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Century Textiles & Industries Ltd - Auditor's Report

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369.50 5.75 (1.58%)
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Code: 500040
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369.30 6.05 (1.67%)
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Code: CENTURYTEX
Performance
1 Week : Rs 385.40 (-4.13%)
1 Month : Rs 339.05 (8.98%)
1 Year : Rs 299.35 (23.43%)
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CENTURY TEXTILES AND INDUSTRIES LIMITED

ANNUAL REPORT 2011-2012

AUDITORS` REPORT

TO 
THE MEMBERS OF 
CENTURY TEXTILES AND INDUSTRIES LIMITED

1.  We  have  audited the attached Balance Sheet of  Century  Textiles  and 
Industries  Limited  as  at March 31, 2012, and the  related  Statement  of 
Profit  and  Loss and Cash Flow Statement for the year ended on  that  date 
annexed thereto, which we have signed under reference to this report. These 
financial  statements are the responsibility of the  Company`s  Management. 
Our  responsibility is to express an opinion on these financial  statements 
based on our audit.

2.  We  conducted  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  assessing the accounting principles used and significant estimates made 
the  financial 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 (Auditor`s Report) Order, 2003, as  amended 
by  the Companies (Auditor`s Report) (Amendment) Order, 2004 (together  the 
"Order"), issued by the Central Government of India in terms of sub-section 
(4A)  of Section 227 of `The Companies Act, 1956` of India (the `Act`)  and 
on  the basis of such checks of the books and records of the Company as  we 
considered  appropriate and according to the information  and  explanations 
given  to us, we give in the Annexure a statement on the matters  specified 
in paragraphs 4 and 5 of the Order.

4.  Further  to  our comments in the Annexure referred to  in  paragraph  3 
above, 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 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 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 dealt with by this report comply with  the  accounting 
standards referred to in sub-section (3C) of Section 211 of the Act; 

(e) On the basis of written representations received from the directors, as 
on  March 31, 2012 and taken on record by the Board of Directors,  none  of 
the directors is disqualified as on March 31, 2012 from being appointed  as 
a director in terms of clause (g) of sub-section (1) of Section 274 of  the 
Act;

(f) In our opinion and to the best of our information and according to  the 
explanations  given to us, the said financial statements together with  the 
notes  thereon  and attached thereto give, in the  prescribed  manner,  the 
information  required  by  the  Act,  and give a  true  and  fair  view  in 
conformity with the accounting principles generally accepted in India: 

(i)  In  the  case of the Balance Sheet, of the state  of  affairs  of  the 
Company as at March 31, 2012;

(ii) In the case of the Statement of Profit and Loss, of the profit for the 
year ended on that date; and 

(iii)  In  the case of the Cash Flow Statement, of the cash flows  for  the 
year ended on that date.
 
For DALAL & SHAH	   
Firm Registration Number: 102021W	   
Chartered Accountants	   
	   
S. Venkatesh	   
Partner	   
Membership No.: F-037942	   

Place: Mumbai 
Dated: May 2, 2012	 

ANNEXURE TO AUDITORS` REPORT

Referred  to  in paragraph 3 of the Auditors` Report of even  date  to  the 
members  of  Century  Textiles  and Industries  Limited  on  the  financial 
statements as of and for the year ended 31st March, 2012

1.  (a)  The Company is generally 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 over a period of  three 
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 
the  year  and no material discrepancies between the book records  and  the 
physical inventory have been noticed.
 
(c) In our opinion, and according to the information and explanations given 
to  us,  a substantial part of fixed not been disposed of  by  the  Company 
during the year.

2.  (a)  The  inventory  (excluding stocks with  third  parties)  has  been 
physically  verified  by  the Management during the  year.  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.

3. 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.
 
The other clauses (iii) (b), (iii) (c), (iii) (d), (iii) (f) and (iii)  (g) 
of the Order, are not applicable in the case of the Company for the current 
year, since in our opinion, there is no matter which arises to be  reported 
in the Order.

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 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,  no  major 
weakness have been noticed or reported.

5.  (a) In our opinion, and according to the information  and  explanations 
given  to us, the particulars of contracts or arrangements referred  to  in 
Section  301  of the Act have been entered in the register required  to  be 
maintained under that section.
 
(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 year have been made at prices which are reasonable having regard to the 
prevailing market prices at the relevant time.

