We have audited the attached Balance Sheet of Ansal Properties &
Infrastructure Limited as at March 31, 2012 and also the Statement of
Profit and Loss and the Cash Flow Statement of the Company for the year
ended on that date, annexed thereto. 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.
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 the management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable
basis for our opinion.
As required by the Companies (Auditors' Report) Order, 2003 as amended
by the Companies (Auditors' Report) (Amendment) Order, 2004
(collectively the Order) issued by the Central Government of India in
terms of Section 227 (4A) of the Companies Act, 1956 and on the basis
of such checks as we considered appropriate and according to the
information and explanations given to us, we enclose in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the said
Further to our comments in the Annexure referred to above, we report
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
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, Statement of Profit & Loss and Cash Flow
Statement dealt with by this report are in agreement with the books of
d) In our opinion, the Balance Sheet, Statement of Profit & Loss 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 Companies Act, 1956.
e) On the basis of written representations received from the directors
as on March 31, 2012 and taken on record by the Board of Directors, we
report that none of the directors is disqualified as on March 31, 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) Without qualifying our opinion, we draw attention to:
i. Note No. 30 wherein the Company has claimed exemption of Rs. 3448
lacs in earlier years under section 80 lA of the Income Tax Act, 1961
being tax profits arising out of sale of Industrial Park units, pending
the notification of the same by Central Board of Direct Taxes. Further
the company has taken opinion from a senior counsel that its
application satisfies all the conditions specified in the said Scheme
of Industrial Park. We have relied on management contention. However,
no exemption is claimed during the current year as there are no sales
of industrial park units.
ii. Note No. 32(b) wherein the Company is carrying project inventory
of Rs. 16833 lacs for one of its Group Housing projects. The company
had applied to the Authority for developing the project on the basis of
revised Scheme announced by the Authority for which approval has been
received envisaging developing the project on a smaller piece of land
equivalent to the amount paid and surrender balance project land
subject to certain conditions. Pending final decision of the Authority
in the matter, the management is of the view that there is no
impairment in the value of land/ project and we have relied on
iii. Note No. 32(a) wherein the Company has given advances to land
owning companies / collaborators I others for purchase / aggregation of
land / for others to the tune of Rs.13707 lacs. This includes Rs.
10000 lacs as security deposits, the recoverability / adjustment of
which is dependent upon the future events such as launch of project(s)
for which steps have been or are being taken by the Company. As regards
the balance amount of Rs.3707 lacs, pending details of land purchased
and financial position of these parties, we understand from management
that these advances are given in respect of on going transactions with
collaborators / other parties and are regarded as being in the normal
course of business. We have relied on management contention.
g) The Company has not considered for the estimated borrowing costs to
be incurred in future in general for determining the project revenues,
project inventory and debtors. According to the management the amount
of these items cannot be determined at this stage, and therefore, we
are unable to comment on the consequential impact thereof on the
carrying value of project inventory, revenue recognition and
outstanding debtors and other adjustments that may be necessitated on
this account in the financial statements.
h) The Company had, during the year ended March 31, 2010, changed its
accounting policy in respect of accounting for certain costs in the
nature of administration and selling costs by charging them off to
Profit & Loss against the earlier policy of treating them as part of
project cost for determining project inventory, revenue and debtors.
Expenditure of such nature incurred in earlier years and considered as
part of project inventories under Projects/ Contract work in progress
upto March 31, 2009 has been carried forward as such. Such amount has
not been determined by the management in view of the practical
difficulties involved, as explained. In the absence of availability of
these amounts relating to the period upto March 31, 2009, we are unable
to comment on the impact thereof on the carrying value of project
inventories, revenue recognition and outstanding debtors and other
adjustments that may be required in the financial statements.
