Mar 31, 2018
Report on the Standalone Financial Statements
1. We have audited the accompanying standalone financial statements of Federal-Mogul Goetze (India) Limited (âthe Companyâ), which comprise the Balance Sheet as at 31 March 2018, the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity, for the year then ended, and a summary of the significant accounting policies and other explanatory information. Managementâs Responsibility for the Standalone Financial Statements
2. The Companyâs Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these standalone financial statements that give a true and fair view of the state of affairs (financial position), profit or loss (financial performance including other comprehensive income), cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (âInd ASâ) specified under Section 133 of the Act. 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 standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error. Auditorâs Responsibility
3. Our responsibility is to express an opinion on these standalone financial statements based on our audit.
4. 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 thereunder.
5. 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 standalone financial statements are free from material misstatement.
6. 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 auditorâs 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 controls relevant to the Companyâs preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An a udit also inc l ude s evalua ting the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Companyâs Directors, as well as evaluating the overall presentation of the financial statements.
7. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on these standalone financial statements. Opinion
8. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone 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 including Ind AS specified under Section 133 of the Act, of the state of affairs (financial position) of the Company as at 31 March 2018, and its profit (financial performance including other comprehensive income), its cash flows and the changes in equity for the year ended on that date.
Other matter paragraph
9. The Company had prepared separate sets of statutory financial statements for the year ended 31 March 2017 and 31 March 2016 in accordance with Accounting Standards prescribed under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 (as amended) on which we issued auditorâs reports to the shareholders of the Company dated 19May 2017 and 13 May 2016, respectively. These financial statements have been adjusted for the differences in the accounting principles adopted by the Company on transition to Ind AS, which have also been audited by us. Our opinion is not modified in respect of this matter
Report on Other Legal and Regulatory Requirements
10. As required by the Companies (Auditorâs Report) Order, 2016 (âthe Orderâ) issued by the Central Government of India in terms of Section 143(11) of the Act, we give in the Annexure I a statement on the matters specified in paragraphs 3 and 4 of the Order.
11. Further to our comments in Annexure I, as required by Section143(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 it appears from our examination of those books;
c. the standalone financial statements dealt with by this report are in agreement with the books of account;
d. in our opinion, the aforesaid standalone financial statements comply with Ind AS specified under Section 133 of the Act;
e. on the basis of the written representations received from the directors and taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2018 from being appointed as a director in terms of Section164(2) of the Act;
f. we have also audited the internal financial controls over financial reporting (IFCoFR) of the Company as of 31 March 2018 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date and our report dated 29 May 2018 as per annexure II expressed an unqualified opinion; and.
g. with respect to the other matters to be included in the Auditorâs Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014 (as amended), in our opinion and to the best of our information and according to the explanations given to us:
i. the Company, as detailed in Note 39 to the standalone financial statements, has disclosed the impact of pending litigations on its financial position;
ii. the Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;
iii. there were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company; and
iv. the disclosure requirements relating to holdings as well as dealings in specified bank notes were applicable for the period from 8 November 2016 to 30 December 2016 which are not relevant to these standalone financial statements. Hence, reporting under this clause is not applicable.
Annexure I
Based on the audit procedures performed for the purpose of reporting a true and fair view on the financial statements of the Company and taking into consideration the information and explanations given to us and the books of account and other records examined by us in the normal course of audit, and to the best of our knowledge and belief, 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 program of physical verification of its fixed assets under which fixed assets are verified in a phased manner 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. No material discrepancies were noticed on such verification.
(c) The title deeds of all the immovable properties (which are included under the head âProperty, plant and equipmentâ) are held in the name of the Company.
(ii) In our opinion, the management has conducted physical verification of inventory at reasonable intervals during the year and no material discrepancies between physical inventory and book records were noticed on physical verification.
(iii) The Company has not granted any l oa n , secu red or u n secu red to companies, firms, Limited Liability Partnerships (LLPs) or other parties covered in the register maintained under Section 189 of the Act. Accordingly, the provisions of clauses 3(iii)(a), 3(iii)(b) and 3(iii)(c) of the Order are not applicable.
(iv) In our opinion the, Company has complied with the provisions of sections 185 and 186 of the Act in respect of loans, investments, guarantees, and security.
(v) In our opinion, the Company has not accepted any deposits within the meaning of Sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended). Accordingly, the provisions of clause 3(v) of the Order are not applicable.
(vi) We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under clause Section 148 of the Act in respect of Companyâs products and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.
(vii)(a) The Company is regular in depositing undisputed statutory dues including provident fund, employeesâ state insurance, income-tax, sales-tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues, as applicable, to the appropriate authorities. Further, no undisputed amounts payable in respect thereof were outstanding at the year-end for a period of more than six months from the date they become payable.
(b) The dues outstanding in respect of income-tax, sales-tax, service tax, duty of customs, duty of excise and value added tax on account of any dispute, are as follows:
Statement of Disputed Dues
Name of the statute |
Nature of dues |
Amount (Rs. in lacs) |
Amount paid under protest (Rs. in lacs) |
Period to which the amount relates |
Forum where dispute is pending |
|
Income tax Act, 1961 |
Income tax |
94.67 |
- |
2002-2003 |
Commissioner of Income tax (Appeal) |
|
Income tax Act, 1961 |
Income tax |
41.34 |
- |
2014-2015 |
Commissioner of Income Tax (Appeal) |
|
Income tax Act, 1961 |
Income tax |
16.54 |
- |
1995-1996 and 1996-1997 |
Honorable High Court, Delhi |
|
Income tax Act, 1961 |
Income tax |
432.49 |
- |
1997-1998 |
Honorable High Court, Delhi |
|
Income tax Act, 1961 |
Income tax |
83.26 |
- |
1998-1999 |
Honorable Supreme Court, Delhi |
|
Income tax Act, 1961 |
Income tax |
59.68 |
- |
1999-2000 |
Commissioner Income Tax (Appeal) |
|
Income tax Act, 1961 |
Income tax |
38.86 |
- |
1999-2000 |
Honorable Supreme Court, Delhi |
|
Income tax Act, 1961 |
Income tax |
20.84 |
- |
2000-2001 |
Honorable Supreme Court, Delhi |
|
Income tax Act, 1961 |
Income tax |
80.84 |
- |
2001-2002 |
Commissioner of Income Tax (Appeals) |
|
Income tax Act, 1961 |
Income tax |
13.81 |
- |
2002-2003 |
Income Tax Appellate Tribunal |
|
Income tax Act, 1961 |
Income tax |
42.44 |
- |
2004-2005 |
Commissioner of Income Tax (Appeals) |
|
Income tax Act, 1961 |
Income tax |
3.94 |
- |
2005-2006 |
Assessing Officer for Appeal Effect |
|
Income tax Act, 1961 |
Income tax |
74.24 |
- |
2008-2009 |
Income Tax Appellate Tribunal |
|
Income tax Act, 1961 |
Income tax |
217.36 |
- |
2010-2011 |
Income Tax Appellate Tribunal |
||
Income tax Act, 1961 |
Income tax |
343.34 |
- |
2011-2012 |
Commissioner of Income Tax (Appeals) |
||
Income tax Act, 1961 |
Income tax |
318.31 |
- |
2012-2013 |
Commissioner of Income Tax (Appeals) |
||
The Central Excise Act, 1944 |
Excise Duty |
9.34 |
- |
1987-1990 |
Honorable High Court of Punjab and Haryana |
||
The Central Excise Act,1944 |
Excise Duty |
1.18 |
- |
1995-1996 |
Joint Commissioner of Central Excise |
||
The Central Excise Act, 1944 |
Excise Duty |
1.36 |
- |
2003-2004 |
Joint Commissioner of Central Excise, Patiala, Punjab |
||
The Central Excise Act, 1944 |
Excise Duty |
1.76 |
- |
1997-1999 |
Assistant Commissioner of Central Excise, Patiala, Punjab |
||
The Central Excise Act, 1944 |
Excise Duty |
1.86 |
- |
1997-1998 |
Joint Commissioner of Central Excise, Patiala, Punjab |
||
The Central Excise Act, 1944 |
Excise Duty |
6.96 |
- |
1998-1999 |
Joint Commissioner of Central Excise |
||
The Central Excise Act,1944 |
Excise Duty |
15.13 |
- |
2000-2001 Honorable Supreme Court and 2001-2002 |
|||
The Central Excise Act, 1944 |
Excise Duty |
44.12 |
1.33 |
2004 - 2005 |
Central Excise and Service Tax Appellate Tribunal. |
||
The Central Excise Act, 1944 |
Excise Duty |
104.54 |
- |
2001-2004 |
Additional Commissioner |
||
The Central Excise Act, 1944 |
Excise Duty |
3.32 |
- |
2001-2002 |
Additional Commissioner of Central Excise |
||
The Central Excise Act, 1944 |
Excise Duty |
29.45 |
29.45 |
2010-2014 |
Commissioner, Gurgaon |
||
Finance Act, 1994 (Service Tax) |
Service tax |
96.11 |
- |
2005-2011 |
Joint Commissioner of Central Excise, Patiala, Punjab |
||
Finance Act, 1994 (Service Tax) |
Service tax |
86.44 |
25 |
2006-2007 |
Central Excise and Service Tax Appellate Tribunal |
||
Finance Act, 1994 (Service Tax) |
Service tax |
7.10 |
- |
Jan 2009 -August 2009 |
Assistant Commissioner, Bhiwadi, Rajasthan |
||
Finance Act, 1994 (Service Tax) |
Service tax |
55.28 |
- |
2006-2012 |
Joint Commissioner, Jaipur, Rajasthan |
||
Finance Act, 1994 (Service Tax) |
Service tax |
310.40 |
330 |
2008-2012 |
Central Excise and Service Tax Appellate Tribunal |
||
Finance Act, 1994 (Service Tax) |
Service tax |
16.61 |
- |
2009-2010 |
Joint Commissioner, Jaipur, Rajasthan |
||
Finance Act, 1994 (Service Tax) |
Service tax |
13.81 |
- |
2009-2012 |
Commissioner (Appeals) |
||
Finance Act, 1994 (Service Tax) |
Service tax |
10.70 |
- |
2011-2013 |
Deputy Commissioner (Appeals) |
||
Finance Act, 1994 (Service Tax) |
Service tax |
5.81 |
0.58 |
2012-2013 |
Commissioner of Central Excise |
||
Finance Act, 1994 (Service Tax) |
Service tax |
18.12 |
- |
2012-2013 |
Deputy Commissioner (Appeals) |
||
Finance Act, 1994 (Service Tax) |
Service tax |
8.34 |
- |
2013-2014 |
Commissioner of Central Excise |
||
Finance Act, 1994 (Service Tax) |
Service tax |
113.70 |
4.60 |
May 2005 to July 2005 |
Central Excise and Service Tax Appellate Tribunal |
||
Finance Act, 1994 (Service Tax) |
Service tax |
194.00 |
14.60 |
Oct 2008 to March 2013 |
Central Excise and Service Tax Appellate Tribunal |
||
Finance Act, 1994 (Service Tax) |
Service tax |
5.90 |
- |
2014 |
Deputy Commissioner |
||
Finance Act, 1994 (Service Tax) |
Service tax |
19.11 |
- |
2013-2014 |
Additional Commissioner |
||
Karnataka VAT Act, 2003 |
Value added tax |
97.00 |
163.57 |
1996-2002 |
Honorable High court of Karnataka |
||
West Bengal VAT Act,2003 |
Value added tax |
1.56 |
- |
2001-2002 |
Assistant Commissioner, Kolkata |
||
West Bengal VAT Act,2003 |
Value added tax |
1.87 |
- |
2004-2005 |
Assistant Commissioner, Kolkata |
||
Bihar VAT Act,2005 |
Value added tax |
25.66 |
25.67 |
2005-2006 |
Additional Commissioner, Patna |
||
(viii) The Company has not defaulted in repayment of loans or borrowings to any bank or financial institution or government during the year. The Company did not have any outstanding debentures during the year.
