I. We have audited the attached Balance Sheet of e.star Infotech
Limited as at 31s1 March 2007, the Profit and Loss Account for the year
ended on that date 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 conduct 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 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 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(as
amended) 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 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 dealt with by this
report are in agreement with the books of account
(iv) In our opinion, the Balance Sheet, Profit and Loss Account 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 on31st March 2007 and taken on record by the Board of
Directors, we report that none of the directors is disqualified as on
31st March 2007 from being appointed as a director in terms of clause
(g) of sub-section (1) of section 274 of the Companies Act 1956.
(vi) In our opinion and to the best of our information and according to
the explanation 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 31st March 2007.
(b) In the case of the Profit and Loss Account of the profit for the
year ended on that date.
ANEXURE TO THE REPORT OF THE AUDITORS TO THE MEMBERS
Referred to in paragraph 3 of our report of even date, we state that
i) (a) The company has maintained proper records showing full
particular including quantitative details and situation of fixed assets
on the basis of information available.
(b) We are informed that fixed assets have been physically verified by
the management during the year There is a regular programme of
verification which, in our opinion, is reasonable having regard to the
size of the company and the nature of its assets. No material
discrepancies were noticed on such verification.
(c) There has been no substantial disposal of Fixed assets during the
year which has affected the going concern status of the company.
[ii) (a) The stock of software packages have been physically verified
by the management at reasonable intervals during the year. In our
opinion and as per explanations given to us frequency of the
verification is reasonable.
(b) In our opinion and according to the information and explanation
given to us, 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 explanation
given to us the company is maintaining proper records of inventory. No
material discrepancies were noticed on physical verification between
physical stock and book records.
(iii) (a) The company has not granted loan to any company covered in
the register maintained under section 301 of the Companies Act, 1956.
So the Clause 4 (iii)(b),(c) & (d) of Company (Auditors Report) Order,
2003(as amended) are not applicable to the company.
(e) The Company has not taken any loan secured or unsecured from
companies .firms or other parties covered in the register maintained
under Section 301 of the Companies Act 1956 So the Clause 4 (iii)(f),
(g) of Company (Auditors Report) Order,2003(as amended) are not
applicable to the company.
(iv) 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 with regard to purchases of inventory,
fixed assets and with regard to the sale of goods and services . During
the course of our audit, we have not observed any continuing failure to
correct major weaknesses in internal controls.
(v) (a) According to the information and explanations given to us, we
are of the opinion that the transactions 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 have been made at prices which are reasonable
having regard to prevailing market prices at the relevant time.
(vi) The company has not accepted any deposits during the year and
consequently the provision of
section 58A and 58AA of the companies Act 1956 and the rules framed
hereunder are not applicable.
(vii) In our opinion, the company has an internal audit system
commensurate with the size of the
company and nature of its business.
(viii) According to the information and explanation given to us the
maintenance of Cost Record has not
been prescribed by the central Government u/s 209(1 )(d) of the
Companies Act 1956 for any of the activities of the company.
(ix) (a) According to the information and explanation given to us the
company is generally regular in depositing with appropriate authorities
undisputed statutory dues including income tax, sales tax, wealth tax,
custom duty, excise duty, cess and other material statutory dues as
applicable to it and there is no undisputed amounts payable in respect
of Income Tax, Service Tax, Wealth Tax, Sales Tax, Customs Duty, Excise
Duty and Cess as at 31st March, 2007 for a period of more than six
months from the date they become payable except Professional Tax
amounting to Rs. 16,680 /- which were outstanding for more than six
months as on 31st March,2007.
(b) According to the information and explanation given to us, there are
no dues of sale tax, income tax, customs duty, wealth tax, excise duty
and cess which have not been deposited on account of any dispute.
(x) The Company does not have any accumulated losses. The company has
not incurred cash losses
during the current and immediately preceding financial year.
(xi) According to the information and explanations provided to us the
company has no outstanding dues
to financial institutions, banks or debetureholders except the under
mentioned claims of Banks which are in dispute and pending.
Bank Nature
Union Bank of India Bank
Guarantee
Bank of Baroda Bank
Guarantee
Amount Remark
Rs.1,15,84,586/- (Principle) Outstanding since
Rs.3,51,655 (Interest) 23.12.2003
Rs.41,28,367/- (Principle) Outstanding since
Rs. 7,99,820 (Interest 30.6.2004_
(xii) In our opinion and according to the information and explanations
provided 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 and according to the information and explanations
provided to us the nature of
activities of the company does not attract any special statute
applicable to Chit Fund and Niddhi/ Mutual Benefit Fund / Society.
(xiv) Based on our examination of records and the information and
explanation given to us the company
has not dealt/traded in shares, securities, debentures and other
securities during the year.
(xv) In our opinion and according to the information and explanations
provided to us the company has not
given any guarantee for loans taken by others from banks or financial
institutions.
vi) The Company has not accepted any term loan during the year.
vii) According to the information and explanations given to us and Cash
Flow Statement and other
records of the company examined by us, we report that the company has
not raised funds, short term or long term during the year.
viii) The Company has not made any preferential allotment of shares to
parties or companies covered in the register maintained u/s 301 of the
Companies Act 1956
ix) The Company has not issued any debentures till date.
x) The Company has not raised any money through public issue during the
year.
xi) According to the information and explanation given to us, no fraud
on or by the Company has been
noticed or reported during the course of our audit
murgesh Kabra & Co.
hartered Accountants
murgesh Kabra
coprietor membership
No. 44075
place: Navi Mumbai
dated: 29th August 2007
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