| We have audited the accompanying financial statements of Gujarat Gas
Company Limited ("the Company"), which comprise the Balance Sheet as at
March 31, 2014, the Statement of Profit and Loss and Cash Flow
Statement for the period from January 1, 2013 to March 31, 2014, and a
summary of significant accounting policies and other explanatory
information.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation of these financial
statements that give a true and fair view of the financial position,
financial performance and cash flows of the Company in accordance with
the Accounting Standards referred to in sub-section (3C) of section 211
of the Companies Act, 1956 ("the Act") read with the General Circular
15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs in
respect of Section 13 3 of the Companies Act, 2013. This responsibility
includes the design, implementation and maintenance of internal control
relevant to the preparation and fair presentation of the financial
statements that give a true and fair view and are free from material
misstatement, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The procedures
selected depend on the auditor's judgment, including the assessment of
the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the Company's preparation and
fair presentation of the financial statements in order to design audit
procedures that are appropriate in the circumstances, but not for the
purpose of expressing an opinion on the effectiveness of the entity's
internal control. An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of the accounting
estimates made by the Management, as well as evaluating the overall
presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the financial statements give the information
required by the Act 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, 2014;
b. in the case of the Statement of Profit and Loss, of the Profit for
the period ended on that date; and
c. in the case of the Cash Flow Statement, of the cash flows for the
period ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order, 2003 ("the
Order") issued by the Central Government of India in terms of
sub-section (4A) of section 227 of the Act, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
2. As required under provisions of section 227(3) of the Act, we
report that:
a. We have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purpose of our
audit;
b. 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;
c. The Balance Sheet, Statement of Profit and Loss and Cash Flow
Statement dealt with by this Report are in agreement with the books of
account;
d. In our opinion, the Balance Sheet, Statement of Profit and Loss and
Cash Flow Statement comply with the accounting standards referred to in
sub-section (3C) of section 2 11 of the Act read with the General
Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate
Affairs in respect of Section 13 3 of the Companies Act, 2013; and
e. As the Company is a Government Company, in terms of notification
no. G.S.R 829(E) dated 21st October 2003, issued by department of
company affairs, ministry of finance, the clause (g) of sub-section (1)
of section 274 of the Companies Act, 1956 is not applicable.
ANNEXURE TO INDEPENDENT AUDITORS' REPORT
(Referred to in paragraph 1 under "Report on Other Legal and Regulatory
Requirements' section of our report of even date)
(i) (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation, of fixed
assets.
(b) The fixed assets are physically verified by the Management
according to a phased programme designed to cover all the items, other
than underground gas pipelines which are not physically verifiable,
over a period of 3 years which, in our opinion, is reasonable having
regard to the size of the Company and the nature of its assets.
Pursuant to the programme, a portion of the fixed assets has been
physically verified by the Management during period and no material
discrepancies have been noticed on such verification.
(c) In our opinion, and according to the information and explanations
given to us, a substantial part of fixed assets has not been disposed
off by the Company during the period.
(ii) (a) The inventory [excluding stocks with third parties] has been
physically verified by the Management during the period. In respect of
inventory lying with third parties, these have substantially been
confirmed by them. In our opinion, the frequency of verification is
reasonable.
(b) In our opinion, 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) On the basis of our examination of the inventory records, 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.
(iii) The Company has not granted/taken any loans, secured or
unsecured, to /from companies, firms or other parties covered in the
register maintained under Section 301 of the Act. Therefore, the
provisions of Clause 4(iii) [(b), (c) and (d) / (f) and (g)] of the
said Order are not applicable to the Company.
(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. Further, on the basis of our examination of
the books and records of the Company, and according to the information
and explanations given to us, we have neither come across, nor have
been informed of, any continuing failure to correct major weaknesses in
the aforesaid internal control system.
(v) (a) According to the information and explanations given to us, we
are of the opinion that the Company has entered all the transactions
required to be entered in the register maintained under section 301 of
the Companies Act, 1956.
(b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of such contracts or
arrangements and exceeding the value of Rupees Five Lakhs in respect of
any party during the period have been made at prices which are
reasonable having regard to the prevailing market prices at the
relevant time.
