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Gemstone Investments Ltd.

BSE: 531137 | NSE: | Series: NA | ISIN: INE503D01027 | SECTOR: Finance - Investments

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Annual Report

For Year :
2015 2014 2013 2012 2010 2009 2008 2007 2005

Auditor's Report

We have audited the accompanying financial statements of Gemstone Investments Limited which comprise the balance sheet as at 31 March 2014, the statement of profit and loss and the cash flow statement for the year then ended and a summary of significant accounting policies and other explanatory information. Management''s Responsibility for the Financial Statements Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956(the Act). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error. Auditor''s Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. Subject to the matters discussed in this report, We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Companies (Auditor''s Report) Order, 2003 (CARO) 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 (the Act) we give in the annexure a statement on the matters specified in paragraphs 4 and 5 of the said order, which is subject to the matters discussed in this report. Basis of Opinion We draw our attention to the following matters: 1. The balance of the loans and advances are subject to confirmation and reconciliation. 2. The Company has not stipulated any term for payment of interest and repayment of loans at any time of sanctioning the loan but the company follows the practice of providing interest at the year end. 3. One bank account with the HDFC bank is being freezed by the investigation wing of the Income Tax Department who was carrying inquiries in respect of some other companies. 4. During the year the company has disposed off the some of the unquoted investments of Rs. 669.00 lacs at book value and has collected Rs. 580 lacs, the remaining balance of Rs. 89.00 lacs has been shown as current investments. 5. The company has not complied with the bank''s circular DNDS/ (PD) CC No. 200/03- 10001/2010-11 dated 17/09/2010 for all the NBFC being credit institution are required to become member of at least one credit information company. Opinion In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required subject to the our comments in paragraph 1 to 5 in basis of opinion above, give a true and fair view in conformity with the accounting principles generally accepted in India: a) in the case of the Balance sheet, of the state of affairs of the Company as at March 31, 2014; b) in the case of the statement of Profit and Loss Account, of the profit for the year ended on that date; and c) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date. Report on Other Legal and Regulatory Requirements 1. As required by the Companies (Auditor''s Report) Order, 2003 (''''the Order''''), issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order. 2. As required by section 227(3) of the Act, subject to the our comments in paragraph 1to 5 in basis of opinion 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 those books; c. the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with by this Report are in agreement with the books of account; d. in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956; e. on the basis of written representations received from the directors as on March 31, 2014, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2014, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956; f. since the central government has not issue4d any notification as to the rate at which the cess is to be paid under section 441A of the Companies Act, 1956 nor has it issued any rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the Company. ANNEXURE TO THE AUDITORS'' REPORT The Annexure referred to in paragraph 1 of our report of even date, to the members of Gemstone Investments Limited on the accounts of the company for the year ended 31st March 2014. On the basis of such checks as considered appropriate and according the information and explanation given to us during the course of our audit, we report that: 1. (a) The Company has maintained proper records showing full particulars including quantitative details and situation of its fixed assets. (b) As explained to us, fixed assets, have been physically verified by the management at reasonable intervals; no material discrepancies were noticed on such verification. (c) In our opinion and according to the information and explanation given to us, no fixed asset has been disposed during the year and therefore does not affect the going concern assumption. 2. According to the information and explanation given to us, the company is Non Banking Finance Company which does not carry any inventory. 3. (a) According to the information and explanation given to us and on the basis of our examination of the books of account, the Company has not granted loans during the year. However the outstanding balance as on 31/03/2014 is of Rs. 20 lacs (previous year 20 lacs) to M/S Asian Comtrade Pvt Ltd a company listed in the register maintained under Section 301 of the Companies Act, 1956. (b) We have been informed that the company is holding 24.48% of the shares of M/s Asian Comtrade Pvt. Ltd. The loan does not carry any interest. The loan is granted to company for its working Capital to carry business which is in the interest of the Company. (c) The Outstanding balance of loan to M/S Asian Comtrade Pvt Ltd is of Rs. 20 Lacs as on 31/03/2014. (d) There are no Overdue amount exceeding Rs. 1.00 Lacs (e) The company has not taken any loans, secured or unsecured, from companies, firms or other partners listed in the register maintained under Section 301 of the Act. Clause (f) and (g) are not applicable. 