1. We have audited the attached balance sheet of M/s. OM METALS INFRA
PROJECTS LIMITED, as at 31.03.2007 and also the profit and loss account
and the cash flow statement of the company for the year ended on that
date annexed thereto. The accounts of branches/division i.e.
Engineering, Multiplex and Hotel divisions audited by other auditors
are incorporated in the said balance sheet and profit and loss account
and cash flow statement which have been forwarded to us and have
considered the same in preparing this report. These financial statement
are the responsibility of the companys management. Our responsibility
is to express an opinion on these financial statements based on our
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 principal 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 our opinion.
3. As required by the Companies ( Auditors Report ) order , 2003 (as
amended) issued by the Central Government of India in terms of
subsection (4A) of section 227 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 above, we
(a) We have obtained all the information and explanations, which .to
the best of our knowledge and belief were necessary for the purposes of
(b) In our opinion, proper books of accounts as required by law have
been kept by the company so far as appears from our examination of
those books and proper returns adequate for the purposes of our audit
have been received from the Engineering, Multiplex and Hotel,
divisions/branches not visited by us. The branch/division Auditors
reports have been. forwarded to us and have been appropriately dealt
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
and with the audited returns, audited by other auditors of the
Engineering, Multiplex and Hotel divisions of the company.
d) In our opinion, the balance sheet , profit and loss account and cash
flow statement dealt with by this report comply with the applicable
accounting standard s referred to in sub-section (3C) of section 211 of
the Companies Act 1956
e) On the basis of written representations received from the directors,
as on 31.03.2007 and taken on record by the Board of Directors, we
report that none of the directors of the company is disqualified as on
31.03.2007 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 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 subject
to note no 26 of schedule 19 regarding provision for tax liabilities
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 31.03.2007 and.
(ii) in the case of the profit and Loss account, of the profit for the
year ended on that date and
(iii) In the case of the cash flow statement , of the cash flows of the
company for the year ended on that date .
ANNEXURE REFERRED TO IN PARAGRAPH 3 OF OUR REPORT OF EVEN DATE TO THE
MEMBERS OF M/S OM METALS INFRAPROJECTS LIMITED , KOTA (RAJ.) ON THE
ACCOUNTS AS AT AND FOR THE YEAR ENDED ON 31st MARCH, 2007
On the basis of the information and explanations given to us and on the
basis of such checks as we considered appropriate, our statement on the
matters specified in para 3 and 4 of the said order is given below. In
preparing the report, we have considered the report made under the
aforesaid order by other auditors, who have audited the accounts of the
Divisions of Engg., Multiplex and Hotel of the Company.
1. In respect of its fixed assets. .
a) The Company has maintained proper records showing full particulars,
including quantitative details and situation on fixed assets except
hotel division , the records of which are under completion.
b) The management has carried out a physical verification of most of
its fixed assets during the year except hotel division has a program to
verify fixed assets physically in a phased manner. In our opinion , the
frequency of verification is reasonable having regard to the size of
the company and the nature of its fixed assets. No material
discrepancies were noticed on such physical verification .
In our opinion, the company lias not disposed of a substantial part of
its fixed assets during the year and the going concern status of the
company is not affected,2(a) The inventory of the company has been
physically verified during the year by the Management. In our opinion,
the frequency of verification is reasonable according to the nature of
(b) In our opinion and according to the information and explanation
given to us, 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) On the basis of our examination of records of inventory, we are of
the opinion that the company has maintained proper records of
inventory. The; discrepancies noticed on physical verification of
inventories as compared to book records were not material, having
regard to the size or the operations of the Company and have been
properly dealt within the books of account.
3. In respect of the loans , secured or unsecured , granted by the
company to companies , firm or other parties covered in the register
maintained under section 301 of the Companies act, 1956.
a) The company has given loans to Six Party (Subsidary and joint
venture) .In respect of the said loan, the maximum amount outstanding
at any time during the year is Rs. 3673.55 lacs and year end balance of
Rs. 3673.55 Lacs .
b) In our opinion and according to the information and explanations
given to us, the aforesaid loan is interest free and other terms &
conditions are not prima-facia prejudicial to the interest of the
c) The said interest free loan given to subsidiary and joint venture of
the company is repayable on demand and there is no repayment schedule.
d) In respect of loans given by the company, the same is repayable on
demand and therefore the question of overdue amount does not arise .
e) As informed to us, the company has not taken any loans , secured or
unsecured from companies, firm or other parties except advance from
OML+JSC Ukrain (JV) maximum balance Rs. 1771.89 lacs (previous year
Rs. 1630.50 lacs) covered in the register maintained under section 301
of the companies Act, 1956 and outstanding balance is Rs. 1 771.89 lacs
at the year end.
f) In our opinion, the rate of interest and other terms and conditions
of unsecured loan taken by the Company are not, prima facie,
prejudicial to the interest of the Company.
g) During the year, the principal amount for loan taken and interest
thereon are not due for payment.
4. In our opinion and according to the information and explanations
given to us, having regard to the explanation that some of the items
purchased/job work are of special nature and suitable alternative
sources do not- exist for obtaining comparable quotations, there is an
adequate internal control system commensurate with the size of the
company and the nature of its business with regard to the purchase of
inventories and fixed assets and with regard to the sale of goods and
services . Further, on the basis of our examination and according to
the information and explanations give to us, we have not observed any
continuing failure to correct major weaknesses in such internal control
5. In respect of contracts or arrangements entered in the register
maintained in pursuance of section 301 of the Companies Act, 1956 to
the best of our knowledge and belief and according to the information
and explanations given to us:-
a) The particulars of contracts or arrangements referred to in section
301 that needed to be entered into the register, maintained under the
said section have been so entered.
