1. We have audited the attached Balance sheet of M/s. BHORUKA
ALUMINIUM LIMITED as at March 31, 2011and also the Profit and Loss
Account and 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.
2. We conducted our audit in accordance with the 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 statement. 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 (Auditors'' Report) Order, 2003, issued
by the Central Government of India in terms of sub-section (4A) of
Section 227 of the Companies Act, 1956, we annex hereto 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 that:
(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
(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 and proper returns adequate for the purpose of our audit
have been received from branches of the Company, not visited by us;
(c) the Balance Sheet, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account;
(d) in our opinion, the Balance Sheet, Profit and Loss Account and Cash
Flow Statement dealt with by this report, comply with applicable
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 March 31, 2011, and taken on record by the Board of
Directors, we report that none of the directors of the Company is
disqualified as on March 31, 2011 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 explanations given to us, the said accounts give the information
required by the Companies Act, 1956, in the manner so required subject
to non-consolidation of Subsidiary Company Bhoruka Aluminium (FZE) UAE
in view of no transactions as per Notes to Accounts No.19 under Item
No.13 in terms of Section 212 (2) (c ) of the Companies Act, 1956 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, 2011;
(ii) in the case of the Profit and Loss Account, 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.
ANNEXURE TO AUDITORS'' REPORT TO THE MEMBERS (Referred to the paragraph
3 of our report of even date)
1. (a) The company has maintained proper records showing full
particulars including quantitative details and situation of its fixed
(b) As explained to us, the fixed assets have been physically verified
by the management at reasonable intervals and no material discrepancies
were noticed on such physical verification.
(c) There was no disposal of substantial part of its fixed assets
during the year.
2. (a) Physical verification of inventory has been conducted by the
management at reasonable intervals.
(b) The procedure for Physical verification of inventory followed by
the management are reasonable and adequate in relation to the size of
the Company and nature of its business.
(c) The Company has maintained proper records of inventory and no major
discrepancies were noticed on physical verification.
3. In our opinion and according to the information and explanations
given to us,
(a) the Company has unsecured loan at the beginning of the year from
Bhoruka Agro Greens Limited amounting to Rs 12,03,45,327/= covered in
the register maintained under Section 301 of the Companies Act,
1956.Consequent to the amalgamation of the said Company with the
Company, the Outstanding amount is NIL.
(b) The rate of interest and other terms and conditions of loan taken
by the company are primafacie not prejudicial to the interest of the
(c) The Company is regular in payment of principal amount and interest.
(d) The Company has not taken or granted any loans, secured or
unsecured from companies, firms and other parties, in the register
maintained under section 301 of the Companies Act,1956.
4. In our opinion and according to the information and explanations
given to us, there are adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchase of inventory, fixed assets and for the sale of goods and
services. Further, we have not come across any major weakness in the
internal control system nor we have been informed of any such instance.
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 transactions that need to be entered into the register
maintained under section 301 have been so entered.
(b) In our opinion and according to the information and explanations
given to us, the transactions with parties exceeding the value of
Rupees five lakhs each entered into during the financial year, are at
prices which are reasonable having regard to the prevailing market
prices at the relevant time.
6. In our opinion and according to information and explanations given
to us, the Company has not accepted any fixed deposits from the public,
under Section 58A, 58AA or any other relevant provisions of the
Companies Act, 1956.
7. In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
8. We have broadly reviewed the books of accounts and records
maintained by the Company pursuant to the Rules made 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 records have been made and maintained. We have not, however,
made a detailed examination of the same.
9. According to the records of the Company, it has generally been
regular in depositing undisputed statutory dues including Provident
Fund and Employees'' State Insurance, Income-tax, Sales tax, Custom
Duty, Excise Duty, Service-tax, Cess and other statutory dues during
the year with the appropriate authorities, and there are no arrears of
outstanding statutory dues as on that date, for a period of more than
six months except Rs 65,000 on account of service tax which is pending
with Central Excise Tribunal, from the date they became payable.
10. The Company has no accumulated losses at the end of the financial
year and it has not incurred cash losses in the current year and also
in the immediately preceding financial year.
11. Based on our audit procedures and as per the information and
explanations given by the management, we are of the opinion that the
Company has not defaulted in repayment of dues to bank.
12. According to the information and explanations given to us, the
Company has not granted any loans and advances on the basis of
securities by way of pledge of shares, debentures and other securities.
13. The nature of Company''s activities during the year is such that
clauses (xiii) and (xiv) of paragraph 4 of Companies (Auditors'' Report)
Order, 2003 are not applicable to the Company for the year.
14. The Company has given guarantee for loans taken by one of its
Associate Company Bhoruka Fabcons Private Limited from banks or
15. Based on our audit procedures and information and explanation
given by the management, during the financial year the Company has not
obtained any term loan.
16. On the basis of information and explanations given to us and on an
overall examination of the Balance Sheet and the Cash Flow Statement of
the Company, funds raised on short-term basis have, prima facie, not
been used during the year for long-term investment.
17. The Company has made preferential allotment of 1,27,44,838 equity
shares during the financial year to promoters and others includes
conversion of Global Depository Receipts (GDRs) and Warrants into
Further, the Company has allotted 59,03,333 Equity shares to the
shareholders of erstwhile Bhoruka Agro Greens Limited consequent to
amalgamation with the Company as per the scheme sanctioned by the
Honourable High Court of Karnataka vide its Order dated 15th December,
18. The Company has not issued any debentures during the year.
19. The Company has not raised any money by way of Public Issue except
through Preferential allotment for which the Company has disclosed the
end use of money and the same has been verified.
20. Based upon the audit procedures performed and as per the
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 R.S. Agarwala & Co.,
Membership No. 22958
Firm Reg No-00049S
Date: 5th May, 2011