Subject to that stated in clause g) and h) above having its impact as
aforesaid, in our opinion and to the best of our information and
according to the explanations given to us, the said accounts read with
the Accounting policies and Notes thereon give the information required
by the Act, in the manner so required and give a true and fair view in
conformity with the accounting principles generally accepted in India:
a) In the case of Balance Sheet, of the state of affairs of the Company
as at March 31,2012;
b) In the case of Statement of Profit and Loss, of the Profit for the
year ended on that date; and
c) In the case of Cash Flow Statement, of the Cash flows for the year
ended on that date.
ANNEXURE TO AUDITORS' REPORT
(Annexure referred to in our report of even date) Re: Ansal Properties
& Infrastructure Limited
1. a. The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
b. The Company has a phased programme of physical verification of its
fixed assets which, in our opinion, is reasonable having regard to the
size of the Company and the nature of its assets. All the fixed assets
identified during the year for verification have not been physically
verified by the management. However, discrepancies noticed during
physical verification have been recorded and accounted for in the books
of account to the extent of verification carried out.
c. Fixed assets disposed off during the year were not substantial.
2. a. As explained to us, physical verification has been conducted by
the management at reasonable intervals in respect of building material,
stores & spares and inventory of shops/flats/houses. In our opinion,
the frequency of such verification is reasonable.
b. The procedures for the physical verification of inventory followed
by the management are, in our opinion, reasonable and adequate in
relation to the size of the Company and nature of its business.
c. In our opinion, the Company is maintaining proper records of
inventory. The discrepancies noticed on physical verification of
inventory as compared to book records were not material and have been
properly dealt with in the books of account.
3. a. The company has not granted any loans, secured or unsecured, to
companies, firms or other parties listed in the register maintained
under section 301 of the Companies Act, 1956.
b. Since there are no such loans, the comments regarding repayment of
the principal amount & interest due thereon and overdue amounts are not
c. The company has taken deposits from one of the directors and his
relative covered in the register maintained under section 301 of the
Companies Act, 1956. In our opinion the rate of interest and other
terms and conditions of such deposits are not prima facie, prejudicial
to the interest of the company. The maximum amount of deposit during
the year was Rs. 21 lacs and the yearend balance was also Rs. 21 lacs.
d. In respect of deposits taken, repayment of the principal and
interest has been regular. There are no overdue amounts at the year
4. In our opinion, and according to the information and explanations
given to us during the course of audit, there are adequate internal
control systems commensurate with size of the Company and the nature of
its business with regard to purchase of inventory and fixed assets and
for the sale of services. Further, on the basis of our examination of
the books & records of the company, carried out in accordance with the
generally accepted auditing practices in India, we have neither come
across nor have we been informed of any instance of major weaknesses in
the aforesaid internal control systems. The company's activity does not
qualify for sale of goods. However, the internal control systems with
regard to documentation of advances given to land owning companies/
collaborators/ associates/ others need improvement.
5. a. To the best of our knowledge and according to the information
and explanations given to us, we are of the opinion that particulars of
contracts or arrangements that need to be entered into the register
maintained under 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 with parties in pursuance of
contracts or arrangements, with whom transactions exceeding the value
of Rupees Five Lacs in respect of each party have taken place during
the financial year, are at prices, which are reasonable, having regard
to the prevailing market prices at the relevant time where such market
prices are available.
6. In respect of fixed deposits accepted from the public, the
provisions of section 58A and 58AA or any other relevant provisions of
the Act including the Companies (Acceptance of Deposits) Rules, 1975
have been complied with. We have been informed that no order has been
passed by Company Law Board or National Company Law Tribunal or RBI or
any Court or any other Tribunal in this regard.
7. In our opinion, the Company has an internal audit system
commensurate with the size & nature of its business.
8. The Central Government has during the year prescribed for
maintenance of Cost accounting records pursuant to the requirements of
clause (d) of sub-section (1) of section 209 of the Companies Act, 1956
with regard to the activities of the company. The Company is in the
process of making and maintaining those records. However, we are not
required to carry out a detailed examination of the same.
