We have audited the attached Balance Sheet of SURAJ INDUSTRIES LIMITED,
as at 31st March, 2003, Profit & Loss Account and the Cash Flow
Statement for the year ended on that date annexed thereto. These
financial statements are the responsibility of the Company s
management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with the 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 mis-statement. 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
As required by the Manufacturing and other Companies (Auditors Report)
Order, 1988, issued by the Central Government of India in terms of Sub
section (4A) 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.
Attention is drawn to note no 4 of part B of Schedule K. As indicated
in the said note that manufacturing activities at the factory have been
suspended since January 2003. However, these accounts have been
prepared on the going concern concept of accounting in light of the
facts mentioned in the said note.
Further to our comments in the Annexure referred to above, we report
i) We have obtained all the information and explanations, which to the
best of our knowledge and belief, were necessary for the purposes of
ii) 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
iii) The Balance Sheet and the Profit and Loss Account and the Cash
Flow Statement dealt with by this report are in agreement with the
books of account;
iv) In our opinion, the Balance Sheet and Profit & Loss Account and the
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) Based on the written representation received from the Directors as
on March 31,2003 and taken on record by the Board of Directors, we
report that none of the Directors are disqualified as on March 31, 2003
from being appointed as a Director in terms of clause (g) of
sub-section (1) of section 274 of the Companies Act, 1956.
vi) Subject to Note no.2 of part B of schedule L relating to allotment
of shares against unrealised stock invest, in our opinion and to the
best of our information and according to the explanations given to us,
the said accounts read with the significant 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 accepted in India;
a) In the case of Balance Sheet, of the State of affairs of the Company
as at March 31, 2003; and
b) In the case of Profit and Loss Account, of the Loss of the Company
for the year ended on that date, and
c) In the case of Cash Flow Statement, of the cash flows of the Company
for the year ended on that date.
For TAS ASSOCIATES
Place: New Delhi (SUBODH GUPTA)
Dated: 28th August, 2003 Partner
ANNEXURE REFERRED TO IN OF THE AUDITORS REPORT TO THE MEMBERS OF SURAJ
INDUSTRIES LIMITED ON THE ACCOUNTS FOR THE YEAR ENDED MARCH 31,2003.
1. The Company has maintained proper records showing full particulars
including quantitative details and situation of fixed assets. During
the year these fixed assets have been physically verified by the
Management and no serious discrepancies were noticed on such
2. None of the fixed assets have been re-valued during the year.
3. The stock of finished goods, stores, spare parts and raw material
have been physically verified by the management at reasonable
intervals. In our opinion the frequency of verification is reasonable.
4. The discrepancies between physical stocks and book records as
observed on verification which were not material in relation to the
size of the company, have been properly dealt with in the books of
5. In our opinion, the procedure of physical verification of stocks
followed by the management are reasonable and adequate in relation to
the size of the company, and the nature of the business.
6. In our opinion the valuation of finished goods, spare parts and raw
materials is fair and proper in accordance with the normally accepted
accounting principles and is on the same basis as in the earlier year.
7. The term and conditions of unsecured loan taken by the company from
Companies, firms or other parties listed in the register maintained
under section 301 of the Companies Act, 1956, are not, prima facie,
prejudicial to the interest of the company.
8. The Company has not granted any loan, secured or unsecured, to
companies, firms, or other parties listed in the register maintained
under section 301 of Companies Act, 1956.
9. In respect of loans & advances in the nature of loans given to
employees, the repayment of principal & interest, wherever applicable
are in accordance with the stipulations where made.
10. In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
commensurate with the size of the company and the nature of its
business for the purpose of purchase of raw materials including
components. Plant and Machinery, equipments & other assets and for sale
11. According to information & explanations given to us, there are no
transactions of purchase of goods and materials and sale of goods,
material and services made in pursuance of contracts or arrangements
which are required to be entered in the register(s) maintained under
section 301 of the Companies Act, 1956.
12. As certified by the management and as per the explanations given to
us, no unserviceable or damaged stores and raw material are included in
the stocks and as such no write off or provisions for the loss arising
from such items have been made in the accounts.
13. The company has complied with the provisions of Section 58A of the
Companies Act, 1956 and the rules framed thereunder, wherever
applicable, for accepting deposit from public.
14. In our opinion reasonable records have been maintained by the
company for the sale and disposal of realizable by-products and scrap.
15. In our opinion the company has an adequate internal audit system
whose scope and coverage is commensurate with the size and nature of
16. 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 maintained.
17. According to the records, the company has been regular in
depositing provident fund dues with appropriate authorities. However,
according to the information and explanation given to us the provision
for Employees State Insurance are not applicable in case of the
18. According to information and explanations given to us there are no
undisputed amounts payable in respect of Income-Tax, Wealth-Tax,
Sales-Tax, Custom duty and excise duty as on 31.03.03, the last day of
the financial year concerned, for a period of more than six months from
the date they became payable.
19. During the course of our examination of the books of account
carried out in accordance with the generally accepted Auditing
Practices, we have not come across any personal expenses, other than
those payable under contractual obligations or in accordance with
generally accepted business practices, which have been charged to
Profit & Loss Account.
20. The Company is not a sick industrial company within the meaning of
clause (o) of sub-section (1) of section 3 of the sick Industrial
Companies (Special Provision) Act, 1985.
For TAS ASSOCIATES
Place: New Delhi (SUBODH GUPTA)
Dated: 28 August, 2003 Partner