(ix) The Company did not raise moneys by way of initial public offer or further public offer (including debt instruments) and in our opinion, the term loans were applied for the purposes for which the loans were obtained.
(x) No fraud by the Company or on the Company by its officers or employees has been noticed or reported during the period covered by our audit.
(xi) The Company has provided managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act 2013.
(xii) In our opinion, the Company is not a chit fund or a Nidhi/ mutual benefit fund/ society. Accordingly, the provisions of clause 3(xii) of the Order are not applicable.
(xiii) In our opinion all transactions with the related parties are in compliance with Sections 177 and 188 of Act, where applicable, and the requisite details have been disclosed in the standalone financial statements etc., as required by the applicable IND AS.
(xiv) During the year, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures.
(xv) In our opinion, the Company has not entered into any non-cash transactions with the directors or persons connected with them covered under section 192 of the Act.
(xvi) The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934.
Independent Auditorâs Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (âthe Actâ)
1.In conjunction with our audit of the standalone financial statements of Federal Mogul (Goetze) India Limited (âthe Companyâ) as of and for the year ended 31 March 2018, we have audited the internal financial controls over financial reporting (IFCoFR) of the Company as at that date. Managementâs Responsibility for Internal Financial Controls
2. The Companyâs Board of Directors is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of the Companyâs business, including adherence to the Companyâs policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.
Auditorâs Responsibility
3. Our responsibility is to express an opinion on the Companyâs IFCoFR based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India (âICAIâ) and deemed to be prescribed under Section 143(10) of the Act, to the extent applicable to an audit of IFCoFR, and the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (âthe Guidance Noteâ) issued by the ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate IFCoFR were established and maintained and if such controls operated effectively in all material respects.
4. Our audit involves performing procedures to obtain audit evidence about the adequacy of the IFCoFR and their operating effectiveness. Our audit of IFCoFR includes obtaining an understanding of IFCoFR, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditorâs judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Companyâs IFCoFR.
Meaning of Internal Financial Controls over Financial Reporting
6. A companyâs IFCoFR is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A companyâs IFCoFR include those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the companyâs assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
7. Because of the inherent limitations of IFCoFR, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the IFCoFR to future periods are subject to the risk that the IFCoFR may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
8. In our opinion, the Company has, in all material respects, adequate internal financial controls over financial reporting and such controls were operating effectively as at 31 March 2018, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India.
For Walker Chandiok & Co LLP
Chartered Accountants
Firmâs Registration No.: 001076N/N500013
per Anamitra Das
Partner
Membership No.:062191
Place: Gurugram
Date:29th May 2018
Mar 31, 2017
To the Members of Federal-Mogul
Goetze (India) Limited
Report on the Standalone Financial
Statements
1. We have audited the accompanying standalone financial statements of Federal-Mogul Goetze(India) Limited("the
Company"), which comprise the Balance Sheet as at 31 March 2017, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended and the summary of the significant accounting policies and other explanatory information.
Management''s Responsibility for the Standalone Financial Statements
2. 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 of these standalone 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 (as amended). This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act; safeguarding the assets of the Company; 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
3. Our responsibility is to express an opinion on these standalone financial statements based on our audit.
4. 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.
5. 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 standalone financial statements are free from material misstatement.
6. 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 controls 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. 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.
7. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on these standalone financial statements. Opinion
8. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone 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 2017, and its profit and its cash flows for the year ended on that date.
Report on Other Legal and Regulatory Requirements
9. As required by the Companies (Auditor''s Report) Order, 2016 ("the Order") issued by the Central Government of India in terms of Section 143(11) of the Act, we give in the Annexure I a statement on the matters specified in paragraphs 3 and 4 of the Order.
10. Further to our comments in Annexure I, as required by Section143(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 it appears from our examination of those books;
c. the standalone financial statements dealt with by this report are in agreement with the books of account;
d. in our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 (as amended);
e. on the basis of the written representations received from the directors as on 31 March 2017 and taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2017 from being appointed as a director in terms of Section164(2) of the Act;
f. we have also audited the internal financial controls over financial reporting (IFCOFR) of the Company as of 31 March 2017 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date and our report dated 19 May 2017 as per annexure II expressed an unqualified opinion; and.
g. 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, as detailed in Note 33 to the standalone financial statements, has disclosed the impact of pending litigations on its standalone financial position;
ii. the Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses; and
iii. there were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.
iv. the Company, as detailed in Note 48 to the standalone financial statements, has made requisite disclosures in these standalone financial statements as to holdings as well as dealings in Specified Bank Notes during the period from 8 November 2016 to 30 December 2016. Based on the audit procedures performed and taking into consideration the information and explanations given to us, in our opinion, these are in accordance with the books of account maintained by the company.
Annexure I
Based on the audit procedures performed for the purpose of reporting a true and fair view on the financial statements of the Company and taking into consideration the information and explanations given to us and the books of account and other records examined by us in the normal course of audit, and to the best of our knowledge and belief, 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 program of physical verification of its fixed assets under which fixed assets are verified in a phase manner 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. In accordance with this program, certain fixed assets were verified during the year and no material discrepancies were noticed on such verification.
(c) The title deeds of all the immovable properties (which are included under the head ''fixed assets'') are held in the name of the Company.
(ii) In our opinion, the management has conducted physical verification of inventory at reasonable intervals during the year and no material discrepancies between physical inventory and book records were noticed on physical verification.
(iii) The Company has not granted any loan, secured or unsecured to companies, firms, Limited Liability Partnerships (LLPs) or other parties covered in the register maintained under Section 189 of the Act. Accordingly, the provisions of clauses 3(iii)(a), 3(iii)(b) and 3(iii)(c) of the Order are not applicable.
(iv) In our opinion the, Company has complied with the provisions of sections 185 and 186 of the Act in respect of loans, investments, guarantees, and security.
(v) In our opinion, the Company has not accepted any deposits within the meaning of Sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended). Accordingly, the provisions of clause 3(v) of the Order are not applicable.
(vi) We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central
Government for the maintenance of cost records under sub-section (1) of Section 148 of the Act in respect of Company''s products and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.
(vii)(a) The Company is regular in depositing undisputed statutory dues including provident fund, employees'' state insurance, income-tax, sales-tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues, as applicable, to the appropriate authorities. Further, no undisputed amounts payable in respect thereof were outstanding at the year-end for a period of more than six months from the date they become payable.
(b) The dues outstanding in respect of income-tax, sales-tax, service tax, duty of customs, duty of excise and value added tax on account of any dispute, are as follows:
Statement of Disputed Dues
Name of the statute |
Nature of dues |
Amount (Rs,in lacs) |
Amount Period to Forum where paid under which the dispute is pending protest amount (Rs, in lacs) relates |
||
The Central |
Excise Act, 1944 |
Excise Duty |
76.42 |
- |
2000 - 2003 Central Excise and Service Tax Appellate Tribunal, Chennai |
The Central |
Excise Act, 1944 |
Excise Duty |
189.48 |
- |
2001 - 2006 Central Excise and Service Tax Appellate Tribunal. |
The Central |
Excise Act, 1944 |
Excise Duty |
5.03 |
- |
2006-2007 Central Excise and Service Tax Appellate Tribunal. |
The Central |
Excise Act, 1944 |
Excise Duty |
3.19 |
- |
2010-11 Assistant Commissioner (Central Excise), Bhiwadi, Rajasthan |
The Central |
Excise Act,1944 |
Excise Duty |
1.18 |
- |
1995-96 Joint Commissioner of Central Excise |
The Central |
Excise Act, 1944 |
Excise Duty |
6.96 |
- |
