| Report on the Financial Statements
We have audited the accompanying financial statements of SAAG RR Infra
Limited ('the Company') which comprise the Balance Sheet as at 31st
March, 2013, the Statement of Profit and Loss and the Cash Flow
Statement for the Year then ended and a summary of significant
accounting policies and other explanatory information.
Management's Responsibility for the Financial Statement
The 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'). This responsibility includes
the design, implementation and maintenance of internal control relevant
to the preparation and 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
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. 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 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 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 31st March, 2013;
b) in the case of the Statement of Profit and Loss, of the Loss of the
Company for the Year ended on that date; and
c) in the case of the Cash Flow Statement, of the Cash Flows of the
company for the year ended on that date.
Emphasis of Matter
Attention is invited to note 2.33 in the notes forming part of the
financial statements. The Company has incurred a net loss of Rs. 279.30
million during the year ended March 31, 2013, and, as of that date the
Company's net worth has also been completely eroded. These factors,
along with other matters as set forth in Note 2.33, raise substantial
doubt that the Company will be able to continue as going concern. Our
opinion is not modified in this respect.
Report on Other Legal & Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order, 2003 ('the
Order'), as amended, issued by the Central Government of India in terms
of Section 227 (4A) 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.
2. As required by Section 227(3) of the Companies Act, 1956, 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 purpose 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, Statement of Profit and Loss 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, Statement of Profit and Loss 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; and
v On the basis of written representations received from the Directors
as at 31st March, 2013, and taken on record by the Board of Directors,
none of the directors are disqualified as on 31st March, 2013, from
being appointed as a director in terms of clause (g) of sub section (1)
of Section 274 of the Companies Act, 1956.
ANNEXURE TO THE AUDITORS' REPORT:
The Annexure referred to in our report to the members of SAAG RR Infra
Limited ('the company') for the year ended 31st March, 2013. We report
that:
1) a) The Company has maintained proper records to show full
particulars, including quantitative details and situation of fixed
assets. However, comprehensive description of assets and current
location are to be incorporated in the asset records after completion
of reconciliation referred to in paragraph 1(b) below.
b) The Fixed Assets have been physically verified by the management
during the year. Pending completion of reconciliation which is
reportedly in progress, discrepancies if any, cannot be ascertained.
c) The company has not disposed off substantial part of its fixed
assets, which will affect the going concern status of the company.
2) a) The Stock of traded goods of the Company has been physically
verified at periodic intervals during the year by the management. In
our opinion, the frequency of such verification is adequate.
b) In our opinion, and according to the information and explanations
given to us, the procedures for 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, the company has maintained proper records of
inventory .The discrepancies noticed between the physical stocks as
verified and the book records were not material and have been properly
dealt with in the books of account.
3) a) The Company has not granted any loans, secured or unsecured to
companies, firms or parties covered in the register maintained under
Section 301 of the Act. Accordingly, paragraphs 4(iii)(a) to 4(iii)(d)
of the Order are not applicable. .
b) The company has not taken any loans, secured or unsecured from
companies, firms or other parties covered in the register maintained
under Section 301 of the Companies Act, 1956. Accordingly paragraphs
4(iii) (e) to 4(iii)(g) of the Order are not applicable.
4) 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 inventory and fixed assets and for the sale of goods and
services. During the course of audit, no major weakness has been
observed in the internal control system.
5) In our opinion and according to the information and explanations
given to us, there is no transaction that needs to be entered in the
register maintained in pursuance of Section 301 of the Companies Act,
1956 during the year under audit. Accordingly, paragraph 4(v) of the
Order is not applicable.
6) The Company has not accepted any deposits from the public.
Accordingly, paragraph 4(vi) of the Order is not applicable.
7) During the year, the Company does not have a formal internal audit
system. However, according to the information and explanations given to
us, the operating internal control systems are commensurate with the
size and nature of the business.
8) Maintenance of cost records has not been prescribed for the Company
by the Central Government under section 209(1) (d) of the Companies Act
1956 for any of the services rendered by the Company. Accordingly,
paragraph 4(viii) of the Order is not applicable.
