MINUTES OF THE AUDIT COMMITTEE OF MINDA INDUSTRIES LIMITED HELD ON TUESDAY JANUARY 20, 2005 AT 11.00 A.M. AT ITS WORKS AT VILLAGE NAWADA FATEHPUR, P.O. SIKANDERPUR BADDA, DISTRICT- GURGAON, HARYANA.

Mr. B.R. Agarwal / Chairman
Mr. Raja Ram Gupta / Member
Mr. Nirmal K. Minda / Managing Director
Mr. Sudhir Jain / Corp. Head- Fin.& Planning
Mr. H.C. Dhamija / Head –A/Cs, Taxation, & Co. Secretary
Mr. Pardeep Mann / Dy. Co. Secretary
Mr. R. N. Saraf / Proprietor - M/s. R. N. Saraf & Co.
(Statutory Auditors)
Mr. A.K. Nair / Partner- Ms. N. Bahl & Co.
(Internal Auditors)
1. CHAIRMAN OF THE COMMITTEE

Mr. B.R. Agarwal, Chairman of the Audit Committee, took the chair.

2 QUORUM OF THE COMMITTEE MEETING

Chairman declared that the quorum being present.

3. LEAVE OF ABSENCE

Board members granted the leave of absence to Mr. Subhash Lakhotia, Member of the Committee by passing the following resolution:

“RESOLVED THAT the leave of absence be and is hereby granted to Subhash Lakhotia, Member of the Committee, who have sought the same from this meeting.

4. CONFIRMATION OF THE MINUTES OF THE PREVIOUS COMMITTEE MEETING HELD ON OCTOBER 14, 2004,

Minutes of the meeting of the Audit Committee of the Company held on October 14, 2004 as circulated were placed before the meeting. Committee Members considered and confirmed the same.

5. REVIEW OF THE INTERNAL AUDITORS’ REPORT

Members noted that M/s. N. Bahl & Company, Chartered Accountants, Internal Auditors of the Company had carried out audit for the second phase i.e. from August 1 to November 30, 2004, as per schedule. A copy of the Internal Audit Report along with the reply / comments of the Units was placed before the meeting. Committee Members considered and reviewed the same.

6. REVIEW OF THE PERFORMANCE OF THE COMPANY

Financial Results of the Company for the quarter ended on December 31, 2004 as circulated were placed before the meeting. Committee members considered and reviewed the same.

7. PUBLICATION OF QUARTERLY RESULTS.

The Un-audited Financial Results for the Quarter ended on December 31, 2004 in the prescribed format were placed before the meeting. Committee members reviewed and forwarded the same for submission to the Board meeting of the company scheduled to be held on January 27, 2005.

8.0 RE-APPOINTMENT & REMUNERATION OF AUDITORS

8.1 STATUTORY AUDITORS

Committee members noted that M/s. R.N. Saraf & Co., Chartered Accountants were appointed as Statutory Auditors of the Company at the Annual General Meeting held on July 14, 2004 to hold office until the conclusion of Next Annual General Meeting. The existing Statutory Audit Fee fee for the year 2003-04 was Rs. 1,50,000/- , Rs. 35,000/- as Tax Audit Fee, Rs. 45,000/- as Income Tax Assessment Fees, Rs.40,000/- as Consultancy Fee plus out of pocket expenses not to exceed Rs. 50,000/-. Committee members recommended the remuneration of Statutory Auditors, M/s. R.N. Saraf & Co., Chartered Accountants for the year 20004-05 by passing the following resolution in this regard:-

“RESOLVED THAT the remuneration of the Statutory Auditors M/s. R..N. Saraf & Co., Chartered Accountants for the year 2003-2004, be and is hereby recommended for Rs. 1,50,000/- as Statutory Audit Fees, Rs. 35,000/- as Tax Audit Fees, Rs. 45,000/- as Income Tax Assessment Fees and Rs. 40,000/- as Consultancy Fees (Service Tax, if any, extra) and out of pocket expenses not to exceed Rs. 50,000/-. ”

8.2 REMUNERATION OF PUNE BRANCH AUDITORS

Committee members noted that M/s. Sancheti Thakkar & Associates, Chartered Accountants, Pune were appointed as Branch auditors of the Company at the Annual General meeting of the Company held on July 14, 2004. The existing Remuneration of Pune Branch auditors for the year 2003-04 was Rs. 45,000/- plus out of pocket expenses. Committee members recommended the enhancement of the remuneration of the Branch Auditors of Pune Unit of M/s. Sancheti Thakkar & Associates, Chartered Accountants, Pune for the year 2004-05 from Rs.45,000/- to Rs.55,000/- and passed the following resolution in this regard: -

“RESOLVED THAT the remuneration of the Branch Auditors M/s. S. Sancheti & Co., Chartered Accountants, Pune for the year 2004-2005, be and is hereby recommended for Rs. 55,000/- as Branch Audit Fees (Service Tax, if any, extra) and reimbursement of out of pocket expenses for both Lightings and Switch Divisions.”

8.3 RE-APPOINTMENT AND REMUNERATION OF INTERNAL AUDITORS M/S. N. BAHL & CO. CHARTERED ACCOUNTANTS.

Committee members noted that M/s. N. Bahl & Co., Chartered Accountants proposed to be re-appointed as Internal Auditors of the company for the year 2004-05 on the existing terms and conditions on a remuneration of Rs.2,70,000/- plus service tax and out of pocket expenses.

Committee members recommended their re-appointment for approval of the Board members on the revised terms and conditions by passing the following resolution :

“RESOLVED

1)  THAT M/s. N. Bahl & Co. Chartered Accountants, C-192, Sarvodaya Enclave, New Delhi – 110 017 be and are hereby recommended to be re-appointed as Internal Auditors of the company for the year 2004-05.

2)  THAT the remuneration of M/s. N. Bahl & Co. Chartered Accountants for the year 2004-05 be and is hereby recommended for Rs. 2,70,000/- plus Service Tax and out of pocket expenses.”

9 COMPLIANCE REPORT

Members noted that the Compliance Reports from Units have been received. The Secretarial Department had carried out the audit of various areas covered in the Compliance Report. Committee members considered and reviewed the same.

10. VOTE OF THANKS

Meeting was terminated with a vote of thanks to the chair.

CHAIRMAN