1. We have audited the attached Balance Sheet of M/s Hindustan
Adhesives Limited as on 31st March, 2012, the Profit and Loss Account
for the year ended on that date 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 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 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, as
amended, issued by the Central Government of India under sub-section
(4A) of section 227 of the Companies Act, 1956, we enclose in the
Annexure a statement on the matters specified in paragraph (4) & (5) of
the said Order.
4. Further to our comments in Annexure referred to above, we report
(i) We have obtained all the information and explanation, 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
(iii) The Balance Sheet and Profit and Loss Account dealt with by this
report are in agreement with the books of account;
(iv) In our opinion, the Balance Sheet and Profit and Loss Account
dealt with by this report comply with the accounting standards referred
to in sub-section (3C) of section 211 of the Companies Act, 1956;
(v) On the basis of written representations received from the
directors, as on 31st March, 2012, and taken on record by the Board of
Directors, we report that none of the director is disqualified as on 31
st March, 2012 from being appointed as a director in terms of clause
(g) of sub-section (1) of section 274 of the Companies Act, 1956;
(vi) Subject to our comments above, in our opinion and to the best of
our information and according to the explanations given to us, the said
statements of accounts read together with the Notes on Financial
statements 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 Balance Sheet, of the state of affairs of the
Company as at 31st March, 2012;
(b) in the case of Profit and Loss Statement, of the Profit of the
Company for the year ended on that date; and
(c) in case of the Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
ANNEXURE TO THE AUDITOR''S REPORT (Referred to in paragraph 3 of our
Report of even date)
(i) (a) The Company is maintaining proper records showing full
particulars including quantitative details and situation of fixed
(b) The management at reasonable intervals has physically verified the
fixed assets, no material discrepancies were noticed on such
(ii) (a) The physical verification of inventory has been conducted by
the management at reasonable intervals.
(b) 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 the Company is maintaining proper records of
inventory and the discrepancies noticed on physical verification were
not material and have been properly dealt with in the books of
(iii) In respect of loans, secured or unsecured, granted or taken by
the company to or from companies, firms or other parties covered under
the register maintained U/s. 301 of the Companies Act, 1956, according
to the information and explanations given to us:
(a) The Company has taken unsecured loans from 5 (Five) parties covered
under the register maintained under section 301 of the Companies Act,
1956. The maximum amount involved in such loans during the year
aggregates to Rs.300.17 Lacs and the closing balance outstanding as on
31st March 2012 is Rs.186.17 Lacs.
(b) In our opinion the terms and conditions of such loans taken by the
company are prima facie not prejudicial to the interests of the company
(c) There is no pre-determined schedule for repayment of unsecured
(d) As there is no schedule for repayment of unsecured loans taken by
the company, therefore, we are not in a position to comment on steps,
if any, taken by the company for repayment of the same.
(e) The company has not granted any loans to companies, firms or other
parties covered under the register maintained U/s. 301 of the Companies
Act, 1956, except temporary advances given 4 (Four) such parties which
has been recovered as stipulated The maximum amount involved in such
loans during the year aggregates to Rs. 140.63 Lacs and the closing
balance outstanding as on 31st March 2012 is Rs. Nil.
(iv) In our opinion and according to the information and explanations
given to us the company has an adequate internal control procedure
commensurate with the size of the Company and the nature of its
business, for the purchases of inventory and fixed assets and for the
sale of goods. There is no continuing failure or weakness in internal
(v) According to the information and explanation given to us, the
transactions that need to be entered into the register in pursuance of
section 301 of the Companies Act, 1956 has been so entered.
In our opinion and according to the information & explanation given to
us, there were no transactions made in pursuance of contracts or
arrangements entered in the register mentioned under section 301 of the
Companies Act exceeding the value of Rs. Five lacs in respect of any
party during the year.
(vi) In our opinion and according to the information and explanations
given to us, the Company has not accepted any public deposits for which
the provisions for compliance U/s.58 and 58AA or any other relevant
provisions of the Companies Act, 1956 applies.
(vii) The Company has an internal audit system commensurate with its
size and nature of its business.
(viii) The Central Government has not prescribed maintenance of cost
records for the company U/s.209 (1 )(d) of the Companies Act, 1956.
(ix) (a) The Company is generally regular in depositing undisputed
applicable statutory dues including Provident Fund, Investor Education
and Protection Fund, Employees'' State Insurance, Income-tax, Sales Tax,
Wealth Tax, Custom Duty, Excise Duty, Service Tax, Cess and any other
statutory dues with the appropriate authorities. Except for certain
cases of delays in deposits.
(b) Following disputed dues of Sales Tax and Excise Duty/cess have not
been deposited: -
SI. Name of the
Statue/ Amount Period to which Authority where
No. Nature of Dues (Rs.) Amount Relates dispute is pending
1. The Central
Sales Tax 15,000/- 2006-07 Deputy
Tax Noida Dy.
Sales Tax) 4,62,997/- 2007-08 Com. trade Tax,
1,32,163/- 2007-08 Com. trade Tax,
480/- 1999-00 (Sales Tax
V T O - Delhi
2. Sales Tax
Delhi 3,337/- 2003-04 Sales Tax
Officer, VAT Delhi
3. The Central
1944 1,95,000/- March, 1998 High Court
(x) The Company has been registered for a period of more than five
years, and the Company does not have any accumulated losses during the
year under report.
(xi) According to the information and explanations given to us, the
company has not defaulted in repayment of dues to any financial
institutions and banks during.
(xii) The Company has not granted any loans or advances on the basis of
security by way of pledge of shares, debentures and other securities.
(xiii) The provisions of any special statute applicable to Chit Fund,
Nidhi /Mutual Benefit Fund/Societies are not applicable to this
(xiv) The company is not dealing or trading in business of securities,
debentures and other investments.
(xv) According to the information and explanations given to us, the
company has given a corporate guarantee of Rs. 14.63 crore to bank
against loan taken by M/s Bagla Polifilms Ltd., for which approval from
Central Government under section 295 of Companies Act, 1956 dated
19-03-2010 has been obtained by the Company.
(xvi) In our opinion and according to the information and explanations
given to us, the term loans obtained in earlier years and continued to
remain outstanding during the financial year under report are applied
for the purpose for which the loans were obtained.
(xvii) According to the information and explanations given to us and on
an overall examination of financial statements of the company and after
placing reliance on the reasonable assumption made by the company for
the classification of long term and short term use of funds we are of
the opinion that, prima-facie, long term funds have not been utilised
for short term purposes and vice-versa.
(xviii) The company has not made any preferential allotment of shares
to parties and companies covered in the register maintained U/s.301 of
the Companies Act, 1956.
(xix) The Company has not issued any debentures since inception.
(xx) The company has not raised any money by public issue during the
(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
For SALARPURIA & PARTNERS
Firm Registration No. 302113E
Place : 1008, Chiranjiv Tower, (KAMAL KUMAR GUPTA)
43, Nehru Place, New Delhi-110 019 Partner
Date : 04.09.2012 M. No. 89190