(b) In our opinion and having regard to our comments in Para (4) above
and according to the informations and explanations given to us, the
transactions . [excluding loans reported under paragraph 3 above]
exceeding the value of rupees five lakhs in respect of any party during
the year have been made at prices which are prima facie reasonable
having regard to the prevailing market prices at the relevant time
where such prices are available. However income from construction
business received from a party in excess of Rs. 5.00. lacs and price
received from the same could not be commented upon us the hotel
division has not made similar transactions from any other party.
6. According to the information and explanations given to us, the
Company has not accepted any deposits from the Public. Therefore the
provisions of clause (vi) of the Companies (Auditors report) order,
2003 are not applicable to the company.
7. In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
8. According to the information and explanation given to us,
maintenance of cost records have not been prescribed by the central
Govt. under section 209 (1) (d) of the Companies Act. 1956 to any
product of the company .
9a) According to the information and explanations given to us and the
books & records of the company examined by us, the company has been
regular in depositing with appropriate authorities undisputed statutory
dues including provident fund , investor education and protection fund
employees state insurance , income tax. sales tax/VAT, wealth tax,
service tax, customs duty, excise duty, cess and other material
statutory dues applicable to it. However in some cases TDS , PF and ESI
lias not been deposited within the stipulated time limit.
b) According to the information and explanations given to us, no
undisputed amounts payable in respect of provident fund , employees
state insurance , income tax, sales tax/VAT, wealth tax, service tax,
customs duty, excise duty, cess and other undisputed statutory dues
were outstanding at the year end for a period of more than 6 months
from the date they became payable except a sum of Rs. 7.82 lacs in
respect of investor education and protection fund.
c)i) The disputed statutory dues aggregating to Rs. 346.65 Lacs that
have not been deposited on. account of disputed.matters pending before
appropriate authorities are as under :- .
Nature of Nature of the Forum where
the Statute Dues dispute is
Central Sales Tax Commissioner
Sales Tax (Appeals)/Tribun
Act, 1956. al
Tax Act of
states High court
Central Excise Duty Tribunal/Commi
Income Income Tax C1T
Tax Act, Appeal/lTAT
Demand Period to which
Amount the amount
(Rs. in relates
1990-91 to 1997-98,
02-03, 04-05 to 2005- 06
98.74 1987 to 1990,
2001-02 to 2004-2005
and amalgamated - Co.
OkCC-2004- 05,ORC-2004: 05,
ii) A general show cause notice of service tax received by the company
that service tax is payable on erection receipts in engg. division for
the period from 01.04.2004 to on ward. The company replied suitably .
10. The Company does not have accumulated losses at the end of the
financial year March 31, 2007. Further , the company has not incurred
any cash losses during the financial year ended March 31, 2007. and in
the immediately preceding financial year ended March 31,2006.
11. According to the records of the company examined by us and the
information and explanations given to us, the Company, has not
defaulted in repayment of dues to financial institutions and banks
during the year.
12. In our opinion and according to the information and explanations
given to us, the Company has not granted any loans and advances on the
basis of security by way of pledge of shares, debentures and other
securities, Paragraph 4 ( xii) of the order is not applicable.
13. In our opinion , the company is not a chit fund or a nidhi/mutual
benefit fund/society. Therefore, the provisions of clause 4 (xiii) of
the Companies (Auditors report) order. 2003 are not applicable to the
14. The company has maintaining proper record of the transactions and
contracts in respect of dealing or trading in shares , securities,
debentures and other investments and timely entries have been made
there in . All shares , securities, debentures and other investments
have been held by the company in its own name. . .
15. The company has given bank guarantees for advance taken / security
deposit for tendering by Joint venture firm from Banks. According to
the information & explanations given to us, we are of the opinion that
the terms & conditions there are not prima facie prejudicial to the
interest of the company.
16. To the best our knowledge and belief and according to the
informations and explanations given to us, in our opinion, the term
loans taken by the company during the year have been applied by the
company for the purposes for which the loans were obtained.
17. According to the information and explanations given to us, and on
an over all examinations of the Balance sheet of the company, we are of
the opinion that there are no funds raised on short term basis that
have been used for long term investment.
18. The company has not made any preferential allotment of shares
during the year to parties and companies covered in the register
maintained under section 301 of the Companies Act, 1956 except 20112659
Equity shares allotted to the share holder of erstwhile Om Structurals
India (P) Limited, Om Kothari Cement & Chemicals (P) Limited, Om Raj
Carbide Limited, Jupiter Manufacturing co. (P) Limited, Richa Builders
(P) Limited, SAH Buildcon (P) Limited pursuant to the scheme of
amalgamation approved by Honble Rajasthan high Court , Jaipur,
(Rajasthan). (See note no - 9.)
19. In our opinion and according to the information and explanations
given to us, the company has not issued any debentures, paragraph 4 ( x
ix) of the order is not applicable.
20. The company has raised monies by way of public issue amounting to
Rs. 120 crore towards the end of the year . Pending utilizations of the
same , the funds have been temporarily invested in current investments
and placed as fixed deposits with banks.
21 Based upon the audit procedures performed and information and
explanations given by the management, we report that no material fraud
on or by the company has been noticed or reported during the course of
our audit for the year ended March 31,2007 .
For M.C.BHANDARI & CO.
Dated: 30-06-2007 ( S.K.MAHIPAL )