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Circuit Systems (India)
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« Mar 13
Auditor's Report (Circuit Systems (India)) Year End : Mar '14
We have audited the accompanying financial statements of Circuit
 Systems (India) Limited (the Company), which comprise the Balance
 Sheet as at 31st March, 2014 and the 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
 
 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 notified under 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 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 31st March, 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.
 
 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, 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 notified
 under 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;
 
 e.  on the basis of written representations received from the directors
 as on 31st March, 2014 and taken on record by the Board of Directors,
 none of the directors is disqualified as on 31st March, 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 Independent Auditors'' Report
 
 [Referred to in Paragraph 1 under the heading of report on other legal
 and regulatory requirements of our report of even date]
 
 1.  (a) The Company has maintained proper records showing full
 particulars, including quantitative details and situation of fixed
 assets on the basis of available information.
 
 (b) As explained to us, all the fixed assets have been physically
 verified by the management in a phased periodical manner, which in our
 opinion is reasonable, having regard to the size of the Company and
 nature of its assets. No material discrepancies were noticed on such
 physical verification.
 
 (c) The fixed assets disposed of during the year, in our opinion, do
 not constitute a substantial part of the fixed assets of the Company
 and such disposal has, in our opinion, not affected to the going
 concern status of the Company.
 
 2.  (a) The inventories have been physically verified during the year
 by management. In our opinion, the frequency of verification is
 reasonable.
 
 (b) According to the information and explanations given to us, in our
 opinion 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.
 
 (c) In our opinion and according to the information and explanations
 given to us the Company is maintaining proper records of inventory.
 According to the information and explanations given to us no material
 discrepancies were noticed on physical verification of inventories as
 compared to book records.
 
 3.  (a) The Company has granted unsecured loans to two parties covered
 in the register maintained under Section 301 of the Companies Act,
 1956. The maximum amount at any time during the year was Rs.
 37,00,000/- (P.Y. Rs. 32,51,896/-) and the year-end balance is NIL
 (P.Y. Nil).
 
 (b) In our opinion and according to the information and explanations
 given to us, the terms and conditions on which loans have been granted
 to the above parties listed in the register maintained under section
 301 of the Companies Act, 1956 are not, prima facie prejudicial to the
 interest of the Company.
 
 (c) We are informed that the loans granted to the above parties, do not
 have any stipulation for the payment of principal and interest.
 
 (d) The Company has taken unsecured loans from three parties covered in
 the Register maintained under Section 301 of the Companies Act, 1956.
 The maximum amount at any time during the year was Rs.  3,66,81,084/-
 (P.Y. Rs. 5,31,96,325/-) and the year-end balance is NIL (P.Y. Nil).
 
 (e) In our opinion and according to the information and explanation
 given to us, the rate of interest and other terms and conditions of
 such loan are not prima facie prejudicial to the interest of the
 company.
 
 (f) In respect of the aforesaid loans, the company is regular in
 repaying the principal amount which is repayable on demand.
 
 4.  In our opinion and according to the information and explanations
 given to us, there is adequate internal control system commensurate
 with the size of the Company and the nature of its business, for the
 purchase of inventory and fixed assets and for the sale of goods and
 services. Further, on the basis of our examination of the books of
 account and records of the Company and according to the information and
 explanation given to us, we have neither come across nor have been
 informed of any continuing failure to correct major weaknesses in the
 internal control system.
 
 5.  According to the information and explanations given to us, the
 particulars of contracts or arrangements referred to in section 301 of
 the Companies Act, 1956 that needs to be entered in the register
 maintained under that section have been so entered. Transactions done
 in pursuance of such contracts or arrangements have made at prices
 which appear reasonable as per information available with the company.
 
 6.  In our opinion and according to the information and explanations
 given to us, the Company has not accepted deposits from the public and
 therefore, the provisions contained in Sections 58A, 58AA or any other
 relevant provisions of the Act and Rules framed there under are not
 applicable to the Company.
 
 7.  In our opinion, the internal audit functions carried out during the
 year by a firm of Chartered Accountants appointed by the management
 have been commensurate with the size of the Company and the nature of
 its business.
 
