1. We have audited the attached Balance Sheet of TATA MOTORS LIMITED
as at March 31, 2009, and also the Profit and Loss Account and the Cash
Flow Statement for the year ended on that date both 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 the 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 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 in paragraph 3
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 written representations received from the
directors, as on March 31, 2009, and taken on record by the Board of
Directors, we report that none of the directors is disqualified as on
March 31, 2009 from being appointed as a director in terms of clause
(g) of sub-section (1) of Section 274 of the Companies Act, 1956; and
(vi) in 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 March 31, 2009;
(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 the Cash Flow Statement, of the cash flows for the
year ended on that date.
ANNEXURE TO THE AUDITORS REPORT
(Referred to in paragraph 3 of our report of even date)
(i) (a) The Company has maintained proper records showing full
particulars including quantitative details and situation of fixed
assets.
(b) As explained to us, the Company has a programme for physical
verification of fixed assets in accordance with which the fixed assets
have been physically verified during the year by the Management. In our
opinion, the frequency of physical verification is reasonable. Having
regard to the size of the operations of the Company and on the basis of
explanations received, in our opinion, the net discrepancies found on
physical verification were not material.
(c) The fixed assets disposed off during the year, in our opinion, do
not constitute substantial part of the fixed assets of the Company and
such disposal has, in our opinion, not affected the going concern
status of the Company.
(ii) (a) As explained to us, the stocks of finished goods (other than a
significant part of the spare parts held for sale) and work in progress
in the Companys custody have been physically verified by the
Management as at the end of the financial year, before the year-end or
after the year-end, and in respect of stocks of stores and spares, the
aforesaid spare parts held for sale, and raw materials in the Companys
custody, there is a perpetual inventory system and a substantial
portion of the stocks have been verified during the year. In our
opinion, the frequency of verification is reasonable. In the case of
materials and spare parts held for sale lying with third parties,
certificates confirming stocks have been received in respect of a
substantial portion of the stocks held during the year or at the
year-end.
(b) In our opinion and according to the information and explanations
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) In our opinion and according to the information and explanations
given to us, the Company is maintaining proper records of inventory.
The discrepancies noticed on verification between the physical stocks
and the book records were not material having regard to the size of the
operations of the Company.
(iii) (a) The Company has not granted any loans, secured or unsecured
to companies, firms or other parties covered in the register maintained
under Section 301 of the Companies Act, 1956. As the Company has not
granted any loans, clauses (iii) (b), (iii) (c) and (iii) (d) of
Paragraph 4 of the Companies (Auditors Report) Order, 2003 are not
applicable to the Company.
(b) The Company has taken loan from two parties covered in the register
maintained under Section 301 of the Companies Act, 1956. The maximum
amount involved during the year was Rs.13.6 crores and the year-end
balance of the loans taken from such parties was Rs.13.6 crores.
(c) In our opinion the rate of interest and other terms and conditions
on which loans have been taken from the 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.
(d) The principal amount is not due for repayment and the Company has
been regular in payment of interest.
(iv) In our opinion and according to the information and explanations
given to us, having regard to the explanations that some of the items
purchased are of special nature and suitable alternative sources do not
exist for obtaining comparable quotations, there exists an adequate
internal control system commensurate with the size of the Company and
the nature of its business with regard to purchases of inventory and
fixed assets and with regard to the sale of goods and services. During
the course of our audit, we have not observed any major weakness in the
internal control system of the Company.
(v) (a) To the best of our knowledge and belief 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 under Section 301 of the Companies Act,
1956 have been so entered.
(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 exceeding the value of rupees five 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.
(vi) In our opinion and according to the information and explanations
given to us, the Company has complied with the provisions of Sections
58A, 58AA and other relevant provisions of the Companies Act, 1956 and
the Companies (Acceptance of Deposits) Rules, 1975 with regard to the
deposits accepted from the public. To the best of our knowledge and
according to the information and explanations given to us, no order has
been passed by the Company Law Board or National Company Law Tribunal
or Reserve Bank of India or any Court or any other Tribunal.
(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 relating to the
manufacture of motor vehicles 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. We have
not, however, made a detailed examination of the records with a view to
determining whether they are accurate or complete. To the best of our
knowledge and according to the information and explanations given to
us, the Central Government has not prescribed maintenance of cost
records under Section 209 (1) (d) of the Companies Act, 1956 for any
other products of the Company.
(ix) (a) According to the information and explanations given to us, the
Company is generally regular in depositing with appropriate authorities
undisputed statutory dues including provident fund, investor education
and protection fund, employees state insurance, income tax, sales tax,
wealth tax, service tax, customs duty, excise duty, cess and other
material statutory dues applicable to it. We are informed by the
Company that the Employees State Insurance Act, 1948 is applicable
only to certain locations of the Company. With regard to the
contribution under the Employees Deposit Linked Insurance Scheme, 1976
(the Scheme), we are informed that the Company has its own Life Cover
Scheme, and consequently, an application has been made seeking an
extension of exemption from contribution to the Scheme, which is
awaited. Further, since the Central Government has till date not
prescribed the amount of cess payable under Section 441A of the
Companies Act, 1956, we are not in a position to comment upon the
regularity or otherwise of the Company in depositing the same.
