1. We have audited the attached financial statements of M/s. Oriental
Hotels Limited (the company) comprising of the Balance Sheet as at 31st
March 2012, Profit and Loss Statement, the Cash Flow Statement for the
year ended on that date, annexed thereto, which we have signed under
reference to this report. 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. 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
issued by the Central Government in terms of sub- section (4A) of
Section 227 of the Companies Act, 1956 (the Act), 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
b) Proper books of account as required by law, have been kept by the
Company so far as it appears from our examination of those books.
c) The Balance Sheet, Profit and Loss Statement and the Cash Flow
statement, dealt with by this report, are in agreement with the Books
d) In our opinion, the Balance Sheet, Profit and Loss Statement and the
Cash Flow statement, dealt with by this report comply with the
accounting standards referred to in subsection (3C) of Section 211 of
the Act, to the extent applicable.
e) On the basis of the 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 Directors are disqualified as at
31st March 2012 from being appointed as a Director in the Company in
terms of clause (g) of subsection (1) of Section 274 of the Companies
f) In our opinion and to the best of our information and according to
the explanations given to us, they said financial statements read
together with the notes thereon, in particular Note No. 38 regarding
exercising of option under Companies (Accounting Standards)(Second
Amendment) Rules, 2011 relating to Accounting Standard (AS) 11 The
Effect of changes in Foreign Exchange rates resulting in the profit
before tax for the year being higher by Rs.1045 lakhs, give the
information required by the Act, in the manner so required and give a
true and fair view in conformity with accounting principles generally
accepted in India:
1) in the case of Balance Sheet, of the state of affairs of the Company
as at 31st March, 2012;
2) in the case of the Profit and Loss Statement, of the Profit for the
year ended on that date; and
3) in the case of Cash Flow Statement, of the Cash flows for the year
ended on that date.
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. Fixed
assets have been physically verified by the Management during the year
based on a phased programme of verifying all the assets over three
years, 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 verification were not material and have been properly
dealt with in the books of account. There was no substantial disposal
of fixed assets during the year.
2. The management has conducted physical verification of inventory at
reasonable intervals. The procedures of physically 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. The
company is maintaining proper records of inventory and no material
discrepancies were noticed on physical verification.
3. (a) In our opinion and according to the information and
explanations given to us, the company has not granted any loan, secured
or unsecured, to companies, firms or other parties covered in the
register maintained under section 301 of the Act.
(b) In our opinion and according to the information and explanations
given to us, the company has not taken any loan, secured or unsecured,
from companies, firms or other parties covered in the register
maintained under section 301 of the Act.
4. In our opinion and according to the information and explanations
given to us, there is an 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 sale of goods and
services. There is no continuing failure to correct major weaknesses in
internal control system.
5. In our opinion and according to the information and explanations
given to us, there are no contracts or arrangements referred to in
section 301 of the Act that need to be entered into a register in
pursuance of said section and therefore reporting under clause v (a)
and v (b) of Paragraph 4 of the Order does not arise.
6. In our opinion and according to the information and explanations
given to us, the company has complied with the provisions of Section 58
A and Section 58 AA or any other relevant provisions of the Act and the
rules framed there under and the directives issued by the Reserve Bank
of India, wherever applicable, with regard to deposits accepted from
7. The company has an internal audit system, which in our opinion, is
commensurate with the size and the nature of its business.
8. The Central Government has not prescribed the maintenance of cost
records under Section 209 (1) (d) of the Companies Act, 1956.
9. According to the information and explanations given to us and on
the basis of our examination of the books of account, the company has
been generally regular in depositing undisputed statutory dues
including Provident Fund, Investor Education and Protection Fund,
Employees State Insurance, Income Tax, Luxury Tax, Sales Tax, Wealth
Tax, Service tax, Customs Duty, Excise Duty and Cess during the year
with the appropriate authorities. There are no outstanding statutory
dues as at 31st March 2012 for a period of more than six months from
the date they became payable.
10. According to the records of the company and information and
explanations given to us, in respect of customs duty, wealth tax,
excise duty and cess, there are no outstanding amounts that have not
been deposited with the appropriate authorities on account of any
dispute. The details of disputed income tax, sales tax, luxury tax and
service tax that have not been deposited with the appropriate
authorities are as follows:
Nature of Dues Amount, Forum where dispute is pending
Income Tax Demand for
the Assessment 182.37 Income Tax Appellate
Years 1998-99, 2003-04,
2004-05, 2005-06, /Commissioner of Income Tax
2008-09 and 2009-10
Sales Tax demands for
the Financial 19.93 Hon''ble High Court of
Sales Tax demands for
the Financial Years 30.76 The Assistant
2004-05 and 2005-06 Taxes), Chennai
Sales Tax demands
year 2008-09 12.07 The Assistant Commissioner
and 2009-2010 Taxes), Special Circle,
Sales Tax demands
for 1990-91 & 1991-92 23.68 Appellate Assistant
Luxury tax demands
for the financial year 1.31 Deputy Commissioner
Luxury tax demands
for the financial 28.19 Hon''ble Kerala High Court,
years 2004-05 and
Service Tax demands for
the financial 94.21 Commissioner of Central
years 2003-04 to
2009-2010 (Appeals), Kochi
Service Tax demands
for the period 88.74 Commissioner of Central Excise
October 2005 to
September, 2010 (Appeals), Mangalore
Service Tax demands
for the period June, 38.01 Commissioner of Central
2005 to March, 2010 (Appeals), Madurai
Service Tax demands for
the financial year 644.06 Hon''ble High Court
of Madras, Chennai
2004-05 to 2010-11
11. The company does not have any accumulated losses at the end of the
financial year and has not incurred cash losses during the financial
year and in the immediately preceding financial year.
12. Based on our audit procedures and on the basis of information and
explanations given by the management, we are of the opinion that the
company has not defaulted in payment of dues to Banks or financial
institutions. There are no amounts fall due in respect of debentures.
13. According to information and explanations given to us, the company
has not granted loans or advances on the basis of security by way of
pledge of shares, debentures and other securities.
14. The company is not a chit fund / nidhi / mutual benefit fund /
15. Based on our examination of records and the information and
explanations given to us, the company has not dealt / traded in shares,
securities, debentures and other investments during the year.
16. In our opinion and according to the information and explanations
given to us, the company has not given any guarantee for loans taken by
others from banks or other institutions.
17. The company has availed term loans from banks during the year
which have been applied for the purpose for which they were raised.
18. According to the cash flow statement and other records examined by
us and the information and explanations given to us, on an overall
basis, funds raised on short term basis prima face, have not been used
during the year for long term investment, other than temporary
deployment pending application.
19. The company has not made any preferential allotment of shares to
parties or companies covered in the register maintained under Section
301 of the Act.
20. According to the information and explanations given to us and the
records examined by us, securities have been created in respect of
debentures during the year .
21. The company has not raised any monies by public issue during the
22. To the best of our knowledge and belief and according to the
information and explanations given to us, no fraud on or by the company
was noticed or reported during the year.
For BRAHMAYYA & CO., For SNB ASSOCIATES
Chartered Accountants Chartered Accountants
Firm Registration No: 000511S Firm Registration No: 015682N
R. NAGENDRA PRASAD S. LAKSHMANAN
Membership No.203377 Membership No.20045
Date: May 08, 2012