1998-1999 Joint Commissioner of Central Excise |
The Central |
Excise Act, 1944 |
Excise Duty |
3.32 |
- |
2001-2002 Additional Commissioner of Central Excise |
The Central |
Excise Act, 1944 |
Excise Duty |
2.54 |
- |
1995-96 and Joint Commissioner of Central Excise, 2003-2004 Patiala, Punjab |
The Central |
Excise Act, 1944 |
Excise Duty |
9.34 |
- |
1987-1990 Honorable High Court of Punjab and Haryana |
Name of the statute |
Nature of dues |
Amount (Rs, in lacs) |
Amount Period to paid under which the protest amount (Rs, in lacs) relates |
Forum where dispute is pending |
|
The Central Excise Act,1944 |
Excise Duty |
15.13 |
- |
2000-2001 |
Honorable Supreme Court and 2001-2002 |
The Central Excise Act, 1944 |
Excise Duty |
1.76 |
- |
1997-1999 |
Assistant Commissioner of Central Excise, Patiala, Punjab |
The Central Excise Act, 1944 |
Excise Duty |
1.86 |
- |
1997-98 |
Joint Commissioner of Central Excise, Patiala, Punjab |
The Central Excise Act,1944 |
Excise Duty |
121.00 |
- |
2010-14 |
Commissioner, Gurgaon |
The Central Excise Act, 1944 |
Excise Duty |
29.45 |
- |
2010-14 |
Commissioner, Gurgaon |
Finance Act, 1994 (Service Tax) |
Service Tax |
16.61 |
- |
2009-10 |
Joint Commissioner, Jaipur, Rajasthan |
Finance Act, 1994 (Service Tax) |
Service Tax |
62.41 |
- |
2008-11 |
Assistant Commissioner, Bhiwadi, Rajasthan |
Finance Act, 1994 (Service Tax) |
Service tax |
695.23 |
- |
2008-2011 |
Central Excise and Service Tax Appellate Tribunal, Bengaluru |
Finance Act, 1994 (Service Tax) |
Service tax |
5.81 |
- |
2012-2013 |
Commissioner of Central Excise |
Finance Act, 1994 (Service Tax) |
Service tax |
96.11 |
- |
2005-2011 |
Joint Commissioner of Central Excise, Patiala, Punjab |
Finance Act, 1994 (Service Tax) |
Service tax |
194.00 |
- |
Oct 2008 to |
March 2013 CESTAT |
Finance Act, 1994 (Service Tax) |
Service tax |
294.00 |
- |
2010-2013 |
Commissioner of Central Excise |
Finance Act, 1994 (Service Tax) |
Service tax |
8.34 |
- |
2013-14 |
Commissioner of Central Excise |
Finance Act, 1994 (Service Tax) |
Service tax |
310.40 |
- |
2008-12 |
CESTAT |
Finance Act, 1994 (Service Tax) |
Service Tax |
86.44 |
25.00 |
2006-2007 |
Central Excise and Service Tax Appellate Tribunal |
Finance Act, 1994 (Service Tax) |
Service Tax |
113.70 |
- |
May 2005 to July 2005 |
Central Excise and Service Tax Appellate Tribunal |
Finance Act, 1994 (Service Tax) |
Service tax |
13.81 |
- |
2009-2012 |
Commissioner (Appeals) |
Finance Act, 1994 (Service Tax) |
Service tax |
18.12 |
- |
2012-2013 |
Joint Commissioner (Appeals) |
Finance Act, 1994 (Service Tax) |
Service tax |
10.70 |
- |
2011-2013 |
Joint Commissioner (Appeals) |
Finance Act, 1994 (Service Tax) |
Service tax |
2.42 |
- |
2010-14 |
Deputy Commissioner, Patiala, Punjab |
Finance Act, 1994 (Service Tax) |
Service tax |
5.90 |
- |
2014 |
Additional Commissioner |
Finance Act, 1994 (Service Tax) |
Service tax |
19.11 |
- |
2013-14 |
Additional Commissioner |
Income tax Act, 1961 |
Income tax |
3.05 |
- |
2000-2001 |
Supreme Court |
Income tax Act, 1961 |
Income tax |
72.68 |
- |
2007-2008 |
Income tax appellate tribunal |
Income tax Act, 1961 |
Income tax |
68.45 |
- |
2001-2002 |
Assessing Officer for Appeal Effect |
Income tax Act, 1961 |
Income tax |
11.60 |
- |
2002-2003 |
Income Tax Appellate Tribunal |
Income tax Act, 1961 |
Income tax |
12.39 |
- |
2001-2002 |
Assessing Officer for Appeal Effect |
Income tax Act, 1961 |
Income tax |
85.17 |
- |
1997-1998 |
Honorable High Court, Delhi |
Income tax Act, 1961 |
Income tax |
1.52 |
- |
1997-1998 |
Honorable High Court, Delhi |
Income tax Act, 1961 |
Income tax |
39.52 |
- |
2005-2006 |
Assessing Officer for Appeal Effect |
Income tax Act, 1961 |
Income tax |
16.54 |
- |
1995-1996 Honorable High Court, Delhi and1996-1997 |
|
Income tax Act, 1961 |
Income tax |
66.55 |
- |
1998-1999 |
Supreme Court |
Income tax Act, 1961 |
Income tax |
16.71 |
- |
1998-1999 |
Supreme Court |
Income tax Act, 1961 |
Income tax |
345.80 |
- |
1997-1998 |
Honorable High Court, Delhi |
Income tax Act, 1961 |
Income tax |
0.52 |
- |
2000-2001 |
Supreme Court |
Income tax Act, 1961 |
Income tax |
21.21 |
- |
1999-2000 |
Supreme Court |
Name of the statute |
Nature of dues |
Amount (Rs, in lacs) |
Amount Period to paid under which the protest amount (Rs, in lacs) relates |
Forum where dispute is pending |
||
Income tax Act, 1961 |
Income tax |
17.65 |
- |
1999-2000 |
Supreme Court |
|
Income tax Act, 1961 |
Income tax |
19.23 |
- |
2004-2005 |
AO for Appeal Effect |
|
Income tax Act, 1961 |
Income tax |
59.68 |
- |
1999-00 |
Commissioner Income Tax (Appeal) |
|
Income tax Act, 1961 |
Income tax |
2.00 |
- |
2004-2005 |
Assessing Order for final order |
|
Income tax Act, 1961 |
Income tax |
262.49 |
- |
2007-08 to 2016-17 |
Income tax Officer |
|
Income tax Act, 1961 |
Income tax |
3.56 |
- |
2004-2005 |
Assessing Officer for Appeal Effect |
|
Income tax Act, 1961 |
Income tax |
2.21 |
- |
2002-03 |
Income Tax Appellate Tribunal |
|
Income tax Act, 1961 |
Income tax |
17.27 |
- |
2000-01 |
Honorable Supreme Court |
|
Income tax Act, 1961 |
Income tax |
19.22 |
- |
2004-05 |
Assessing Officer for final order |
|
Income tax Act, 1961 |
Income tax |
117.26 |
- |
2011-12 |
Assessing Officer for final order |
|
Income tax Act, 1961 |
Income tax |
0.31 |
- |
2011-12 |
Assessing Officer for final order |
|
Income tax Act, 1961 |
Income tax |
0.67 |
- |
2011-12 |
Assessing Officer for final order |
|
Income tax Act, 1961 |
Income tax |
26.60 |
- |
2011-12 |
Assessing Officer for final order |
|
Income tax Act, 1961 |
Income tax |
199.50 |
- |
2010-11 |
Income Tax Appellate Tribunal |
|
Income tax Act, 1961 |
Income tax |
198.49 |
- |
2011-12 |
Assessing Officer for final order |
|
Income tax Act, 1961 |
Wealth Tax |
3.94 |
- |
2005-06 |
Income Tax Appellate Tribunal |
|
Income tax Act, 1961 |
Income tax |
17.85 |
- |
2011-12 |
Income Tax Appellate Tribunal |
|
Income tax Act, 1961 |
Income tax |
414.03 |
- |
2012-13 |
Commissioner of Income Tax (Appeals) |
|
Income tax Act, 1961 |
Income tax |
70.87 |
- |
2008-09 |
Commissioner of Income Tax (Appeals) |
|
Income tax Act, 1961 |
Income tax |
1.71 |
- |
2009-10 |
Commissioner of Income Tax (Appeals) |
|
Income tax Act, 1961 |
Income tax |
1.78 |
- |
2009-10 |
Commissioner of Income Tax (Appeals) |
|
Income tax Act, 1961 |
Income tax |
143.66 |
- |
2013-14 |
Commissioner of Income Tax (Appeals) |
|
Andhra Pradesh VAT Act ,2005 |
Value added |
tax |
35.00 |
- |
2013-14 |
Deputy Commissioner, Appeal |
Delhi VAT Act ,2004 |
Value added |
tax |
196.00 |
- |
2010-11 |
Special Commissioner Objection Hearing |
Delhi VAT Act ,2004 |
Value added |
tax |
16.00 |
- |
2009-10 |
Special Commissioner Objection Hearing |
Kanrataka VAT Act, 2003 |
Value added |
tax |
13.38 |
3.41 |
2008-09 |
Joint Commissioner Appeal |
Delhi VAT Act,2004 |
Value added |
tax |
613.93 |
- |
2007-2008 |
Delhi - Commissioner |
Delhi VAT Act,2004 |
Value added |
tax |
73.44 |
- |
2008-2009 |
Delhi - Commissioner |
Rajasthan VAT Act, 2003 |
Value added |
tax |
137.29 |
- |
2007-08 and Honorable High Court of Rajasthan 2009-10 |
|
Bihar VAT Act,2005 |
Value added |
tax |
25.66 |
16.50 |
2005-2006 |
Deputy Commissioner, Patna |
West Bengal VAT Act,2003 |
Value added |
tax |
1.76 |
- |
2006-2007 |
Commissioner (Appeals) |
West Bengal VAT Act,2003 |
Value added |
tax |
1.18 |
- |
2006-2007 |
Commissioner (Appeals) |
West Bengal VAT Act,2003 |
Value added |
tax |
1.87 |
- |
2004-2005 |
Commissioner (Appeals) |
West Bengal VAT Act,2003 |
Value added |
tax |
1.56 |
- |
2001-2002 |
Commissioner (Appeals) |
Karnataka VAT Act, 2003 |
Value added |
tax |
97.00 |
215.37 |
1996-2002 |
Honorable High court of Karnataka |
Rajasthan VAT Act, 2003 |
Value added |
tax |
2.52 |
- |
2009-10 |
Commercial Tax officer, Bhiwadi, Rajasthar |
Rajasthan VAT Act, 2003 |
Value added |
tax |
50.64 |
- |
2012-13 |
Assistant Commissioner, Bhiwadi, Rajasthan |
Rajasthan VAT Act, 2003 |
Value Added |
Tax 544.24 |
- |
2013-14 |
Assistant Commissioner, Bhiwadi, Rajasthan |
|
Andhra Pradesh VAT Act,2005 |
Value Added |
Tax |
11.41 |
- |
2012-13 |
Special Commissioner Objection Hearing |
Maharastra VAT Demand Act, 2002 |
Value Added |
Tax |
23.88 |
- |
2012-13 |
Special Commissioner Objection Hearing |
Name of |
Nature of Amount |
Amount |
Period to |
Forum where |
|
the statute |
dues (Rs, in lacs) |
paid under which the |
dispute is pending |
||
protest |
amount |
||||
(Rs, in lacs) |
relates |
||||
Gujarat VAT Demand Act, 2003 Value Added Tax 568.25 |
- |
2012-13 |
Special Commissioner Objection Hearing |
||
Gujarat CST Demand |
Value Added Tax |
39.28 |
- |
2012-13 |
Special Commissioner Objection Hearing |
Uttranchal VAT Act,2005 |
Value Added Tax |
33.38 |
- |
2010-11 |
Special Commissioner Objection Hearing |
Karnataka VAT Act, 2003 |
Value Added Tax 278.51 |
55.00 |
2005-2006 |
Honorable High Court of Karnataka |
|
Uttar Pradesh VAT Act ,2005 |
Value Added tax |
82.78 |
40.00 |
2007-2008 |
Commissioner (Appeals), Ghaziabad |
Karnataka VAT Act ,2003 |
Value Added tax 410.00 |
216.00 |
2007-2011 |
ACCT, Audit Banglore, |
|
Karnataka VAT Act, 2003 |
Value Added tax |
1.36 |
1.38 |
2007-2008 |
Assistant . Commissioner, Banglore |
Karnataka VAT Act, 2003 |
Value Added tax 293.00 |
89.60 |
2014-15 |
Deputy Commissioner of Commercial Tax, |
|
Audit Banglore, |
|||||
Rajasthan VAT Act, 2003 |
Value Added Tax |
2.15 |
- |
2008-2009 |
Assistant commissioner, Bhiwadi, Rajasthan |
Uttar Pradesh VAT Act 2008 |
Value Added Tax |
32.68 |
- |
2012-2013 |
Commissioner, Uttar Pradesh |
(viii) The Company has not defaulted in repayment of loans or borrowings to any bank during the year. The Company did not have any outstanding dues to government or financial institutions or outstanding debentures during the year.
(ix) The Company did not raise moneys by way of initial public offer or further public offer (including debt instruments). In our opinion, the term loans were applied for the purposes for which the loans were obtained.
(x) No fraud by the Company or on the Company by its officers or employees has been noticed or reported during the period covered by our audit.
(xi) Managerial remuneration has been paid and provided by the Company in accordance with the requisite approvals mandated by the provisions of Section 197 of the Act read with Schedule V to the Act.
(xii) In our opinion, the Company is not a Nidhi company. Accordingly, provisions of clause 3(xii) of the Order are not applicable.
(xiii) In our opinion all transactions with the related parties are in compliance with Sections 177 and 188 of Act, where applicable, and the requisite details have been disclosed in the financial statements etc., as required by the applicable accounting standards.