6. In our opinion, and according to the information and explanations  given 
to us, the Company has complied with the directives issued by Reserve  Bank 
of India and the provisions of Sections 58A and 58AA or any other  relevant 
provisions  of  the Act and the Companies (Acceptance of  Deposits)  Rules, 
1975 with regard to the deposits accepted from the public. According to the 
information  and explanations given to us, no order has been passed by  the 
Company Law Board or National Company Law Tribunal or Reserve Bank of India 
or  any  Court  or  any other Tribunal on the Company  in  respect  of  the 
aforesaid deposits.

7.  In our opinion, the Company has an internal audit  system  commensurate 
with its size and the nature of its business.

8. 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.

9.  (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, employees` state  insurance, 
income  tax, sales tax, wealth tax, service tax, customs duty, excise  duty 
and  other  material statutory dues, as applicable,  with  the  appropriate 
authorities.
 
(b)  According  to  the information and explanations given to  us  and  the 
records  of the Company examined by us, the particulars of dues  of  income 
tax,  sales tax, service tax, customs duty and excise duty as at March  31, 
2012 which have not been deposited on account of disputes, are as follows:

Nature of Dues     A          B                        C 
 
Income Tax	 0.10	2007-08 to 2009-10   Departmental Authorities	   
	         2.20	2000-01 to 2010-11   High Court	   

Custom Duty	 2.70	1996-97 to 2009-10   Tribunal (CESTAT)	   
	         0.05	1987 to 1999	     Departmental Authorities	   

Excise Duty      5.96	1997-98 to 2001-02   Supreme Court	   
	         0.08	1994-95 to 2006-07   High Court	   
	        36.61	1994-95 to 2011-12   Tribunal	   
	         0.54	1997-98 to 2010-11   Departmental Authorities	   

Sales Tax,      98.47	2002-03 to 2007-08   Supreme Court	   
Entry Tax,       8.05	1985 to 2011-12	     High Court	   
etc.		 7.82	1994-95 to 2010-11   Tribunal	   
	        34.91	1985-86 to 2011-12   Departmental Authorities	   

Service Tax      0.13	2005-06 to 2007-08   Supreme Court	   
                 1.02	1998-99 to 2008-09   Tribunal	   
	         1.11	2004-05 to 2011-12   Departmental Authorities	 

A = Amount (Rs. in Crores)
B = Period to which the amount relates
C = Forum where dispute is pending
  
There were no disputed amounts due towards Wealth Tax.

10. The Company has no accumulated losses as at 31st March, 2012 and it has 
not incurred any cash losses in the financial year ended on that date or in 
the immediately preceding financial year. 

11.  According  to  the  records of the Company  examined  by  us  and  the 
information and explanations given to us, the Company has not defaulted  in 
repayment of dues to any financial institution or bank or debenture holders 
as at the balance sheet date.

12.  The  Company has not granted any loans and advances on  the  basis  of 
security by way of pledge of shares, debentures and other securities.

13.  The provisions of any special statute applicable to chit fund /  nidhi 
/ mutual benefit fund / societies are not applicable to the Company.

14.  In  our  opinion,  the  Company  has  maintained  proper  records   of 
transactions  and  contracts  relating to dealing  or  trading  in  shares, 
securities,  debentures  and other investments during the year  and  timely 
entries have been made therein. Further, such securities have been held  by 
the Company in its own name or are in the process of transfer in its  name, 
except to the extent of the exemption granted under Section 49 of the Act.

15. 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 banks or financial institutions during the year.

16. In our opinion, and according to the information and explanations given 

to  us,  the  term loans have been applied, on an overall  basis,  for  the 
purposes for which they were obtained.

17.  On  the basis of an overall examination of the balance  sheet  of  the 
Company, in our opinion, and according to the information and  explanations 
given  to  us, funds raised on a short-term basis, aggregating  Rs.  777.47 
Crore, have been used for long-term investment in Fixed assets.

18.  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 year.

19. The Company has not issued any debentures during the year; and does not 
have any debentures outstanding as at the year end.

20. The Company has not raised any money by public issues during the year.

21.  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, except for two instances of fraud, informed to us by the Management, 
by  a  third  party by falsifying cheque leaves and  forging  signature  of 
authorised  signatories  aggregating Rs.1.45 Crore and by  an  employee  by 
falsifying  cheque leaves aggregating Rs.0.31 Crore, we have  neither  come 
across  any  instance of fraud on or by the Company,  noticed  or  reported 
during  the  year,  nor  have we been informed of  any  such  case  by  the 

Management. The Company has taken necessary action and recovered the entire 
amount in both the cases.
 
For DALAL & SHAH	   
Firm Registration Number: 102021W	   
Chartered Accountants	   
	   
S. Venkatesh	   
Partner	   
Membership No.: F-037942	   

Place: Mumbai
Dated: May 2, 2012

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