1. We have audited the attached Balance Sheet of JAMNA AUTO INDUSTRIES
LIMITED as at 31 March 2011 and also the Profit & Loss Account annexed
thereto and the Cash Flow Statement for the year ended on that date.
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 conducted our audit in accordance with Auditing Standards
generally accepted in India. These Standards require that we plan and
perform the audit to obtain reasonable assurance 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
our opinion.
3. As required by the Companies (Auditors Report) Order, 2003 as
amended by the Companies (Auditors'' Report) (Amend.), Order 2004 issued
by the 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 in paragraph 3
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 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 the
books.
c. The Balance Sheet, Profit & Loss Account and Cash Flow statement
dealt with by this report are in agreement with the books of accounts.
d. In our opinion, the Profit & Loss Account and the Balance Sheet and
Cash Flow Statement of the company comply with the Accounting Standards
referred to in Sub-section (3C) of Section 211 of the Companies Act,
1956 to the extent applicable.
e. On the basis of written representations received from the Directors
and on the basis of Form DD-A submitted by all the directors to the
company and taken on record by the Board of Directors, we report that
none of the directors is disqualified as on 31st March, 2011 from being
appointed as a director in terms of clause (g) 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 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.
(i) In the case of the Balance Sheet, of the state of the affairs of
the company as at 31 March 2011 and;
(ii) In the case of Profit & Loss Account, of the profit of the company
for the year ended on that date.
(iii) In the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Annexure Referred to in Paragraph 3 of Our Report of Even Date
TO THE SHAREHOLDERS OF JAMNA AUTO INDUSTRIES LIMITED ON THE ACCOUNTS
FOR THE YEAR ENDED 31 MARCH 2011
(i) (a) In our opinion, the company has maintained proper record,
showing full particulars including quantitative details and situation
of fixed assets.
(b) As certified by the Management, the fixed assets have been
physically verified by the Management at reasonable intervals. No
material discrepancies with respect to book records were noticed on
such verification.
(c) In our opinion and according to explanations given to us, fixed
assets disposed off during the year were not substantial and as such
the disposal has not affected the going concern status of the company.
(ii) (a) As explained to us and as certified by the Management,
physical verification of inventory has been conducted by Management at
reasonable intervals. In our opinion, the frequency of verification is
reasonable.
(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 nature of its business.
(c) On the basis of our examination of the record of inventory, we are
of the opinion that the company is maintaining proper records of
inventory. Discrepancies noticed on verification of inventory as
compared to book records were not material and these have been properly
dealt with in the books of account.
(iii) (a) The company has granted unsecured loan to companies covered
in the register maintained under Section 301 of the Companies Act,
1956. Number of such parties is one and amount outstanding as on 31
March 2011 is Nil, maximum amount outstanding during the year is
Rs.400.00 lacs and
(b) The rate of interest and other terms and conditions of the loan are
not prima facie prejudicial to the interest of the company.
(c) The loan is repayable on demand. However, as on
31 March 2011 no amount is outstanding. The loan has been squared up.
(d) Since the principal amount and the interest on the loan has been
repaid during the year, sub-clause (d) is not applicable.
(e) Sub-clauses (e), (f) and (g) are not applicable since the company
has not taken any loan secured or unsecured from companies covered in
the register maintained under Section 301 of the Companies Act, 1956.
(iv) In our opinion and according to the information and explanation
given to us, there are adequate internal control procedures
commensurate with the size of the company and the nature of its
business with regard to purchase of inventory and fixed assets and for
the sale of goods and services. During the course of our audit, no
major weakness has been noticed in the internal controls.
(v) (a) In our opinion the transactions that need to be entered into
the register maintained under Section 301 have been so entered.
(b) In our opinion and according to the information and explanation
given to us the transactions in pursuance of contracts or arrangements
entered into register maintained under Section 301 of the Companies
Act, 1956 have been made at prices which are reasonable having regard
to the explanation furnished by the Management regarding necessity of
meeting the technical specification, quality control requirements and
delivery schedules. The comparison of the prices of similar transaction
with other parties and the prevailing market prices is not available
since the company has not dealt with others in this regard.
(vi) The company has not accepted public deposits, hence the directives
issued by the Reserve Bank of India and the provisions of Section 58A,
58AA or any other relevant provisions of the Companies Act, 1956 are
not applicable. We are informed that no order 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 during the year in this
regard.
(vii) In our opinion, the company has an adequate internal audit system
commensurate with the size and the nature of its business.
(viii) We have broadly reviewed the books of accounts maintained by the
company in respect of products where, pursuant to the Rules made by the
Central Government, the maintenance of cost records have been
prescribed under Section 209(1)(d) of the Companies Act, 1956, and are
of the opinion that prima facie, the prescribed accounts and records
have been maintained. However we have not, nor we are required, made a
detailed examination of the records with a view to determining whether
they are accurate or complete.
(ix) In respect of statutory dues
(a) 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 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 aforesaid dues were
outstanding as on 31 March 2011 for a period of more than six months
from the date they became payable.
