institution or bank or debenture holders.
19. The company has not given any guarantee for loans taken by others
from bank or financial institutions, the terms and conditions whereof
are prejudicial to the interest of the company.
20. Fund raised on short- term basis has not been used for long-term
investment.
21. The company has not made any preferential allotment of shares to
parties and companies covered in the register maintained under section
301 of the Companies Act, 1956.
22. The company has not created securities in respect of debentures
issued.
23. The company has not raised money by public issue during the year.
24. Based upon the audit procedures performed and information and
explanations given by the management, we report that no fraud on or by
the company has been noticed or reported during the course of our
audit.
For Giri & Co.
Chartered Accountants
(Sd./-) R. Giri BCom FCA FCMA BL
Senior Partner
Membership Number : 25458
Place : Coimbatore
Date : 21.08.2014
Jun 30, 2013
Report on the Financial Statements
We have audited the. accompanying financial statements of M/S. SHREE
KARTHIK PAPERS LIMITED ("the company"), which comprise the Balance
Sheet as at June 30, 2013, and the statement of Profit and Loss and
cash flow statement for the year ended and a summary of significant
accounting policies and other explanatory information.
Management''s Responsibility for the financial statements
Management is responsible for the preparation of these .financial
statements that give a true and fair view of the financial position and
financial performance of the Company in accordance with the Accounting
Standards referred to in Sub-Section (3C) of section 211 of the
Companies Act, 1956 ("the act"). This responsibility includes the
design, implementation and maintenance of internal control retevant to
the preparation and presentation of the financial statements that give
a true and fair view and are free from material''misstatement, whether
due to fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Charted
Accountants of India. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material- misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The procedures
selected depend on the auditor''s judgment, including the assessment of
the risks .of material misstatement of the financial statements,
whether due to fraud or error. In making those risk assessments, the
auditor considers internal control relevant to the Company''s
preparation and fair presentation of the financial statements in order
to design audit procedures that are appropriateness of accounting
policies used, and the reasonableness of the accounting estimates made
by management, as well as evaluating the overall presentation of the
financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
Opinion ~
In our opinion and to the best of our information and according to the
explanations given to us, the financial statements give the information
required by the Act in the manner so required and give a true and fair
view in conformity with the Accounting principles generally accepted in
India:
(a) in the case of the Balance sheet, of the state of affairs of the
Company as at June 30, 2013;
(b) in the case of the Profit and loss Account, of the loss for the
year ended on that date
(c) in the case of the Cash Flow Statement, of the Cash Flows for the
year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order") issued by the Central Government of India in terms of
sub-section (4A) of section 227 of the 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 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 the Company so far as appears from our^ examination of those
books
c) The Balance Sheet and statement of Profit and loss dealt with by
this Report are in agreement with the books of account
d) In our opinion, the Balance Sheet and Statement of Profit and Loss
comply with the Accounting Standards referred to in sub-section (3C) of
section 211 of the Companies Act, 1956
e) On the basis of written representations received from the directors
as on June 30,~2013, and taken on record by the Board of Directors,
none of the directors is disqualified as on June 30, 2013, from being
appointed as a director in terms of clause (g)'' of sub-section (1) of
section 274 of the companies Act, 1956.
f) Since the Central Government has not issued any notification as to
the rate at which the cess is to paid under section 441A of the
Companies Act, 1956 nor has it issued any Rules under the said section,
prescribing the manner in which such cess is to be paid, no cess is due
and payable by the Company.
ANNEXURE TO THE AUDITORS''REPORT
(Referred to our report of even date)
1. The Company has generally maintained proper records showing full
particulars including quantitative details and situation of fixed
assets.,
2. As per the information and explanations given to us, fixed assets
have been physically verified by the Management at reasonable
intervals, and discrepancies (if any) noticed on verification during
the year have been properly adjusted in the books of accounts.
3. The company has not disposed off substantial part of fixed assets
during the year.
4. As per the information and explanations given to us, inventories
have been physically verified at reasonable interval during the year by
the Management.
5. The procedures of physical verification of inventory followed by
the management are reasonable and adequate in relation to the size of
the company and the nature of its business.
6. The Company has taken unsecured loan from / to other parties
covered in the register maintained under Section 301 of the Companies
Act, 1956.