(xiv) During the year, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures.
(xv) In our opinion, the Company has not entered into any non-cash transactions with the directors or persons connected with them covered under Section 192 of the Act.
(xvi) The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934.
Independent Auditor''s report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act")
1. In conjunction with our audit of the standalone financial statements of the Federal-Mogul Goetze (India) Limited("the Company") as of and for the year ended 31 March 201 7, we have audited the internal financial controls over financial reporting (IFCOFR) of the company as of that date.
Management''s Responsibility for Internal Financial Controls
2. The Company''s Board of Directors is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of the company''s business, including adherence to the company''s policies, the safeguarding of the its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act. Auditors'' Responsibility
3. Our responsibility is to express an opinion on the Company''s IFCOFR based on our audit. We conducted our audit in accordance with the Standards on Auditing, issued by the Institute of Chartered Accountants of India(ICAI) and deemed to be prescribed under section 143(10) of the Act, to the extent applicable to an audit of IFCOFR and the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the "Guidance Note"), issued by the ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate IFCOFR were established and maintained and if such controls operated effectively in all material respects.
4. Our audit involves performing procedures to obtain audit evidence about the adequacy of the IFCOFR and their operating effectiveness. Our audit of IFCOFR included obtaining an understanding of IFCOFR, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. 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.
5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the IFCOFR.
Meaning of Internal Financial Controls over Financial Reporting
6. A company''s IFCOFR is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company''s IFCOFR includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
7. Because of the inherent limitations of IFCOFR, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the IFCOFR to future periods are subject to the risk that the IFCOFR may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
8. In our opinion, the Company has, in all material respects, adequate internal financial controls over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31 March 2017, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India.
For Walker Chandiok & Co LLP
Chartered Accountants
Firm''s Registration No.: 001076N/N500013
per Anamitra Das
Partner
Membership No.:062191
Place: Gurugram
Date:19th May 2017
Mar 31, 2016
To the Members of Federal-Mogul Goetze (India) Limited Report on the Standalone Financial Statements
1. We have audited the accompanying standalone financial statements of Federal-Mogul Goetze (India) Limited ("the Company"), which comprise the Balance Sheet as at 31 March 2016, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.
Management''s Responsibility for the Standalone Financial Statements
2. 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 of these standalone 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 (as amended). This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act; safeguarding the assets of the Company; 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
3. Our responsibility is to express an opinion on these standalone financial statements based on our audit.
4. 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.
5. 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 standalone financial statements are free from material misstatement.
6. 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 controls 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. 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.
7. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.
Opinion
8. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone 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 2016, and its profit and its cash flows for the year ended on that date.
Report on Other Legal and Regulatory Requirements
9. As required by the Companies (Auditor''s Report) Order, 2016 ("the Order") issued by the Central Government of India in terms of Section 143(11) of the Act, we give in the Annexure Aa statement on the matters specified in paragraphs 3 and 4 of the Order.
10. As required by Section143(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 it appears from our examination of those books;
c. the standalone financial statements dealt with by this report are in agreement with the books of account;
d. in our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 (as amended);
e. on th e basis of th e written representations received from the directors as on 31 March 2016 and taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2016 from being appointed as a director in terms of Section 164(2) of the Act;
f. we have also audited the internal financial controls over financial reporting (IFCoFR) of the Company as of 31 March 2016 in conjunction with our audit of the financial statements of the Company for the year ended on that date and our report dated 13 May 2016 as per annexure B expressing our unmodified opinion on adequacy and operating effectiveness of the internal financial controls over financial reporting.
g. 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. as detailed in Note 33 to the standalone financial statements, the Company has disclosed the impact of pending litigations on its standalone financial position;
ii. the Company did not have any longterm contracts including derivative contracts for which there were any material foreseeable losses;
iii. there were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.
Annexure A
Based on the audit procedures performed for the purpose of reporting a true and fair view on the financial statements of the Company and taking into consideration the information and explanations given to us and the books of account and other records examined by us in the normal course of audit, 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 program of physical verification of its fixed assets under which fixed assets are verified in a phased manner 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. No material discrepancies were noticed on such verification.
(c) The title deeds of all the immovable properties are held in the name of the Company.
(ii) The management has conducted physical verification of inventory at reasonable intervals during the year and no material discrepancies between physical inventory and book records were noticed on physical verification.
(iii) The Company has not granted any loan, secured or unsecured to companies, firms, Limited Liability Partnerships (LLPs) or other parties covered in the register maintained under Section 189 of the Act. Accordingly, the provisions of clauses 3(iii)(a), 3(iii)(b) and 3 (i i i) ( c) of the Order are not applicable.
(iv) In our opinion the, Company has complied with the provisions of sections 185 and 186 of the Act in respect of loans, investments, guarantees, and security.
(v) The Company has not accepted any deposits within the meaning of Sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended). Accordingly, the provisions of clause 3(v) of the Order are not applicable.
(vi) We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under sub-section (1) of Section 148 of the Act in respect of Company''s products/services and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.
(vii) (a) Undisputed statutory dues including provident fund, employees'' state insurance, income-tax, sales-tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues, as applicable, have generally been regularly deposited to the appropriate authorities, though there has been a slight delay in a few cases. Further, no undisputed amounts payable in respect thereof were outstanding at the year-end for a period of more than six months from the date they became payable.
(b) The dues outstanding in respect of income-tax, sales-tax, service-tax, duty of customs, duty of exciseand value added tax on account of any dispute, are as follows:
Name of |
Nature of dues Amount |
Amount |
Period to |
Forum where |
||
the statute |
(Rs, in lacs) |
paid under |
which the |
dispute is pending |
||
protest |
amount |
|||||
(Rs, in lacs) |
relates |
|||||
Delhi VAT |
Value added tax |
196.00 |
2010-2011 |
Special Commissioner Objection Hearing |
||
Delhi VAT |
Value added tax |
16.00 |
2009-2010 |
Special Commissioner Objection Hearing |
||
Finance Act, |
1994 (Service Tax) |
Service tax |
16.61 |
2009-2010 |
Joint Commissioner,Jaipur |
|
Finance Act, |
1994 (Service Tax) |
Service tax |
62.41 |
2008-2011 |
Assistant Commissioner, Bhiwadi, Rajasthan |
|
Finance Act, |
1994 (Service Tax) |
Service tax |
695.23 |
2008-2011 |
Central Excise and Service Tax Appellate Tribunal, Bengaluru |
|
Finance Act, |
1994 (Service Tax) |
Service tax |
96.11 |
2005-2011 |
Joint Commissioner of Central Excise, Patiala, Punjab |
|
Finance Act, |
1994 (Service Tax) |
Service tax |
19.18 |
2006-2007 |
Central Excise and Service Tax Appellate Tribunal, Chandigarh |
|
Finance Act, |
1994 (Service Tax) |
Service tax |
16.79 |
2011-2012 |
Honorable High Court of Karnataka |
|
Finance Act, |
1994 (Service Tax) |
Service tax |
5.81 |
2012-2013 |
Commissioner of Central Excise |
|
Finance Act, |
1994 (Service Tax) |
Service tax |
13.81 |
2009-2012 |
Commissioner(Appeals) |
|
Finance Act, |
1994 (Service Tax) |
Service tax |
18.12 |
2012-2013 |
Joint Commissioner (Appeals) |
Name of the statute |
Nature of dues Amount (Rs, in lacs) |
Amount paid under protest (Rs, in lacs) |
Period to which the amount relates |
Forum where dispute is pending |
|
Finance Act, 1994 (Service Tax) |
Service tax |
10.70 |
2011-2013 |
Joint Commissioner (Appeals) |
|
Finance Act, 1994 (Service Tax) |
Service tax |
86.44 |
25.00 |
2006-2007 |
Central Excise and Service Tax Appellate Tribunal |
Finance Act, 1994 (Service Tax) |
Service tax |
113.70 |
May 2005-July 2005 |
Central Excise and Service Tax Appellate Tribunal |
|
Finance Act, 1994 (Service Tax) |
Service tax |
134.00 |
2006-2011 |
Commissioner of Central Excise |
|
Finance Act, 1994 (Service Tax) |
Service tax |
349.17 |
2015-2015 |
Commissioner of Central Excise |
|
Finance Act, 1994 (Service Tax) |
Service tax |
294.00 |
2012-2013 |
Commissioner of Central Excise |
|
Finance Act, 1994 (Service Tax) |
Service tax |
4.54 |
2012-2013 |
Deputy Commissioner, Patiala |
|
Finance Act, 1994 (Service Tax) |
Service tax |
670.21 |
2008-2013 |
Commissioner Service Tax |
|
Finance Act, 1994 (Service Tax) |
Service tax |
0.84 |
July 2011- Assistant Commissioner of February 2013 Central Excise |
||
Rajasthan VAT |
Value added tax |
9.02 |
2007-2008 |
Honorable High Court of Rajasthan |
|
Rajasthan VAT |
Value added tax |
19.68 |
2009-2010 |
Honorable High Court of Rajasthan |
|
Income tax Act, 1961 |
Income tax |
3.05 |
2000-2001 |
Honorable Supreme Court |
|
Income tax Act, 1961 |
Income tax |
72.68 |
2007-2008 |
Income tax appellate tribunal |
|
Income tax Act, 1961 |
Income tax |
68.45 |
2001-2002 |
Assessing Officer for Appeal Effect |
