1. We have audited the attached Balance Sheet of Aventis Pharma
Limited the Company as at December 31, 2008 and also the Profit and
Loss account and 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
our opinion.
3. As required by the Companies (Auditors Report) Order, 2003 (as
amended) issued by the Central Government of India in terms of
sub-section (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
report that:
i. 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;
ii. 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 books;
iii. The balance sheet, profit and loss account and cash flow statement
dealt with by this report are in agreement with the books of account;
iv. In our opinion, the balance sheet, profit and loss account and cash
flow statement dealt with by this report comply with the accounting
standards referred to in sub-section (3C) of section 211 of the
Companies Act, 1956.
v. On the basis of the written representations received from the
directors, as on December 31, 2008, and taken on record by the Board of
Directors, we report that none of the directors is disqualified as on
December 31, 2008 from being appointed as a director in terms of clause
(g) of sub-section (1) of section 274 of the Companies Act, 1956.
vi.ln 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:
a) in the case of the balance sheet, of the state of affairs of the
Company as at December 31, 2008;
b) in the case of the profit and loss account, of the profit for the
year ended on that date; and
c) in the case of cash flow statement, of the cash flows for the year
ended on that date.
Annexure referred to in paragraph [3] of our report of even date
Re: Aventis Pharma Limited
(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) All fixed assets have not been physically verified by the
management during the year but there is a regular programme of
verification which, in our opinion, is reasonable having regard to the
size of the Company and the nature of its assets. As informed, no
material discrepancies were noticed on such verification.
(c) There was no substantial disposal of fixed assets during the year.
(ii) (a) The management has conducted physical verification of
inventory at reasonable intervals during the year.
(b) The procedures of physical verification of inventory 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 inventory and no
material discrepancies were noticed on physical verification.
(iii) (a) The Company has granted loan to a company covered in the
register maintained under section 301 of the Companies Act, 1956. The
maximum amount involved during the year was Rs. 325,000 thousands and
the year-end balance of loan granted was Rs. 170,000 thousands.
(b) In our opinion and according to the information and explanations
given to us, the rate of interest and other terms and conditions for
such loans are not prima facie prejudicial to the interest of the
Company.
(c) As informed, the loan granted is re-payable on demand. There has
been no default for repayment on the part of the party to whom the
money has been lent. The payment of interest has been regular.
(d) There is no overdue amount of loans granted to the Company listed
in the register maintained under section 301 of the Companies Act,
1956.
(e) As informed, the Company has not taken any loans, secured or
unsecured from companies, firms or other parties covered in the
register maintained under section 301 of the Companies Act, 1956.
(f) As the Company has not taken any loans, clause iii (f) and (g) of
the Companies (Auditors report) Order, 2003 (as amended) are not
applicable.
(iv) 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 for the sale of goods and
services. During the course of our audit, no major weakness has been
noticed in the internal control system in respect of these areas.
(v) (a) According to the information and explanations provided by the
management, we are of the opinion that the particulars of contracts or
arrangements referred to in section 301 of the Act that need to be
entered into the register maintained under section 301 have been so
entered. (b) In respect of transactions made in pursuance of such
contracts or arrangements exceeding value of Rupees five lakhs entered
into during the financial year, because of the unique and specialized
nature of the items involved and absence of any comparable prices, we
are unable to comment whether the transactions were made at prevailing
market prices at the relevant time.
(vi) The Company has not accepted any deposits from the public.
(vii) In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
(viii) 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 section 209(1 )(d) of the Companies
Act, 1956, and are of the opinion that prima facie, the prescribed
accounts and records have been made and maintained.
(ix) (a) Undisputed statutory dues including provident fund, investor
education and protection fund, employees state insurance, income-tax,
sales-tax, service tax, wealth-tax, customs duty, excise duty, cess
have generally been regularly deposited with the appropriate
authorities.
(b) According to the information and explanations given to us, no
undisputed amounts payable in respect of provident fund, investor
education and protection fund, employees state insurance, income-tax,
wealth-tax, service tax, sales-tax, customs duty, excise duty, cess and
other undisputed statutory dues were outstanding, at the year end, for
a period of more than six months from the date they became payable.
(c) According to the records of the Company, the dues outstanding of
income-tax, sales-tax, excise duty and customs duty on account of any
dispute, are as follows:
Name of the statute Nature of dues
Income Tax Act ,1961 Income Tax- Due to
disallowances and
abatement of relief/ rebate
Income Tax- Due to
disallowances and
abatement of relief/ rebate
Penalty under section 271
(1) (c) of the Income Tax,
1961
The Central Excise Act, Wrongful Availment of
1944 Modvat
Duty on Samples
Disallowance of Modvat
Disallowance of Modvat
Medicinal & Toilet Dispute Whether Central
Preparations (Levy of or State Excise duty
Excise Duty) Act, 1955
Dispute Whether Central
or State Excise duty
Karnataka Sales tax Act Order passed under
of 1957 section 12A and 25
Foreign Trade (Develop- Demand for refund of
ment & Regulation) Act customs duty & interest
1992 on account of rejection of
input/output norms
Amount* Period to which the Forum where dispute is pending
(Rs) 000s amount relates
73,011 Assessment Year Commissioner of Income Tax
2005-06 (Appeals)
33,479 Assessment Year Commissioner of Income Tax
2004-05 (Appeals)
30,880 Assessment Year Commissioner of Income Tax
2002-03 (Appeals)
18,900 1994-1995 Customs Excise and Service tax
Appellate tribunal.
529 1994 to 1999 Customs Excise and Service tax
Appellate tribunal.
1,720 1993 Commissioner of Appeals, Surat.
361 1993 Commissioner of Appeals, Surat.
23,156 1990 to 1997 Central Board of Excise and
Customs.
13,207 1996 to 1999 Commissioner of State Excise
Maharashtra.
845 1999-2000 Karnataka Appellate Tribunal.
5,955 2005 Director General of Foreign Trade,
Delhi
* Net of amount paid under protest or otherwise.
Apart from the above, there are no dues of wealth tax, service tax,
customs duty & cess which have not been deposited on account of any
dispute.
(x) The Company has no accumulated losses at the end of the financial
year and it has not incurred cash losses in the current and immediately
preceding financial year.
(xi) Based on our audit procedures and as per the information and
explanations given by the management, we are of the opinion that the
Company has not defaulted in repayment of dues to banks. The Company
does not have any borrowings from financial institutions or by way of
debentures.
(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 and 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 provisions of clause 4
(xiii) of the Companies (Auditors Report) Order, 2003 (as amended) are
not applicable to the Company.
(xiv) In our opinion, the Company is not dealing in or trading in
shares, securities, debentures and other investments. Accordingly, the
provisions of clause 4(xiv) of the Companies (Auditors Report) Order,
2003 (as amended) are not applicable to the Company.
(xv) 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.
(xvi) The Company did not have any term loans outstanding during the
year.
(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
investment.
(xviii) The Company has not made any preferential allotment of shares
to parties or 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
year.
(xx) The Company has not raised any money through a public issue during
the year
(xxi) Based upon the audit procedures performed for the purpose of
reporting the true and fair view of the financial statements and as per
the information and explanations given by the management, we report
that no fraud on or by the Company has been noticed or reported during
the course of our audit.
For S. R. Batliboi & Co.
Chartered Accountants
per Ravi Bansal
Partner
Membership No. 49365
Mumbai: February 17, 2009