7. In our opinion the rate of interest and other terms and conditions
of loans taken/ granted by the company, secured or unsecured from the
parties listed in the register maintained u/s 301 of the Companies Act
1956, are prima facie not prejudicial to the interest of the company.
8. In respect of loans and advances, the payment of principal amount
and interest has been made as per the revised repayment schedule
approved by the CDR.
9. According to the information and explanations given to us, there is
adequate internal control procedures commensurate with the size of the
company and the nature of it''s business, for the purchase of
inventories and fixed asset and with regard to sale of goods and
services. In our opinion, the internal control is required to be
further strengthened.
10. As per the information and explanation given to us, the
transactions that need to be entered have been entered in the register
maintained under Section 301 of the Companies Act, 1956. In our
opinion, those transactions have been made at prices which are
reasonable having regard to the prevailing market prices at the
relevant time.
11. According to the information and explanations given to us the
company has not accepted deposits from the public.
12. In our opinion, the company has an internal audit system
commensurate with the size and nature of its business.
13. According to the information and explanations given to us, the
company is regular in depositing undisputed statutory dues including
provident fund, investor education and protection fund; employees state
insurance, income tax, sales tax, wealth tax, service tax, cess and any
other statutory dues with the appropriate authorities. There are no
arrears of outstanding statutory dues outstanding as at 31 March, 2013
for a period of more than six months from the date they became payable.
14. According to the information and explanation given to us, the
following dues have not been deposited on account of disputes. The
company is confident of getting these claim quashed as the demands have
been raised only on technical grounds.
15. The Company has accumulated losses. The company has not incurred
cash loss in the current year covered under this report and the company
has noi incurred cash loss in the financial year immediately preceding
the current financial year.
16 According to the information and explanation given to us, the
company has not defaulted in the repayment of dues to any financial
institution or bank or debenture holders in accordance with the terms
and conditions of the CDR approval for debt restructuring.
1.7. According to the information and explanation given to us, the
company has not granted loans and advances on the basis of security by
way of pledge.of shares, debentures and other securities.
18. According to the information and explanation given to us, the
company has not defaulted in repayment of dues to a financial
institution or bank or debenture holders.
19. The company has not given any guarantee for loans taken by others
from bank or financial institutions, the terms and conditions whereof
are prejudicial to the interest of the company.
20. Fund raised on short- term basis has not been used for long-term
investment.
21. The company has not made any preferential allotment of shares to
parties and companies covered in the register maintained under section
301 of the Companies'' Act 1956.
22. The company has not created securities in respect of debentures
issued.
23. The company has not raised money by public issue during the year.
24. Based upon the audit procedures performed and information and
explanations given by the management, we report that no fraud on or by
the company has been noticed or reported during the course of our
audit.
For Giri & Co.
Chartered Accountants
(Sd/-)
R. Glri
Place : Coimbatore Senior Partner
Date : 21.08.2013 Membership Number : 25458
Jun 30, 2011
We have audited the attached Balance Sheet of SHREE KARTHIK PAPERS
LIMITED as at 30th June 2011, the Profit and Loss Account and also the
Cash Flow Statement for the year ended on that date 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.
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.
1. As required by the Companies (Auditor's Report), Order 2003, issued
by the Central Government in terms of section of 227(4A) of the
Companies Act, 1956, we annex hereto a statement on the matter
specified in paragraph 4 & 5 of the said order.
2. Further to our comments in the annexure referred to above, we
report that:
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 our examination of
those books.
c. The Balance Sheet, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of accounts.
d. In our opinion, the Balance Sheet, Profits Loss Account and Cash
Flow Statement dealt with by this report comply with the accounting
standards referred in sub-section 3C of Section 211 of the Companies
Act, 1956.
e. Based on representations made by the Directors of the Company and
the information and explanations given to us, we report that none of
the Directors of the Company are, prima facie, as at 30th June 2011,
disqualified from being appointed as Directors of the Company in terms
of clause (g) of sub section (1) of Section 274 of the Companies Act
1956.
f. In our opinion and to the best of our information and according to
the explanations given to us, the said accounts read together with
notes thereon, give the information so required by the Companies Act,
1956 in the manner so required and give a true and fair view in
conformity with the accounting principles generally accepted in India.
(i) In so far as it relates to the Balance Sheet of the State of
Affairs of the Company as at 30,h June 2011.