|
Income tax Act, 1961 |
Income tax |
11.60 |
2002-2003 |
Income Tax Appellate Tribunal |
|
Income tax Act, 1961 |
Income tax |
12.39 |
2001-2002 |
Assessing Officer for Appeal Effect |
|
Income tax Act, 1961 |
Income tax |
85.17 |
1997-1998 |
Honorable High Court, Delhi |
|
Income tax Act, 1961 |
Income tax |
39.52 |
2005-2006 |
Assessing Officer for Appeal Effect |
|
Income tax Act, 1961 |
Income tax |
16.54 |
1995-1997 |
Honorable High Court, Delhi |
|
Income tax Act, 1961 |
Income tax |
66.55 |
1998-1999 |
Honorable Supreme Court |
|
Income tax Act, 1961 |
Income tax |
16.71 |
1998-1999 |
Honorable Supreme Court |
|
Income tax Act, 1961 |
Income tax |
1.52 |
1997-1998 |
Honorable High Court, Delhi |
|
Income tax Act, 1961 |
Income tax |
345.80 |
1997-1998 |
Honorable High Court, Delhi |
|
Income tax Act, 1961 |
Income tax |
0.52 |
2000-2001 |
Honorable Supreme Court |
|
Income tax Act, 1961 |
Income tax |
21.21 |
1999-2000 |
Honorable Supreme Court |
|
Income tax Act, 1961 |
Income tax |
17.65 |
1999-2000 |
Honorable Supreme Court |
|
Income tax Act, 1961 |
Income tax |
19.23 |
2004-2005 |
Assessing Officer for Appeal Effect |
|
Income tax Act, 1961 |
Income tax |
2.00 |
2004-2005 |
Assessing Officer for Appeal Effect |
|
Income tax Act, 1961 |
Income tax |
70.68 |
2008-2009 |
Commissioner Income Tax (Appeals) |
|
Income tax Act, 1961 |
Income tax |
14.45 |
2008-2009 |
Commissioner Income Tax (Appeals) |
|
Income tax Act, 1961 |
Income tax |
73.29 |
2008-2009 |
Commissioner Income Tax (Appeals) |
|
Income tax Act, 1961 |
Income tax |
1.63 |
2008-2009 |
Commissioner Income Tax (Appeals) |
|
Income tax Act, 1961 |
Income tax |
19.06 |
2009-2016 |
Income tax Officer |
|
Income tax Act, 1961 |
Income tax |
1.78 |
2009-2010 |
Commissioner Income Tax (Appeals) |
|
Income tax Act, 1961 |
Income tax |
83.69 |
2009-2010 |
Commissioner Income Tax (Appeals) |
|
Income tax Act, 1961 |
Income tax |
1.79 |
2009-2010 |
Commissioner Income Tax (Appeals) |
|
Income tax Act, 1961 |
Income tax |
3.56 |
2004-2005 |
Assessing Officer for Appeal Effect |
|
Income tax Act, 1961 |
Income tax |
2.21 |
2002-2003 |
Income Tax Appellate Tribunal |
|
Income tax Act, 1961 |
Income tax |
17.27 |
2000-2001 |
Honorable Supreme Court |
|
Income tax Act, 1961 |
Income tax |
2.00 |
2004-2005 |
Assessing Officer for final Order |
|
Income tax Act, 1961 |
Income tax |
19.22 |
2004-2005 |
Assessing Officer for final Order |
Name of the statute |
Nature of dues Amount Amount (Rs,in lacs) paid under protest (Rs,in lacs) |
Period to which the amount relates |
Forum where dispute is pending |
||
Income tax Act, 1961 |
Income tax |
117.26 |
2011-2012 |
Assessing Officer for final Order |
|
Income tax Act, 1961 |
Income tax |
0.31 |
2011-2012 |
Assessing Officer for final Order |
|
Income tax Act, 1961 |
Income tax |
0.67 |
2011-2012 |
Assessing Officer for final Order |
|
Income tax Act, 1961 |
Income tax |
26.60 |
2011-2012 |
Assessing Officer for final Order |
|
Income tax Act, 1961 |
Income tax |
199.50 |
2010-2011 |
Income Tax Appellate Tribunal |
|
Income tax Act, 1961 |
Income tax |
198.49 |
2011-2012 |
Assessing Officerfor final Order |
|
Income tax Act, 1961 |
Income tax |
17.85 |
2011-2012 |
Income Tax Appellate Tribunal |
|
Karnataka VAT Act |
Value added tax |
13.38 |
2008-2009 |
Joint Commissioner Appeal |
|
Karnataka VAT Act, 2003 |
Value added tax |
97.00 |
140.00 |
1996-2002 |
Honorable High Court of Karnataka |
Karnataka VAT Act, 2003 |
Value added tax |
278.51 |
55.00 |
2005-2006 |
Honorable High Court of Karnataka |
Karnataka VAT Act, 2003 Taxes, Audit Bangalore, |
Value added tax |
293.00 |
89.60 |
2014-2015 |
Deputy Commissioner of Commercial |
Karnataka VAT Act, 2003 |
Value added tax |
1.36 |
1.38 |
2007-2008 |
Karnataka Appellate Tribunal |
Rajasthan VAT |
Value added tax |
9.04 |
9.00 |
2009-2010 |
Commercial Tax Officer, Bhiwadi |
Rajasthan VAT |
Value added tax |
388.80 |
7.00 |
2012-2013 |
Assistant Commissioner, Bhiwadi |
Rajasthan VAT |
Value added tax |
2.15 |
2008-2009 |
Assistant Commissioner, Bhiwadi |
|
Rajasthan VAT |
Value added tax |
0.03 |
2009-2010 |
Commercial Tax Officer, Bhiwadi |
|
Orissa VAT Act |
Value added tax |
99.39 |
2012-2014 |
Joint Commissioner Appeal |
|
Andhra Pradesh VAT |
Value added tax |
35.00 |
2013-2014 |
Deputy Commissioner, Appeal |
|
The Central Excise Act,1944 |
Duty of excise |
76.42 |
2000-2003 |
Central Excise and Service Tax Appellate Tribunal, Chennai |
|
The Central Excise Act,1944 |
Duty of excise |
189.48 |
2001-2006 |
Central Excise and Service Tax Appellate Tribunal. |
|
The Central Excise Act,1944 |
Duty of excise |
5.03 |
2006-2007 |
Central Excise and Service Tax Appellate Tribunal. |
|
The Central Excise Act,1944 |
Duty of excise |
3.19 |
2003-2004 |
Assistant Commissioner (Central Excise), Bhiwadi, Rajasthan |
|
The Central Excise Act,1944 |
Duty of excise |
6.96 |
1998-1999 |
Joint Commissioner of Central Excise. |
|
The Central Excise Act,1944 |
Duty of excise |
3.32 |
2001-2002 |
Additional Commissioner of Central Excise |
|
The Central Excise Act,1944 |
Duty of excise |
2.54 |
1995-2004 |
Joint Commissioner of Central Excise, Patiala Punjab |
|
The Central Excise Act,1944 |
Duty of excise |
9.34 |
1987-1990 |
Honorable High Court of Punjab and Haryana |
|
The Central Excise Act,1944 |
Duty of excise |
14.02 |
2000-2001 |
Central Excise and Service Tax Appellate Tribunal, Delhi |
|
The Central Excise Act,1944 |
Duty of excise |
15.13 |
2000-2002 |
Honorable Supreme Court |
|
The Central Excise Act,1944 |
Duty of excise |
1.76 |
1997-1999 |
Assistant Commissioner of Central Excise, Patiala Punjab |
|
The Central Excise Act,1944 |
Duty of excise |
1.86 |
1997-1998 |
Joint Commissioner of Central Excise, Patiala Punjab |
|
The Central Excise Act,1944 |
Duty of excise |
8.34 |
2015-2016 |
Joint Commissioner, Gurgaon |
|
The Central Excise Act,1944 |
Duty of excise |
29.45 |
2010-2014 |
Commissioner, Gurgaon |
|
The Central Excise Act,1944 |
Duty of excise |
0.97 |
2014-2015 |
Commissioner, Appeals |
|
UP VAT |
Value Added Tax |
82.78 |
40.00 |
2007-2008 |
Commissioner (Appeals), Ghaziabad |
Name of |
Nature of dues |
Amount |
Amount |
Period to |
Forum where |
the statute |
(Rs, in lacs)paid under |
which the |
dispute is pending |
||
protest |
amount |
||||
(Rs, in lacs) |
relates |
||||
Karnataka Sales Tax |
Value Added Tax |
410.00 |
216.00 |
2007-2011 |
Assistant Commissioner of Commercial Taxes, Audit Bangalore, |
UP VAT |
Value Added Tax |
32.68 |
2012-2013 |
Commissioner, Uttar Pradesh |
|
Maharashtra VAT |
Value Added Tax |
30.19 |
2008-2009 |
Deputy Commissioner, Pune |
|
Delhi VAT |
Value Added Tax |
613.93 |
2007-2008 |
Delhi - Commissioner |
|
Delhi VAT |
Value Added Tax |
73.44 |
2008-2009 |
Delhi - Commissioner |
|
Bihar VAT |
Value Added Tax |
25.66 |
16.50 |
2005-2006 |
Deputy Commissioner, Patna |
West Bengal VAT |
Value Added Tax |
1.76 |
2006-2007 |
Commissioner (Appeals) |
|
West Bengal VAT |
Value Added Tax |
1.18 |
2006-2007 |
Commissioner (Appeals) |
|
West Bengal VAT |
Value Added Tax |
1.87 |
2004-2005 |
Commissioner (Appeals) |
|
West Bengal VAT |
Value Added Tax |
1.56 |
2001-2002 |
Commissioner (Appeals) |
|
VAT, Uttaranchal |
Value Added Tax |
66.77 |
2010-2011 |
Joint Commissioner Appeal |
|
Wealth tax act, 1957 |
Wealth Tax |
3.90 |
2006-2007 |
Commissioner Income Tax (Appeals) |
(viii) The Company has not defaulted in repayment of loans or borrowings to any bank or financial institution or government during the year. The Company did not have any outstanding debentures during the year.
(ix) In our opinion, the Company has applied moneys raised by way of the term loans for the purposes for which these were raised. The Company did not raise moneys by way of initial public offer/ further public offer (including debt instruments)..
(x) No fraud by the Company or on the Company by its officers or employees has been noticed or reported during the period covered by our audit.
(xi) In our opinion, managerial remuneration has been paid (and)/ provided in accordance with the requisite approvals mandated by the provisions of section 197 of the Act read with Schedule V to the Act.
(xii) In our opinion, the Company is not a Nidhi Company. Accordingly, clause 3(xii) of the Order is not applicable.
(xiii) In our opinion all transactions with the related parties are in compliance with sections 177 and 188 of Act, where applicable, and the requisite details have been disclosed in the financial statements etc., as required by the applicable accounting standards.
(xiv) During the year, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures.
(xv) The Company has not entered into any non-cash transactions with directors or persons connected with them.
(xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.
Annexure B Independent Auditor''s report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act")
1. In conjunction with our audit of the standalone financial statements of Federal-Mogul (Goetze) India ("the Company") as of and for the year ended 31 March 2016, we have audited the internal financial controls over financial reporting (IFCoFR) of the Company of as of that date. Management''s Responsibility for Internal Financial Controls
2. The Company''s Board of Directors is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of the Company''s business, including adherence to Company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act. Auditors'' Responsibility
3. Our responsibility is to express an opinion on the Company''s IFCoFR based on our audit. We conducted our audit in accordance with the Standards on Auditing, issued by the Institute of Chartered Accountants of India (ICAI) and deemed to be prescribed under section 143(10) of the Act, to the extent applicable to an audit of IFCoFR, and the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the "Guidance Note") issued by the ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate IFCoFR were established and maintained and if such controls operated effectively in all material respects.
4. Our audit involves performing procedures to obtain audit evidence about the adequacy of the IFCoFR and their operating effectiveness. Our audit of IFCoFR included obtaining an understanding of IFCoFR, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s IFCoFR.
Meaning of Internal Financial Controls over Financial Reporting
6. A Company''s IFCoFR is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A Company''s IFCoFR includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2)provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorisations of management and directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the Company''s assets that could have a material effect on the financial statements. Inherent Limitations of Internal Financial Controls over Financial Reporting
7. Because of the inherent limitations of IFCoFR, including the possibility of collusion or improper management override of controls, material mis statements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the IFCoFR to future periods are subject to the risk that IFCoFR may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
8. In our opinion, the Company has, in all material respects, adequate internal financial controls over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31 March 2016, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India.
