1. We have audited the attached Balance Sheet of Limited as at 31st
March, 2003 and also the Profit and Loss Account of the company for the
period ended on that date annexed thereto. These financial statements
are the responsibility of the companys management. Our responsibility
is to express and opinion on these financial statements based on our
2. We conducted our audit in accordance with auditing standards
generally accepted in India. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatements. 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 statements
presentation. We believe that our audit provides a reasonable basis for
3. As required by the manufacturing and other companies (Auditors
Report) order, 1998, issued by the central Government in terms of
section 227 (4A) of the companies Act 1956, we give in the Annexure, a
Statement on the matters specified in paragraphs 4 and 5 of the said
4. Further to our comments in the annexure referred to in paragraph 1
above, we report that:
a) We have obtained all information and explanations which to the best
of our knowledge and belief were necessary for the purposes of our
b) In our opinion, proper books of account as required by law have been
kept by company, so far as appears from examination of these books.
c) The Balance Sheet and the Profit and Loss account dealt with in this
report are in agreement with the above books of account.
d) In our opinion, the Balance Sheet and Profit and Loss Account comply
with the accounting standards, to the extent applicable, referred to in
sub-section (3C) of section 211 of the companies Act, 1956.
e) On the basis of the written representations received from and the
directors of the company, other than nominee directors, and taken on
records by the board of Directors, we report that none of those
directors is disqualified as at 31 March, 2003 from being appointed as
a director 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 explanation given to us, the said accounts, read together with the
Note No. 4 regarding recalling of Loan and filing case with Debt
recovering Tribunal by IFCI.
Note No. 5 regarding reconciliation of Interests with Bank in NRA
Note No. 6 regarding Company being declared sick and BIFR orders
Note No. 9 regarding Balance Confirmation with Sundry Debtors, Advances
Note No.5&9 of the Annexure to the Audit report regarding Sales,
purchases and internal control systems of the Company.
Thereon, give the information required by 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 the case of the Balance Sheet, of the state of affairs of the
company, as at 31st March, 2003 and
ii) In the case of the profit and Loss Account, of the toss for nine
months period ended on that date.
For Anoop Kumar Sharma & Associates
Date : 27thAugust, 2003
Place: Chandigarh Sd/-
(Anoop Kumar Sharma)
ANNEXURE TO THE AUDITORS REPORT
Referred to in Paragraph 1 of our report of even date
1. The company has maintained proper records showing full particulars
including quantitative details and situation of fixed assets except for
Building & Plant & Machinery. As per the information and explanation
none of the assets have been physically verified by the management
during the year.
2. The fixed assets have not been revalued during the year.
3. Physical verification of stores, spares parts has been conducted by
the management at the end of financial year, No material discrepancy
was noticed on stocks and spares on such verification and the dosing
stocks are taken as physically verified and certified by the management
as at the end of the financial year.
4. The Company has not taken/granted any loans from/to companies,
firms or other parties listed in the register maintained under Section
301 of the companies Act, 1956 and from/to companies under the same
management within the meaning of section 370 (1B) of the companies Act,
5. In our opinion internal control procedures commensurate with the
size of the company and there is no proper system of recording sales
and purchases of raw material and other assets.
6. According to the information and explanation given to us, there are
no transactions for purchase of goods and material and sale of good,
material and services made in pursuance of contracts or arrangement
entered in the register maintained under section 301 of the companies
Act, 1956 and aggregating during the year to Rs. 50,000/- or more in
respect of each party.
7. The company has not accepted any deposits from the public.
8. The Company does not generate any Disposable by product or scrap.
9. In our opinion the internal audit system of the company is not
commensurate with the size and nature of its business.
10. The maintenance of cost records has not been prescribed by the
central Government under section 209 (1) (d) of the Companies Act, 1956
for the business carried on by the company.
11. The company has regularly deposited provident Fund dues with the
12. According to the information and explanations given to us, there
are no undisputed amounts payable in respect of income tax, wealth tax,
custom duty and excise duty outstanding for a period of more than six
months as at 31st March, 2003 from the date they became payable.
13. According to the information and explanation given to us, no
personal expenses of employees or directors have been charged to
revenue account, other than those payable under contractual
obligations, or in accordance with generally accepted business
14. The company has been declared sick industrial company within the
meaning of clause (o) of section (1) of section 3 of the sick
Industrial companies (Special provisions) Act, 1985. The BIFR has
recommended takeover/change of management/winding up of the Company.
15. In relation of trading activities of the company, it has adequate
system to determine the damaged stocks. There were no significant
damaged observed during the year.
For Anoop Kumar Sharma & Associates
Date : 27th August, 2003 (Anoop Kumar Sharma)
Place: Chandigarh Partner