1. We have audited the attached Balance Sheet of ASHOK LEYLAND LIMITED
(the Company) as at March 31, 2012, the Statement of Profit and Loss
and the Cash Flow Statement for the year ended on that date, both
annexed thereto, (collectively referred to as the financial
statements), signed by us under reference to this report. 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 and assurance
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
3. As required by the Companies (Auditor''s Report) Order, 2003 issued
by the Central Government in terms of Section 227(4A) 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.
4. Further to our comments in the Annexure referred to in paragraph 3
above, we report as follows:
a. we have obtained all the information and explanations, which, to
the best of our knowledge and belief, were necessary for the purposes
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
c. the financial statements dealt with by this report are in agreement
with the books of account.
d. in our opinion, the aforesaid financial statements comply in all
material respects with the applicable Accounting Standards referred to
in Section 211(3C) of the Companies Act, 1956 (the Act).
e. in our opinion and to the best of our information and according to
the explanations given to us, the aforesaid financial statements read
with the Statement on Significant Accounting Policies and Notes to 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:
(i) in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2012;
(ii) in the case of the Statement of Profit and Loss, of the profit for
the year ended on that date; and
(iii) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
5. On the basis of written representations received from the Directors
as on March 31, 2012, and taken on record by the Board of Directors, we
report that none of the Directors is prima facie disqualified as on
March 31, 2012 from being appointed as a director in terms of Section
274(l)(g) of the Act.
As required by the Companies (Auditor''s Report) Order, 2003 (CARO)
issued by the Government of India in terms of Section 227(4A) of the
Companies Act, 1956, and on the basis of such checks as we considered
appropriate and according to the information and explanations given to
us, we report that:
1. (i) the Company is maintaining proper records showing full
particulars including quantitative details and situation of fixed
(ii) the fixed assets are being physically verified under a phased
programme of verification, which, in our opinion, is reasonable having
regard to the nature and value of its assets. However, no material
discrepancies have been noticed on such verification.
(iii) the Company has not disposed off substantial part of its fixed
assets during the year.
2. (i) inventories have been physically verified during the year by
the management at reasonable intervals.
(ii) the procedures of physical verification of the inventory followed
by the management are reasonable and adequate in relation to the size
of the Company and the nature of its business.
(iii) the Company is maintaining proper records of its inventories and
no material discrepancies were noticed on physical verification.
3. the Company has neither granted nor taken any loans, secured or
unsecured, to / from companies, firms or other parties covered in the
register maintained under Section 301 of the Act.
4. there is an adequate internal control system commensurate with the
size of the Company and the nature of its business with regard to
purchase of inventory and fixed assets and for sale of goods and
services. Further, on the basis of our examination of the books and
records of the Company, we have neither come across nor have been
informed of any continuing failure to correct major weaknesses in the
aforesaid internal control system.
5. a) in our opinion and to the best of our knowledge and belief, the
particulars of contracts or arrangements referred to Section 301 that
needed to be entered into the register, maintained under the said
section have been so entered.
b) where each of such transactions is in excess of Rs 5 lakhs in
respect of any party, the transactions have been made at prices which
are prima facie reasonable having regard to the prevailing market
prices at the relevant time.
6. the Company has not accepted any deposits from the public to which
the directives issued by the Reserve Bank of India and the provisions
of Section 58A and 58AA or any other relevant provisions of the Act and
the Companies (Acceptance of Deposit) Rules, 1975 apply.
7. the Company has an internal audit system commensurate with its size
and nature of its business.
8. we have broadly reviewed the cost records maintained by the Company
pursuant to the Companies (Cost Accounting Records) Rules, 2011
prescribed by the Central Government under Section 209(l)(d) of the
Companies Act, 1956 and are of the opinion that prima facie the
prescribed cost records have been made and maintained. We have,
however, not made a detailed examination of the cost records with a view
to determine whether they are accurate or complete.
9. (i) the Company is generally 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, customs duty, excise duty, cess and other material
statutory dues as applicable with the appropriate authorities during the
(ii) no undisputed amounts payable in respect of income tax, wealth
tax, sales tax, customs duty, excise duty and cess were in arrears, as
at the balance sheet date for a period of more than six months from the
date they became payable.
(iii) there are no dues of income tax, wealth-tax and customs duty
which have not been deposited on account of any dispute. Details of
dues towards sales tax, excise duty, service tax and cess that
have not been deposited on account of dispute are as stated below:
Nature of Dues Period to Forum Amount
dues which the where they stayed
amount dispute is not
Sales Tax 2,224.33 Various Appellate 2,846.88
35.84 Various Tribunal 204.30
- Various High Court 49.09
Excise 26.78 Various Commis- -
Duty, periods sioner of
and cess from Central
thereon 2008-2011 Excise (Ap-
1,415.09 Tribunal 4.88
Service tax 51.62 Various Tribunal -
and cess periods (CESTAT)
- Various Tribunal 230.31
Income - 2005-06 Commis- 8,045.47
Tax and sionerof
2007-2008 Income Tax
10. the Company does not have any accumulated losses as at March 31,
2012 and has not incurred any cash losses in the financial year ended
on that date or in the immediately preceding financial year.
11. the Company has not defaulted in repayment of dues to any
financial institution, bank or debenture holders during the year.
12. the Company has maintained adequate documents and records where it
has granted loans and advances on the basis of security by way of
pledge of shares, debentures and other securities.
13. the provisions of any special statute applicable to a chit fund,
nidhi or mutual benefit fund / societies are not applicable to the
14. the Company is not dealing or trading in shares, securities,
debentures and other investments. Accordingly the provisions of Clause
4(xiv) of the CARO are not applicable to the Company.
15. the terms and conditions of guarantees given during the year by
the Company, for loans taken by others from banks or financial
institutions, are not prima facie prejudicial to the interest of the
16. the term loans availed by the Company were prima facie, applied
for the purpose for which they were obtained.
17. on an overall examination of the financial statements of the
Company, funds raised on short-term basis have, prima facie, not been
used for long-term investment.
18. the Company has not made any preferential allotment of shares
during the year to any party.
19. the Company has created securities / charges in respect
Of debentures issued and outstanding.
20. the Company has not raised any money by public issues during the
21. considering the size and nature of the Company''s operations, no
fraud of material significance on or by the Company has been noticed or
reported during the year.
For M.S. KRISHNASWAMI & RAJAN
For DELOITTE HASKINS & SELLS
Chartered Accountants Chartered Accountants
Registration No. 01554S Registration No. 117366W
M.K. RAJAN R. LAXMINARAYAN
Membership No.4059 Membership No.33023
May 14, 2012 Chennai