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« Mar 13
Auditor's Report (Alchemist) Year End : Mar '14
We have audited the accompanying financial statements of Alchemist
 Limited (the Company) which comprise the Balance Sheet as at March
 31,2014, the Statement of Profit and Loss and 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
 
 Management is responsible for 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 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
 materia! 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 Chartered
 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 appropriate.in the circumstances, but not for the
 purpose of expressing an opinion on the effectiveness of the entity''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 March 31,2014;
 
 b) in the case of the Statement of Profit and Loss, of the profit for
 the year ended on that date; and
 
 c) in the case of the Cash Flow Statement, of the cash flows for the
 year ended on that date.
 
 Emphasis of Matter
 
 Without qualifying our report, we draw attention to the note no. 43 to
 the financial statements The balances of some of the trade
 receivables, trade payables and loans & advances made and received, are
 subject to confirmation and as such there balances are reflected in the
 Balance Sheet as appearing in the books, pending reconciliation, the
 net effect is unascertainable,. In view of the same, the impact, if
 any, on the financial statements could not be ascertained.
 
 Report on Other Legal and Regulatory Requirements
 
 1. As required by the Companies (Auditor''s Report) Order, 2003 (the
 Order) as amended, 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, Statement of Profit and Loss and Cash Flow
 Statement dealt with by this Report are in agreement with the books of
 account;
 
 d) in our opinion, the Balance Sheet, Statement of Profit and Loss, and
 Cash Flow Statement comply with the Accounting Standards referred to in
 sub-section (3C) of section 211 of the Companies Act, 1956 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
 
 e) on the basis of written representations received from the directors
 as on March 31, 2014, and taken on record by the Board of Directors,
 none of the directors is disqualified as on March 31, 2014, from being
 appointed as a director in terms of clause (g) of sub-section (1) of
 section 274 of the Companies Act, 1956.
 
 ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT
 
 Referred to in paragraph 1 under ''Report on Other Legal and Regulatory
 Requirements'' section of our report of even date. We report that:
 
 (i) (a) In our opinion and according to the information and
 explanations given to us, the Company has maintained 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, the Company has formulated a regular program of
 verification by which all the assets of Company have been physically
 verified. No material discrepancies were noticed on physical
 verification conducted by the management during the year as compared
 with the book records.
 
 (c) in our opinion and according to the information and explanations
 given to us, no substantial part of fixed asset has been disposed
 during the year and therefore it does not affect the going concern
 status of the company.
 
 (ii) (a) In our opinion and according to the information and
 explanations given to us, inventories have been physically verified
 during the year by the management at reasonable intervals except for
 the work in progress inventory.
 
 (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) In our opinion and on the basis of our examination of the records,
 the Company is generally maintaining proper records of its inventories
 except for the work in progress inventory. No material discrepancy was
 noticed on physical verification of stocks by the management as
 compared to book records.
 
 (iii) (a) According to the information & explanations given to us, the
 Company has granted loans to subsidiary companies namely Alchemist
 Foods Limited and Alchemist Hospitality Group Private Limited (Parties
 covered in the register maintained under section 301 of the Companies
 Act, 1956) for which the maximum amount outstanding during the year was
 Rs. 12185.01 Lacs and Rs. 25.16 Lacs respectively and amount
 outstanding on 31st March, 2014 was Rs. 12180.26 Lacs and Rs. 25.15
 Lacs respectively.
 
 (b) According to the information & explanations given to us, the loans
 given by the Company are interest free unsecured loans and the loans
 can be recalled by the Company by giving a prior notice of at least
 twelve months, subject to concurrence of the loanee. Accordingly the
 terms of the loans are prima-facie prejudicial to the interest of the
 Company.
 
 (c) According to the information & explanations given to us, there has
 been no incidence of default in repayment.
 
 (d) In our opinion and according to the information and explanations
 given to us, there is no overdue amount in respect of the loan given by
 the Company.
 
