We have audited the accompanying f nancial statements of J. B.
CHEMICALS & PHARMACEUTICALS LIMITED (the Company), which comprise the
Balance Sheet as at 31st March 2014, the Statement of Prof t & Loss and
Cash Flow Statement for the year then ended and a summary of signif
cant accounting policies and other explanatory information.
Management Responsibility for the Financial Statements
Management is responsible for the preparation of these f nancial
statements that give a true and fair view of the f nancial position, f
nancial performance and cash f ows of the Company in accordance with
the Accounting Standards notif ed under the Companies Act, 1956 (the
Act) read with the General Circular 15/2013 dated 13th September, 2013
of the Ministry of Corporate Af airs in respect of Section 133 of the
Companies Act, 2013 and in accordance with the accounting principles
generally accepted in India. This responsibility includes the design,
implementation and maintenance of internal control relevant to the
preparation and presentation of the f nancial 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 f nancial
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 f nancial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the f nancial statements. The
procedures selected depend on the auditors'' judgement, including the
assessment of the risks of material misstatement of the f nancial
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 f nancial statements
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
ef ectiveness 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 f nancial statements.
We believe that the audit evidence we have obtained is suf cient 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 said accounts together with the notes
thereon 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:
- in the case of the Balance Sheet, of the state of af airs of the
Company as at 31st March, 2014;
- in the case of the Statement of Prof t and Loss, of the prof t for
the year ended on that date; and
- in the case of the Cash Flow Statement, of the cash f ows for the
year ended on that date.
Report on Other Legal and Regulatory Matters
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 specif ed 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 Prof t 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 Prof t and Loss, and
Cash Flow Statement comply with the Accounting Standards notif ed under
the Act read with the General Circular 15/2013 dated 13th September,
2013 of the Ministry of Corporate Af airs in respect of Section 133 of
the Companies Act, 2013;
e) On the basis of written representation received from the directors,
as on 31st March, 2014 and taken on record by the Board of Directors,
we report that none of the directors is disqualif ed as on 31st March,
2014 from being appointed as a director in terms of clause (g) of
sub-section (1) of section 274 of the Companies Act, 1956 are not
J. B. CHEMICALS & PHARMACEUTICALS LIMITED FOR THE PERIOD ENDED 31ST
1) a) The company has maintained proper records showing full
particulars including quantitative details and situation of f xed
b) These f xed assets have been physically verif ed by the management
at regular interval considering the size of the company and nature of
assets. No material discrepancies have been noticed on such verif
c) No disposal of a substantial part of f xed assets of the company has
taken place during the year.
2) a) As explained to us, the inventories were physically verif ed
by the management at reasonable intervals during the year.
b) In our opinion and according to the information and explanation
given to us, the procedures of physical verif cation 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) In our opinion and according to the information and explanation
given to us, the company has maintained proper records of its
inventories and the discrepancies noticed on physical verif cation
between physical stock and the book records were not material and have
been adequately dealt with in the books of account.
3) a) According to information and explanation given to us,
the company has, during the year, not granted any loan secured or
unsecured to the companies, f rms or other parties covered in the
register maintained under section 301 of the Companies Act, 1956.
Accordingly, paragraphs 4 (iii) (a), (b), (c) and (d) of the Order, are
b) According to information and explanation given to us, the company
had, taken unsecured loans from two companies covered in the register
maintained under section 301 of the Companies Act, 1956. The year end
balance is Rs. 105.00 Lakhs and the maximum amount involved at any time
during the year is Rs. 105.00 Lakhs. The rate of interest and other
terms and conditions are not prima-facie prejudicial to the interest of
the company. The payment of principal amount and interest are also
4) The company has adequate internal control procedure commensurate
with the size of the company and nature of
its business with regard to purchase of inventories and f xed assets
and for sale of goods and services. We have not come across any major
weakness in internal control.
