1. We have audited the attached Balance Sheet of Indian Extractions
Limited, as at 31st March, 2008, the Profit and Loss Account and also
the Cash Flow Statement for the year ended on that date, 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 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 management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
3. As required by the Companies (Auditors Report) Order, 2003, issued
by the Central Government of India 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
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
c) The Balance Sheet, Profit 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, Profit and Loss Account and Cash
Flow Statement comply with the Accountings 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, 2008 and taken on record by the board of
directors, we report that none of the directors is disqualified as on
31st March, 2008 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 said accounts read along with the
significant accounting policies and other notes thereon give the infor-
mation 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, 2008;
ii) in the case of the profit and loss account, of the loss for the
year ended on that date; and
iii) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
ANNEXURE TO AUDITORS REPORT
Re: Indian Extractions Limited
(Referred to in Paragraph 3 of our report of even date)
i) The nature of the Companys business /activities during the year has
been such that clauses (xiii) and (xiv) of paragraph 4 of the Companies
(Auditors Report) Order, 2003 are not applicable to the Company for
ii) a) The Company has maintained proper records showing full
particulars including quantitative details and situation of fixed
b) Major Items of fixed assets have been physically verified by the
management during the year which, in our opinion, is resonable having
regard to the size of the company and the nature of its assets. We are
informed that no material discrepancies were noticed on such
c) The Company has not disposed off a substantial part of fixed assets
during the year.
iii) a) The inventory has been physically verified during the year by
the management. In our opinion, the frequency of verification is
b) The procedures of physical verification 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 is maintaining proper records of its inventory. The
discrepancies noticed on verification between the physical stocks and
the book records were not material.
iv) a) There are no loans secured or unsecured given to companies,
firms or other prarties covered in the Register maintained under
Section 301 of the Companies Act, 1956 and hence clause (a), (b), (c)
and (d) of clause (iii) are not applicable to the Company.
b) The Company had taken an unsecured loan from a party covered in the
Register maintained under Section 301 of the Companies Act, 1956. The
maximum amount involved during the year was Rs. 45 lacs and the year
end balance of loans taken was Rs. 45 lacs.
c) In our Opinion, the rate of interest and other terms and conditions
of such loans are not, prima facie, prejudicial to the interest of the
d) The Company is generally regular in repaying the principal amounts
as stipulated and has been regular in the payment of interest.
v) 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 inventory and fixed assets and with regard to sale of goods
and services. During the course of our audit, we have not observed any
continuing failure to correct major weaknesses in internal control.
vi) a) According to the information and explanation given to us, we are
of the opinion that the the particulars of contracts/arrangements that
need to be entered into the Register maintained under section 301 of
Companies Act, 1956 have been so entered.
b) According to the information and explanations given to us, there are
no transactions, which are in excess of Rs. 5 Lacs in respect of each
party covered under section 301 of the Companies Act, 1956 (excluding
loans reported under paragraph (vi) above). Hence, Clause (v) (b) of
paragraph 4 of the Companies (Auditors Report) order, 2003 is not
vii) According to the information and explanations given to us, the
Company has complied with the provisions of section 58A, 58AA or any
other relevant provisions of the Companies Act, 1956 and the Rules
framed there under with regard to deposits accepted from public. We are
informed that no order has been passed by the Company Law Board or the
Reserve Bank of India or any Court or any other Tribunal in this
viii) In our opinion, the Company has an internal audit system
commensurate with the size of the Company and nature of its business.
ix) According to the information and explanations given to us the
Central Government has not prescribed maintenance of Cost Records under
Section 209 (1) (d) of the Companies Act, 1956, in respect of products
manufactured by the Company.
x) a) In our opinion and according to the information and explanations
given to us, the Company has generally been regular in depositing
undisputed 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 Value Added Tax
and any other statutory dues with the appropriate authorities during
the year, where applicable. According to the information and
explanation given to us, no arrears of statutory dues as at 31st March
, 2008 were outstanding for a period of more than six months from the
date they became payable.
b) According to the information and explanations given to us, details
of dues of sales tax, income tax, customs duty, wealth tax, excise
duty, service tax and cess which have not been deposited as on 31st
March, 2008 on account of any dispute are given below :
Name of Nature of Amount
Statute the Dues (Rs. In Lakhs)
Sales Tax Act Sales Tax Demand 25.36
Period to which Forum where
the amount relates dispute is pending
A.Y. 1991-92 Gujarat Sales Tax
xi) In our opinion, the accumulated losses of the Company are not more
than fifty percent of its net worth. The Company has not incurred cash
losses during the financial year covered by our audit : however the
company had incurred cash losses during the immediately preceding
xii) 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. There are no dues to financial institutions or debenture
xiii) According to the information and explanations given to us, the
Company has not given any loans and advances on the basis of security
by way of pledge of shares, debentures and other securities.
xiv) According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from bank
or financial institutions.
xv) To the best of our knowledge and belief, and according to the
information and explanations given, to us, the term loan taken during
the year has been applied for the purpose for which it was obtained.
xvi) According to the information and explanations given to us, and on
an overall examination of the balance sheet of the Company, funds
raised on short term basis have, prima facie, not been used for long
xvii) 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.
xviii)The Company has not issued any debentures during the year.
xix) The Company has not raised any money by way of public issues
during the year.
xx) To the best of our knowledge and belief and according to the
information and explanations given to us, no fraud on or by the Company
was noticed or reported during the year.
For DELOITTE HASKINS AND SELLS
A. B. Jani
Membership No. : 46488
Dated: 18th June, 2008