1) We have audited the attached Balance Sheet of RTS POWER CORPORATION
LIMITED (the Company) as at 31st March, 2012 and also the annexed
Profit & Loss Statement and Cash Flow Statement for the year ended on
that date annexed hereto. 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 examination, 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 of India in terms of Sub Section (4a) of
Section 227 of the Companies Act, 1956 and on the basis of such checks
as we considered appropriate and according to the information and
explanations given to us during the course of our audit, we enclose in
the Annexure a statement on the matters specified in paragraphs 4 and 5
of the said Order as far as applicable:
4) Further to above -
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 accounts as required by law have
been kept by the Company so far as appears from our examination of the
iii) The Branch Auditor''s Report of branches not visited by us, have
been properly dealt with in preparing our report.
iv) The Balance Sheet, the Profit & Loss Statement and Cash Flow
Statement dealt with by the report are in agreement with the books of
accounts of the Company.
v) In our opinion, the Profit and Loss Statement, Balance Sheet and
Cash Flow Statement comply with the mandatory Accounting Standards
referred to in Section 211(3C) of the Companies Act, 1956 to the extent
vi) 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 Directors is disqualified as on 31st March,
2012 from being appointed as a Director in terms of Section 274(1)(g)
of the Companies Act, 1956.
vii) In our opinion and to the best of our information and according to
the explanations given to us, the said accounts read with significant
accounting policies & notes thereon 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 the Balance Sheet, of the state of affairs of the
Company as at 31st March, 2012
b) In the case of the Profit & Loss Statement, of the Profit for the
year ended on that date AND
c) In the case of the Cash Flow Statement, of the Cash Flows for the
year ended on that date
ANNEXURE TO THE AUDITORS'' REPORT REFERRED TO IN OUR REPORT OF EVEN DATE
i) The Company is maintaining proper records showing full particulars,
including quantitative details and situation of fixed assets. The
management has physically verified fixed assets during the year- end
and no discrepancy was noticed on such verification. In our opinion,
the frequency of verification is reasonable. There was no substantial
disposal of fixed assets during the year.
ii) Physical verification of inventory has been conducted at reasonable
intervals by the management. 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. The Company is maintaining proper records of inventory.
Discrepancies noticed on physical verification as compared to books
records, which were not material, have been properly dealt with in the
books of accounts.
iii) a) As informed , the Company has not granted any loan, secured or
unsecured, to companies, firms
or parties listed in the register maintained under Section 301 of the
Companies Act, 1956. Consequently, the requirements of Clauses (iii)
(b), (iii) (c) and (iii) (d) of paragraph 4 of the Order are not
b) The Company has taken unsecured loan from a party and fifteen
companies covered in the register maintained under Section 301 of the
Companies Act 1956. The maximum amount involved during the year was Rs.
1748.93 lacs & the year-end balance of such loan taken was Rs. 1277.49
c) In our opinion and according to information and explanation given to
us, the rate of interest and other terms and conditions on which loan
has been taken from companies and a party listed in register maintained
under Section 301 of the Companies Act 1956 are not prima facie
prejudicial to the interest of the Company.
d) The Company is regular in repayment of principal as per
stipulations, wherever made and is regular in payment of Interest.
iv) In our opinion and according to the information and explanations
given to us, there is an adequate internal control procedure
commensurate with the size of the company and nature of its business
for 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 weakness in internal control.
v) a) In our opinion and according to the information and explanations
given to us, the particulars of
contracts or arrangements referred to in Section 301 of the Companies
Act, 1956 have been duly entered in the register required to be
maintained under the Section.
b) In our opinion and according to information and explanations given
to us, the transactions made in pursuance of such contracts or
arrangements and exceeding the value of Rs. 5,00,000/- in respect of
each party during the year have been made at prices which are
reasonable having regard to the prevailing market prices at the
relevant time except in cases where comparison could not be made in
absence of similar transactions with other parties.
vi) In our opinion & according to the information and explanations
given to us, the Company has not accepted any deposit from public
during the year and therefore, the provisions contained in Section 58A,
58AA or any other relevant provisions of the Act and Rules framed
thereunder are not applicable to the Company.
vii) In our opinion, the Company has an internal audit system
commensurate with its size and nature of its business.
viii) According to the information given to us, the Central Government
has prescribed maintenance of cost records under Section 209 (1) (d) of
the Companies Act, 1956 for products of the Company. We have broadly
reviewed the accounts and records of the Company in this connection and
are of the
opinion, that prima-facie, the prescribed accounts and records have
been made and maintained. We have not, however, carried out a detailed
examination of the same to determine whether they are accurate and
ix) a) The Company is regular in depositing with appropriate
authorities undisputed statutory dues
including provident fund, employees state insurance, income tax, sales
tax, customs duty, service tax, cess and other statutory dues
applicable to it. According to the information and explanations given
to us, no undisputed amounts payable in respect of income tax, wealth
tax, sales tax, customs duty, excise duty, service tax or cess were in
arrears, as at the close of the year for a period of more than six
months from the date they became payable.
b) According to the information and explanations given to us, there are
no dues of sales tax, income tax, customs duty, wealth tax, excise
duty, service tax and cess, which have not been deposited on account of
any dispute except the following :
Name of Nature of Amount Period From where
Statute Due (Rs.) dispute is
Tax Entry Tax 11,34,451/- For
on Entry of
Years Rajasthan High
Goods in Court Stayed
Local Area 50% hence
Act, 1999 50% deposited
during the year.
Tax Entry Tax 22,38,619/- For
Previous H''ble Rajasthan
on Entry of Years High Court
Goods in Judgement for
Local Area 50% deposit
Tax Income Tax 20,57,170/- A.Y.
Act, 1961 Commissioner of
Income Tax Income Tax 22,104/- A.Y.
Act, 1961 Commissioner of
x) The Company does not have any accumulated losses. The Company has
not incurred any cash losses in the current financial year and in the
immediately preceding financial year.
xi) As per the information and explanations furnished to us and our
verification of records of the Company, the Company has made delays in
repayment of dues to banks. The period and amount of delay are as
of dues Period of Delay Amount (Rs.)
Interest 30 to 90 Days 510,797
Interest 90 to 180 Days 149,512
The Company has no dues to financial institutions. The Company has no
xii) As informed and explained 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.
xiii) In our opinion and according to the information and explanations
given to us, the nature of activities of the Company does not attract
any special statute applicable to chit fund/nidhi/mutual benefit
xiv) The Company does not have any dealing or trading in shares,
securities, debentures or other investments, and accordingly Clause
(xiv) of Para 4 of the Order is not applicable.
xv) According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from bank
or financial institutions.
xvi) Term loans obtained by the Company were applied for the purpose
for which the loans were obtained.
xvii) 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
xviii) The Company has made preferential allotment of 3,80,000 Equity
Shares of Rs 10/- each at a premium of Rs. 26 per share to a company
covered in the Register maintained under Section 301 of the Companies
Act, 1956.The Equity Shares have been issued based on the price
determined as per SEBI Guidelines and are therefore not prejudicial to
the interest of the Company..
xix) The Company has not issued any debenture during the year.
xx) The Company has disclosed the end use of money raised by issue of
Equity Shares on Preferential basis and the same has been verified by
us. (Refer Note No. 33)
xxi) During the course of our examination of the books and records of
the Company carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
fraud on or by the Company, noticed or reported during the year, nor we
have been informed of any such case by the management.
For A. C. Bhuteria & Co.
Firm Registration No. 303105E
2, India Exchange
Place Mohit Bhuteria
Kolkata - 700 001 Partner
Dated : 29th August, 2012 Membership No. 56832