We have audited the attached Balance Sheet of Jaipur Polyspin Limited
as at 31st March 2005 and also the Profit & Loss Account and 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. We 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 misstatements. 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 the management, as well as
evaluating the overall financial statement presentation. We believe
that our audit provides a reasonable basis for our opinion.
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
(c) The balance sheet, profit & 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 & 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.
(e) On the basis of written representations received from the
directors, as on 31.03.2005 and taken on record by the Board of
Directors, we report that none of the Directors is disqualified as on
31st March, 2005 from being appointed as a director in term 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 read together with
notes thereon, and appearing in Schedule of Accounting Policies and
Notes on 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:
(i) in the case of the balance sheet, of the state of affairs of the
company as at 31st March, 2005.
(ii) in the case of the profit & loss account, of the loss for the year
ended on that date; and
(iii) in the case of cash flow statement, of the cash flows for the
year ended on that date.
As required by the Companies (Auditors Report) (Amendment) Order, 2004
(The Order) issued by the Central Government of India in terms of
sub-section (4A) of section 227 of the Companies Act, 1956 (The Act)
and in terms of the information and explanations given to us and also
on the basis of such checks as we considered appropriate, we further
state that: -
1. (a) The Company has maintained proper records showing full
particulars including quantitative details and situations of fixed
(b) Fixed Assets have been physically verified by the Management
according to the regular programme of periodical verification in phased
manner which in our opinion is reasonable having regard to the size of
the Company and the nature of its Fixed Assets. The discrepancies
noticed on such physical verification were not material.
(c) No Substantial, part of its fixed assets has been disposed off
during the year, which has bearing on the going concern concept.
2. (a) The inventory has been physically verified during the year by
the management. In our opinion, the frequency of verification is
(b) The procedures of physical verification of inventories followed by
the management are reasonable and adequate in relation to the size of
the Company and the nature of its business.
(c) The Company is maintaining proper records of inventory. No material
discrepancies have been noticed on physical verification of stocks as
compared to book records.
3. The Company has neither granted nor taken any loans, secured or
unsecured to/from companies, firms or other parties as covered in the
register maintained under section 301 of The Act. 1956. Accordingly,
the clause 4 (iii) (b) to (g) of The Order are not applicable.
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 and fixed assets and for the sale of goods and
services. During the course of our audit, we have not observed any
continuing failure to correct major weaknesses in internal control
5. a.) According to information and explanation given to us, and on
the basis of records made available to us, we are of the opinion that
the transactions that need to be entered in the register maintained
under the Section 301 of the Act have been so entered.
b.) According to information and explanation given to us, the
transactions made in pursuance of contracts or arrangements entered
into the register maintained under the Section 301 of the Act have been
made at a prices which are generally reasonable having regard to
prevailing market prices at the relevant time.
6. In our opinion and according to the information and explanations
given to us company has not accepted any deposits from the public in
terms of Sections 58A, 58AA or any other relevant provision of the Act
and th& rules framed there under.
7. In our opinion, the Company has an internal audit system
commensurate with its size and nature of its business.
8. We have broadly reviewed the books of account maintained by the
Company pursuant to the order issued by the Central Government for
maintenance of cost records under Section 209 (l)(d) of The Act in
respect of Textiles and are of the opinion that, prima facie, the
prescribed accounts and records have been made and maintained. We have
not, however, made a detailed examination of the records with a view to
determine whether they are accurate and complete.
9. (a) According to the records of the company, undisputed statutory
dues including provident fund, investor education protection fund,
Income tax, Sales tax. Wealth tax, Service Tax, Customs duty. Excise
duty. Cess and other material statutory dues have generally been
regularly deposited during the year with the appropriate authorities
and there are no undisputed amounts payable in respect of above
statutory dues outstanding as at 31st March, 2005 for a period
exceeding six months from the date they became payable.
(b) As per the records of the Company and information and explanation
given to us in cases of dues of Income Tax, Sales Tax, Service Tax,
Custom Duty, Wealth Tax, Excise Duty, Cess that have not been deposited
on account of any dispute are mentioned below:-
Nature of Statute Nature of
the dues Amount (Rs) Forum where dispute
1 Central Excise duty Excise Duty 24815 Central Excise Gold
- do - 184947 Tribunal Commissioner
Customs & Central
2. Textile Act. Cess Cess 4949052 Textile Committee
Cess Appellate Tribunal
10. The company has no accumulated losses and has not incurred cash
losses in the current financial year, and in the immediately preceding
11. In our opinion, on the basis of audit procedures and on the
information and explanations given to us, the company has not defaulted
in repayment of any dues to financial institutions or banks. The
Company has not issued debentures.
12. Based on examination of documents and records made available to us
and on the basis of information and explanations given to us, the
company has not granted any 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 or a nidhi/mutual
benefit fund/society. Therefore, the provisions of clause 4(xiii) of
The Order are not applicable to the company.
14. In our opinion, the company is not dealing in or trading in
shares, securities, debentures and other investments. Accordingly, the
provisions of clause 4(xiv) of The Order are not applicable to the
15. Based on examination and on the basis of information and
explanations given to us, the company has not given any guarantee for
loans taken by others from banks or financial institutions.
16. On the basis of information and explanations given to us, in our
opinion, term loan(s) were applied for the purposes for which the
loan(s) were obtained.
17. According to the information and explanation 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. During the year, the company has not made any preferential
allotment of shares to any parties or companies covered in the register
maintained under section 301 of The Act.
19. The company has neither issued nor had any outstanding debentures
during the year.
20. The company has not raised any money through a public issue during
21. Based upon the audit procedures performed and on the basis of
information and explanations given to us, we report that no fraud on or
by the company has been noticed or reported during the course of our
For LODHA & CO.,
Place : NOIDA Partner
Dated : 25 April, 2005 Membership No 71622