1. We have audited the attached balance sheet of Eicher Limited (the
Company) as at 31st March, 2007, the profit and loss account and also
the cash flow statement for the year ended on that date annexed
thereto. These financial statements are the responsibility of the
Companys 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 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 (Auditors Report) Order, 2003 (the
Order) issued by the Central Government of India in terms of
sub-section (4A) of section 227 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 above, we
(i) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purpose of our
(ii) 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 the
(iii) The balance sheet, the profit and loss account and the cash flow
statement dealt with by this
report are in agreement with the books of account;
(iv) In our opinion, the balance sheet, the profit and loss account and
the cash flow statement dealt with by this report comply with the
accounting standards referred to in sub- section (3C) section 21 I of
the Companies Act, 1956;
(v) On the basis of written representations received from the Directors
of the Company, as on 31!t March, 2007 and taken on record by the Board
of Directors, we report that none of the directors is disqualified as
on 3 Ist March, 2007 from being appointed as a director in terms of
clause (g) of sub-section (I) of section 274 of the Companies Act,
(vi) In our opinion and to the best of our information and according to
the explanation given to us, the said accounts give the information
required by the 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:
(a) In the case of the balance sheet, of the state of affairs of the
Company as at 31 March 2007;
(b) In the case of the profit and loss account, of the profit for the
year ended on the date; and
(c) In the case of the cash flow statement, of the cash flows for the
year ended on the date.
ANNEXURE TO AUDITORS REPORT
REFERRED TO IN PARAGRAPH 3 OF OUR REPORT OF EVEN DATE
1. The Company is maintaining proper records showing full particulars
including quantitative details and situation of fixed assets. These
assets have been physically verified by the management during the year
which in our opinion is reasonable having regard to the size of the
Company and the nature of its business. No discrepancies between the
book records and the physical inventory were noticed on such
verification. As there was no sale of fixed assets during the financial
year ended March 31, 2007 substantial or otherwise, paragraph (4)(i)(c)
of the Order is not applicable.
2. Physical verification of the stocks i.e. shares held as
stock-in-trade, has been conducted by the management at reasonable
intervals.The procedures of physical verification of stocks followed by
the management are reasonable and adequate in relation to the size of
the Company and the nature of its business.The Company has maintained
proper records of such stock-in-trade. No discrepancies have been
noticed on physical verification of stocks as compared to book records.
3. The Company has not taken any loans in the nature of loans to
parties covered in the register maintained under section 301 of the
Companies Act, 1956.The Company has given unsecured loans to its
holding company covered in the register maintained under section 301 of
the Companies Act, 1956. The maximum amount involved during the year
was Rs. 610 lacs and the year end balance was Rs. Nil. In our opinion
the rate of interest and other terms and conditions on which loan has
been granted to the company listed, in the register maintained under
section 301 are not, prima facie, prejudicial to the interest of the
Company. The concerned company has repaid the principal amount as
stipulated and has been regular in the payment of interest as
stipulated. Further, there are no dues outstanding as at the year end.
4. Having regard to the nature of the Companys business and based on
our scrutiny of the
Companys records and the information and explanations received by us,
we report that the Companys activities do not include purchases of
inventory and sale of goods and services. In our opinion and according
to the information and explanation received by us, there are adequate
internal control procedures commensurate with the size of the Company
and the nature of its business with regards to purchases of fixed
assets. During the course of our audit, we have neither come across
nor have been informed of any instance of major weaknesses in the
aforesaid internal controls system.
5. Based on the audit procedures applied by us and the information and
explanations provided by the management, we are of the opinion that
there were no transactions made in pursuance of contracts or
arrangements referred to in section 301 of the Act during the year that
need to be entered in the register maintained under that
section.Accordingly, paragraph (4)(v) of the Order is not applicable.
6. The Company has not accepted any deposits from the public within
the meaning of Sections 58A, 58AA or any other relevant the Act and the
rules framed there under or to which the directives issued by the
Reserve Bank of India apply. As per the information and explanations
given to us, no order under the aforesaid sections has been passed by
the Company Law Board or National Company Law Tribunal or Reserve Bank
of India or any Court or any other Tribunal on the Company.
Accordingly, paragraph (4)(vi) of the Order is not applicable.
7. In our opinion, the Company has an internal audit system
commensurate with the size of the Company and the nature of its
8. We are informed that the maintenance of,cost records has not been
prescribed by the Central Government under section 209(l)(d) of the
Companies Act, 1956. Accordingly, paragraph (4)(viii) of the Order is
9. According to the records of the Company, 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 statutory dues
applicable to it have been regularly deposited with the appropriate
authorities. According to the information and explanations given to us,
no undisputed amounts payable in respect of the Income tax/ Sales tax/
Wealth tax/ Service tax/ Custom duty/Excise duty/ Cess were outstanding
as at 31 March, 2007, for a period of more than six months from the
date of becoming payable. According to the information and explanations
given to us and the records of the company examined by us, the
particulars of dues of income-tax as at March 31, 2007 which have not
been deposited on account of a dispute have been stated in Note 7 on
Schedule I to the balance sheet.
10. The Company does not have accumulated losses at the end of the
financial year as at March 31, 2007. The Company has not incurred any
cash losses during the financial year covered by our audit and in the
immediately preceding financial year.
11. As the Company has not borrowed from any financial institutions or
banks nor has issued any debentures till 31 March, 2007, paragraph
(4)(xi) of the Order is not applicable.
12. As the Company has not granted any loans and advances on the basis
of security by way of pledge of shares, debentures or other securities,
paragraph (4)(xii) of the Order is not applicable.
13. The Company does not attract any special statute applicable to
chit fund and nidhi/mutual benefit fund/ societies. Accordingly,
paragraph (4)(xiii) of the Order is not applicable.
14. On the basis of our examination of the Companys records we are of
the opinion that the Company is maintaining adequate records regarding
transactions and contracts regarding Its trading activities in shares,
and timely entries have been made in these records. The shares,
securities and other investments have been held by the Company in its
15. As the Company has not given any guarantee for loans taken by
others from bank or financial institutions, paragraph (4)(xv) of the
Order is not applicable.
16. As the Company has not obtained any term loans and there are no
term loans outstanding as at the beginning of the year, paragraph
(4)(xvi) of the Order is not applicable.
17. According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we report
that no funds raised on short term basis have been used for long term
18. As the Company has not made any preferential allotment of shares
to parties and companies covered in the register maintained under
section 301 of the Act during the year, paragraph (4)(xviii) of the
Order is not applicable.
19. As the Company did not have any outstanding debentures during the
year, paragraph (4)(xix) of the Order is not applicable.
20. As the Company has not raised any money by way of public issue
during the year, paragraph (4)(xx) of the Order is not applicable.
21. During the course of our examination of the books and records of
the Company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
fraud on or by the Company, noticed or reported during the year, nor
have we been informed of such case by the management.
For VKGN& Associates
Place : New Delhi Vijay Gupta
Date : August 21,2007 Membership No. 081986