1. We have audited the attached Balance Sheet of TATA CHEMICALS
LIMITED (the Company) as at 31st March, 2011, the Profit and Loss
Account and the Cash Flow Statement of the Company for the year ended
on that date, both annexed thereto. 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.
2. We conducted our audit in accordance with the 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 misstatements. An audit
includes examining, on a test basis, evidence supporting the amounts
and the disclosures in the financial statements. An audit also includes
assessing the accounting principles used and the significant estimates
made by the Management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable
basis for our opinion.
3. As required by the Companies (Auditors Report) Order, 2003 (CARO)
issued by the Central Government in terms of Section 227(4A) 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.
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
audit;
(b) in our opinion, proper books of account as required by law have
been kept by the Company so far as it appears from our examination of
those books;
(c) the Balance Sheet, the Profit and Loss Account and the Cash Flow
Statement dealt with by this report are in agreement with the books of
account;
(d) in our opinion, the Balance Sheet, the Profit and Loss Account and
the Cash Flow Statement dealt with by this report are in compliance
with the Accounting Standards referred to in Section 211(3C) of the
Companies Act, 1956;
(e) 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 principles
generally accepted in India:
(i) in the case of the 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 the case of the Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
5. On the basis of the written representations received from the
Directors as on 31st March, 2011 taken on record by the Board of
Directors, none of the Directors is disqualified as on 31st March, 2011
from being appointed as a director in terms of Section 274 (1) (g) of
the Companies Act, 1956.
ANNEXURE TO THE AUDITORS REPORT
(Referred to in paragraph 3 of our report of even date)
(i) Having regard to the nature of the Companys
business/activities/result/transactions, etc., clauses (x), (xii),
(xiii), (xiv) and (xix) of paragraph 4 of CARO are not applicable.
(ii) In respect of its fixed assets:
(a) The Company has maintained proper records showing full particulars,
including quantitative details and situation of fixed assets.
(b) The fixed assets were physically verified during the year by the
Management in accordance with a regular programme of verification
which, in our opinion, provides for physical verification of all the
fixed assets at reasonable intervals. According to the information and
explanations given to us, no material discrepancies were noticed on
such verification.
(c) The fixed assets disposed off during the year, in our opinion, do
not constitute a substantial part of the fixed assets of the Company
and such disposal has, in our opinion, not affected the going concern
status of the Company.
(iii) In respect of its inventory:
(a) As explained to us, the inventories were physically verified during
the year by the Management at reasonable intervals.
(b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the Management were reasonable and adequate in relation to
the size of the Company and the nature of its business.
(c) In our opinion and according to the information and explanations
given to us, the Company has maintained proper records of its
inventories and no material discrepancies were noticed on physical
verification.
(iv) The Company has neither granted nor taken any loan, secured or
unsecured, to/from companies, firms or other parties listed in the
Register maintained under Section 301 of the Companies Act, 1956.
(v) In our opinion and according to the information and explanations
given to us, having regard to the explanations that some of the items
purchased are of special nature and suitable alternative sources are
not readily available for obtaining comparable quotations, there is an
adequate internal control system commensurate with the size of the
Company and the nature of its business with regard to purchases of
inventory and fixed assets and the sale of goods and services. During
the course of our audit, we have not observed any major weakness in
such internal control system.
(vi) To the best of our knowledge and belief and according to the
information and explanations given to us, there were no contracts or
arrangements the particulars of which needed to be entered into the
register maintained under Section 301 of the Companies Act, 1956.
(vii) According to the information and explanations given to us, there
are no deposits from the public in terms of Sections 58A and 58AA or
any relevant provision of the Companies Act, 1956.
(viii) In our opinion, the Company has an adequate internal audit
system commensurate with the size and the nature of its business.
(ix) We have broadly reviewed the books of account maintained by the
Company pursuant to the rules made by the Central Government for the
maintenance of cost records under Section 209(1)(d) of the Companies
Act, 1956 in respect of certain products manufactured by the Company
viz., Cement, Caustic Chlorine, Soda Ash, Ammonia, Urea, Diammonium
Phosphate, Nitrogen Phosphorous Potash, Single Super Phosphate,
Sulphuric Acid and Sodium Tripolyphosphate and are of the opinion that
prima facie the prescribed accounts and records have been made and
maintained. We have, however, not made a detailed examination of the
records with a view to determining whether they are accurate or
complete. To the best of our knowledge and according to the information
and explanations given to us, the Central Government has not prescribed
the maintenance of cost records for any other product of the Company.
(x) According to the information and explanations given to us in
respect of statutory dues:
(a) The Company has generally been regular in depositing undisputed
dues, including Provident Fund, Investor Education and Protection Fund,
Employees State Insurance, Income-tax, Sales Tax, Wealth Tax, Service
Tax, Custom Duty, Excise Duty, Cess and other material statutory dues
applicable to it with the appropriate authorities.
(b) There were no undisputed amounts payable in respect of Income-tax,
Wealth Tax, Custom Duty, Excise Duty, Cess and other material statutory
dues in arrears as at 31st March, 2011 for a period of more than six
months from the date they became payable.
(c) Details of dues of Income-tax, Sales Tax, Wealth Tax, Service Tax,
Custom Duty, Excise Duty and Cess which have not been deposited as on
31st March, 2011 on account of disputes are given below:
Statute Nature of Dues Forum where Period to which Amount
dispute is the amount involved
pending relates (Rs. in
crores)
Central Sales Sales Tax High Court 1997-2001 7.48
Tax Act,1956
and (Central and State)Tribunal 1991-92, 1994-97,
Sales Tax
Act of and Value Added 1999-2000 and
various
states Tax 2001-03 9.69
Appellate 1995-99 and 5.91
authority upto 2001-2008
Commissioners
level
Customs
Act, 1962 Customs Duty Supreme Court 1991-92 3.96
Tribunal 2001-04 0.96
Appellate
authority 1987-88, 1992-93 0.19
upto Commissi
-oners and 2001-02
level
Central
Excise Excise Duty Supreme Court 1974-1980 and 0.31
Act, 1944 1981-85
Tribunal 1985-88, 1994-97 0.89
Appellate
authority 1994-2000 and 66.90
upto
Commissioners 2004-09
level
Income Tax
Act, 1961 Income Tax Appellate
authority 2001-02, 2002-03,125.58
upto
Commissioners 2003-04, 2004-05,
level 2005-06, 2007-08
Total 221.87
(xi) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in the repayment of dues to
banks, financial institutions and debenture holders.
(xii) In our opinion and according to the information and explanations
given to us, the terms and conditions of the guarantees given by the
Company for loans taken by others from banks and financial institutions
are not prima facie prejudicial to the interests of the Company.
(xiii) In our opinion and according to the information and explanations
given to us, the term loans have been applied for the purposes for
which they were obtained.
(xiv) In our opinion and according to the information and explanations
given to us and on an overall examination of the Balance Sheet, we
report that funds raised on short-term basis have not been used during
the year for long- term investment.
(xv) According to the information and explanations given to us, the
Company has made preferential allotment of shares to one of the
Companies covered in the Register maintained under Section 301 of the
Companies Act, 1956 at a price which is prima facie not prejudicial to
the interests of the Company.
(xvi) The Company has not raised any money by way of a public issue
during the year.
(xvii) To the best of our knowledge and according to the information
and explanations given to us, no fraud by or on the Company has been
noticed or reported during the year.
For DELOITTE HASKINS & SELLS
Chartered Accountants
(Registration No.117366W)
Nalin M. Shah
(Partner)
(Membership No. 15860)
MUMBAI, 23rd May, 2011
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