We have audited the attached Balance Sheet of Shivam Autotech Limited
as at 31st March, 2010 and also the Profit & Loss Account andthe Cash
FlowStatementoftheCompanyforthe yearendedonthatdate, annexedthereto.
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.
We have 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
statement presentation. We believe that our audit provides a reasonable
basis for our opinion.
As required by the Companies (Auditors Report) Order, 2003 as amended
by the Companies (Auditors Report) (Amendment) Order, 2004
(Collectively the Order) issued by the Central Government of India in
terms of Section 227 (4A) of the Companies Act, 1956 and on the basis
of such checks as we considered appropriate and according to the
information and explanations given to us, we enclosein theAnnexurea
statementon the matters specified inparagraphs 4 and5 of the said
Further to our comments in the Annexure referred to above, we report
a) We have obtained all the information and explanations which, to the
best of our knowledge and belief, were necessary for the purposesof 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 examinationof those
c) The Balance Sheet, Profit & Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account;
d) In our opinion, the Balance Sheet, Profit & Loss Account and Cash
Flow Statement, dealt with by this report, comply with theAccounting
Standards referred to in sub-section (3C) ofSection 211 ofthe
e) On the basis of written representations received from the directors
as on 31st March, 2010 and taken on record by the Board of Directors,
we report that none of the directors is disqualified as on 31st March,
2010 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 of our information and according to
the explanations given to us, the said accounts read with the
Accounting policies and Notes thereon, 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
i) In the case of Balance Sheet, of the state of affairs of the Company
as at 31st March, 2010;
ii) In the case of Profit and Loss Account, of the Profit for the year
ended on that date; and
iii) In the case of Cash Flow Statement, of the cash flows for the year
ended on that date.
ANNEXURE TO AUDITORS REPORT (Annexure referred to in our report of
1. (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
(b) Verification of the fixed assets is being conducted based on a
phased programme by the management designed to cover all assets, which,
in our opinion, is reasonable having regard to the size of the company
and nature of its business. Discrepancies noticed on such verification
as compared to book records were not material and have been properly
adjusted inthe booksof account.
(c) Fixed assets disposed off during the year were not substantial.
2. (a) The inventory has been physically verified during the year by
the management at all its locations at reasonable intervals. Further
stocks in the possession and custody of third parties as at 31st March
2010 have been verified by the management with reference to
confirmations or statement of account or correspondence of the third
parties. In our opinion, the frequency ofsuch verificationisreasonable.
(b) The procedures for the physical verification of inventory followed
by the management are, in our opinion, reasonable and adequate
inrelation tothe size of the Company and nature ofits business.
(c) 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 and have been
properly dealt with in the books of account.
3. (a) The Company has not granted any loan, secured or unsecured, to
Companies, firms and other parties covered in the register maintained
under section 301ofthe CompaniesAct, 1956.
(b) The company has taken unsecured loan in the nature of advance
against supplies, from a Company covered in the register maintained
under section 301ofthe CompaniesAct, 1956. The maximum amount
outstanding during the year was Rs 1900.00 lacs and year end balance
was Rs 1700 lacs. Apart from this, the company has not taken any other
loans, secured orunsecured, from companies, firms or other parties
listed in the register maintained under section 301 of theCompaniesAct,
(c) In our opinion, other terms&conditionsof such loan are prima facie,
not prejudicial tothe interestof the Company.
(d) In respect of the aforesaid loan, the company was regular in
repayment of principal amount and interest due thereon as per the
termsof the acceptance.
4. In our opinion, and according to the information and explanations
given to us during the course of audit, there are adequate internal
control systems commensurate with size of the Company and the nature of
its business with regard to purchase of inventory and fixed assets and
for the sale of goods and services. Further, on the basis of our
examination of the books & records of the company, carried out in
accordance with the generally accepted auditing practices in India, we
have neither come across nor have we been informed of any instance of
major weaknesses in the aforesaid internal control systems.
5. (a) Based upon the audit procedures applied by us and according to
the information and explanations given to us, we are of the opinion
that the particulars of contracts or arrangements that need to be
entered into the register maintained undersection301oftheCompaniesAct,
(b) In our opinion, and according to the information and explanations
given to us, the transactions made in pursuance of contracts or
arrangements entered in the register maintained under Section 301 of
the Companies Act, 1956 and aggregating during the year to Rupees five
lakhs or more in respect of each party have been made at prices which
are reasonable having regard to market prices for such transactions,
prevailing at the relevant time, where such market prices are
6. The Company has not accepted any deposits from the public within
the meaning of section 58Aand 58AAor any other relevant provisions
ofthe CompaniesAct, 1956 including the Companies (Acceptance of
Deposits) Rules, 1975.
7. In our opinion, the Company has an internal audit system
commensurate with the size & natureof its business.
8. Wehave broadly reviewed the CostAccounting records, maintained by
the Company pursuanttothe Rules prescribed by the Central Government
for the maintenance of cost records under clause (d) ofsub-section (1)
of section 209 of the Companies Act, 1956 and are of the opinion that,
prima facie, the prescribed accounts and records have been made and
9. (a) According to the records of the Company, 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 material statutory dues
have been generally regularly deposited with the appropriate
authorities during the year and there are no such undisputed statutory
dues outstanding as on the date of Balance Sheet foraperiod exceeding
six monthsfrom the datethey became payableasonthe dateofthe balance
(b) According to the information & explanations given to us and as per
the books and records examined by us, there are no dues in respect of
Excise Duty, Sales Tax, Wealth Tax, Custom Duty, Income Tax and Cess
which have not been deposited on account of any dispute except the
following dues of Service Tax along with the forum where the dispute is
Name of the
Statute Nature of Dues Year to
which Forum Amount
Act,1994 Service Tax 2005-06 to Additional 1437794.00
10. There are no accumulated losses of the Company as at the end of
the financial year. There are no cash losses during the financial year
and inthe immediately preceding financial year.
11. According to the information and explanations given to us and as
per the books and records examined by us, the Company has not
defaultedin repaymentof duesto any financial institution or bank.
12. Accordingtothe information and explanations giventous, the Company
has not granted any loans and advances on the basis ofsecurityby way
ofpledge ofshares, debentures and other securities.
13. The Company does not fall within the category of Chit fund / Nidhi
/ Mutual Benefit fund / Society and hence the related reporting
requirementsof the Order are not applicable.
14. The Company is not dealing in or trading in shares, securities,
debentures, and other investments. Accordingly, the provisions ofclause
4(xiv) ofthe Order are not applicable to the company.
15. The company has not given any guarantees for loans taken byothers
from bankor financial institution.
16. In our opinion, and according tothe information and explanations
givento us, the term loans raised during the year by the Company have
been applied for the purpose for which the said loans were obtained,
where such end-use has been stipulated bythe lender.
17. According to the information and explanations given to us and as
per the books and records examined by us, on an overall examination of
the Balance Sheet of the Company, the funds raised by the Company on
short-term basis have been applied for long-term investment to the
extent of Rs.2956.97Lacs. We understand from management that the
company is in the process of arranging suitable long term funds to
replace these short term funds.
18. 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.
19. The Company hasnot issued anydebentures during theyear nor hasany
20.The Company hasnot raised any money by way of public issues during
21. 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, we have neither come across any instance
of fraud on or by the Company,noticed andreportedduring theyear, nor
have we been informed of such case by the management.
Firm Regn No. 000756N
(ARUN K. TULSIAN)
Place: New Delhi
Dated: 31st, July 2010