For Walker Chandiok & Co LLP
(Formerly Walker, Chandiok & Co)
Chartered Accountants
Firm''s Registration No.: 001076N/N500013
per Anamitra Das
Partner
Membership No.:062191
Place: Gurgaon
Date:13h May 2016
Mar 31, 2015
1. We have audited the accompanying financial statements of
Federal-Mogul Goetze (India) Limited, ("the Company"), which comprise
the Balance Sheet as at 31 March 2015, and the Statement of Profit and
Loss and Cash Flow Statement for the period 1 January 2014 to 31 March
2015, and a summary of significant accounting policies and other
explanatory information.
Management''s Responsibility for the
Financial Statements
2. Management is responsible for 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 notified under the Companies Act, 1956 ("the Act")
read with the General Circular 15/2013 dated 13 September 2013 of the
Ministry of Corporate Affairs in respect of section 133 of the
Companies Act, 2013. This responsibility includes the design,
implementation and maintenance of internal control 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.
Auditors'' Responsibility
3. 3. Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. 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.
4. An audit involves performing procedures to obtain audit evidence
about the amounts and disclosures in the financial statements. The
procedures selected depend on the auditors'' 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 control relevant to the
Company''s preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of Company''s internal control. An audit also includes
evaluating the appropriateness of accounting policies used and the
reasonableness of the accounting estimates made by management, as well
as evaluating the overall presentation of the financial statements.
5. We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our audit opinion.
Opinion
6. In our opinion and to the best of our information and according to
the explanations given to us,
the 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:
i) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31 March 2015.
ii) in the case of Statement of Profit and Loss, of the profit for the
period 1 January 2014 to 31 March 2015; and
iii) in the case of the Cash Flow Statement, of the cash flows for the
period 1 January 2014 to 31 March 2015
Report on Other Legal and Regulatory Requirements
7. As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order") issued by the Central Government of India in terms of
sub-section (4A) of Section 227 of the Act, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
8. As required by Section 227(3) of the Act, 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 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 financial statements dealt with by this report are in agreement
with the books of account.
d. in our opinion, the financial statements comply with the Accounting
Standards notified under Companies Act, 1956 read with the General
Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate
Affairs in respect of section 133 of the Companies Act, 2013 ; and
e. on the basis of written representations received from the directors
as on 31 March 2015 under section 164(2) of the Companies Act, 2013 and
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 Companies Act, 2013, provisions of which
are consistent with clause (g) of sub-section (1) of section 274 of the
Act.
Other Matter
9. The Ministry of Corporate Affairs (''MCA'') had on 1 April 2014, vide
its General Circular No. 07/2014, ''Dissemination of information with
regards to the provisions of the Companies Act, 2013 as notified till
date vis-a-vis corresponding provisions of the Companies Act, 1956'',
identified such sections of the Act that would cease/ continue to have
effect from 1 April 2014. Accordingly, in terms of the aforesaid
Circular, our
reporting in respect of clauses (iii), (v)(a) and (b), (vi), (viii),
(xiv), (xviii) of the Companies (Auditor''s Report) Order, 2003 (dealing
with sections 49, 58A, 58AA, 209(1 )(d) and 301 of the Act) is only for
the period beginning from 1 January 2014 till 31 March 2014 since as
per the aforementioned MCA Circular these sections have ceased to have
effect from 1 April 2014.
Annexure to the Independent Auditors'' Report of even date to the
members of Federal-Mogul Goetze (India) Limited, on the financial
statements for the period 1 January 2014 to 31 March 2015 Based on the
audit procedures performed for the purpose of reporting a true and fair
view on the financial statements of the Company and taking into
consideration the information and explanations given to us and the
books of account and other records examined by us in the normal course
of audit, we report that:
(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) All fixed assets have not been physically verified by the
management during the period, however, there is a regular program of
verification once in three years, 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) In our opinion, a substantial part of fixed assets has not been
disposed off during the period.
(ii) (a) The management has conducted physical verification of invent
-ory at reasonable intervals during the period except goods in transit.
(b) 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) The Company is maintaining proper records of inventory and no
material discrepancies between physical inventory and book records were
noticed on physical verification.
(iii) (a) The Company has not granted any
loan, secured or unsecured to companies, firms or other parties covered
in the register maintained under Section 301 of the Act. Accordingly,
the provisions of clauses 4(iii)(b) to 4(iii) (d) of the Order are not
applicable.
(e) The Company has not taken any loans, secured or unsecured from
companies, firms or other parties covered in the register maintained
under Section 301 of the Act. Accordingly, the provisions of clauses
4(iii)(f) and 4(iii)(g) of the Order are not applicable.
(iv) In our opinion, 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. During the course of our audit, no major
weakness has been noticed in the internal control system in respect of
these areas.
(v) (a) The Company has not entered into any contracts or arrangements
referred to in Section 301 of the Act.
Accordingly, the provisions of clause 4(v) of the Order are not
applicable.
(vi) The Company has not accepted any deposits from the public within
the meaning of Sections 58A and 58AA of the Act and the Companies
(Acceptance of Deposits) Rules, 1975. Accordingly, the provisions of
clause 4(vi) of the Order are not applicable.
(vii) In our opinion, the Company has an internal audit system
commensurate with its size and the nature of its business.
(viii) We have broadly reviewed the books of account maintained by the
Company pursuant to the Rules made by the Central Government for the
maintenance of cost records under clause (d) of sub-section (1) of
Section 209 of the Act in respect of Company''s products and are of the
opinion that, prima facie, the prescribed accounts and records have
been made and maintained. However, we have not made a detailed
examination of the cost records with a view to determine whether they
are accurate or complete.
(ix)(a) Undisputed statutory dues including provident fund, investor
education and protection fund, employees'' state insurance, income-tax,
sales-tax, wealth tax, service tax, custom duty, excise duty, cess and
other material statutory dues, as applicable, have generally been
regularly deposited with the appropriate authorities, though there has
been a slight delay in a few cases. Further, no undisputed amounts
payable in respect thereof were outstanding at the year- end for a
period of more than six months from the date they became payable.
(b) The dues outstanding in respect of income-tax, sales-tax, wealth
tax, service tax, custom duty, excise duty, cess on account of any
dispute, are as follows:
Name of the Nature of dues Amount Amount
statute (Rs. Paid Under
Lacs) Protest
(Rs in lacs)
The Central
Excise Act,1944 Trade discount 33.74
The Central
Excise Act,1944 Excise duty on
turnover discount 42.71
The Central Excise Excise duty on turnover 189.48
Act, 1944 discount
The Central Excise
Act,1944 Cenvat credit availed twice 5.04
The Central Excise
Act,1944 Demand on removal of non-
saleable stock removed
from RG-1 8.57
The Central Excise
Act,1944 Excise duty on capital
goods 3.19
The Central Excise
Act, 1944 Classification of Light
metal cylinder casting 6.97
The Central Excise
Act,1944 Demand on sale of various
types of scrap 3.33
The Central Excise
Act,1944 Demand in respect of Modvat
credits on input and Capital
goods 2.54
The Central Excise
Act,1944 Demand in respect of Modvat
credits on input and Capital
goods 1.76
The Central Excise
Act,1944 Interest on reversal of
Special addition duty 14.02
The Central Excise
Act,1944 Conversion of aluminum
scrap into ingots from
Colts department 15.14 -
The Central Excise
Act,1944 Input tax credit on
various expenses 16.61 -
The Central Excise
Act,1944 Input tax credit on
various expenses 62.41 -
The Central Excise
Act,1944 Input tax credit on
various expenses 695.23 -
The Central Excise
Act,1944 Input tax credit on
various expenses 153.84 -
The Central Excise
Act,1944 Disallowance of service
tax credit on various
services 96.11 -
The Central Excise
Act,1944 Disallowance of service
tax credit on various
services 19.18 -
The Central Excise
Act,1944 Availment of Cenvat on
Job work charges 152.21 -
The Central Excise
Act,1944 Disallowance of service
tax credit on various
services 16.79 -
Karnataka VAT Act,
2003 Difference in VAT rates
(classification issue) 97 140.81
Karnataka VAT Act,
2003 Difference in VAT rates
(classification issue) 278.51 55
Income tax Act,
1961 Disallowance of
expenditure in relation to
exempt income 3.05 -
Income tax Act,
1961 Disallowance of expenditure
in relation to exempt income 8.59 -
Income tax Act,
1961 Interest free loan to
subsidiary 72.68 -
Income tax Act,
1961 Disallowance of development
expenditure treated as
capital in nature 68.45 -
Income tax Act,
1961 Disallowance of certain
expenses 158.01 -
Income tax Act,
1961 Loss in relation to
diminution in value of
shares disallowed 12.39 -
Income tax Act,
1961 Brought forward losses
of the amalgamating
company denied 5,674.45 -
Income tax Act,
1961 Disallowance for
amalgamating expenses 0.69 -
Income tax Act,
1961 Provision for expenses
disallowed 85.17 -
Income tax Act,
1961 Disallowance of
proportionate royalty
expense 39.52 -
Income tax Act,
1961 Distribution of gift
coupons to shareholders
at AGM 16.54 -
Income tax Act,
1961 Disallowance of exemption
on dividend 66.55 -
Income tax Act,
1961 Addition of revaluation
reserves to book profits 16.71 -
Income tax Act,
1961 Apportionment of common
administrative costs 1.52 -
Income tax Act,
1961 Disallowance of lease rent
expenses 345.8 -
Income tax Act,
1961 Applicability of interest
u/s 234D 0.51 -
Income tax Act,
1961 Disallowance of expenditure
in relation to exempt
income 21.21 -
Income tax Act,
1961 Addition to revaluation
reserves to book profits 17.65 -
Income tax Act,
1961 Loss in relation to
diminution in value of
shares disallowed 19.23 -
UP VAT Difference in VAT rates
(classification issue) 82.78 10.291
Karnataka VAT Entry tax on import of
capital goods 410 216
The Central Excise
Act,1944 Denial of Cenvat credit
of excise duty/ service tax
paid on common inputs/
services, 393.78 -
The Central Excise
Act,1944 CENVAT credit taken in respect
of the said inputs or capital
goods 5.81 -
Name of the statute Period to Forum where dispute is
which the Pending
amount relates
The Central Excise Act,1944 2000 - 2004 Joint Commissioner of Central
Excise, Bengaluru
The Central Excise Act,1944 2000 - 2003 Central Excise and Service
Tax Appellate Tribunal Chenna
The Central Excise Act,1944 2001 - 2006 Central Excise and Service
Tax Appellate Tribunal.
The Central Excise Act,1944 2005-2007 Central Excise and Service
Tax Appellate T ribunal.
The Central Excise Act,1944 July 2005 to Commissioner - Central Excise
December 2005
The Central Excise Act,1944 2010- 2011 Assistant Commissioner
(Central Excise), Bhiwadi,
Rajasthan
The Central Excise Act,1944 1998-99 Joint Commissioner of Central
Excise.
