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61
Annual Report 2011-12
60 Kajaria Ceramics Limited
Annexure to the Auditors’ Report
1.
a) The Company has maintained proper records to
show full particulars including quantitative details
and situation of fixed assets.
b) As explained to us, all the fixed assets have been
physically verified by the management in a phased
periodical manner, which in our opinion is
reasonable, having regard to the size of the
Company and nature of its assets. No material
discrepancies were noticed on such physical
verification.
c) In our opinion, the Company has not disposed off a
substantial part of its fixed assets during the year
and the going concern status of the Company is not
affected.
2.
a) Physical verification has been conducted by the
management at reasonable intervals in respect of
finished goods, stores, spare parts and raw materials.
We were informed that physical verification of clay
was made on the basis of volume and density which
is approximately correct.
b) In our opinion and according to the information and
explanation given to us, the procedure of physical
verification of these stocks followed by the
management is reasonable and adequate in relation
to the size of the Company and the nature of its
business.
c) In our opinion the Company is maintaining proper
records of inventories. The discrepancies noticed on
such verification between the physical stocks and
book records were not significant and the same has
been properly dealt with in the books of account.
3.
The Company has not granted any loan to Companies,
firms or other parties covered in the register maintained
under section 301 of the Companies Act, 1956 except an
interest free loan of
`
36.77 million given to a Subsidiary
Company. As per the information and explanations given
to us, the terms and conditions of the loan are not prima
facie prejudicial to the interest of Company. There are no
overdue balances outstanding in relation to the loans as
on 31st March, 2012.
4.
The Company has not taken any loan from companies,
firms or other parties covered in the register maintained
under section 301 of the Companies Act, 1956.
5.
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 with regard to
purchase of inventories, fixed assets and with regard to
the sale of goods and services. During the course of
audit, we have not observed any continuing failure to
correct major weaknesses in internal control system.
6.
a) In our opinion and according to information and
explanations given to us the transactions that
needed to be entered in the register maintained
under section 301 of the Companies Act, 1956 have
been entered in the register.
b) In our opinion, the transactions made in pursuance
of contracts/ arrangements entered in the register
maintained under Section 301 of the Companies Act,
1956 and exceeding the value of
`
500,000 in
respect of each party during the year have been
made at prices which appear reasonable as per
information available with the Company.
7.
In our opinion and according to the information and
explanations given to us, the Company has not accepted
any deposits within the meaning of provisions of section
58A, 58AA or any other relevant provisions of the
Companies Act, 1956 and the Companies (Acceptance of
Deposits) Rules, 1975.
8.
In our opinion and according to the information and
explanations given to us, the Company has adequate
internal audit system commensurate with its size and
nature of its business.
9.
The central government has prescribed the maintenance
of cost records under section 209(1)(d) of the Companies
Act, 1956 in respect of the manufacturing activities of
the Company. We have broadly reviewed the accounts
and records of the Company in this connection and are of
the opinion, that prima facie, the prescribed accounts
and records have been made and maintained. We have
not, however, carried out a detailed examination of the
same.
Annexure referred to in paragraph 1 of the Auditors’ Report on Accounts for the year ended 31st March 2012
10. a) As per information and explanations given to us the
Company has been regular in depositing the
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, Octroi,
Entry Tax and other statutory dues with the
appropriate Authorities. There are no undisputed
statutory dues at the year end outstanding for a
period of more than six months from the date they
become payable.
b) We have been informed that disputed demands of
`
64.34 million in respect of Sales Tax and Service
Tax are pending in appeals with the Commissioner
Appeals/High Court as per details below:
Particulars
Amt
Remarks
Demanded
Sales Tax Cases
1,366,298 Appeals pending with
Commissioner (Appeals)
Customs Duty
140,165 Appeal pending before
Commissioner (Appeals)
Entry Tax
62,631,098 Appeal pending with
Supreme Court
Service Tax
346,927 Appeal pending with
High Court, Rajasthan
11. There are no accumulated losses of the Company as at
the end of the year. The Company has not incurred cash
losses during the financial year covered by our audit and
in the immediately preceding financial year.
12. Based on our audit procedures and on the basis of
information and explanations given to us by the
management, we are of the opinion that there is no
default in repayment of dues to the Financial Institutions,
Banks or debenture holders as at the year end.
13. The Company has not granted any loans and advances
on the basis of security by way of pledge of shares,
debentures and other securities. Hence paragraph 4 (xii)
of the order is not applicable.
14. In our opinion, the Company is not a chit fund/ nidhi/
mutual benefit fund/ society. Therefore, the provisions
of clause (xiii) of paragraph 4 of the order are not
applicable to the Company.
15. According to information and explanations given to us
the Company has not given any guarantee for loan taken
others from Banks or Financial Institutions, the terms and
conditions whereof are prejudicial to the interest of the
Company.
16. According to the information and explanations given to
us the term loans taken by the Company have been
applied for the purposes for which the loans were
obtained.
17. According to the information and explanations given to
us and on overall examination of the Balance Sheet of
the Company, we are of the opinion that the funds raised
on short term basis have not been utilised for long term
investment.
18. During the year the Company has not made any
preferential allotment of shares to parties and
Companies covered in the Register maintained u/s 301
of the Companies Act, 1956. As such paragraph 4 (xviii) of
the order is not applicable.
19. Since the Company has not raised money by way of
Public Issue during the year paragraph 4 (xx) of the order
is not applicable.
20. Based upon the audit procedures performed and
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 the
year ended 31st March, 2012.
21. Other clauses of the order are not applicable to the
Company for the year under report.
For O. P. Bagla & Co.
Chartered Accountants
Firm Registration No. 000018N
Atul Bagla
Place : New Delhi
Partner
Dated : 27 April 2012
Membership No. 91885