We have audited the accompanying standalone financial statements of
GUJARAT LEASE FINANCING LIMITED (the Company), which comprise the
Balance Sheet as at 31st March, 2015, the Statement of Profit and Loss
and the Cash Flow Statement, and a summary of the significant
accounting policies and other explanatory information for the year then
Management''s Responsibility for the Standalone Financial Statements
The Company''s Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 (the Act) with respect
to the preparation of these standalone 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 principles
generally accepted in India, including the Accounting Standards
specified under Section 133 of the Act, read with Rule 7 of the
Companies (Accounts) Rules, 2014. This responsibility also includes
maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding the assets of the Company and
for preventing and detecting frauds and other irregularities; selection
and application of appropriate accounting policies; making judgments
and estimates that are reasonable and prudent; and design,
implementation and maintenance of adequate internal financial controls,
that were operating effectively for ensuring the accuracy and
completeness of the accounting records, 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.
Our responsibility is to express an opinion on these financial
statements based on our audit.
We have taken into account the provisions of the Act, the accounting
and auditing standards andmatters which are required to be included in
the audit report under the provisions of the Act and the Rules made
We conducted our audit in accordance with the Standards on Auditing
specified under Section 143(10) of the Act. 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 the 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 financial control relevant
to the Company''s preparation of the financial statements that give a
true and fair view in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing
an opinion on whether the Company has in place an adequate internal
financial controls system over financial reporting and the operating
effectiveness of such controls. An audit also includes evaluating the
appropriateness of the accounting policies used and the reasonableness
of the accounting estimates made by the Company''s Directors, 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 qualified audit opinion on the
standalone financial statements.
Basis for Qualified Opinion
Attention is invited to the Note 2.20 (c) regarding non-recognition of
income of interest on tax refunds amounting to Rs.1,060.94 lacs
(Previous year ended 31st March, 2014: Rs.1,033.66 lacs) and short
provision of tax of Rs.277.21 lacs (Previous year ended 31st March,
2014: Rs.284.96 lacs).
Had the aforesaid amount on tax refund been accounted for in the books
of account, the accumulated losses as at 31st March, 2015 would have
been Rs.16,752.40lacs (Previous year ended 31st March, 2014: Rs.
16,780.33 lacs) as against reported figure of Rs.17,536.13 lacs
(Previous year ended 31st March, 2014: Rs. 17,529.03 lacs), provision
for taxation net of advance tax would have been converted to advance
tax net of provision Rs.1.79 lacs (Previous year ended 31st March,
2014: Rs. 1.97 lacs) as against reported figure of Rs.781.94 lacs
(Previous year ended 31st March, 2014: Rs. 746.73 lacs)
This matter was also qualified in our report on the financial
statements for the year ended 31st March 2014.
In our opinion and to the best of our information and according to the
explanations given to us,except for the effects of the matter described
in the Basis for Qualified Opinion paragraph above, the aforesaid
financial statements 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, of the state of
affairs of the Company as at 31st March, 2015, and its loss and its
cash flows for the year ended on that date.
Emphasis of Matter
We draw attention to Note 1 to the financial statement regarding
preparation of the financial statement of the Company on going concern
basis for the reasons stated therein. The appropriateness of this
assumption of going concern is dependent upon the continued support
from one of the promoter group company and the resolution of the tax
dispute referred to in the said note.
Our opinion is not modified in respect of this matter.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2015 (the
Order) issued by the Central Government in terms of Section 143(11) of
the Act, we give in the Annexure a statement on the matters specified
in paragraphs 3 and 4 of the Order.
2. As required by Section 143(3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations
which to the best of our knowledge and belief were necessary for the
purposes of our audit.
(b) Except for the effects of the matter described in the Basis for
Qualified Opinion paragraph above, 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 Statement of Profit and Loss, and the Cash
Flow Statement dealt with by this Report are in agreement with the
books of account.