5) a) To the best of our knowledge and belief, and according to
information and explanation given to us, the particulars of contracts
or arrangements referred to in section 301 of the Act have been entered
in the register maintained under that section.
b) The transaction of purchase of goods and material and sale of goods,
material and services, made in pursuance of contracts or arrangements
entered in the Register maintained under section 301 of the Act and
exceeding the value of rupees f ve lakhs in respect of any party during
the year, have been made at prices which are reasonable having regard
to the prevailing market prices at the relevant time.
6) In our opinion and according to the information and explanation
given to us, the company has complied with the directives issued by the
Reserve Bank of India and the provisions of section 58A and 58AA or any
other relevant provisions of the Act and rules framed there under, with
regard to the deposits accepted from the public.
7) The company has appointed a f rm of Chartered Accountants to carry
out its internal audit function. In our opinion, the internal audit
system is commensurate with the size of the company and nature of its
8) We have broadly reviewed the books of account maintained by the
company, pursuant to the rules made by the Central Government for the
maintenance of cost records, under clause (d) of sub-section (1) of
section 209 of the Companies Act, 1956 and are of the opinion that
prima facie the prescribed accounts and records have generally been
maintained. We have not, however, made a detailed examination of the
records with a view to determining whether they are accurate or
9) a) According to the records of the company, the company is
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 and other statutory dues with the appropriate
authorities. According to the information and explanation given to us,
there are no undisputed amounts payable in respect of such statutory
dues which have remained outstanding as at 31st March, 2014 for a
period of more than six moths from the day they became payable.
b) According to information and explanation given to us, details of
disputed Sales Tax demand aggregating that have not been deposited on
account of disputes are given below:
Name of Statue Nature of Dues Amount
(Rs In lakhs)
The UP Sales Tax Act Sales Tax 0.25
Tamil Nadu VAT Act, 2006 VAT Tax 3.44
The Kerala VAT Act, 2003 VAT Tax 4.59
Gujarat VAT Act, 2003 VAT Tax 30.79
Central Excise Act, 1944 Excise Duty & 7.19
The Finance Act, 1994 Service Tax & 2.76
Name of Statue Period to which Forum where dispute
amount relates pending
The UP Sales Tax Act 1992-1993 Supreme Court of India
Tamil Nadu VAT Act, 2006 2006-2007 to Commissioner Appeals
The Kerala VAT Act, 2003 2009-2010 VAT Appellate Tribunal
Gujarat VAT Act, 2003 2008-2009 Commissioner Appeals
Central Excise Act, 1944 2006-2009 CESTAT
May 2001 to
July 2010 to
Nov 2011 to
The Finance Act, 1994 2009-2010 CESTAT
10) The company has no accumulated losses and has not incurred cash
losses in the current f nancial year and in the immediately preceding f
11) The company has not defaulted in repayment of dues to any Banks.
12) The company has not granted loans and advances on the basis of
security by way of pledge of shares, debentures or other securities.
13) The provisions of any Special Statue applicable to Chit Funds,
Nidhis or Mutual Benef t Funds / Societies are not applicable to the
14) The company is not dealing in or trading in shares, securities,
debentures, or other investments and hence, requirement of paragraph
4(xiv) are not applicable to the company.
15) According to the information and explanation given to us, the
company has not given any guarantee for loans taken by others from the
Banks and Financial Institutions.
16) In our opinion and according to the information and explanations
given to us, on an overall basis, the term loans have been applied for
the purpose for which they have been obtained.
17) According to the Cash Flow Statement and other records examined by
us and on the basis of information and explanation given to us, on an
overall basis, funds raised on Short Term basis have, prima facie, not
been used during the year for Long Term investment.
18) During the year, the company has not issued and allotted any shares
to parties and companies covered in the register maintained u/s 301 of
the Companies Act, 1956.
19) Since the company does not have any debentures, the question of
creation of securities for debentures does not arise.
20) Since the company has not raised money by Public Issue, clause (xx)
of the Order is not applicable.
21) 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 J. K. Shah & Co.
Chartered Accountants Firm
Registration No. : 109606W
J. K. Shah
Place: Mumbai Partner
Date : May 26, 2014 Membership No: 3662