The Central Excise Act,1944 2001 -02 Additional Commissioner
The Central Excise Act,1944 1995- 96, Joint Commissioner of Central
2003-2004 Excise, Patiala Punjab
The Central Excise Act,1944 1997- 99 Assistant Commissioner
The Central Excise Act,1944 2000-02 Central Excise & Service Tax
Appellate Tribunal,
Chandigarh
The Central Excise Act,1944 2000-2001 Hon''ble Supreme Court
The Central Excise Act,1944 2009-10 Joint Commissioner, Jaipur
The Central Excise Act,1944 2008-11 Assistant Commissioner,
Bhiwadi, Rajasthan
The Central Excise Act,1944 2008-11 Central Excise and Service
Tax Appellate Tribunal,
Bengaluru
The Central Excise Act,1944 2011 Commissioner & Commissioner
Appeal
The Central Excise Act,1944 2005- 11 Joint Commissioner of Central
Excise, Patiala, Punjab
The Central Excise Act,1944 2006- 07 Central Excise and Service
Tax Appellate Tribunal,
Chandigarh
The Central Excise Act,1944 2011 Commissioner Central Excise,
Bengaluru
The Central Excise Act,1944 2011- 12 Hon''ble High Court of
Karnataka
Karnataka VAT Act, 2003 1996- 97 to Hon''ble High Court of
2001 -02 Karnataka
Karnataka VAT Act, 2003 2005-06 Hon''ble High Court of
Karnataka
Income tax Act, 1961 2000-01 Hon''ble Supreme, Delhi
Income tax Act, 1961 2001 -02 Commissioner Income Tax
(Appeals)
Income tax Act, 1961 2007- 08 Income tax appellate tribunal
Income tax Act, 1961 2001 -02 Commissioner Income Tax
(Appeals)
Income tax Act, 1961 2002-03 Income Tax Appellate Tribunal
Income tax Act, 1961 2001 -02 Commissioner Income Tax
(Appeals)
Income tax Act, 1961 2002-03 Income Tax Appellate Tribunal
Income tax Act, 1961 2002-03 Income Tax Appellate Tribunal
Income tax Act, 1961 1997- 98 Hon''ble High Court, Delhi
Income tax Act, 1961 2005-06 Income Tax Officer
Income tax Act, 1961 1995-96 & Hon''ble High Court, Delhi
1996-97
Income tax Act, 1961 1998- 99 Hon''ble Supreme Court
Income tax Act, 1961 1998- 99 Hon''ble Supreme Court
Income tax Act, 1961 1997-98 Hon''ble High Court, Delhi
Income tax Act, 1961 1997-98 Hon''ble High Court, Delhi
Income tax Act, 1961 2000-01 Hon''ble Supreme Court, Delhi
Income tax Act, 1961 1999- 00 Hon''ble Supreme Court
Income tax Act, 1961 1999-00 Hon''ble Supreme Court
Income tax Act, 1961 2004-05 Income Tax Officer
UP VAT 2007-08 Commissioner UP
Karnataka VAT 2007- 11 Assistant Commissioner of
Commercial Taxes, Audit
Bangalore,
The Central excise Act 1944 2012- 13 Commissioner & Commissioner
Appeal
The Central excise Act 1944 2008- 2011 Commissioner of Central
Excise
Name of the Nature of dues Amount Amount
statute (Rs. Paid Under
Lacs) Protest
(Rs in lacs)
The Central Excise
Act,1944 Denial of Cenvat credit
of excise duty/ service tax
paid on common inputs/ input
services, 472.94 -
The Central Excise
Act,1944 Payment of service tax
under GTA on inwards/
outwards freight 13.81 -
The Central Excise
Act,1944 Payment of service tax
under GTA on inwards/
outwards freight 18.13 -
The Central Excise
Act,1944 Service tax credit on
security & advertising
services 10.70 -
Delhi VAT Act 2004 VAT on sale of Fixed
assets payable 613.93 -
Delhi VAT Act 2004 Non submission of C form
and F forms 73.44 -
Bihar VAT Act 2005 non submission of Sales
Invoices & Form F 25.66 16.5
MVAT Act 2002 F-Form disallowed 9.2 -
West Bengal VAT
Act 2003 Disallowance of sales
return 1.76 -
West Bengal VAT Act
2003 Disallowance of pre-fitment
warranty materials 1.18 -
West Bengal VAT Act
2003 Disallowance of F form 1.87 -
West Bengal VAT Act
2003 Dispute in sales of gross
turnover & stock transfer 1.56 -
The Central Excise Act
,1944 Input tax credit on various
expenses 86.44 25
The Central Excise Act,
1944 Input tax credit on various
expenses 113.70 -
Income tax Act,
1961 Disallowance of expenditure
in relation to exempt
income 1.99 -
Wealth tax act,
1957 Disallowance of debt relating
to taxable wealth 3.9 -
Income tax Act,
1961 Disallowance of expenditure
in relation to exempt income 3.56 -
Income tax Act,
1961 Interest free loan to
subsidiary 70.68 -
Income tax Act,
1961 Disallowance of prior
period expenses 14.45 -
Income tax Act,
1961 Disallowance of proportionate
royalty expense 73.29 -
Income tax Act,
1961 Disallowance of club expenses 1.63 -
Income tax Act,
1961 Default notices on account
of short deduction/
short payment of tax deduction
at Source 19.06 -
Karnataka VAT Act,
2003 Sale made on concessional
form. 1.36 1.38
Karnataka VAT Act,
2003 Sales tax demand for the
assessment year 2014-15 293 -
Rajasthan VAT Act
2003 Non submission of statutory
form on the concessional sale 2.15 -
Rajasthan VAT Act
2003 Non submission of statutory
form on the concessional
sale. 0.03 -
Rajasthan VAT Act
2003 Sale tax demand on forms 306 -
The Central Excise Act,
1944 VAT demand on the stock transfer
- not allowed and tax on the
stock transfer 32.11 -
The Central Excise Act,
1944 Demand issued for non -
submission of stock transfer
forms in the audit. 30.19 -
The Central Excise Act,
1944 Service tax credit disallowed
on the health service 134.00 -
Income tax Act,
1961 Disallowance if expenditure
in relation to exempt income. 1.77 -
Income tax Act,
1961 Amount of proportionate
royalty disallowed. 83.68 -
Income tax Act,
1961 Dis-allowance of club
expenses. 1.79 -
Income tax Act,
1961 Management fee disallowed. 199.5 -
Income tax Act,
1961 Advances written of
disallowed. 17.85 -
The Central Excise Act,
1944 Reversal of credit obtained
on LPG 0.97 -
The Central Excise Act,
1944 Dis-allowance of service tax
credit 349.17 -
The Central Excise Act,
1944 Service tax credit
disallowed. 294.00 -
The Central Excise Act,
1944 Payment of Service tax
on PF & ESI contribution
by FMGIL 4.54 -
The Central Excise Act,
1944 Service tax not paid on
royalty 670.21 -
The Central Excise Act,
1944 Input credit on Job work
Invoice issued by FMTPR 0.84 -
The Central Excise Act,
1944 Disallowance of service
tax credit. 611.96 -
Name of the statute Period to Forum where dispute is
which the Pending
amount relates
The Central Excise Act,1944 2012-13 Commissioner & Commissioner
Appeal
The Central Excise Act,1944 2009-12 Commissioner(Appeals)
The Central Excise Act,1944 2012-13 Joint Commissioner
(Appeals)
The Central Excise Act,1944 2011-13 Joint Commissioner (Appeals)
Delhi VAT Act 2004 2007-08 Delhi - Commissioner
Delhi VAT Act 2004 2008-09 Delhi - Commissioner
Bihar VAT Act 2005 2005-06 Deputy Commissioner, Patna
MVAT Act 2002 2000-01 Sales tax Pune
West Bengal VAT Act 2003 2006-07 Assistant Commissioner
(Kolkata)
West Bengal VAT Act 2003 2006-07 Assistant Commissioner
(Kolkata)
West Bengal VAT Act 2003 2004-05 Assistant Commissioner
(Kolkata)
West Bengal VAT Act 2003 2001-02 Assistant Commissioner
(Kolkata)
The Central Excise Act,1944 2006-07 Custom Excise & Service Tax
Appellate Tribunal
The Central Excise Act,1944 May 2005 to
July 2005 Custom Excise & Service Tax
Appellate Tribunal
Income tax Act, 1961 2004-2005 Income Tax Officer
Wealth tax act, 1957 2006-07 Commissioner Income Tax
(Appeals)
Income tax Act, 1961 2006-07 Income Tax Appellate
Tribunal
Income tax Act, 1961 2008-09 Commissioner Income Tax
(Appeals)
Income tax Act, 1961 2008-09 Commissioner Income Tax
(Appeals)
Income tax Act, 1961 2008-09 Commissioner Income Tax
(Appeals)
Income tax Act, 1961 2008-09 Commissioner Income Tax
(Appeals)
Income tax Act, 1961 2009-10 to Income tax Officer
2015-16
Karnataka VAT Act, 2003 2007-08 Assistant Commissioner,
Bangalore
Karnataka VAT Act, 2003 2014-15 Deputy Commissioner of
Commercial Taxes
Rajasthan VAT Act 2003 2008-09 Assistant commissioner,
Bhiwadi
Rajasthan VAT Act 2003 2009-10 Commercial Tax Officer,
Bhiwadi
Rajasthan VAT Act 2003 2012-13 Assistant Commissioner,
Bhiwadi
The Central Excise Act,1944 2012-13 Commissioner, Uttar Pradesh
The Central Excise Act,1944 2008-09 Pune,-Deputy Commissioner,
The Central Excise Act,1944 2006-11 Commissioner
Income tax Act, 1961 2010-11 Commissioner of Income Tax
Appeals
Income tax Act, 1961 2010-11 Commissioner of Income Tax
Appeals
Income tax Act, 1961 2010-11 Commissioner of Income Tax
Appeals
Income tax Act, 1961 2011-12 Dispute Resolution Panel
Income tax Act, 1961 2011-12 Dispute Resolution Panel
The Central Excise Act,1944 2014.15 Commissioner of Central
Excise
The Central Excise Act,1944 Aug 2013 Commissioner of Central
to July 2014 Excise
The Central Excise Act,1944 2012-13 Commissioner
The Central Excise Act,1944 2012-13 Deputy. Commissioner
The Central Excise Act,1944 2008-13 Commissioner Service Tax
The Central Excise Act,1944 July 2011 Assistant Commissioner of
to Feb 2013 Central Excise
The Central Excise Act,1944 01.03.2005 Hon''ble High Court
to 30.06.2008
(x) In our opinion, the Company has no accumulated losses at the end of
the financial period and it has not incurred cash losses in the current
and the immediately preceding financial year.
(xi) In our opinion, the Company has not defaulted in repayment of dues
to any financial institution or a bank. The company does not have any
outstanding debenture during the period.
(xii) The Company has not granted any loans and advances on the basis
of security by way of pledge of shares, debentures and other
securities. Accordingly, the provisions of clause 4(xii) of the Order
are not applicable.
(xiii) In our opinion, the Company is not a chit fund or a nidhi/
mutual benefit fund/ society. Accordingly, provisions of clause
4(xiii) of the Order are not applicable.
(xiv) In our opinion, the Company is not dealing or trading in shares,
securities, debentures and other investments. Accordingly, the
provisions of clause 4(xiv) of the Order are not applicable.
(xv) The Company has not given any guarantees for loans taken by others
from banks or financial institutions. Accordingly, the provisions of
clause 4(xv) of the Order are not applicable.
(xvi) In our opinion, the Company has applied the term loans for the
purpose for which these loans were obtained.
