We have audited the accompanying financial statements of Inditrade
Capital Limited, Kochi (formerly known as JRG Securities Limited) (the
Company), which comprise the Balance Sheet as at March 31, 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
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.
Our responsibility is to express an opinion on these financial
statements based on our audit. 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 auditors'' 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 Company''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.
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 and give a true and fair
view in conformity with the accounting principles generally accepted in
(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, of the loss 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.
The financial statements of the Company for the year ended 31 March
2013 were audited by another auditor who expressed an unmodified
opinion on those statements on 14 May 2013.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors'' 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, 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
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
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
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 Act;
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 Act.
Annexure to Independent Auditors'' Report
(i) (a) The Company is in the process of updating its records showing
full particulars, including quantitative details and situation of fixed
(b) The company has a regular programme of physical verification of its
fixed assets by which all fixed assets are verified in a phased manner
over a period of three years. In our opinion, this periodicity of
physical verification is reasonable having regard to the size of the
Company and the nature of its assets. In accordance with this programme
certain fixed assets were verified during the year and no material
discrepancies were noticed on such verification.
(c) In our opinion and according to the information and explanations
given to us, a substantial part of fixed assets has not been disposed
of by the company during the year.
(ii) The Company is a service company, primarily rendering services as
brokers to various stock exchanges. Accordingly, paragraph 4 (ii) of
the order is not applicable.
(iii) (a) As informed, 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 Companies Act, 1956.
Accordingly, paragraph 4 (iii)(b),(c) and (d) of the order are not
(b) The Company had taken loan from a company covered in the register
maintained under section 301 of the Companies Act, 1956. The maximum
amount involved during the year was Rs. 3, 31, 14,990/- and the
year-end balance was Rs. 1, 65, 08,297/-.
(c) In our opinion, the rate of interest and other terms and conditions
for such loans are not, prima facie, prejudicial to the interest of the
(d) In respect of the aforesaid loans, the company is regular in
repaying the principal amounts as stipulated and has been regular in
payment of interest.
(iv) In our opinion and according to the information and explanations
given to us, there exists an adequate internal control system
commensurate with the size of the Company and the nature of its
business with regard to purchase of fixed assets and with regard to the
sale of services. During the course ofour audit, we have not observed
any continuing failure to correct weakness in internal control system
of the company.
(v) (a) According to the information and explanations given to us, we
are of the opinion that the particulars of contracts or arrangements
referred to in section 301 of the Companies Act, 1956 that need to be
entered into the register maintained under section 301 have been so
(b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of such contracts or
arrangements exceeding value of rupees Five lakhs have been entered
into during the financial year at prices which are reasonable having
regard to the prevailing market prices at the relevant time.
(vi) In our opinion and according to the information and explanations
given to us, the company has not accepted any deposits from the public
within the meaning of Sections 58A and 58AA of the Act and the rules
framed there under.
(vii) In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
(viii) The Central Government of India has not prescribed the
maintenance of cost records under clause (d) of sub-section (1) of
Section 209 of the Act for any of the products of the company.
(ix) (a) The Company is regular in depositing with appropriate
authorities undisputed statutory dues including provident fund,
investor education and protection fund, employees'' state insurance,
income-tax, sales- tax, wealth-tax, service tax, and other material
statutory dues applicable to it, though there exists delay in few
According to the information and explanations given to us, no
undisputed dues in respect of provident fund, investor education and
protection fund, employees'' state insurance, income-tax, service tax,
cess and other statutory dues which were outstanding, at the year end
for a period of more than six months from the date they became payable.
(b) According to the records of the Company, the dues outstanding of
income-tax, sales-tax, wealth-tax, service tax, customs duty, excise
duty and cess on account of any dispute, are as follows:
Name of the Nature of Amount* Financial Year for
statute dues which the amount
Income tax act, Disallowed Rs. 1,67,84,040 2006-07; 2007-08;
1961 expenditure 2008-09;2010-11;
Name of the Forum where
statute dispute is pending
Income tax act, Commissioner appeal
* of which the Rs. 6 00 000 is paid under dispute.
(x) In our opinion, the accumulated losses of the company are not more
than fifty percent of its net worth. Further, the company has not
incurred cash losses during the financial year covered by our audit and
in the immediately preceding financial year.
(xi) The company did not have any outstanding dues to any financial
institution, bank or debenture holder during the year.
(xii) According to the information and explanations given to us and
based on the documents and records produced to us, the company has not
granted loans & advances on the basis of security by way of pledge of
shares, debentures and other securities.
(xiii) In our opinion, the Company is not a chit fund or a nidhi /
mutual benefit fund / society. Therefore, the provision of paragraph
4(xiii) of the Order is not applicable.
(xiv) In our opinion and according to the information and explanations
given to us, the Company has maintained proper records of the
transactions and contracts in respect of trading in securities,
derivatives and other investments during the year and timely entries
have been made therein. Further, such securities, derivatives and
other investments have been held by the Company in its own name.
(xv) In our opinion and 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 except a corporate
guarantee of Rs. 7,00,00,000/- given to its subsidiary company.
(xvi) The Company has not obtained any term loans.
(xvii) According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we report
that no funds raised on short-term basis have been used for long-term
(xviii) According to the information and explanation given to us, 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.
(xix) The Company did not have any outstanding debentures during the
(xx) The Company has not raised money by way of public issue during the
(xxi) 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, and according to the information and
explanations given to us, we have neither come across any instance of
fraud on or by the company, noticed or reported during the year, nor
have we been informed of such case by the management.
For Haribhakti & Co.
Firm Registration No.103523W
Place: Chennai: Partner
Dated: May 27, 2014 Membership No.028423