We have audited the attached Balance Sheet of SHRI NIRANJAN AYURVED
BHAWAN LIMITED, as at 31st March, 2002, and the Profit and Loss Account
of the Company for the year ended on that date and report as follows:-
(1) As required by the Manufacturing and other Companies (Auditors
Report) Order, 1988 issued by the Company Law Board in terms of Section
227(4A) of the Companies Act, 1956, we enclose in the Annexure a
statements on the matters specified in paragraphs 4 and 5 of the said
order, on the basis of such checks of the book and records of the
Company as we considered appropriate and the information and
explanation given to us during the course of our audit.
(2) We are unable to comment on
(i) No provision is made in respect of Gratuity and Leave encashment
benefit as the same is accounted on cash basis.
(ii) Refer Note No: II (I)(3), III & IV of Schedule M to the balance
sheet in respect of non-provision of interest due to which losses and
liabilities are under stated Amount unascertainable.
(3) FURTHER TO OUR COMMENTS REFERRED TO IN PARAGRAPH (1) ABOVE WE
A. Subject to the forgoing remarks in paragraphs (2) above and
consequential cumulative effect thereof on the Companys net worth
liabilities and losses for the period which are not capable of
quantification at present and also subject to our comments in the
Annexure referred to in paragraphs 1 above.
B. (a) We have obtained all the information and explanations which to
the best of our knowledge and belief were necessary for the purposes of
(b) In our opinion, proper books of accounts are required by law have
been kept by the Company, so far as appears from our examination of the
(c) The Balance Sheet and the Profit, and Loss Account dealt with by
this Report are in agreement with the books of accounts.
(d) In our opinion, the Balance Sheet and Profit & Loss Account comply
with the Accounting Standards referred to in sub-section (3C) of
Section 211 of the Companies Act, 1956 to the extent applicable. Except
in the case of accounting for the Retirement benefits as per AS -
issued by Institute of Chartered Accountants of India
(e) On the basis of the written representation received from the
directors and taken on the records by the Board of Directors, we report
that none of the directors is disqualified as on March, 31st, 2002 from
being appointed as 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 our information and according to
the explanations given to us, the accounts give the information
required by the Companies Acts, 1956 in the manner so required and
subject to note no II (2), 11(3), III & IV of schedule `M to the
balance sheet regarding non-provision of liability of gratuity of staff
and non-provision of Bank Interest give a true and fair view.
In the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March, 2002.
In the case of the Profit and Loss Account, of the LOSS of the Company
for the year ended on 31st March, 2002.
ANNEXURE TO THE AUDITORS REPORT
(* Referred to in paragraph 1 of our Report of even date on the
accounts of SHRI NIRANJAN AYURVED BHAWAN LIMITED, for the Year Ended
31st March, 2002).
1. The Company has maintained proper records to show full particulars
including quantitative details and situations of the Fixed Assets. We
are informed by the Management the fixed assets of the Company have
been physically verified and there were no serious discrepancies on
such verification. None of the fixed assets have been revalued during
2. As explained to us, the stock of finished goods and raw material
has been physically verified by the management at reasonable intervals
during the year
3. In our opinion and according to the information and explanation
given to us the procedures of physical verification of stock followed
by the management are reasonable and adequate in relation to the size
of the Company and the nature of business:
4. No material discrepancies have been noticed by management on
physical verification of stocks as compared to book records.
5. In our opinion and on the basis of our examination of the valuation
of stocks such valuation is fair, proper and in accordance with the
normally accepted accounting principle and is on the same basis as in
the previous year.
6. The Company has not taken loans from Companies, firms or other
parties listed in the register maintained under section 301 of the
Companies Act, 1956 and or from the Companies under the same management
as defined under sub-section (1B) of Section 370 of the Companies Act,
7. The Company has not given any, interest free loans or advances to
Companies, firms and other parties listed in the register maintained
under section 301 and 370(1-B) of the Companies Act 1956.
8. Loans and advances free of interest have been given to the
employees and they are repaying the amount as stipulated or as
9. According to the information and explanation given to us the
Company has Internal Control procedure commensurate with the size of
the Company and nature of its business for the purchases of stores, raw
material including components, plant and machinery/equipment and other
assets and for the sale of goods.
10. The Company has purchased of stores, raw materials including
components in excess of Rs. 50,000/- in value from firms, subsidiaries
or Companies or other parties in which Directors are interested as
listed in the register maintained under section 301 of the Companies
Act, 1956. However, in the absence of details about comparative
prices, we are not in a position to comment whether the rates at which
they are purchased are prima facie prejudicial to the interest of the
11. As explained to us, unserviceable or damaged stores, raw material
of finished goods are determined by the Company and adequate provision
for loss has been made in the accounts.
12. The Company has not accepted deposits from the public during the
year to which the provisions for Section 58-A of the Companies Act,
1956 and the rules made thereunder are not applicable. Deposits
accepted in the earlier years, (when the rules regarding Acceptance of
Deposits were not applicable of the Company due to exemption available
on account of Company being Small Scale Industrial Unit) have been
adjusted and transferred to Share Application Account which are pending
13. The Company has maintained reasonable records for the sale and
disposal of scraps which is accounted for on realisation basis. The
Company has no by product.
14. The Company has an internal audit system commensurate with its size
and nature of its business.
15. During the year, the Company was not regular in depositing
provident fund dues. The Company has not paid Provident Fund dues of
the workers for the period February & March, 2002. The provision of
Employees State Insurance Fund Scheme are not applicable to the Company
as per information given to us.
16. According to the information and explanations given to us, there
are no undisputed amount payable in respect of Income Tax, Wealth Tax,
Sales Tax, Custom Duty and Excise Duty as which are outstanding as on
31.3.2002 for the period of more than six months from the date they
became payable, except in the case of Professional Tax of Rs. 25,980/-
which has not been paid.
17. On the basis of our examination of the books and according to the
information and explanations given to us, no personal expenses have
been charged to Revenue Account other than those payable under
contractual obligations or in accordance with generally accepted
18. The Company is not a Sick Industrial Company within the meaning of
clause (o) of sub-section (1) of section 3 of the Sick Industrial
Companies (Special Provisions) Act, 1985.
19. As explained to us, other clauses of the order are not applicable
to the Company.
For SUNIL VENKAWALA & ASSOCIATES
Mumbai, dated 3rd August, 2002