9. a. In our opinion and according to the information and explanations
given to us, according to the records of the Company, undisputed
statutory dues including Provident Fund, Investor Education and
Protection Fund, Employees State Insurance, Sales tax, Wealth-tax,
Custom Duty, Excise Duty, Cess and other material statutory dues,
wherever applicable, have been generally regularly deposited with the
appropriate authorities except in certain cases of delays of Service
Tax which have been deposited with interest. However there are no such
undisputed statutory dues payable for a period of more than six months
from the date they became payable as at March 31,2012.
b. According to the information and explanations given to us and as per
the books and records examined by us, there are no dues of Customs
duty, Excise duty, Service tax and Cess which have not been deposited
on account of any dispute, except the following in respect of disputed
Sales tax, Wealth tax and Income Tax along with the forum where dispute
S.No. Name of Statute Nature of Dues
(i) Income Tax Act FBT
(ii) Income Tax Act Interest on FBT
(iii) Wealth Tax Act Wealth Tax
(iv) Wealth Tax Act Wealth Tax
(v) Wealth Tax Act Wealth Tax
(vi) Haryana Local Area Local Area
Development Tax Act Development Tax
(vii) Sales Tax Act Delhi Sales Tax
(viii) Sales Tax Act Delhi Sales Tax
(ix) Sales Tax Act UP Sales Tax
(x) UP Trade Tax Act UP Sales Tax
(xi) UP Trade Tax Act UP Sales Tax
Name of Statute Amount Assessment Forum where pending
(Rs.in lacs) Year
Income Tax Act 2.14 2007-08 Deputy Commissioner of
Income Tax Act 0.49 2006-07 Asstt. Commissioner of
Income Tax, New Delhi
Wealth Tax Act 0.45 1992-93 Asstt.Commissioner of
Wealth Tax, New Delhi
Wealth Tax Act 0.50 1997-98 Deputy Commissioner of
Wealth Tax, New Delhi
Wealth Tax Act 0.96 2000-01 Deputy Commissioner of
Wealth Tax, New Delhi
Haryana Local Area
Development Tax Act 8.73 2003-04 Joint Excise & Taxation
Sales Tax Act 4.47 1999-2000 Assessing Officer, Delhi
Sales Tax Act 33.17 2004-05 Trade Tax Tribunal, Delhi
Sales Tax Act 0.29 2006-07 Additional Commissioner
U P Trade Tax Act 2.38 2008-09 Additional Commissioner
U P Trade Tax Act 1.08 2008-09 Additional Commissioner
10. There are no accumulated losses of the Company as at the end of
the financial year. There are no cash losses during the financial year
and in the immediately preceding financial year.
11. According to the information and explanations given to us and as
per the books and records examined by us, we report as follows:
(a). In respect of payments due for Debentures on account of Principal,
Premium and Interest aggregating Rs 5224.15 lacs to LIC Mutual Fund and
Rs. 750.00 lacs to HDFC India Real Estate Fund (HIREF), payments were
delayed from 1 day to 343 days and these dues were cleared upto the
close of financial year except for Rs 819.23 lacs, which was paid to
LIC Mutual Fund subsequently. Other amount due in respect of Debentures
to HIREF aggregating of Rs 1559.62 lacs have been outstanding for 1 day
to 275 days as at the close of financial year and are outstanding as on
(b). Amounts due in respect of Term Loans from Banks / Financial
Institutions on account of Principal & Interest aggregating Rs.
59018.91 lacs were delayed and have been fully paid. These include
amounts* due to LIC of India (7 instances of Rs.3299.31 lacs-(i) Rs
3199.31 lac, (ii) Rs 100.00 lac, (iii) 1 to 576 days), IDBI Bank
Limited (14 instances of Rs. 951.62 lacs- (i) Rs 862.35 lacs, (ii) Rs
89.27 lacs and (iii) 1 to 120 days), IFCI Limited (16instances
ofRs.4628.52 lacs - (i) Rs 4578.52 lacs, (ii) Rs 50.00 lacs and (iii) 1
to 89 days), IFCI Factors Limited (14 instances of Rs.721.02lacs- (i)
Rs 671.02 lacs, (ii) Rs 50.00 lacs and (iii) 1 to 86 days), HDFC
Limited(119instances ofRs.14877.29 lacs - (i) Rs 14367.00 lacs, (ii) Rs
510.29 lacs and (iii) 1 to 99 days), LIC Housing Finance Limited (22
instances ofRs. 8106.54 lacs-(i) Rs 6740.85 lacs, (ii) Rs 1365.69 lacs
and (iii) 1 to 159days), Central Bank of India (11 instances of (i) Rs.
