| We have audited the accompanying financial statements of RAJ OIL MILLS
LIMITED, (the "Company"), which comprise of the Balance Sheet as at
March 31, 2015, the Statement of Profit and Loss and 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 Statements
The Company's Board of Directors is responsible for the matters in
section 134(5) of the Companies Act, 2013 ("the Act") with respect to
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 principles generally
accepted in India, including the Accounting Standards specified under
Section 133 of the Act, read with Rule 7 of the Companies (Accounts)
Rules, 2014. This responsibility also includes the maintenance of
adequate accounting records in accordance with the provision of the Act
for safeguarding of the assets of the Company and for preventing and
detecting the frauds and other irregularities; selection and
application of appropriate accounting policies; making judgments and
estimates that are reasonable and prudent; and design, implementation
and maintenance of internal financial control, that were operating
effectively for ensuring the accuracy and completeness of the
accounting records, 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 have taken into account the provisions of the Act, the accounting
and auditing standards and matters which are required to be included in
the audit report under the provisions of the Act and the Rules made
there under.
We have conducted our audit in accordance with the Standards on
Auditing specified under section 143(10) of the Act. 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 financial control relevant to the Company's
preparation of the financial statements that give true and fair view 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 Company's Directors, 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 on the financial
statements.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid 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, 2015;
b) in the case of the Statement of Profit and Loss, Loss of 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.
Emphasis of Matters
We draw attention to the following matters in the Notes to the
financial statements:
a) In the financial statement which indicates that the Company has
accumulated losses and its net worth has been fully eroded, the Company
has incurred a net cash outflow during the current and previous year
(s) and, the Company's current liabilities exceeded its current assets
as at the balance sheet date. However, the financial statements of the
Company have been prepared on a going concern basis for the reasons
stated in the said Note.
b) The Company is required to maintain the cost record for the
manufacturing process but has not maintained the cost of material
consumed on actual consumption basis, instead accounted for the
difference of inventory as "presumed to be consumed " against
production cost of unit produced, resultantly all the normal and
abnormal losses (if any) are adjusted in the production cost.
Our opinion is not modified in respect of this matter.
Report on other Legal and Regulatory Requirements
As required by section 143(3) of the Act, we report that:
a) We have sought and 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, the 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 aforesaid financial statements comply with the
Accounting Standards specified under Section 133 of the Act, read with
Rule 7 of the Companies (Accounts) Rules, 2014.
e) In our opinion Directors of the Company are disqualified as on 31st
March 2015 from being appointed as Director in terms of clause (b) of
sub-section (2) of section 164 of the Companies Act, 2013 on account of
non-payment of public deposit.
f) With respect to the other matters included in the Auditor's Report
and to our best of our information and according to the explanations
given to us :
i. The companydid not have any long-term contracts including
derivatives contracts for which there were any material foreseeable
losses.
ii. There are no amounts which required to be transferred to the
Investor Education and Protection Fund by the Company.
Annexure to the Auditors' Report
The Annexure referred to in our Independent Auditor's report to the
Members of Raj Oil Mills Limited on the financial statements for the
year Ended 31st March, 2015. We report that:
(i) (a) The company has maintained proper records showing full
particulars, including quantitative details and situation of its
fixed assets;
(b) The Company has a program of verification of fixed assets to cover
all the items in a phased manner which, in our opinion, is reasonable
having regard to the size of the Company and the nature of its assets.
Pursuant to the program, certain fixed assets were physically verified
by the Management during the year. According to the information and
explanations given to us no material discrepancies were noticed on such
verification
(ii) (a) Physical verification of inventory has been conducted at
reasonable intervals by the management.
(b) In our opinion and according to the information and explanation
given to us 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 inventory records, we are of the
opinion that the Company is maintaining proper records of inventory.
The discrepancies noticed on physical verification of inventory as
compared to book records, were not material enough.
(iii) In respect of loans, the Company has not granted secured and
unsecured loan to companies, firms or other parties covered in the
register maintained under section 189 of the Companies Act, 2013.