 8.  According to the information and explanations given to us, the
 Central Government has prescribed for maintenance of cost records under
 Section 209(1)(d) of the Companies Act, 1956 in respect of
 manufacturing activity of the Company and we 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 determining whether they are accurate or
 complete.
 
 9.  (a) According to the information and explanations given to us and
 on the basis of our examination of the books of account, the Company
 has been generally regular in depositing undisputed statutory dues
 including Provident Fund, Investor Education and Protection Fund,
 Employees'' State Insurance, Sales Tax/Value Added Tax, Gratuity,
 Professional Tax, Income-tax, Wealth-tax, Custom Duty, Excise duty,
 Service Tax, Cess and any other applicable dues, during the year with
 the appropriate authorities. However, minor delay has been noticed in
 respect of Tax Deducted at Source (TDS) during the year. According to
 the information and explanation given to us no undisputed amounts
 payable in respect of statutory dues outstanding as at 31st March 2014
 for a period of more than six months from the date they became payable.
 
 (b) According to the information and explanation given to us, there are
 no dues of Provident Fund, Sales tax/ Value Added Tax, Professional
 tax, Income tax, Wealth-tax, Custom duty, Excise duty, Service tax,
 Cess and any other dues to the extent applicable, which have not been
 deposited on account of dispute. The following are the particulars of
 statutory dues not deposited by the Company on account of disputes as
 at 31st March 2014:
 
 Nature of        Nature of         Amount*                Period to 
 the Statute      the Dues          (Rs. In Lakhs)         which amount
                                                           relates
                                                           pending
 
 GST/CST of       Time limit of     Matter is related to   F.Y. 1998-99
 GST Act.         deferment         time limit, amount     to         
                                    is not quantified      F.Y. 2001-02
 
 VAT Act          Demand of         1,72,284               F.Y. 2004-05
                  excess interest                                   
                  paid on refund
 
 Income Tax Act   Demand for        29,84,020              F.Y. 2009-10
                  income tax &                             A. Y. 2010-11
                  Interest thereon
 
 Nature of             Forum where
 the Statute           dispute is
                   
 GST/CST of            Gujarat Value Added Tax,
 GST Act.              Tribunal, Ahmedabad
                    
 
 VAT Act               Deputy Commissioner of
                       Commercial Tax (Appeal)
                  
 Income Tax Act        CIT (Appeals)
                 
 10.  The Company does not have any accumulated losses at the end of the
 year and has not incurred cash losses in the current financial year.
 Company has incurred cash losses in the immediately preceding financial
 year.
 
 11.  In our opinion and according to the information and explanation
 given to us, the Company has been generally regular in repayment of
 dues to Banks and Financial Institutions.
 
 12.  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.
 
 13.  In our opinion, the Company is not a chit fund / nidhi / mutual
 benefit fund / society. Therefore, the provisions of clause (xiii) of
 paragraph 4 of the Order are not applicable to the Company.
 
 14.  In our opinion and according to the information and explanations
 given to us, the Company is not dealing or trading in shares,
 securities, debentures and other investments. The investment in shares
 and other securities have been held by the Company in its own name.
 
 15.  According to the information and explanations given to us, Company
 has not given any guarantee for loan taken by others from banks and
 Financial Institutions during the year.
 
 16.  In our opinion and according to the information and explanations
 given to us, the term loans have been applied for the purposes for
 which they were obtained.
 
 17.  On the basis of the information and explanations given to us and
 on an overall examination of the Financial Statements of the Company,
 in our opinion, there are no funds raised on a short-term basis which
 have been used for long-term investments.
 
 18.  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 during the year.
 
 19.  The Company has not issued any debentures during the year.
 
 20.  During the year, the Company has not raised money by public issue.
 
 21.  During the course of our examination of the books of account and
 records of the Company, carried out in accordance with the generally
 accepted auditing practices in India, we have not come across any
 instance of material fraud on or by the Company, noticed or reported
 during the year, nor have been informed of such case by the management.
 
                                              For. C.R. SHAREDALAL & CO.
                                                  CHARTERED ACCOUNTANTS,
                                               (Registration No.109943W)
 
                                                      (C. R. SHAREDALAL)
 PLACE : AHMEDABAD                                               PARTNER
 DATE : 15th May, 2014                              Membership No.002571
Source : Dion Global Solutions Limited
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