4. In our opinion and according to the information and explanations given to us, there is generally an adequate internal control procedures commensurate with the size of the Company and the nature of its business, for the purchase of fixed assets and payment for expenses. However the company doesn''t have adequate internal control system for sanctioning of loans and advances. 5. a) Based on the Audit procedure applied by us and according to the information and explanations provided by the management, the particulars of contracts or arrangements referred to in section 301 of the Act have been entered in the register required to be maintained under that section. b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register of maintained under section 301 of the Companies Act, 1956 and exceeding the value of rupees five lakhs in respect of any party during the year have been made at prices which are reasonable having regards to prevailing market prices at the relevant time. 6. The Company has not accepted any deposits under section 58A and 58AA of the Companies Act, 195 and the Companies (Acceptance of Deposits) rules 1975, and hence the provisions of the clause 4(vi) of the Companies (Auditors Report) Order, 2003 (as amended) are not applicable to the Company. 7. The Company doesn''t have an internal audit system commensurate with the size and nature of its business. 8. As per information & explanation given by the management, maintenance of cost records has been prescribed by the Central Government under clause (d) of sub-section (1) of section 209 of the Act and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained. 9. (a) According to the records of the Company no undisputed statutory dues including Provident Fund, Investors'' Education and Protection Fund, Employees'' State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom duty, Excise duty, and cess to the extent applicable and any other statutory dues have generally been regularly deposited with the appropriate authorities. According to the information and explanation given to us there were no outstanding statutory dues as on 31st March 2014 for a period of more than six months from the date they became payable (b) According to the information and explanations given to us, except income tax of Rs. 7.96 lacs (Asst year 2012-12) no undisputed amount amounts payable in respect of income tax, wealth tax, service tax, sales tax, customs duty and excise duty and cess were in arrears as at March 2014 for a period of more than six months from the date they became payable. (c) According to the information and explanations given to us, the following amount of income tax has not been deposited on account of any dispute. Sr. Nature of Nature of Period to Forum where Amount in No Statute Dues which it the dispute Rs. relates is pending 1 Income Tax Income Tax Asst Year CIT Appeals 3,98,98,380/- Act, 1961 2010-11 10. The Company does not have any accumulated loss and has not incurred cash loss during the financial year covered by our audit and in the immediately preceding financial year. 11. Based on our audit procedures and on the information and explanations given by the management, we are of the opinion that, the Company has not defaulted in repayment of dues to a financial institution, bank or debenture holders. 12. According to the information and explanations given to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities. 13. The Company is not a chit fund or a nidhi/ mutual benefit fund/ society. Therefore, the provision of this clause of the Companies (Auditor''s Report) Order, 2003 ( as amended) is not applicable to the Company. 14. According to the information and explanation given to us, the company has disposed off the some of the unquoted investment at the book value and has maintained proper records of transaction and contracts as to dealing or trading in shares and other investments held by the company in its own name except to the extent, of the exemption if any, granted under Section 49 of the Companies Act, 1956 and timely entries have been therein. 15. According to the information explanations given to us, the Company has not given any grantees for loan taken by others from a bank or financial institution. 16. Based on our audit procedures and on the information given by the management, we report that the Company has not raised any term loans during the year. 17. Based on the information and explanations given to us and on an overall examination of the Balance Sheet of the Company as at 31st March, 2014 we report that no funds raised on the Short- term basis have been used for long-term investment by the Company. 18. Based on the audit procedures performed and the information and explanations given to us by the management, we report that the Company has not made any- preferential allotment of shares during the year. 19. The Company has no outstanding debentures during the period under audit. 20. The Company has not raised any money by public issue during the year. 21. Based on the audit procedures performed and the information and explanations given to us, we report that no fraud on or by the Company has been noticed or reported during the year, nor have we been informed of such case by the management. For N R Gala & Associates Chartered Accountants FRN No. 131744W Sd/- Navin Gala (Proprietor) Membership No.: 040640 Place: Mumbai Date: 29/05/2014