GAIL India
BSE: 532155 | NSE: GAIL | ISIN: INE129A01019 | Oil Drilling And Exploration
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| Auditor's Report | Year End : Mar '09 |
We have audited the attached Balance Sheet of GAIL (India) Limited as
at March 31,2009, and also the Profit and Loss Account and the Cash
flow statement of the Company for the year ended on that date annexed
thereto in which are incorporated the accounts of the two units audited
by branch auditors.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.
We have 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 misstatement. An audit
includes examining, on a test check basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also
includes assessing accounting principles used and significant estimates
made by the management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable
basis for our opinion.
As required by the statement on 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 enclose in the
Annexure a statement on the matters specified in paragraphs 4 and 5 of
the said Order.
Further to our comments in the Annexure referred to 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
audit;
b) The allocation of work amongst the auditors has been followed as per
the directions contained in letter addressed to GAIL (India) Limited by
the office of the Comptroller & Auditor General of India, New Delhi.
c) In our opinion, proper books of account as required by law have been
kept by the Company so far as appears from our examinations of those
books. The Branch Auditors Report have been forwarded to us and have
been appropriately dealt with;
d) The Balance Sheet and Profit & Loss Account and the Cash Flow
Statement dealt with by this report are in agreement with the books of
account;
e) In our opinion, the Balance Sheet Profit & Loss Account and Cash
Flow Statement dealt with by this report comply with the Accounting
Standards referred to in sub- section (3C) of section 211 of the
Companies Act, 1956;
f) Disclosure in terms of clause (g) of sub- section (1) of section 274
of the Companies Act, 1956 is not required as per notification No. GSR
829(E) dated October 21,2003 issued by the Department of Company
Affairs;
g) In our opinion and to the best of our information and according to
the explanations given to us, the said financial statements, read
together with the significant accounting policies and notes thereon
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 31st March, 2009.
b) in the case of Profit & Loss account, of the profit for the year
ended that date; and
c) in the case of Cash Flow Statement, of the cash flow of the Company
for the year ended on that date.
Annexure to the Auditors report
The Annexure referred to in the auditors report to the shareholders of
GAIL (India) Limited for the year ended March 31,2009. We report that:
(i) (a) The company has generally maintained proper records showing
full particulars including quantitative details and situation of fixed
assets.
(b) According to the information and explanation given to us, there is
a regular programme of verification of fixed assets which, in our
opinion, is reasonable having regard to the size of the company and the
nature of its assets. Fixed assets have been physically verified by the
management during the year and no material discrepancies were noticed
on such verification.
In our opinion, there was no substantial disposal of fixed assets
during the year.
(ii) According to the information and
explanations given to us, the inventory of stores and spares were
physically verified by the Management, except those lying with
Engineers India Ltd., and other contractors at the end of the year. We
have been explained that the stock of gas at the end of the year has
been taken with reference to reading of Turbine Flow Meter/Gas
Chromatograph installed at Terminals, Stock of LPG/Pentane/SBP Solvent
are determined with reference to Tank Level Gauge measurement which are
converted into tonnage by measurement of density and applying
correction factor for temperature. LPG vapour volume is converted to
tonnage by standard formulae,
In our opinion and according to the information and explanations given
to us,
the procedures of 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.
According to the information and explanations given to us, no material
discrepancies have been noticed on physical verification of stock of
stores and spares as compared to the books and records.
(iii) The Company has neither granted nor taken any loans secured or
unsecured, to or from companies, firms or other parties covered in the
register maintained under Section 301 of the Companies Act, 1956.
(iv) In our opinion, and according to information and explanations
given to us, there are adequate internal control procedures
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.
(v) On the basis of our examination of the books of accounts, and as
per information and explanation given to us, the company has not made
any transactions in respect of any party during the financial year that
needs to be entered in the register pursuant to the section 301 of the
companies Act, 1956.
(vi) The company has not accepted any deposits from the public during
the year covered under sections 58A and 58AA or any other relevant
provision of the Companies Act, 1956.
(vii) In our opinion, the companys internal audit system is
commensurate with its size and nature of its activities.
(viii)We have broadly reviewed the books of Accounts maintained by the
Company pursuant to the order made by the Central Government for the
maintenance of Cost records under Section 209(1)(d) of the Companies
Act, 1956 and we are of the opinion that prima facie the prescribed
accounts and records have been maintained. We have not, however, made a
detailed examination of these records.
