1. We have audited the attached Balance Sheet of M/s Ansal Housing &
Construction Ltd. as at 31st March 2010 and also the Proft and Loss
Account and the Cash Flow Statement for the year ended on that date
annexed thereto. These fnancial statements are the responsibility of
the Companys management. Our responsibility is to express an opinion
on these fnancial 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
fnancial statements are free of material misstatement. An audit
includes examining, on a test basis, evidences supporting the amounts
and disclosures in the fnancial statements. An audit also includes
assessing the accounting principles used and signifcant estimates made
by management as well as evaluating the overall fnancial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the Companies (Auditors Report) Order, 2003 as
amended by (Amendment) Order, 2004 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 specifed
in paragraphs 4 and 5 of the said order.
4. Without qualifying our opinion, we have to state that:
a) The Company has advanced Rs. 820.97 lacs to certain
parties/collaborators which have been accounted for as advances for
land. In the absence of underlying contracts/agreements in this
regard, we have relied on the managements representation that the
advances are good and recoverable (Note No. 4 of Schedule 15).
b) Commission payable to non-executive directors amounting to Rs. 10 lacs
is subject to approval by the Central Government (Note No. 12(b) of
Schedule 15).
5. Further to our comments in the Annexure referred to in paragraph 3
and 4 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 purpose of our
audit.
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 the
books.
c) The Balance Sheet, Proft 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, Proft and Loss Account and Cash
Flow Statement dealt with by this report comply with accounting
standards referred to in sub section (3C) of Section 211 of the
Companies Act, 1956.
e) On the basis of the written representations received from the
directors as on 31st March, 2010 and taken on record by the Board of
Directors, we report that none of the directors is disqualifed as on
31st March 2010 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 our information and according to
the explanations given to us, the accounts read with accounting
policies and other notes, give the information required by the
Companies Act, 1956, in the manner so required and give 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 afairs of the
Company as at 31st March, 2010 and ;
ii) in the case of the Proft and Loss Account, of the proft for the
year ended on that date.
iii) in the case of the cash fow statement, of the cash fows for the
year ended on that date.
Annexure to the Auditors Report (Referred to in Paragraph 3 Thereof)
Based on the audit procedures performed for the purpose of reporting a
true and fair view on the Financial Statements of the Company and
taking into consideration the information and explanations given to us
and the books and accounts and other records examined by us in the
normal course of audit, we report that:
1. a) The Company has maintained proper records showing full
particulars including quantitative details and situation of fxed
assets.
b) As explained to us, the fxed assets are physically verifed by the
management in a phased periodical manner, which in our opinion is
reasonable, having regard to the size of the Company and nature of its
assets. No material discrepancies were noticed on such physical
verifcation.
c) The Company has not disposed of a substantial part of the fxed
assets during the year and hence the going concern assumption is not
afected.
2. a) As per information and explanations given to us, the inventory
of building materials, stores and spares, restaurants provisions,
beverages etc. and fats/shops/ houses etc. at major locations has been
physically verifed during the year by the management. In our opinion,
the frequency of verifcation is reasonable. According to the
information and explanations given to us, keeping in view the nature of
the operations of the Company, inventory of work-in-progress can not be
physically verifed.
b) In our opinion and according to the explanations given to us, the
procedures of physical verifcation of inventories followed by the
management are reasonable and adequate in relation to the size of the
Company and the nature of its business.
c) The Company has maintained proper records of inventory. As
explained to us, there were no material discrepancies noticed on
physical verifcation of inventory as compared to the book records.
3. a) The Company has granted unsecured interest free loan to a wholly
owned subsidiary company. The maximum amount involved during the year
and year end balance of loan was Rs. 500 lacs.
b) The loan is interest free being given to a wholly owned subsidiary.
c) In respect of loan given to the wholly owned subsidiary, there is no
stipulation regarding repayment.
d) The Company has not taken any loans, secured or unsecured, from
companies firms or other parties covered in the register maintained
under section 301 of the Companies Act, 1956.