(b) The disputed statutory dues that have not been deposited on account
of matters pending in appeal/ adjudication before appropriate
authorities are as under :
Sl. Name of
Statute Nature of dues Forum where dispute is Pending Amount
No. (Rs. in
Lacs)
1 Entry Tax/
Sales Tax Forging benefit MP Commercial Tax Appellate 11.78
Board, Bhopal
2 Nikaykar Payment of
Nikaykar MP Commercial Tax Appellate 0.65
Board, Bhopal
3 State Sales
Tax Set off the
sales tax
liability
incurred
during MP Commercial Tax Appellate 0.25
the expansion
of the unit Board,Bhopal
4 Central
Excise Act,
1944 Excise Duty High Court, Gwalior 7.47
5 Service Tax Service Tax on
outward transport
of goods Customs Excise and Service Tax 2.14
Appellate Board, Delhi
6 Service Tax Service Tax on
outward transport
of goods Customs Excise and Service Tax 0.3
Appellate Board, Delhi
7 Service Tax Service Tax on
outward transport
of goods Customs Excise and Service Tax 2.29
Appellate Board, Delhi
8 Service Tax Service Tax on
outward transport
of goods Customs Excise and Service Tax 3.54
Appellate Board, Delhi
9 Central Excise
Act, 1944 Cenvat Credit on
goods received
back into Assistant Commissioner Central 4.05
the factory on
the basis of own
invoices Excise, Yamuna Nagar
10 Central Excise
Act, 1944 Cenvat Credit
towards Service
Tax on Assistant Commissioner Central 1.35
outward freight. Excise,Yamuna Nagar
11 Service Tax Cenvat Credit on
service tax paid
to custom Commissioner(Appeal), Central 2.62
house agent for
export of finished
goods Excise, Delhi
12 Service Tax Cenvat Credit on
service tax paid on
outward Commissioner (Appeal),Central 4.13
transport of goods Excise,Delhi
13 Service Tax Cenvat Credit on
service tax paid on
outward Customs Excise and Service Tax 4.24
transport of goods Appellate Board,Delhi
14 Service Tax Cenvat Credit on
service tax paid on
outward Customs Excise and Service Tax 3.45
transport of goods Appellate Board,Delhi
15 Service Tax Cenvat Credit on
service tax paid on
outward Customs Excise and Service Tax 1.12
transport of goods Appellate Board,Delhi
TOTAL 49.42
(x) The accumulated losses of the company are not more than fifty
percent of its net worth as on 31 March 2011, and the company has not
incurred cash losses during the fnancial year under consideration.
(xi) Based on our audit procedures and according to the information and
explanation given to us, we are of the opinion that the company has not
defaulted in repayment of dues to financial institutions, banks or
debenture holders.
(xii) Based on our audit procedures and on the information and
explanations given by the Management, we are of the opinion that since
the company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities,
it is not required to maintain records in respect thereof.
(xiii) The company is not a chit fund/nidhi/mutual benefit fund/
society to which the provisions of special statue relating to chit fund
are applicable. Accordingly provision of sub clause (xiii) of the Order
is not applicable.
(xiv) According to the information and explanations given and is
capital of subsidiary LLP by Management, the company is not dealing or
trading in shares, securities, debentures and other investments. The
company has made investments in unquoted shares of companies for which
proper records have been kept by the company. All the investments are
in the name of the company.
(xv) Based on our examination of the records and as explained by the
Management, we are of the opinion that the company has not given any
guarantee for loans taken by others from banks or financial
institutions.
(xvi) In our opinion, the term loans have been applied for the purposes
for which they were obtained.
(xvii) Based on our examination of the Balance Sheet and Cash Flows
Statement of the company as at 31 March 2011, and information and
explanations given to us, we report that funds raised on a short-term
basis have not been used for long-term investment.
(xviii) The company has only issued,121572 equity shares to its
employees under Employees Stock Option and no other preferential
allotment has been made to the parties
and companies covered in the Register maintained under section 301 of
the Companies Act, 1956. The price at which 121572 equity shares were
issued to the employees under Employees Stock Option is not prima facie
prejudicial to the interest of the company.
(xix) The company has made preferential allotment of shares to a
company covered in the register maintained under Section 301 of the
Companies Act, 1956 during the year. In our opinion and according to
the information and explanation given to us, the price at which such
shares have been issued is not prejudicial to the interest of the
company.
(xx) During the period covered by our Audit report, the company has not
issued any debentures requiring report under this clause.
(xxi) During the year ended 31 March 2011, the company has not raised
money by way of public issue. Accordingly paragraph 4(xx) of the Order
is not applicable.
(xxii) Based on the audit procedures performed and information and
explanations given by the Management, we report that no fraud on or by
the company has been noticed or reported during the year.
For A. S. G. & Associates Goel Garg & Co. A. K. Kalia & Assocaites
Chartered Accountants Chartered
Accountants Chartered Accountants
FR No- 000389N FR No - 000397N FR No - 006949N
Amar Jeet Singh S. C. Garg Anil K. Kalia
Partner Partner Proprietor
M No - 089285 M No - 13370 M No - 085672
Place : New Delhi
Date : 11 July 2011
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