(d) Except for the effects of the matter described in the Basis for
Qualified Opinion paragraph above, in our opinion, the aforesaid
financial statements comply with the Accounting Standards specified
under Section 133 of the Act, read with Rule 7 of the Companies
(Accounts) Rules, 2014.
(e) The matter described in the Basis for Qualified Opinion paragraph
above, and the going concern matter described in the Emphasis of Matter
paragraph above, in our opinion, may have an adverse effect on the
functioning of the Company.
(f) On the basis of the written representations received from the
directors as on31stMarch, 2015 taken on record by the Board of
Directors, none of the directors is disqualified as on 31stMarch, 2015
from being appointed as a director in terms of Section 164 (2) of the
(g) The qualification relating to the maintenance of accounts and other
matters connected therewith are as stated in the Basis for Qualified
Opinion paragraph above.
(h) With respect to the other matters to be included in the Auditor''s
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:
i) The Company has disclosed the impact of pending litigations on its
financial position in its financial statements - Refer Note 2.5and
2.18to the financial statements;
ii) The Company did not have any long-term contracts including
derivative contracts for which there were any material foreseeable
iii) There were no amounts which were required to be transferred to the
Investor Education and Protection Fund by the Company.
ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT
(Referred to in paragraph 1 under ''Report on Other Legal and Regulatory
Requirements'' section of our report of even date)
1. Having regard to the nature of the Company''s business / activities
during the year, clauses (ii) and (vi) of paragraph 3 of the Order are
not applicable to the Company.
2. 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
explanation given to us, no material discrepancies were noticed on such
3. The Company has not granted any loans, secured or unsecured, to
companies, firms or other parties covered in the Register maintained
under Section 189 of the Companies Act, 2013.
4. In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchase of fixed assets. During the course of our audit we have not
observed any continuing failure to correct major weaknesses in such
internal control system.
5. According to the information and explanations given to us, the
Company has not accepted any deposit during the year.
6. According to the information and explanations given to us, in
respect of statutory dues:
(a) The Company has generally been regular in depositing undisputed
statutory dues, including Provident Fund, Sales tax, Income-tax,
Service Tax, and other material statutory dues applicable to it with
the appropriate authorities. Other dues mentioned in clause 7(a) of
para 3 of the Order were not applicable to the Company during the year.
(b) There were no undisputed amounts payable in respect of Provident
Fund, Income-tax, Sales Tax, Service Tax and other material statutory
dues in arrears as at March 31,2015 for a period of more than six
months from the date they became payable. Other dues mentioned in
clause 7(b) of para 3 of the Order were not applicable to holding and
subsidiaries during the year.
(c) There are no dues of Income-tax and Service Tax which have not been
deposited as on March 31, 2015 on account of disputes.
Details of dues of Sales Tax which have not been deposited as on 31st
March, 2015 on account of disputes are given below:
Statute Nature of Dues Forum where Period to which
Dispute is the amount
Central Sales Demand of Sales Tax 1989-90 to
Tax Act,1956 Tax and Penalty Tribunal 1994-95
Statute Amount involved(Rs. in lacs)
Central Sales 21.12
(d) There are no amounts that are due to be transferred to the Investor
Education and Protection Fund in accordance with the relevant
provisions of the Companies Act, 1956 (1 of 1956) and Rules made
7. The accumulated losses of the Company at the end of the financial
year are not less than fifty percent of its net worth. The Company has
incurred cash losses during the financial year covered by our audit and
in the immediately preceding financial year.
8. In our opinion and according to the information and explanations
given to us, the Company has not borrowed any monies from banks,
financial institutions or through issue of debentures.
9. According to the information and explanations given to us, the
Company has not given guarantees for loans taken by others from banks
and financial institutions.
10. In our opinion and according to the information and explanations
given to us, the Company has not obtained any term loans during the
11. To the best of our knowledge and according to the information and
explanations given to us, no fraud by the Company and no material fraud
on the Company has been noticed or reported during the year.
For C.C.Chokshi & Co.
(Firm''s Registration No. 101876W)
Hemendra L. Shah
20th May, 2015 Partner
MUMBAI (Membership No. 33590)