(ii) In so far as it relates to the Profits Loss Account of the profit
of the Company, for the year ended on that date.
AND
(iii) In so far as it relates to the Cash Flow Statements of the cash
flow of the Company, for the year ended on that date.
In terms of the information given to us and the books and records
examined by us in the normal course of audit and to the best of our
knowledge and belief, we state that:
1. In respect of its fixed assets:
a. The Company has maintained proper records showing full particulars
including quantitative details and situation of fixed assets.
b. As explained to us, the fixed assets have been physically verified
by the management during the year in a phased periodical manner, which
in our opinion is reasonable, having regard to the size of the company
and the nature of its assets. No material discrepancies were noticed on
such physical verification.
2. In respect of its inventories:
a. As explained to us, inventories have been physically verified by
the management at regular intervals during the year.
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 are reasonable and adequate in relation to
the size of the company and the nature of its business.
c. The company has maintained proper records of inventories. As
explained to us, there were no material discrepancies noticed on
physical verification of inventories as compared to the book records.
3. In respect of loans, secured or unsecured, granted or taken by the
company to / from companies, firms or other parties covered in the
register maintained under section 301 of the Companies Act, 1956:
a. During the year the company has financial transactions with the
Directors as detailed below
Name of the Balance as on Closing Balance
Directors 01.07.2010 as on 30.06.2011
M.S.Velu Rs.7,99,32,571/- Rs.8,58,23,433/-
Managing Director
S.S.Velu Rs.76,62,224/- Rs.66,49,077/-
Director
b. The loans are unsecured. The Company is paying interest for the
same.
c. The company has not granted any loans to any party or company. As
such the sub Clause (d)4(iii) is 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 purchases of inventory, fixed assets and also for the
sale of goods and Services. During the course of our audit, we have not
observed any major weaknesses in internal controls.
5. In respect of transactions covered under section 301 of the
Companies Act, 1956:
a. In our opinion and according to the information and explanations
given to us, the transaction made in pursuance of contract or
arrangements, that needed to be entered into in the register maintained
under section 301 of the Companies Act, 1956, have been so entered.
b. The transactions have been made at prices which are reasonable
having regard to the prevailing market prices at the relevant time.
6. The company has not accepted any deposits from the public.
7. The Company has the Internal Audit System and is commensurate with
the size of the Company and nature of its business.
8. The Central Government has prescribed maintenance of cost records
under section 209(1)(d) of the Companies Act, 1956, for the
manufacturing activity of the company. We have broadly reviewed the
accounts and records of the company in this connection and are of the
opinion, that prima facie, the prescribed accounts and records have
been made and maintained. We have not, however, made a detailed
examination of the same.
9. In respect of statutory dues:
a. The company has generally been regular in depositing undisputed
dues, including Provident Fund, Investor Education and Protection Fund,
Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise
Duty, Cess and other statutory dues applicable to the company.
b. According to the information and explanations given to us, there
were no undisputed amounts payable in respect of the aforesaid dues as
at 30th June 2011 for a period of more than six months from the date
they become payable.
c. According to the information and explanations given to us, the
following dues have not been deposited on account of disputes. The
Company is confident of getting these claim quashed as the demands have
been raised only on technical grounds.
SI.
No Name of
the statute Nature
of Dues Forum where dispute Pending Amount
Sales Tax
a. 1995-1996 Penalty Sales Tax Appellatte.
Tribunal (AB) 2,21,858
(Appeal pending)
b. 1999-2000 Tax The Appellatte Asst. 15,88,951
(CST) Penalty Commissioner(Ct.)Cbe., 17,99,951
(Appeal pending)
c. 2000-2001 Tax The Appellatte Asst. 27,61,182
(CST) Penalty Commissioner(Ct.) Cbe., 29,43,768
(Appeal pending)
d. 2003-2004 Tax Sales Tax Appellatte. 4,44,575
(CST) Tribunal (AB)
(Appeal pending)
e. 2004-2005 Tax The Appellatte Asst. 15,25,088
(CST) Penalty Commissioner(Ct.)Cbe., 16,02,309
(Appeal pending)
f. 2004-2005 Tax The Appellatte Asst. 1,17,030
(TNGST) Penalty Commissioner(Ct.)Cbe., 58,515
(Appeal pending)
10. The company has not incurred cash loss during the financial year
covered by our audit; and not in the immediately preceding financial
year.