 (e) According to the information & explanations given to us, the
 Company has taken unsecured loan from KDS Corporation Private Limited
 and Technology Parks Limited (Party covered in the register maintained
 under section 301 of the Companies Act, 1956) for which the maximum
 amount outstanding during the year was Rs. 72555.94 Lacs and Rs.
 70460.00 Lacs respectively and amount outstanding on 31st March, 2014
 was Rs. 4971.17 Lacs and Rs. 70460.00 Lacs respectively. 
 
 (f) According to the information & explanations given to us, the loans
 accepted by the Company are interest free unsecured loans. The terms of
 repayment with respect to loan from KDS Corporation Private Limited has
 not been defined and is repayable on the mutual agreement of both the
 parties involved. Loan from Technology Parks Limited is repayable on
 service of a minimum notice of 12 months by the lender for a repayment
 in excess of Rs. 50.00 Crores, however upon the concurrence of the
 Company. Hence terms of both the loans prima-facie are not prejudicial
 to the interest of the Company.
 
 (g) According to the information & explanations given to us, there has
 been no incidence of default in repayment.
 
 (iv) In our opinion and according to the information and explanations
 given to us, there is an adequate internal control procedure
 commensurate with the size of the Company and the nature of its
 business, for the purchase of inventories & fixed assets and payment
 for expenses & for sale of goods and services. During the course of our
 audit, no major instance of continuing failure to correct any
 weaknesses in the internal controls has been noticed.
 
 (v) a) In our opinion and according to the information and explanations
 given to us, the transactions made in the pursuance of contracts or
 arrangements, that need to be entered into the register maintained
 under section 301 ofthe Companies Act, 1956 for the year have been so
 entered.
 
 (b) In our opinion and according to the information and explanations
 given to us, the transaction made in pursuance of contracts or
 arrangements entered in the register maintained under section 301 of
 the Companies Act, 1956 aggregating during the year to Rs. 5.00 Lacs or
 more in respect of each party have been made at prices which in our
 opinion, are reasonable having regard to prevailing market price at
 relevant time.
 
 (vi) The Company has not accepted deposits from the public during the
 year covered by our audit report. However, the deposits have been
 repaid during the year. The Company has complied with all the
 provisions of Section 58Aand 58AAof the Act and the rules framed there
 under.
 
 (vii) As per information & explanations given by the management, the
 Company has a separate internal audit department constituting of
 professionals undertaking audit exercises throughout the year.
 Accordingly the internal audit system in the Company seems commensurate
 with its size and the nature of its business.
 
 (viii) We have broadly examined the books of accounts maintained by the
 Company pursuant to the rules by the Central Government for the
 maintenance of cost records under section 209 (1 )(d) of the Companies
 Act, 1956 and are of the opinion that, prima facie, the prescribed
 accounts and records have been made and maintained. We have however,
 not made a detailed examination of the records with a view to determine
 whether they are accurate or complete.
 
 (ix) (a) Based on our audit procedures and on the information and
 explanations given by the management, we report that undisputed
 statutory dues including Provident Fund, Investor Education and
 Protection Fund, Employees'' State Insurance, Income-tax, Sales-tax,
 Wealth Tax, Service Tax, Custom Duty, Excise Duty, cess to the extent
 applicable and any other statutory dues, have generally been deposited
 in time with the appropriate authorities, though there have been slight
 delays in few cases. According to the information and explanations
 given to us there was an amount of Rs.  26884/- pertaining to labour
 cess outstanding as on 31st March, 2014, for a period of more than six
 months from the date it became payable.
 
 (b) Details of excise duty which has not been deposited as on 31st
 March, 2014 by the Company on account of dispute is given below:
 
 Name of          Nature of          Forum           Total Amount  
 the Statute      the dues       where pending         involved* 
                                                      (Rs. Lacs) 
 
 Central Excise   Excise Duty     Commissioner          173.55    
 Act, 1944                      of Central Excise      
                                Commissionerate,       
                                   Chandigarh.               
 
 Name of              Amount paid        Period to
 the Statute         under protest     which amount
                      (Rs. Lacs)         relates
 
 Central Excise          63.13           December,
 Act, 1944                                2007 to
                                         September,
                                            2012
 
 * Amount as per demand order, not including interest and penalty as not
 quantified in the demand order.
 