(vi) The Company has not accepted any deposits from the public within
the meaning of Sections 58A and 58AA of the Act and the rules framed
there under.
(vii) In our opinion, the Company has an internal audit system
commensurate with its size and the nature of its business.
(viii) We have broadly reviewed the books of account maintained by the
Company in respect of products where, pursuant to the rules made by the
Central Government of India, the maintenance of cost records has been
prescribed under clause (d) of sub-section (1) of Section 209 of the
Act, 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 determine whether
they are accurate or complete.
(ix) (a) According to the information and explanations given to us and
the records of the Company examined by us, in our opinion, the Company
is regular in depositing the undisputed statutory dues, including
provident fund, investor education and protection fund, income tax,
sales tax, wealth tax, customs duty, excise duty and other material
statutory dues, as applicable, with appropriate authorities, except
that the service tax on committement charges was not deposited within
the prescribed time limit. The amount of service tax outstanding for a
period exceeding six months from the date they become payable was Rs.
1.38 Crore. The same has since been paid.
(b) According to the information and explanations given to us and the
records of the Company examined by us, there are no dues of sales tax,
wealth tax and customs duty which have not been deposited on account of
any dispute.
The particulars of dues of service tax, excise and income tax as at
March 31, 2014 which have not been deposited on account of a dispute,
are as follows:
Name of Nature of Amount Period to which
the Statute dues (Rs. In Crores) the amount relates
Finance Act,
1994 Service Tax
(including 35.79 2005-2012
interest and
penalty)
Central
Excise Act, Excise Duty
(including 11.86 October 2006
1944 interest and
penalty)
Income Tax
Act,1961 Income Tax and 0.79 Assessment Year
Interest thereon 2010-11
Income Tax
Act,1961 Income Tax and 0.35 Assessment Year
Interest thereon 1996-97
Name of the Statue Forum where the dispute is pending
Finance Act, 1994 CESTAT
Central Excise Act, 1944 Commissioner (Appeals)
Income Tax Act,1961 Commissioner of Income Tax (Appeal).
Income Tax Act,1961 Commissioner of Income Tax (Appeal).
(x) The Company has no accumulated losses as at the period ended March
31, 2014 and it has not incurred any cash losses in the period ended on
that date or in the immediately preceding financial year.
(xi) As the Company does not have any borrowings from any financial
institution or bank nor has it issued any debentures as at the balance
sheet date, the provisions of Clause 4(xi) of the Order are not
applicable to the Company.
(xii) The Company has not granted any loans and advances on the basis
of security by way of pledge of shares, debentures and other
securities. Therefore, the provisions of Clause 4(xii) of the Order are
not applicable to the Company.
(xiii) As the provisions of any special statute applicable to chit
fund/nidhi/mutual benefit fund/ societies are not applicable to the
Company, the provisions of Clause 4(xiii) of the Order are not
applicable to the Company.
(xiv) The Company is not dealing in or trading in shares, securities,
debentures and other investments. Accordingly, the provisions of Clause
4(xiv) of the Order 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
banks or financial institutions during the period. Accordingly, the
provisions of Clause 4(xv) of the Order are not applicable to the
Company.
(xvi) The Company has not raised any term loans. Accordingly, the
provisions of Clause 4(xvi) of the Order are not applicable to the
Company.
(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 the 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 and companies covered in the register maintained under
Section 301 of the Act during the period. Accordingly, the provisions
of Clause 4(xviii) of the Order are not applicable to the Company.
(xix) The Company has not issued any debentures during the period and
does not have any debentures outstanding as at the beginning and at the
period end. Accordingly, the provisions of Clause 4(xix) of the Order
are not applicable to the Company.
(xx) The Company has not raised any money by public issues during the
year. Accordingly, the provisions of Clause 4(xx) of the Order are not
applicable to the Company.
(xxi) 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, and according to the information and
explanations given to us, we have neither come across any instance of
material fraud on or by the Company, noticed or reported during the
period, nor have we been informed of any such case by the Management.
For Manubhai & Shah
Chartered Accountants
Firm Registration No. 106041W
Place: Ahmedabad (G. R. Parmar)
Date: May 15 , 2014 Partner
Membership No.121462
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