11. The Company has not defaulted in repayment of dues to financial
institutions or Banks.
12. In our opinion and according to the information and explanations
given to us, no loans and advances have been granted by the Company on
the basis of security by way of pledge of shares, debentures and other
securities.
13. In our opinion, the Company is not a chit fund or a nidhi / mutual
benefit fund / society. Therefore, clause 4(xiii) of the Company's
(Auditor's Report) Order, 2003, is not applicable to the Company.
14. The Company is not dealing or trading in shares, debentures and
other investments.
15. The Company has not given any guarantee for loans taken by others
from bank or financial institutions.
16. The Company has not obtained any term loans during the year.
17. The Company has not utilized any funds raised on short term basis
during the year, for long term investment.
18. During the year the Company has not made any preferential
allotment of shares to parties and Companies covered in the Register
maintained under section 301 of the Companies Act 1956.
19. The Company has not issued any debentures.
20. The Company has not raised any money by public issue.
21. According to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
Place : Coimbatore for GIRI & Co.,
Date : 28.11.2011 Chartered Accountants
(Sd./-) R. GIRI
Partner
Membership No.: 25458
Jun 30, 2010
We have audited the attached Balance Sheet of SHREE KARTHIK PAPERS
LIMITED as at 30th June 2010, the Profit and Loss Account and also the
Cash Flow Statement for the year ended on that date annexed thereto.
These financial statements are the responsibility of the Companys
management. Our responsibility is to express an opinion on these
financial statements based on our audit.
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.
1. As required by the Companies (Auditors Report), Order 2003, issued
by the Central Government in terms of section of 227(4A) of the
Companies Act, 1956, we annex hereto a statement on the matter
specified in paragraph 4 & 5 of the said order.
2. Further to our comments in the annexure referred to above, we
report that:
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 our examination of
those books.
c. The Balance Sheet, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of accounts.
d. In our opinion, the Balance Sheet, Profit & Loss Account and Cash
Flow Statement dealt with by this report comply with the
accounting-standards referred in sub-section 3C of Section 211 of the
Companies Act, 1é56.
e. Based on representations made by the Directors of the Company and
the information and explanations given to us, we report that none of
the Directors of the Company are, prima facie, as at 30th June 2010,
disqualified from being appointed as Directors of the Company in terms
of clause (g) of sub section (1) of Section 274 of the Companies Act
1956.
f. In our opinion and to the best of our information and according to
the explanations given to us, the said accounts read together with
notes thereon, give the information so required by the Companies Act,
1956 in the manner so required and give a true and fair view in
conformity with the accounting principles generally accepted in India.
(i) In so far as it relates to the Balance Sheet of the State of
Affairs of the Company as at 30th June 2010.
(ii) In so far as it relates to the Profit & Loss Account of the profit
of the Company, for the year ended on that date.
AND
(iii) In so far as it relates to the Cash FI6w Statements of the cash
flow of the Company, for the year ended on that date.
ANNEXURE REFERRED TO IN PARAGRAPH 1 OF THE AUDITORS REPORT OF EVEN
DATE
In terms of the information given to us and the books and records
examined by us in the normal course of audit and to the best of our
knowledge and belief, we state that:
1. In respect of its fixed assets:
a. The Company has maintained proper records showing full particulars
including quantitative details and situation of fixed assets.
b. As explained to us, the fixed assets have been physically verified
by the management during the year in a phased periodical manner, which
in our opinion is reasonable, having regard to the size of the company
and the nature of its assets. No material discrepancies were noticed on
such physical verification.
c. The company has not disposed any of its assets during the year
2. In respect of its inventories:
a. As explained to us, inventories have been physically verified by
the management at regular intervals during the year.
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 are reasonable and adequate in relation to
the size of the company and the nature of its business.
c. The company has maintained proper records of inventories. As
explained to us, there were no material discrepancies noticed on
physical verification of inventories as compared to the book records.