 (x) The Company does not have any accumulated loss and has not incurred
 cash loss during the financial year covered by our audit and in the
 immediately preceding financial year.
 
 (xi) Based on our audit procedures and on the information and
 explanations given by the management, we are of the opinion that,
 during the year there have been delays in repayment of dues by the
 Company to financial institutions, banks or debenture holders. The
 details of the continuing default as on 31st March, 2014 in repayment
 of principle and interest is as follows:
 
 Name of Bank             Sanction     Default   Default      Default 
 -Type of Loan              amount      amount   cleared      cleared
                                         as on    amount         date
                                      31/03/14
 
 Punjab National Bank-   210000000     4484969   4484969   05-04-2014
 
 Project Term Loan   
 
 UCO Bank-Vehicle Loan      612000       21222      9017   02-05-2014
                                                   12205   27-05-2014
 
 UCO Bank-Vehicle Loan     1143000       50251     15880   02-05-2014
                                                   24541   27-05-2014
 
 UCO Bank-Vehicle Loan      716000       41366      9617   02-05-2014
                                                   15375   27-05-2014
 
 UCO Bank-Vehicle Loan      529000       28111         -            -
 
 Total                   213000000     4625919   4571604             
 
 Name of Bank                         Default
 -Type of Loan                    outstanding
                               as on 29/05/14
                                 
 Punjab National Bank-                      -
 
 Project Term Loan   
 
 UCO Bank-Vehicle Loan                      -
                             
 
 UCO Bank-Vehicle Loan                   9830
                           
 
 UCO Bank-Vehicle Loan                  16374
                         
 
 UCO Bank-Vehicle Loan                  28111
 
 Total                                  54315
 
 (xii) According to the information and explanations 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.  
 
 (xiii) The Company is not a chit fund or a nidhi/ mutual benefit
 fund/society. Therefore, the provision of clause 4(xiii) of the Order
 is not applicable to the Company 
 
 (xiv) Based on our audit procedures and on the information and
 explanation given by the management, the Company is maintaining proper
 records in respect of transactions and contract, in shares, securities,
 debentures and other investments and timely entries have been made
 therein, The shares and other investments have been held by the company
 in its own name.
 
 (xv) According to the information and explanations given to us, the
 Company has given guarantees to the tune of Rs. 3597.49 Lacs for loans
 taken by others from banks and financial institutions, the terms
 whereof are prima-facie not prejudicial to the interest of the Company.
 
 (xvi) Based on our audit procedures and on the information and
 explanation given by the management, we report that the term loans have
 been applied for the purpose for which they were raised.
 
 (xvii) Based on our audit procedures and on the information and
 explanation given by the management, we report that no funds raised on
 short-term basis have been used for long-term investment by the
 Company.
 
 (xviii) According to the information and explanations given to us, the
 Company has not issued shares to parties and companies covered in the
 register maintained u/s 301 of the Companies Act, 1956, during the
 year. Therefore, the provision of clause 4(xviii) of the Order is not
 applicable to the Company.
 
 (xix) According to the information and explanations given to us, the
 Company has not issued any secured debentures during the year.
 Therefore, the provision of clause 4(xix) of the Order is not
 applicable to the Company.
 
 (xx) During the year, the Company has not raised any money by way of
 the public issue. Therefore, the provision of clause 4(xx) of the Order
 is not applicable to the Company.
 
 (xxi) Based on the audit procedures performed and the information and
 explanations given to us, we report that no fraud on or by the Company
 has been noticed or reported during the year, nor have we been informed
 of such case by the management.
 
                                                                    Sd/-
                                                     C.A. Ashish Chhabra
                                                                 Partner
                                                   Membership No. 507083
                                                  N. Kumar Chhabra & Co.
 Date: 29 May, 2014                                Chartered Accountants
 Place: New Delhi                          Firm Registration No. 000837N
Source : Dion Global Solutions Limited
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