1878.77 lacs and (iii) 1 to40days), United Bank of India (14 instances
of Rs. 2402.92 lacs- (i) Rs 1855.55 lacs, (ii) Rs 547.37 lacs and (iii)
1 to 149 days), UCO Bank (22 instances of Rs. 5718.95 lacs-(i) Rs
5531.80 lacs, (ii) Rs 187.15 lacs and (iii) 1 to 97 days), Yes Bank
Limited (26 instances of Rs.5440.46 lacs-(i) Rs 4938.99 lacs, (ii) Rs
501.47 lacs and (iii) 1 to90days), Punjab National Bank (21 instances
of Rs.10301.59 lacs-(i) Rs 10151.59 lacs, (ii) Rs 150.00 lacs and (iii)
1 to 139days) and Syndicate Bank (3 instances of (i) Rs. 691.92 lacs
and (iii) 1 to45days).
(C). In respect of other amounts due to Banks/Financial Institutions
aggregating to Rs.6855.77 lacs, the payments have been delayed from 1
day to 183 days and are outstanding as on date. These include amounts
due to LIC of India (8 instances of Rs.697.28 lacs), LIC Housing
Finance Limited (5 instances ofRs. 1795.43 lacs), IFCI Limited (2
instances ofRs.107.53 lacs), IFCI Factors Limited (2 instances ofRs.
270.67 lacs), HDFC Limited (2 instances of Rs. 2339.66 lacs), UCO Bank
(1 instance of Rs.87.00 lacs), Yes Bank Limited (1 instance of
Rs.321.56 lacs) and Punjab National Bank (4 instances ofRs.1236.64
lacs), explained by the management, the delays are attributable to the
delays in processing of Company's proposal for rescheduling and
restructuring in several cases. *
(i). Amount paid during the financial year.
(ii). Amount paid subsequent to the close of financial year.
(iii). Delay ranging in days.
12. According to the information and explanations 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 Company does not fall within the category of Chit fund I
Nidhi/Mutual Benefit fund/Society and hence the related reporting
requirements of the Order are not applicable.
14. According to the information and explanations given to us, the
Company is not dealing or trading in shares, securities, debentures and
other investments and hence the related reporting requirements of the
Order are not applicable.
15. The Company has given guarantees against loans taken by others
from banks & financial institutions; the terms & conditions of such
guarantees are not, prima facie, prejudicial to the interest of the
16. In our opinion and according to the information and explanations
given to us, the term loans raised during the year by the Company have
been generally applied for the purpose for which the said loans were
obtained and for overall project related activity in general.
17. According to the information and explanations given to us and as
per the books and records examined by us, on an overall examination of
the Balance Sheet of the company, the funds raised by the Company on
short-term basis have not been applied for long-term investment.
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.
19. According to the information and explanations given to us and the
records examined by us, the company has created necessary securities
for the debentures issued except those issued to one of the lenders
wherein the security provided by the company is less than the total
amount of debentures necessitating classification of the balance amount
of debentures as unsecured. We are explained that the said lender is
not pursuing for any additional security.
20. The company has not raised any money by way of public issues
during the year.
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, we have neither come across any instance
of fraud on or by the Company, noticed and reported during the year,
nor have we been informed of such case by the management.
For S. S. KOTHARI MEHTA & CO.
Firm Reg. No. 000756N
(ARUN K. TULSIAN)
Membership No. 89907
Date : 26th May, 2012
Place : New Delhi