3. In respect of loans, secured or unsecured, granted or taken by the
company to / from companies, firms or other parties covered in the
register maintained under section 301 of the Companies Act, 1956:
a. During the year the company has financial transactions with the
Directors as detailed below
Name of the Balance as on Closing Balance
Directors 01.07.2009 as on 30.06.2010
M.S.Velu Rs.3,74,00,908/- Rs.7,99,32,571/-
Managing Director
S.S.Velu Rs.61,71,245/- Rs.76,62,224/-
Director
b. The loans are unsecured. The Company is paying interest for the
same.
c. The company has not granted any loans to any party orpompany. As
such the sub Clause (d)4(iii) is 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 purchases of inventory, fixed assets and also for the
sale of goods and Services. During the course of our audit, we have not
observed any major weaknesses in internal controls.
5. In respect of transactions covered under section 301 of the
Companies Act, 1956:
a. In our opinion and according to the information and explanations
given to us, the transaction made in pursuance of contract or
arrangements, that needed to be entered into in the register maintained
under section 301 of the Companies Act, 1956, have been so entered.
b. The transactions have been made at prices which are reasonable
having regard to the prevailing market prices at the relevant time.
6. The company has not accepted any deposits from the public.
7. The Company has the Internal Audit System and is commensurate with
the size of the Company and nature of its business.
8. The Central Government has prescribed maintenance of cost records
under section 209(1)(d) of the Companies Act, 1956, for the
manufacturing activity of the company. We have broadly reviewed the
accounts and records of the company in this connection and are of the
opinion, that prima facie, the prescribed accounts and records have
been made and maintained. We have not, however, made a detailed
examination of the same.
9. In respect of statutory dues:
a. The company has generally been regular in depositing undisputed
dues, including Provident Fund, Investor Education and Protection Fund,
Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise
Duty, Cess and other statutory duesapplicable to the company.
b. According to the information and explanations given to us, there
were no undisputed amounts payable in respect of the aforesaid dues as
at 30th June 2010 for a period of more than six months from the date
they become payable.
c. According to the information and explanations given to us, the
following dues have not been deposited on " account of disputes. The
Company is confident of getting these claim quashed as the demands have
been raised only on technical grounds.
Name of the
statute No. Nature
of Dues Forum where dispute Pending Amount
Sales Tax
a.1995-1996 Penalty Sales Tax Appellatte. Tribunal (AB) 2,21,858
(Appeal pending)
b.1999-2000 Tax The Appellatte Asst. 15,88,951
(CST) Penalty Commissioner(Ct.)Cbe., 17,99,951
(Appeal pending)
c.2000-2001 Tax The Appellatte Asst. 27,61,182
(CST) Penalty Commissioner(Ct.) Cbe., 29,43,768
(Appeal pending)
d. 2003-2004 Tax Sales Tax Appellatte. 4,44,575
(CST) Tribunal (AB)
(Appeal pending)
e. 2004-2005 Tax The Appellatte Asst. 15,25,088
(CST) Penalty Commissioner(Ct.)Cbe., 16,02,309
(Appeal pending)
f. 2004-2005 Tax The Appellatte Asst. 1,17,030
(TNGST) Penalty Commissioner(Ct.)Cbe., 58,515
(Appeal pending)
10. The Company has not incurred cash loss during the financial year
covered by our audit; and in the immediately preceding financial year,
the company has incurred cash loss to the tune of Rs.30.60 lacs
11. The Company has not defaulted in repayment of dues to financial
institutions or Banks.
12. In our opinion and according to the information and explanations
given to us, no loans and advances have been granted by the Company on
the basis of security by way of pledge of shares, debentures and other
securities.
13. In our opinion, the Company is not a chit fund or a nidhi /mutual
benefit Jund /society. Therefore, clause 4(xiii) of the Companys
(Auditors Report) Order, 2003, is not applicable to the Company.
14. The Company is not dealing or trading in shares, debentures and
other investments.
15. The Company has not given any guarantee for loans taken by others
from bank or financial institutions.
16. The Company has not obtained any term loans during the year.
17. The Company has not utilized any funds raised on short term basis
during the year, for long term investment.
18. During the year the Company has not made any preferential
allotment of shares to parties and Companies covered in the Register
maintained under section 301 of the Companies Act 1956.
19. The Company has not issued any debentures.
20. The Company has not raised any money by public issue.
21. According to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
Place: Coimbatore , for GIRI & Co.,
Date : 22.11.2010 Chartered Accountants
(Sd./-)
R. GIRI
Partner
Membership No.: 25458