We have audited the attached Balance Sheet of M/S. RAJKAMAL SYNTHETICS
LIMITED for the year ended 31st March, 2010, the Profit and Loss
Account and also the Cash Flow Statement for the year ended on that
date annexed there to. 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 misstatement. An audit includes
examining, on a test basis, evidence supporting the amount and
disclosures in the financial statements. An audit 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
As required by 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 & 5 of the said order.
Further to our comments in the Annexure referred to above, we report
(i) We have obtained all the information and explanations 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 the law
have been kept by the Company so far as appears from our examination of
(iii) The Balance Sheet and the Profit & Loss, Account dealt with by
this report are in agreement with the Books of Accounts;
(iv) In our opinion, the Balance Sheet, Profit and Loss Account and the
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.
(v) On the basis of written representations received from the
directors, as on, 31st, March, 2009 and taken pn record by the Board of
Directors, we report that none of the directors is disqualified as on
31st March 2010, from being appointed as a director in terms of clause
(g) of Sub-section (1) of section 274 of the Companies Act, 1956;
(vi) The Company incurred a net profit of Rs 1,95,916/- during the year
ended March 31, 2011 and total liabilities exceeded from its total
assets by Rs. 54,120,994/- The Company has repaid part of its secured
loan. For the revival of the company, Company has started its business
activities and management is confident in its revival. (vii) Subject
to the above, and notes appearing in schedule H, in our opinion, and to
the best of our information and, according to the explanations, 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 principle generally accepted in India:
(i) In the case of Balance Sheet of the State of affairs of the Company
as at 31st March, 2011
(ii) In the case of the Profit and Loss Account of the Profit of the
Company for the year ended on that date;and
(iii) In case of Cash Flow Statement, of the cash flow for the year
ended on that date.
ANNEXURE TO THE AUDITORS REPORT (REFERRED IN PARAGRAPH -2 OF OUR
REPORT OF EVEN DATE)
(i) There are no Fixed Assets with the company.
(ii) There is no stock with the company.
(iii) (a) The company has not given any advances in the nature of loan.
(b) The company had taken loan from two parties covered in the register
maintained under section 301 of the Companies Act, 1956. The maximum
amount involved during the year was Rs. 42,29,500/- and the year- end
balance of loan taken from such parties was Rs. 5,00,000/-
(c) In our opinion, the rate of interest and other terms and conditions
on which loans have been taken from/ granted to companies, firms or
other parties listed in register maintained under section 301 of the
Companies Act, 1956 are not, prima facie, prejudicial to the interest
of the company.
(d) There is no overdue amount of loans taken from directors or other
parties listed in the register maintained under section 301 of the
Companies Act, 1956.
(iv) According to information given to us there is no manufacturing
activity of the company since last 15 years. However during the course
of our audit, we have not observed any continuing failure to correct
major weaknesses in internal controls.
(v) (a) According to the information and explanations given to us, we
are of the opinion that the transactions that needed to be entered have
been entered in the register maintained under section 301 of the
Companies Act, 1956.
(b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of contracts or
arrangements entered in the register maintained under section 301 of
the Companies Act, 1956 exceeding the value of rupees five lakhs in
respect of any party during the year have been made at prices which are
reasonable having regard to the prevailing market prices at the
(vi) In our opinion and according to the information and explanations
given to us, the company has complied with the provisions of section
58A and 58AA of the Companies Act, 1956 and the Companies (Acceptance
of Deposits) Rules, 1975 the Company has not accepted deposits from the
(vii) In our opinion, the company is not required to have internal
(viii) The Company; is, not required to maintain cost records u/s.
209(1) (d) of the Companies Act, 1956. Accordingly the provision of
clause 4 (viii) of the order 2003 is not applicable to this Company.
(ix) (a) The Company is regular in depositing with appropriate
authorities undisputed statutory dues including provident fund,
employees state insurance, income tax, sales tax, wealth tax, custom
duty, excise duty and other statutory dues applicable to it.
(b)According to the information and explanations given to us, no
undisputed amounts payable in respect of income tax,wealth tax, sales
lax, customs duty, excise duty were in arrears, as at 31st March, 2010
for a period of more than six months from the date they became payable.
(c) According to the information and explanations given to us, there
are no dues of sales tax, custom duty, income tax wealth tax, excise
duty and cess which have not been deposited on account of any dispute.
(x) In our opinion, the accumulated losses of the company are more than
fifty percent of its net worth. The company has incurred cash profits
in the current year.
(xi) In our opinion and
according to the information and explanations given to us, the company
has settled with Kotak Mahindra Bank Ltd. (ICICI Bank), who was the
major secured creditor. And the settlement with the other secured
creditor namely UTI and the Debenture Holders are in process.
(xii)The company has not granted any advances in the nature of loans on
the basis of security by way of pledge of shares or other securities.
(xiii) In our opinion, the company is not a chit and fund or a
nidhi/mutual benefit fund/society. Therefore, the provisions of clause
4(xiii) of the Companies (Auditors Report) Orders, 2003 is not
applicable to this company. (xiv) In our opinion, the company is not
dealing in or trading in share, securities, debentures and other
investments, Hence, the clause (xiv) of the order is not applicable.
(xv) In our opinion, the company has not given any guarantees for loans
taken by others from banks or financial institutions. Hence, the
clause (xv) of the others is not applicable.
(xvi) In our opinion, there is no Term Loan taken by the Company.
(xvii) According to the informations and explanations given to us and
on an overall examination of the balance sheet of the company, we
report that the no funds raised on short-term basis have been used for
long-term investment. No. long-term funds have been used to finance
(xviii) The Company has not made any preferential allotment of shares
during the year.
(xix) During the period covered by our audit, the company has not
issued any debentures. Hence, the clause (xix) of the Order is not
applicable. (xx) The Company has not raised any money by public issue
during the period covered by our audit. Accordingly, the provision of
clause 4(xx) of the order, 2003 is not applicable to this company.
(xxi) Accordingly to the information and explanations given to us, no
fraud on or by the company has been noticed during the course of our
For N. K. JALAN & CO.
(N.K. JALAN) PROPRIETOR
PLACE : MUMBAI
DATED : 30th April, 2011