We have audited the attached Balance Sheet of Samrat Pharmachem Limited
as at 31st March 2012, Profit and loss account for the year ended on
that date annexed thereto, and Cash Flow Statement of the Company for
the year e:ided on that date annexed thereto. These financial
statements are the responsibility of the Company''s Management. Our
Responsibilitv 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 the 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 of
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 and 5 of the said order.
Further to our comments in the Annexure referred to above, we report
(a) we have obtained all the information and explanation, which to the
best of our knowledge and belief were necessary for the purpose 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 and profit and loss account dealt with by this
report are in agreement with the books of account;
(d) in our opinion, the Balance sheet and profit and loss account 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 31st March 2012 and taken on record by the board of
directors, we report that none ot the directors is disqualified as on
31st March 2012 from being appointed as a director in terms of clause
(g) of sub-section (1) of section 274 of the Companies Act 1956;
(f) in our opinion, and to the best of 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 accounting principles generally
accepted in India:
(i) in case of the Balance Sheet, of the state of affairs of the
Company as at 31st March 2012;
(ii) in case of Profit and Loss Account, of the profit of the Company
for the year ended on that date.
(iii) in case of cash flow statement, of cash flow of the Company for
the year ended on that date.
(i) (a) The Company is maintaining proper records showing full
particulars of, including quantitative details and situation, of fixed
(b) The management at reasonable intervals has verified the fixed
assets. We have been informed that, no material discrepancies on such
verification have been noticed. .
(c) The Company has not disposed substantial portion of its fixed
assets during the year; accordingly the going concern status of the
Company is r.ot affected.
(ii) (a) As per the records maintained, the management has conducted
verification of inventory at reasonable intervals.
(b) In our view, the procedures of physical verification of inventory
foiiowed by the management are reasonable and adequate in relation to
the size of the Company and nature of its business.
(c) In our view, the Company has maintained proper records of
inventory. The discrepancies noticed on physical verification of stocks
as compared to the book records have been properly dealt with in the
books of account on a periodical intervals.
(iii) (a) The Company has not granted any loans, secured or unsecured
to companies, firms or other parties covered in the register maintained
under section 301 of the Companies Act 1956.
(b) Since no loans are granted, the sub-clause dealing with rate of
interest and other terms and conditions of loans given by the company
are not applicable.
(c) Since no loans are granted, the sub-clause dealing with receipt of
the principal amcjnt and interest on regular basis is not applicable.
(d) Since no loans are granted, the sub-clause dealing with overdue
amount more than rupees one lakh is not applicable.
(e) The Company has not taken unsecured loans from Parties covered in
the register maintained under section 301 of the Companies Act 1956.
(f) Since no loans are taken, the sub-clause dealing with rate of
interest and other terms and conditions of loans given by the company
are not applicable.
(g) Since no loans are taken, the sub-clause dealing with payment of
the principal amount and interest on a regular basis is not applicable.
(iv) In our view, there is an adequate internal control system
commensurate with the size of the Company and nature of its business,
for the purchase of inventory and fixed assets, and for sale of goods
and services. In our view, there has been no continuing failure to
correct major weakness in internal control systems of the Company.
(v) (a) According to the information and explanation given to us and on
the basis of representation received from the Management, particulars
of contracts or arrangements referred to in Section 301 of the Act have
been entered in the register required to be maintained under that
(b) According to the information and explanation given to us and on the
basis of representation received from the Management, each of these
transactions made in pursuance of such contracts or arrangements have
been made at prices which are reasonable having regard to the
prevailing market prices at the relevant time.
(vi) The Company has not accepted any deposits from public within the
meaning of the provisions of section 58A and section 58AA or any
relevant provisions of the Companies Act, 1956 and the rules made there
under. We have been informed by the management that there has been no
order passed by the Company law Board or National Company Law Tribunal
or Reserve Bank of India or any Court or any other Tribunal on the
Company with respect to compliance of the provisions of section 58A or
58AA or any other provisions of the Companies Act 1956. ''
(vii) On the basis of internal audit reports broadly reviewed by us, we
are of the opinion that, the coverage of internal audit functions
carried out by an Internal Audit Department of the Company is adequate
and commensurate with the size of the Company and nature of its
(viii) We have been infcrmed by the management that, the Central
Government has not prescribed the method of maintenance of cost records
u/s. 209 (1) (d) of the Companies Act, 1956 to the industry to which
the Company pertains.
(ix) (a) We have been informed by the management that, the Company is
generally regular in depositing all undisputed statutory dues, with the
appropriate authorities and there have been no material arrears of
outstanding dues as at the last day of this financial year for more
than six months from the date they became payable except the State
profession tax of Company and Advance Income Tax that have not been
paid by the Company.
(b) In our opinion and according to the information and explanation
given to us, there are no dues of Income tax, Sales tax, Wealth Tax,
Service tax, Custom Duty, Excise Duty or Cess, as applicable to it
which have not been deposited on account of any dispute.
(x) There are no accumulated losses at the end of the financial year.
Also, the Company has not reported any cash losses during the year or
immediately preceding financial year.
(xi) As informed to us by the management, the Company has not defaulted
in repayment of any dues to financial institution or banks; whereas
there are no debenture holders.
(xii) The Company has not granted loans and advances on the basis of
security by way of pledge of shares, debentures and other securities;
accordingly, there is no necessity as to maintaining documents and
records in this respect.
(xiii) The provisions of any special statute in respect of chit fund,
nidhi, mutual benefit funds or societies are not applicable to the
(xiv) The Company has not dealt or traded in shares, securities,
debentures and other investments; hence maintenance of records for the
same does not arise.
(xv) The management has informed us that, the Company has not given any
guarantee for loans taken by others from any bank or financial
(xvi) As per the explanation given by the management, the term loans
were applied for the purposes for which they were obtained.
(xvii) As explained to us by the management, there were no funds that
were raised on a short-term basis, which have been applied for
(xviii) The Company has not made any preferential allotment of shares
to parties and companies covered in the register maintained under
section 301 of the Companies Act 1956.
(xix) The Company has not issued any debentures; hence no security or
charges have been created in respect of the same.
(xx) The Company has not made any public issues of shares during the
year; hence disclosure requirement as to end utilization of public
issue money is not required.
(xxi) As informed by the management, there has not been noticed or
reported any fraud on or by the Company during the year.
For Shah,Shah & Shah
Mumbai: 30th May 2012
M. No. 049361