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IEL Ltd.

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Feb 17, 16:00
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Annual Report

For Year :
2015 2013 2012 2011 2010 2009 2008 2007

Auditor's Report

1. We have audited the attached Balance Sheet of India Extractions Limited (the company) as at 31st March 2012, the Statement of Profit and Loss and cash flow statement 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.

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 the management as well as evaluating the overall financial statements presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the companies (Auditor's 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 paragraph 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 audit.

b) In our opinion, proper books of account as required by law have been maintained 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 dealt 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 sub- section (3C) of Section 211 of the Companies Act, 1956 except for the matters contained in the paragraph 4(e) below.

e) The Company has during the year incurred Retrenchment Compensation aggregating to Rs.43,02,523/-, on the termination of the employees on account of discontinuation of manufacturing operations, the same has been considered by the Company as Deferred Expenses which is to be written off over a period of five years. The aggregate net amount of deferred expenses is overstating the profit by Rs. 39,54,984/-.

f) Subject to our examination and observation in paragraph 4 (e), in our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information 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 31th March, 2012;

ii) In the case of the statement of profit and loss, of the profit 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.

5. On the basis of the written representations received from the directors as on 31st March, 2012 and taken on record by the board of directors, we report that none of the directors is disqualified as on 31s1 March, 2012 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

ANNEXURE REFERRED TO IN PARAGRAPH 3 UNDER THE HEADING REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS OF OUR REPORT OF EVEN DATE TO THE MEMBERS OF INDIAN EXTRACTIONS LIMITED ON THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31st MARCH 2012

(i) Fixed Assets

a) The company has maintained fixed asset register 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 program 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 verification.

c) During the year the Land, Building, Plant & Machinery of the Company pertaining to the manufacturing operations has been sold off due to discontinuance of this manufacturing operations. In our opinion and according to the information and explanations given to us, substantial part of fixed assets was been disposed of by the Company during the year; and such disposal, in our opinion, would not affect the going concern status of the company in view of implementations of future plans and new business by the company.

(ii) Inventory

a) The inventory has been physically verified by the management during the year. In our opinion, the frequency of verification is reasonable.

b) In our opinion, the procedures of physical verification of inventory followed by the management are adequate in relation to the size of the Company and the nature of its business.

c) On the basis of our examination of the inventory records, 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.

(iii) Loans granted to or taken from related persons

a) The Company has not granted any loans, secured or unsecured, to companies, firms or other parties covered in the register maintained under Section 301 of the Act. Hence clause (b), (c) and (d) are not applicable to company.

b) The company has taken unsecured loans from an individual covered in the register maintained under section 301 of the Companies Act, 1956. At the year end, the outstanding balance of such loan taken aggregated Rs. 50,000/-, and the maximum amount involved during the year was Rs. 90,50,000/-. In our opinion in respect of loans taken by the company, the terms & conditions are not prima facie prejudicial to the interest of the company. There are no stipulations as regards repayment and interest.

(iv) Internal Control

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 and for providing the services. Further, on the basis of our examination of the books and records of the Company carried out in accordance with the auditing standards generally accepted in India and according to the information and explanations given to us, we have neither , come across nor have been informed of any continuing failure to correct major weaknesses in the aforesaid internal control system.

(v) Related Party Transactions

(a) In our opinion and according to the information and explanations given to us, the contracts or arrangements that need to be entered into the register in pursuance of Section 301 of the Act have been so entered.

(b) In our opinion, and according to the information and explanations given to us transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 and exceeding the value of Rs. Five lakhs in respect of any party during the year have been made at prices which are reasonable having regard to the prevailing market prices M the relevant time.

(vi) Deposits from Public

According to the information and explanation given to us the company has complied with the provision of section 58A, 58AA or any other relevant provision 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 respect.

(vii) Internal Audit

In our opinion, the Company has an internal audit system commensurate with its size and nature of its business.

(viii) Cost Records

The central government has prescribed maintenance of cost records under section 209(1) (d) of the Companies Act, 1956 in respect of the products, manufactured by the company. However, during the year since the Company has discontinued its manufacturing operations, the same have not been maintained.

(ix) Statutory Dues

(a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is generally regular in depositing the undisputed statutory dues including provident fund, investor education and protection fund, employees' state insurance, income-tax, sales-tax, wealth tax, service tax, customs duty, excise duty, cess and other material statutory dues as applicable with the appropriate authorities.

(b) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of income-tax, sales-tax, wealth tax, service tax, customs duty, excise duty and cess as at March 31, 2012 which have not been deposited on account of a dispute.

(c) 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, 2012 on account of any dispute are given below.

Name of Nature of Amount Period to Forum where Statue the Dues (Rs. In which the dispute is Lakhs) amount pending releates

Sales Tax Sales Tax 33.34 A.Y. 1991-92 Gujarat Sales Act Demands Tax Tribunal, Ahmedabad

(x) Net Worth

In our opinion, the accumulated losses of the company are more than fifty percent of its net worth at the end of the financial year. The company has incurred cash profit in the end of the current financial year as well as in the immediately preceding financial year.

(xi) Repayment of dues

According to the records of the Company examined by us and the information and explanation given to us, the Company has not defaulted in repayment of dues to any financial institution or bank or debenture holders as at the balance sheet date.

(xii) Loans granted

The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities. Accordingly, paragraph 4(xii) of the Order is not applicable.

(xiii) Chit Fund

The provisions of any special statute applicable to chit fund / nidhi / mutual benefit fund/societies are not applicable to the Company.

(xiv) Investment Company

In our opinion, the Company is not a dealer or trader in shares, securities, debentures and other investments. Hence, this clause is not applicable.

(xv) Guarantee issued

According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions during the year.

(xvi) Utilization of term loans

According to the information and explanations given to us, the Company has not obtained term loans during the year. Hence, this clause is not applicable.

(xvii) Utilization of short-term loans

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 a short-term basis which have been used for long- term investment and vice versa.

(xviii) Preferential Allotment

During the year, The Company has made preferential allotment of 90,000 Zero Coupon Redeemable Preference Shares of Rs. 100/- each aggregating to Rs.90,00,000/- on a private placement and preferential basis to parties and companies covered in the register maintained under Section 301 of the Act during the year.

(xix) Debentures

The Company has not issued any debentures during the year. Hence, this clause is not applicable.

(xx) End use of Public Issue

The company has not raised funds by way of public issue and hence this clause is not applicable.

(xxi) Frauds

During the course of our examination of the books and records of the Company, carried out in accordance with the auditing standards generally accepted in India, and according to the information and explanations given to us, we have neither come across any instance of fraud by the Company, noticed or reported during the year, nor have we been informed of such case by the management.

For THINGNA & CONTRACTOR

Chartered Accountants

Firm Registration No. 110963W

Sunil Modi

Partner

Membership No. 042562

Place: Mumbai

Date: 24 May, 2012.