4. 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 the nature of its
business for purchase of inventory and fxed assets and for sale of
goods and services. During the course of audit, we have neither come
across nor have been informed of any continuing failure to correct
major weakness in the aforesaid internal control procedures.
5. a) According to information and explanation given to us, we are of
the opinion that the transactions that need to be entered into the
register in pursuance of section 301 of the Companies Act, 1956 have
been so entered.
b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of contracts or
arrangements entered into the register in pursuance of section 301 of
the Companies Act, 1956 and exceeding the value of Rs. fve lakhs 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.
6. In our opinion and according to the information and explanations
given to us, the Company has complied with the provisions of sections
58A and 58AA or any other relevant provisions of the Companies Act,
1956 and the Companies Acceptance of Deposits Rules, 1975. According to
the information and explanations given to us, in this regard, no order
under the aforesaid sections has been 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.
7. In our opinion the Company has an internal audit system
commensurate with the size and nature of its business.
8. The Central Government of India has not prescribed the maintenance
of cost records U/s 209 (1) (d) of the Companies Act, 1956 for any of
the products of the Company.
9. a) According to the information and explanations given to us, and
records of the Company examined by us, in our opinion, the Company is
generally regular in depositing with appropriate authorities statutory
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 statutory dues, wherever
applicable.
b) According to the information and explanations given to us and the
records of the Company examined by us, the disputed amounts payable in
respect of income-tax, sales tax, wealth tax, custom tax and excise
duty/cess not deposited with the appropriate authorities are as
follows:
Nature of dues Amount Period to which
the amount Forum where dispute is
pending
(Rs. In
lacs) relates
Assessment year
Wealth Tax 0.49 2004-05 CWT (Appeals)-I, New Delhi.
Sales Tax 12.38 2003-04 and Tribunal, Commercial
Tax, Ghaziabad.
31.50 2004-05
Provident Fund 66.78* June 1994 to
March 2006 Employees Provident Fund
Appellate Tribunal
Employee State
Insurance 2.97 June 1998 to
April 1999 District Courts,
Tees Hazari, Delhi
* In respect of provident fund dues, the company has paid Rs. 16.69 lacs
against the above demand.
10. The Company does not have any accumulated losses and has not
incurred cash losses during the fnancial year covered by our audit and
the immediately preceding fnancial year.
11. According to the records of the Company examined by us and the
information and explanations given to us, in a few cases during the
year there have been delays in repayment of dues to banks amounting to
Rs. 600 lacs ranging from 15 days to 112 days and to fnancial
institutions amounting to Rs. 600 lacs ranging from 47days to 60 days.
The defaults pertain to repayments due upto 15.8.2009 which have been
regularized by the Company by October, 2009.
12. According to the information and explanation given 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.
13. The provisions of any special statute applicable to chit fund /
nidhi / mutual beneft fund / societies are not applicable to the
Company.
14. In our opinion, the Company is not a dealer or trader in shares,
securities, debentures and other investments.
15. In our opinion and based on the information and explanations given
to us, the company has not given any guarantee for loans taken by
others except for its wholly owned subsidiary from banks or fnancial
institutions during the year.
16. According to the information and explanations given to us and the
records examined by us, terms loans obtained for fnancing real estate
projects, in our opinion, on an overall basis, were used for the real
estate projects.
17. On the basis of an overall examination of the Balance sheet of the
Company, in our opinion and according to the information and
explanations given to us, there are no funds raised on short term basis
which have been used for long term investments.
18. The Company has made preferential allotment of shares during the
year to parties and companies covered in the Register maintained under
section 301 of the Companies Act, 1956. In our opinion and according to
the information and explanations given to us, the price at which shares
have been issued to these parties is not prejudicial to the interest of
the Company.
19. The Company has not issued any debentures during the year.
20. The company has not raised any money by public issue during the
year.
21. According to the information and explanations given to us, during
the year, no fraud on or by the Company has been noticed or reported
during the course of our audit.
For Khanna & Annadhanam
Chartered Accountants
(Firm Registration No. 1297N)
Place : New Delhi
Date : 31st May, 2010
(Jitender Dhingra)
Partner
Membership No. 90217