(ix) (a) According to the records of the
company, the company is generally regular in depositing undisputed
statutory dues including Provident fund, Investor Education and
Protection Fund, Employees State Insurance, Sales tax, Wealth tax,
Service Tax, Custom duty, Excise duty, cess and any other statutory
dues with the appropriate authorities. According to the information and
explanation given to us, no undisputed amounts payable in respect of
Sales tax, Service Tax, Custom duty, Excise duty and other statutory
dues were outstanding at the year end for a period of more than six
months from the date they become payable.
(b) As certified by the Management on which we have relied upon, the
dues of Excise Duty, Custom Duty, Entry Tax, Sales Tax and other Taxes
which have not been deposited on account of disputes and the forum
where the dispute is pending, are given below:
SI. Statute Subject Matter of Dispute
No.
1. Entry Tax (a) Entry Taxon MarketValueof Natural
Gas instead of its Purchase Price
(Including Interest)
(b) Rajasthan Entry Tax Demand
2. Sales Tax (a) Non-acceptance of declaration form
for concessional sales tax
(b) Surcharge on Turn over tax -Rajasthan
(c) CST demand on Transmission
charges with penalty & interest thereor
3. Excise (a) LPG valuation Dispute
(b) Dispute on Pentane Classification
(c) Classification dispute of MFO
as Motor Spirit
4. Service Tax (a) Demand of differential service tax
based on service tax returns for the
period from October 06 to March 07
5. Income Tax (a) Liability of Tax on disallowance of
deductions claimed & Penalty
(b) Demand for short deduction of TDS
6. Other taxes (a) Notified Area tax on revised value.
(incl. interest)
Amount Period of Dispute Status - Forum
212.78 1999-2006 Allahabad High Court
8.11 2002-03 onwards Dy. Commissioner, Appeals, Kota
0.16 1995-96 & 1996-97 Asstt. Commissioner, Commerical Tax, Guna
0.44 2002-03,2003-04 & 2004-05 State tax Tribunal, Ajmer
0.48 2005-06 and 2006-07 AP High Court
15.57 Jan 01 to Feb 05 CESTAT Mumbai & CESTAT, Ahmedabad
46.70 March 2000 to Feb. 2002 CESTAT Ahmedabad & CESTAT, New Delhi
& Aug. 2005 to March 2008
19.39 July 04 to August 07 CESTAT Ahemdabad
0.10 AY-2002-03,2003-04 Commissioner (Appeals) Vadodara
& 2006-2007
80.82 AY-2002-03,2003-04 ITAT Delhi & CIT (A)
& 2006-07
0.23 AY 2009-10 CIT (Appeals)-Baroda
2.48 1985-86 to 2008-09 Ahmedabad High Court
(x) The company has no accumulated losses at the end of the financial
year and it has not incurred any cash losses in the current and
immediately preceding financial year.
(xi) Based on our audit procedure and on the information and
explanations given by the management, we are of the opinion that the
company has not defaulted in repayment of dues to a financial
nstitution, bank and debenture holders.
(xii) In our opinion, the company has not
granted loans and advances on the basis of security by way of pledge of
shares, debentures and other securities other than to its employees. In
our opinion, the company has maintained adequate documents and records
in respect of such loans.
(xiii) The company is not a chit fund, nidhi, mutual benefit fund or a
society. Accordingly, clause 4(xiii) of the order not applicable.
(xiv) According to the information and
explanation given to us, the company is not dealing or trading in
shares, securities, debentures and other investments. Accordingly,
clause 4 (xiv) of the order is not applicable.
(xv) According to the information and
explanation given to us, the company has not given any guarantee for
loans taken by others from banks and financial institutions during the
year.
(xvi) According to the information &
explanation gives to us, company has not raised any term loans during
the year.
(xvii) According to the information and
explanation given to us, company has not raised any short term loan
during the year.
(xviii) The company has not made any
preferential allotment of shares to parties or companies covered in the
register maintained under section 301 of the Companies Act, 1956.
(xix) The company has not issued any debentures during the year.
(xx) During the year no money has been raised by public issues.
(xxi) According to the information and explanations given to us, no
fraud on or by the company has been noticed or reported during the
year.
ForMehraGoel&Co.
Chartered Accountants
R.K. Mehra
Partner
M.No.6102
Place : New Delhi
Dated : June 12,2009.
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