| We have audited the accompanying financial statements of Esaar (India)
Limited ('the Company'), which comprise the balance sheet as at 31
March 2015, 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 Statements
The Company's Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 ("the Act") with respect
to the preparation and presentation 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 maintenance of adequate accounting records in accordance
with the provisions of the Act for safeguarding the assets of the
Company and for preventing and detecting 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 adequate
internal financial controls, 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 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 the 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 a
true and fair view in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing
an opinion on whether the Company has in place an adequate internal
financial controls system over financial reporting and the operating
effectiveness of such controls. An audit also includes evaluating the
appropriateness of the accounting policies used and the reasonableness
of the accounting estimates made by the 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.
Basis for Qualified Opinion
The Company is registered as Non Banking Financial Companies (NBFC),
having Certificate of Registration under Section 45 IA of RBI Act,
1934.The company has not complied few NBFC prudential norms as
prescribed by Reserve Bank of India from time to time as mentioned in
Note no 27.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, except for the effects of the matter
described in the Basis for Qualified Opinion paragraph, 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, of the state of
affairs of the Company as at 31 March 2015 and its profit and its cash
flows for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order, 2015 ("the
Order") issued by the Central Government of India in terms of
sub-section (11) of section 143 of the Act, we give in the Annexure a
statement on the matters specified in the paragraph 3 and 4 of the
Order, to the extent applicable.
2. 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
purposes of our audit.
(b) in our opinion proper books of account as required by law have been
kept by the Company so far as it appears from our examination of those
books;
(c) the balance sheet, the statement of profit and loss and the 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) on the basis of the written representations received from the
directors as on 31 March 2015 taken on record by the Board of
Directors, none of the directors is disqualified as on 31 March 2015
from being appointed as a director in terms of Section 164 (2) of the
Act; and
(f) with respect to the other matters to be included in the Auditor's
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:
i. the Company has disclosed the impact of pending litigations on its
financial position in its financial statements - Refer Note no. 21 to
the financial statements;
ii. the Company did not have any long term contracts including
derivative contracts for which there were any material foreseeable
losses.
iii. The company is not liable to transfer any amounts to the Investor
Education and Protection Fund. Therefore, there has been no delay in
transferring amounts, required to be transferred, to the Investor
Education and Protection Fund by the Company.
The Annexure referred to in our Independent Auditors' Report to the
members of the Company on the financial statements for the year ended
31 March 2015, we report that:
(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) The company has a regular programme of physical verification of
fixed assets. The fixed assets were verified in a phased manner during
the year; in certain assets it was noticed that their useful life had
expired. These assets have been suitably written off in the books of
accounts. In our opinion, the periodicity of physical verification is
reasonable having regard to the size of the Company and the nature of
its assets.
(ii) As informed to us, the equity shares held as inventories in
dematerialized form have been verified by the management with
supportive evidence during the year. And for other unquoted equity
shares held as inventories the procedures performed by the management
for physical verification were found to be satisfactory
(iii) (a) The Company has not granted loans to any party covered in the
register maintained under section 189 of the Companies Act, 2013 ('the
Act'). Accordingly, paragraph 3(iii) (a) of the Order is not applicable
to the Company.
(b) In the case of the loans granted to the bodies corporate listed in
the register maintained under section 189 of the Act, the borrowers
have been regular in the payment of the interest as stipulated. The
terms of arrangements do not stipulate any repayment schedule and the
loans are repayable on demand. Not applicable as the Company has not
granted loans to any parties covered in the register maintained under
section 189 of the Companies Act, 2013
(c) There are no overdue amounts of more than rupees one lakh in
respect of the loans granted to the bodies corporate listed in the
register maintained under section 189 of the Act. Not applicable as the
Company has not granted loans to any parties covered in the register
maintained under section 189 of the Companies Act, 2013.
(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 with regard
to purchase of fixed assets and sale of services. We have not observed
any major weakness in the internal control system during the course of
the audit.
(v) During the year, Company has not accepted any deposits from the
public.
(vi) The Central Government has not prescribed the maintenance of cost
records under section 148(1) of the Act, for any of the services
rendered by the Company.
(vii) (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, wealth
tax, service tax, duty of customs, value added tax, cess and other
material statutory dues have been regularly deposited during the year
by the Company with the appropriate authorities. As explained to us,
the Company did not have any dues on account of employees' state
insurance and duty of excise.
According to the information and explanations given to us, no
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.
(b) According to the information and explanations given to us, there
are no material dues of wealth tax, duty of customs and cess which have
not been deposited with the appropriate authorities on account of any
dispute.
However, according to the information and explanation given to us, the
following dues of Income Tax have not been deposited by the Company.
(Also refer note no. 20 to the financial statements)
Name of the Nature of dues Amount (in Period to Forum where
statute Rs.) which the dispute is
amount pending
relates
Income Tax Income Tax 13,660 Assessment Assessing
Act Year 2008-09 Officer
Income Tax Income Tax 2,53,815 Assessment Assessing
Act Year 2009-10 Officer
(c) According to the information and explanations given to us the
amounts which were required to be transferred to the investor education
and protection fund in accordance with the relevant provisions of the
Companies Act, 1956 (1 of 1956) and rules there under has been
transferred to such fund within time. The Company is not required to
transfer any amount to the investor education and protection fund,
accordingly paragraph (vii) (c) of the Order is not applicable to the
Company.
(viii) Accumulated losses of the company as at 31st March, 2015 do not
exceed fifty percent of its net worth at the end of the financial year.
The company has incurred cash loss of Rs. 4,04,55,805/- during the
financial year covered by our audit and a cash loss of Rs. 63,82,946/-
during the immediately preceding financial year.
(ix) The Company did not have any outstanding dues to financial
institutions, banks or debenture holders during the year.
(x) In our opinion and according to the information and the
explanations given to us, the Company has not given any guarantee for
loans taken by others from banks or financial institutions.
(xi) The Company did not have any term loans outstanding during the
year.
(xii) According to the information and explanations given to us, no
material fraud on or by the Company has been noticed or reported during
the course of our audit.
For Pravin Chandak & Associates
Chartered Accountants
Firm's registration number: 116627W
Sd/-
Pravin Chandak
Partner
Membership number: 049391
Mumbai
27th May 2015
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