Accordingly, the clause 3(iii) (a) and 3(iii) (b) of the Order are not
applicable.
(iv) In our opinion and according to the information and explanation
given to us, the Company has adequate internal control system in place,
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 except in some cases materials are purchased
for alternative source are not readily available for obtaining
comparable quotations. The company needs to take appropriate steps for
purchase of material.
(v) In our opinion and according to the information and explanation
given to us, the company has complied with the provision of sections 73
to 76 or any other relevant provision thereof, except for the default
in repayment of Principal and payment of interest there on during the
year, for compliance with the 'Companies (Acceptance of Deposits)
Rules,1975' with regard to the deposits accepted from the public.
According to the information and explanation given to us,order has been
passed by the Company Law Board or National Company Law Tribunal or any
court or any other Tribunal on the company for the repayment of the
said deposit along with up-to date interest in respect of complaints
received on aforesaid deposits. As per information given to us company
has been registered under BIFR before 31/03/2015 and already filed a
petition with Registrar of Company(ROC), Company Law Board (CLB) and
BIFR for repayment of Public Deposit.
(vi) Maintenance of cost records has been specified by the Central
Government under sub-section (1) of section 148 of the Companies Act,
to the company , however as per information and explanation given to
us, the company is in the process to compliance with the prescribed
records.
(vii) (a) According to the information and explanations given to us,
undisputed amounts payable in respect of provident
fund, income tax, sales tax, wealth tax, service tax, duty of customs,
value added tax, cess and other material statutory dues were in arrears
as at 31 March 2015 for a period of more than six months from the date
they became payable are mentioned here under.
Name of the statute Amount outstanding for more than
6 months as on 31/03/2015
(Excluding Interest) (in Crores.)
Provident Fund 0.49
Employees State
Insurance 0.04
Income Tax 16.03
T.D.S. 1.39
Professional Tax 0.11
MVAT 8.83
Service Tax 0.16
(b) According to the information and explanations given to us, the
detail of statutory dues of sales tax which have not been deposited on
account of dispute is as under.
Name of the Nature of Amount (in Period to Fourm
statute dues Crores) which the where
amount dispute
relates is pending
Sales Tax Sales Tax 9.84 F.Y 05-06 and Sales Tax
08-09 Appeal
Income Tax Income Tax 225.22 F.Y 05-06 to CIT Appeal
11-12
Income Tax Income Tax 16.03 F.Y 05-06 to ITAT
11-12
(c) There are no amounts which required to be transferred to the
Investor Education and Protection Fund by the Company in accordance
with the relevant provision of the companies Act 2013 and rules made
there under.
(viii) The accumulated losses of the company at the end of the
financial year exceeds more than fifty percent of its net worth (100%
networth eroded) and it has generated cash loss in current financial
year and incurred cash loss in the immediately preceding financial
year.
(ix) According to the records of the company examined by us and the
information and explanation provided to us, the Company has defaulted
in repayment of dues to financial institution, Bank or fixed deposit
holders as at the balance sheet date as follows:
Sr. Particulars Principal and Interest
No. (Amount in Crores)
Fund Based
1 SVC Term Loan 0.40*
2 Edelweiss Assets Reconstruction Co. Ltd. 68.07*
3 SVC (C/C) 23.29*
4 Public Deposits (inclusive of interest) 6.84
5 Inter-Corporate Deposit 0.66*
Non Fund Based
1 SICOM (Bill Discounting) 11.56*
2 SIDBI (Bill Discounting) 2.40*
3 IFCI Factors(Bill Discounting) 9.92*
* - Exclusive of Interest
(x) In our opinion, and according to the information and explanations
given to us, The Company has not given any guarantee for loans taken by
others from bank or financial institution during the year.
(xi) In our opinion, and according to the information and explanation
given to us, The Company has not applied for any term loan.
(xii) According to information and explanations given to us there were
no fraud noticed or reported by company for the year under review.
For B. M. Gattani & Co.
Chartered Accountants
FRN: 113536W
Sd/-
B. M. Gattani
Date: 30/05/2015 Proprietor
Place: Mumbai. Membership No. 047066
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