1. We have audited the attached Balance Sheet of Sumeru Industries
Ltd. (the Company) as at March 31 2011 and the related Profit and
Loss Account and the Cash Flow Statement of the Company for the year
ended on that date 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 have 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 (Auditor''s Report) Order, 2003 as
amended by the Companies (Auditor''s Report) (Amendment) Order, 2004
(together the ''Order'') issued by the Central Government of India in
terms of sub-section (4A) of Section 227 of the Companies Act, 1956 of
India (the Act) and on the basis of such checks as we considered
appropriate and according to the information and explanations given to
us, we set out 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 purposes 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, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account;
(d) in our opinion, the Balance Sheet, Profit and loss Account and Cash
Flow Statement dealt with by this report comply with the accounting
standards referred to in sub-section (3C) of Section 211 of the Act;
(e) on the basis of written representations received from the
directors, as on March 31,2011, and taken on record by the Board of
Directors, we report that none of the directors is disqualified as on
March 31, 2011 from being appointed as a director in terms of clause
(g) of sub-section (1) of section 274 of the Act;
(f) in our opinion and to the best of our information and according to
the explanations given to us, the said accounts together with the notes
thereon and attached thereto give in the prescribed manner the
information required by the Act and give a true and fair view in
conformity with the accounting principles generally accepted
(i) in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31,2011; (ii) in the case of the Profit and Loss
Account, of the profit for the year ended on that date; and '' (in) in
the case of the Cash Flow Statement, of the cash flows for the year
ended on that date.
ANNEXURE TO AUDITOR''S REPORT
[Referred to in paragraph 3 of the Auditor''s Report of even date to the
members of Sumeru Industries Ltd. on the accounts for the year ended
March 31, 2011]
1. Ca) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
(b) According to the information and explanations given to us, the
fixed assets of the Company were physically verified by the Management
according to a phased program designed to cover all the items over a
period of three years, which in our opinion, is reasonable having
regard to the size of the Company and the nature of its assets. There
were no discrepancies noticed during the year.
(c) During the year, the Company has not disposed of any asset. In our
opinion the status of the company continues to be going concern.
2. (a) The Company does not hold any physical inventory as at the end
of the year. Hence, para 2(b),(c) are not applicable.
3. The company has neither granted nor taken loans, secured or
unsecured to / from companies, firms or other parties covered in the
register maintained under Section 301 of the Act. As the Company has
not granted / taken any loans, secured or unsecured, to / from
companies, firms etc., listed in the register maintained under Section
301 of the Act, paragraphs 4(111) (a) to (g) of the Order, are not
4. in our opinion and according to the information and explanations
given to us, having regard to the explanations, there is 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 the sale of goods and/or services. Further, on the basis
of our examination of the books and information and as per the
explanations given to us, we have neither come across nor have we been
informed of any instance of continuing failure to correct major
weaknesses in the aforesaid internal control system.
5. Based on the audit procedures applied by us and according to the
information and explanations provided by the management, we are of the
opinion that no transactions need to be entered into the register
maintained under Section 301 of the Act. Consequently, requirement of
clause (v,b) of paragraph 4 of the order is not applicable.
6. The company has not accepted any deposits under the provision of
Sections 58A and 58AA of the Act and the rules framed there under.
7. In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
8. To the best of our knowledge and as explained, the Central
Government has not prescribed the maintenance of cost records under
clause (d) of sub-section (1) of section 209 of the Companies Act, 1956
for the products of the Company.
9. (a) According to the information and explanations given to us and
according to the books and records examined by us, in our opinion, the
Company wherever applicable, is generally regular in depositing the
undisputed statutory dues In respect of provident fund, investor
education and protection fund, employees state insurance, income-tax,
sales-tax, wealth tax, customs duty, excise duty, cess, service tax and
other material statutory dues as applicable with the appropriate
Further, since the Central Government has till date not prescribed the
amount of cess payable under section 441A of the Companies Act, 1956,
the same is not applicable to the company we, therefore, do not Comment
upon its requirements.
(b) According to the information and explanations given to us, no
undisputed amounts payable in respect of Income Tax, Wealth Tax, Sales
Tax, Service Tax, Customs Duty, Excise Duty and Cess were in arrears,
as at March 31,2011 for a period of more than six months from the date
they became payable.
(c) According to the information and explanation given to us, The
following Matters have been decided In favor of the company, although
the Department has preferred appeals at higher level:
Particular Period to which Forum where the Amount
The amount relates dispute is pending (Rs.)
Interest Tax 1995-96 High Court 312003
Interest Tax 1996-97 High Court 835549
Interest Tax 1997-98 High Court 764757
10. The Company does not have accumulated losses as at the end of the
year and the Company has not incurred cash losses during the current
year and immediately preceding financial year.
11. Based on the information and explanations given to us, the Company
has not availed of any credit facilities from any financial
institutions or banks during the year. The Company has not borrowed any
sums through debentures. Accordingly, clause 4(xi) of the Order is not
12. The Company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
13. In our opinion, considering the nature of activities carried on by
the Company during the year, the provisions of any special statute
applicable to chit fund/nidhi/mutual benefit fund/societies are not
applicable to the Company.
14. According to the information and explanations given by the
management, the Company has not indulged in dealing or trading in
shares, securities, debentures and other investments.
15. In our opinion and according to the information and explanations
given to us, the Company has not given any guarantees for loans taken
by others from banks or financial institutions during the year.
16. The company has not obtained any term loan during the year.
17. According to the information and explanations given to us and on
an overall examination of 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 short term
18. 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 during the year.
19. There are no debentures issued and outstanding at the year end.
20. The Company has not raised any money by public issue during the
21. 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
have been informed of such case by the Management.
For Nitin K. Shah & Co.
Firm Reg. NO.107140W
(Nitin K. Shah)
M. No. 012398