(b) According to the information and explanations given to us, no
undisputed amounts payable in respect of statutory dues including
provident fund, investor education and protection fund, employees
state insurance, income tax, sales tax, wealth tax, service tax,
customs duty, excise duty, cess and other material statutory dues
applicable to the Company were in arrears, as at March 31, 2009 for a
period of more than six months from the date they became payable.
(c) According to the information and explanations given to us, details
of dues of income tax, sales tax, wealth tax, service tax, custom duty,
excise duty and cess which have not been deposited on account of any
dispute are given below:
Particulars Financial years to which the matter pertains
Income tax 1998-99
1998-99, 2003-04, 2004-05 and 2005-06
Sales tax 1984-85, 1985-86, 1986-87, 1987-88,
1988-89,1990-91, 1992 - 93,
1994 - 95, 2000 - 01, 2005 - 06
1987-88, 1988-89, 1989-90, 1990-91,
1992-93, 1993-94,1994-95,
1995-96, 1996-97,1997-98, 1999-00, 2000-01, 2004-05
2004-05, 2005-06
1989-90, 1990-91, 1991-92, 1992-93, 1993-94,
1996-97, 1997-98,
1998-99, 1999-00, 2000-01, 2001-02, 2002-03,
2003-04, 2004-05,
2005-06, 2006-07,2007-08, 2008-09
1964-65, 1965-66, 1966-67, 1971-72, 1972-73,
1973- 74, 1974-75,
1975-76, 1979-80, 1982-83, 1984-85, 1985-86,
1986-87, 1987-88,
1988-89, 1991-92, 1992-93, 1993-94, 1994-95,
1995-96, 1996-97,
1997-98, 1999-00, 2000-01, 2001-02, 2004-05,
2005-06
1988-89, 1989-90, 1991-92, 1992-93, 1995-96,
1996-97, 1997-98,
1998-99, 2001-02
1986-87, 1988-89, 1990-91, 1992-93, 1995-96,
1997-98, 1999-00
1986-87, 1991-92, 1999-00, 2002-03
Excise duty 1993-94, 1999-2000, 2001-02, 2002-03, 2004-05,
2005-06, 2006-07,
2007-08, 2008-09
1984-85, 1994-95, 1995-96, 2003-04, 2006-07,
2008-09
Forum where dispute Amount
is pending (Rs. in crores)
Appellate Tribunal 0.22
Commissioner 165.10
High Court 147.59
Appellate Tribunal 25.57
Commissioner (Appeals) 0.18
Joint Commissioner 249.50
Deputy Commissioner 40.76
Additional Commissioner 21.80
Assistant Commissioner 0.09
Trade Tax Officer 0.54
Appellate Tribunal 90.61
Commissioner (Appeals) 0.76
(x) The Company does not have any accumulated losses at the end of the
financial year and has not incurred cash losses during the financial
year covered by our audit and the immediately preceding financial year.
(xi) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to a
financial institution, bank or debenture holder.
(xii) Based on our examination of the records and 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.
(xiii) In our opinion, the Company is not a chit fund or a nidhi/mutual
benefit fund/society. Therefore, the provisions of clause
(xiii) of Paragraph 4 of the Companies (Auditors Report) Order, 2003
are not applicable to the Company.
(xiv) In our opinion and according to the information and explanations
given to us, the Company is not dealing in or trading in shares,
securities, debentures and other investments. Accordingly, the
provisions of clause
(xiv) of Paragraph 4 of the Companies (Auditors Report) Order, 2003
are not applicable to the Company.
(xv) In our opinion and according to the information and explanations
given to us, the terms and conditions of the guarantees given by the
Company for loans taken by others from banks or financial institutions
are not prima facie prejudicial to the interest of the Company.
(xvi) In our opinion and according to the information and explanations
given to us, the term loans have been applied for the purpose for which
they were raised.
(xvii) Based on an overall examination of Balance Sheet of the Company,
as at March 31, 2009, short term funds of Rs 6129 crores have been
utilized for long term application. As per the information and
explanation given to us, the same is attributable to the economic
scenario affecting the volumes and funding plans. Further the Company
has explained that steps are being taken to augment long term funds.
(xviii) According to the information and explanations given to us, 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.
(xix) In our opinion and according to the information and explanations
given to us, during the period covered by our audit report, the Company
has issued debentures and the security or charge has been created in
respect of debentures issued.
(xx) We have verified the end use of money raised by the rights issue
from the Letter of Offer filed with Securities Exchange Board of India
and as disclosed in the Directors Report.
xxi) To the best of our knowledge and belief and according to the
information and explanations given to us, no material fraud on or by
the Company has been noticed or reported during the course of our
audit.
For DELOITTE HASKINS & SELLS
Chartered Accountants
M S Dharmadhikari
Partner
Membership No.: 30802
Mumbai: May 29, 2009