9) a) According to the information and explanations given to us and on
the basis of our examination of the records of the company, amounts
deducted /accrued in the books of account in respect of undisputed
statutory dues including Provident Fund, Income Tax, Sales Tax, Service
Tax and other material statutory dues have not been regularly deposited
during the year by the company with the appropriate authorities.
b) According to the information and explanations given to us and the
books and records examined by us, there are undisputed amounts payable
in respect of Provident Fund, Income Tax, Sales Tax, Service Tax and
other material statutory dues were in arrears as at March 31, 2013
excluding applicable interest in all cases, for a period of more than
six months from the date they became payable, as given below:
S.
No. Name of the Statute Amount in Rs. Million - as
at March 31, 2013,
outstanding for a period of
more than six months from
the day they became payable
1 Service Tax under Finance Act, 1994 17.80
2 Income Tax Act, 1961 - Fringe
Benefit Tax 0.08
3 Income Tax Act, 1961 - Tax
Deducted at Source 8.22
4 Value Added Tax Act 0.02
c) According to the information and explanations given to us, there are
no dues of Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs duty
and Cess, which have not been deposited with the appropriate
authorities on account of any dispute except for the following dues
under Income Tax Act:
Name of the
Statue Nature of the Amount
in Rs Period to
which the Forum where
disputes are
pending
disputed dues Million amount
relates
Income Tax
Act, 1961 Penalty 0.50 Assessment
Year - Commissioner of
Income Tax
(Appeals),
2006-2007 Chennai
Income Tax
Act, 1961 Penalty 0.50 Assessment
Year - Commissioner of
Income Tax
(Appeals),
2007-2008 Chennai
Income Tax
Act, 1961 Penalty 0.50 Assessment
Year - Commissioner of
Income Tax
(Appeals),
2008-2009 Chennai
Service Tax
under Finance
Act, Tax arrears 79.95 FY 2007-08
to FY Commissioner of
Service Tax.
1994 2011-12
10) The Financial statements of the Company as at 31st March 2013 show
accumulated losses of Rs. 654.73 million. The Company has incurred cash
losses during the financial year covered by our audit and in the
immediate preceding financial year.
11) According to the records of the Company examined by us and the
information and explanations given to us by the Management, the Company
has defaulted in repayment of dues with respect to term loans taken
from bank and the unpaid overdue principal and interest stands at Rs.
200.00 million and Rs. 63.60 million respectively.
12) Based on our examination and according to the information and
explanations given to us, the company has not granted loans and
advances based on security by way of pledge of shares, debentures and
other securities. Accordingly, paragraph 4(xii) of the Order is not
applicable.
13) In our opinion and according to the information and explanations
given to us, the Company is not a chit fund/ nidhi/ mutual benefit
fund/society. Accordingly, paragraph 4(xiii) of the Order is not
applicable.
14) According to the information and explanations given to us, the
Company is not dealing or trading in shares, securities, debentures and
other investments. Accordingly, paragraph 4(xiv) of the Order is not
applicable.
15) According to the information and explanations given to us, the
Company has not given guarantee for loans taken by others from banks or
financial institutions. Accordingly, paragraph 4(xv) of the Order is
not applicable.
16) During the year, the company has not taken any term loan from
financial institutions and banks and hence paragraph 4(xvi) of the
Order is not applicable.
17) On the basis of our examination of the Balance Sheet of the Company
and according to the information and explanations given to us, in our
opinion, funds raised on short-term basis have not been used for
long-term investment and vice versa.
18) The company has made preferential allotment of shares to parties
and companies covered in the Register maintained under section 301 of
the Companies Act, 1956 and the price at which allotment has been made
is not prejudicial to the interest of the Company.
19) The company has not issued any debentures during the year.
Accordingly paragraph 4(xix) of the Order is not applicable.
20) The company has not raised any money by issue of shares to public
during the year. Accordingly paragraph 4(xx) of the Order is not
applicable.
21) According to the information and explanations given to us, no
material fraud on or by the company has been noticed or reported during
the year under audit.
For SundarSrini& Sridhar
Chartered Accountants
Firm Registration Number: 004201S
S. Sridhar
Place: Chennai
Date: May 31, 2013 Partner
Membership Number: 025504 |