(xvii) In our opinion and based on an overall examination of the
balance sheet of the Company, we report that the Company has utilized
funds raised on short term basis through short term loans from bank and
other current liabilities aggregating to Rs. 2,753 lacs for various long
term purposes.
(xviii) During the period, the Company has not made any preferential
allotment of shares to parties covered in the register maintained under
Section 301 of the Act. Accordingly, the provisions of clause 4(xviii)
of the Order are not applicable.
(xix) The Company has neither issued nor had any outstanding debentures
during the period. Accordingly, the provisions of clause 4(xix) of the
Order are not applicable.
(xx) The Company has not raised any money by public issues during the
period. Accordingly, the provisions of clause 4(xx) of the Order are
not applicable.
(xxi) No fraud on or by the Company has been noticed or reported during
the period covered by our audit.
For Walker Chandiok & Co LLP
(formerly Walker, Chandiok & Co)
Chartered Accountants
Firm Registration No.: 001076N
per Neeraj Sharma
Partner
Place: Gurgaon Membership
Date: 22 May 2015 No.: 502103
Dec 31, 2013
1. We have audited the accompanying financial statements of
Federal-Mogul Goetze (India) Limited, ("the Company"), which comprise
the Balance Sheet as at 31 December 2013, and 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
2. Management is responsible for 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 notified under the Companies Act, 1956 ("the Act")
read with the General Circular 15/2013 dated 13 September 2013 of the
Ministry of Corporate Affairs in respect of section 133 of the
Companies Act, 2013. This responsibility includes the design,
implementation and maintenance of internal control 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.
Auditors'' Responsibility
3. Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. 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.
4. An audit involves performing procedures to obtain audit evidence
about the amounts and disclosures in the financial statements. The
procedures selected depend on the auditors'' 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 control relevant to the
Company''s preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of Company''s internal control. An audit also includes
evaluating the appropriateness of accounting policies used and the
reasonableness of the accounting estimates made by management, as well
as evaluating the overall presentation of the financial statements.
5. We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our audit opinion.
Opinion
6. In our opinion and to the best of our information and according to
the explanations given to us, the 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:
i) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31 December 2013;
ii) in the case of 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
Report on Other Legal and Regulatory Requirements
7. As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order") issued by the Central Government of India in terms of
sub-section (4A) of Section 227 of the Act, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
8. As required by Section 227(3) of the Act, 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 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 financial statements dealt with by this report are in agreement
with the books of account;
d. in our opinion, the financial statements comply with the Accounting
Standards notified under the Companies Act, 1956 read with the General
Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate
Affairs in respect of section 133 of the Companies Act, 2013 ; and
e. on the basis of written representations received from the
directors, as on 31 December 2013 and taken on record by the Board of
Directors, none of the directors is disqualified as on 31 December 2013
from being appointed as a director in terms of clause (g) of
sub-section (1) of Section 274 of the Act.
Annexure to the Independent Auditors'' Report of even date to the
members of Federal-Mogul Goetze (India) Limited, on the financial
statements for the year ended 31 December 2013
Based on the audit procedures performed for the purpose of reporting a
true and fair view on the financial statements of the Company and
taking into consideration the information and explanations given to us
and the books of account and other records examined by us in the normal
course of audit, 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 program of physical verification of its
fixed assets under which fixed assets are verified in a phased manner
over a period of -three year, 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) In our opinion, a substantial part of fixed assets has not been
disposed off during the year.
ii. (a) The management has conducted physical verification of inventory
at reasonable intervals during the year.
(b) 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) The Company is maintaining proper records of inventory and no
material discrepancies between physical inventory and book records were
noticed on physical verification.
iii. (a) The Company has not granted any loan, secured or unsecured to
companies, firms or other parties covered in the register maintained
under Section 301 of the Act. Accordingly, the provisions of clauses
4(iii)(b) to 4(iii) (d) of the Order are not applicable.
(b) The Company has not taken any loans, secured or unsecured from
companies, firms or other parties covered in the register maintained
under Section 301 of the Act. Accordingly, the provisions of clauses
4(iii)(f) and 4(iii)(g) of the Order are not applicable.
iv. In our opinion, 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. During the course of our audit, no major
weakness has been noticed in the internal control system in respect of
these areas.
v. (a) The Company has not entered into any contracts or arrangements
referred to in Section 301 of the Act. Accordingly, the provisions of
clause 4(v) of the Order are not applicable.
vi. The Company has not accepted any deposits from the public within
the meaning of Sections 58A and 58AA of the Act and the Companies
(Acceptance of Deposits) Rules, 1975. Accordingly, the provisions of
clause 4(vi) of the Order are not applicable.
vii. In our opinion, the Company has an internal audit system
commensurate with its size and the nature of its business.
viii. We have broadly reviewed the books of account maintained by the
Company pursuant to the Rules made by the Central Government for the
maintenance of cost records under clause (d) of sub-section (1) of
Section 209 of the Act in respect of Company''s products and are of the
opinion that, prima facie, the prescribed accounts and records have
been made and maintained. However, we have not made a detailed
examination of the cost records with a view to determine whether they
are accurate or complete.
ix. a) Undisputed statutory dues including provident fund, investor
education and protection fund, employees'' state insurance, income-tax,
sales- tax, wealth tax, service tax, custom duty, excise duty, cess
have not generally been regularly deposited with the appropriate
authorities though the delays in deposit have not been significant.
Further, no undisputed amounts payable in respect thereof were
outstanding at the year-end for a period of more than six months from
the date they become payable:
Undisputed amounts payable in respect thereof, which were outstanding
at the year-end for a period of more than six months from the date they
became payable are as follows:
Name of Nature of Amount Period to Due Date Date of
the statute the dues (Rs. in which the Payment
lacs) amount
relates
Finance Service tax on
royalty, 361.26 October
2007 to Various Not yet
Act, 1994 business
auxiliary 31 December
2012 dates
from paid
(Service services,
consultancy October
Tax) services and
manpower 2007 to 31
recruitment December
agency''s
services 2012
b) The dues outstanding in respect of income-tax, sales-tax, wealth
tax, service tax, custom duty, excise duty, cess on account of any
dispute, are as follows:
Name of the Nature of dues Amount Amount
statute (Rs. Paid Under
Lacs) Protest
(Rs in
lacs)
The Central Excise
Act,1944 Trade discount 33.74
The Central Excise
Act,1944 Excise duty on turnover
discount 42.71
The Central Excise
Act,1944 Excise duty on turnover
discount 189.48
The Central Excise
Act,1944 Convert credit availed
twice 5.04
The Central Excise
Act,1944 Demand on removal of
non-saleable stock
removed from RG-1 8.57
The Central Excise
Act,1944 Excise duty on capital
goods 3.19
The Central Excise
Act,1944 Classification of Light
metal cylinder casting 6.97
The Central Excise
Act,1944 Demand on sale of
various types of scrap 3.33
The Central Excise
Act,1944 Demand in respect of
Modvat credits on
Input and Capital goods 4.38
The Central Excise
Act,1944 Modvat credit on
grinding wheels, stones,
honing sticks 9.34
The Central Excise
Act,1944 Interest on reversal of
SAD 14.02
The Central Excise
Act,1944 Conversion of Aluminum
Scrap into Ingots
from Colts department 15.14
Finance Act, 1994
(Service Tax) Input tax credit on
various expenses 0.09
Finance Act, 1994
(Service Tax) Input tax credit on
various expenses 79.02
Finance Act, 1994
(Service Tax) Input tax credit on
various expenses 695.23
Finance Act, 1994
(Service Tax) Input tax credit on
various expenses 153.84
Finance Act, 1994
(Service Tax) Disallowance of service
tax credit on various
services 96.11
Finance Act, 1994
(Service Tax) Disallowance of service
tax credit on
various services 19.18
Finance Act, 1994
(Service Tax) Service tax on royalty
and technical
know how 39.95
Finance Act, 1994
(Service Tax) Availment of Convert on
Job work charges 152.21
Finance Act, 1994
(Service Tax) Disallowance of service
tax credit on
various services 76.54
Karnataka VAT Act,
2003 Difference in VAT rates
(classification issue) 442.92 140.81
Karnataka VAT Act,
2003 Difference in VAT rates
(classification issue) 278.51 55
Income tax Act, 1961 Disallowance of
expenditure in relation
to exempt income 3.05
Income tax Act, 1961 Disallowance of
expenditure in relation
to exempt income 8.59
Income tax Act, 1961 Interest free loan to
subsidiary 72.68
Income tax Act, 1961 Disallowance of
development expenditure
treated as capital in
nature 68.45
Income tax Act, 1961 Disallowance of
development expenditure
treated as capital in
nature 11.61
Income tax Act, 1961 Disallowance of prior
period expenses 8.02
Income tax Act, 1961 Disallowance of prior
period expenses 57.57
Income tax Act, 1961 Depreciation not allowed
on assets of inactive
Vegetable Oil Division 10.17
Income tax Act, 1961 Depreciation not allowed
on assets of inactive
Vegetable Oil Division 9.53
Income tax Act, 1961 Loss in relation to
diminution in value of
shares disallowed 12.39
Income tax Act, 1961 Disallowance of
Commission and brokerage
expenses for facilitating
loan funds 6.52
Income tax Act, 1961 Disallowance of
Commission and brokerage
expenses for facilitating
loan funds 37.76
Income tax Act, 1961 Disallowance of loan
processing fees paid to
bank 33.99
Income tax Act, 1961 Disallowance of foreign
exchange fluctuation loss 5.04
Income tax Act, 1961 Brought forward losses
of the amalgamating
company denied 5,674.45
Income tax Act, 1961 Disallowance of filing
fees for increasing
authorized share
capital of the Company 2.21
Income tax Act, 1961 Disallowance for
amalgamating expenses 0.69
Income tax Act, 1961 Provision for expenses
disallowed 85.17
Income tax Act, 1961 Provision for expenses
disallowed 57.64
Income tax Act, 1961 Disallowance of
proportionate royalty
expense 39.52
Income tax Act, 1961 Distribution of gift
coupons to shareholders
at AGM 16.54
Name of the Status Period to Forum where dispute is
which the pending
amount
relates
The Central Excise
Act,1944 2000 - 2004 Joint Commissioner of
Central Excise, Bangalore
The Central Excise
Act,1944 2000 - 2003 Central Excise and Service
Tax Appellate Tribunal, Chennai
The Central Excise
Act,1944 2001 - 2006 Central Excise and Service
Tax Appellate Tribunal,
Chandigarh
The Central Excise
Act,1944 2005-2007 Central Excise and Service
Tax Appellate Tribunal,
Bengaluru
The Central Excise
Act,1944 July 2005 to Central Excise and Service
Tax Appellate
December 2005 Tribunal, Bengaluru
The Central Excise
Act,1944 2010-2011 Assistant Commissioner
(Central Excise), Bhiwadi,
Rajasthan
The Central Excise
Act,1944 1998-1999 Joint Commissioner of Central
Excise, Patiala Punjab
The Central Excise
Act,1944 2001-2002 Joint Commissioner of Central
Excise, Patiala Punjab
The Central Excise
Act,1944 1995-96,
1997-98,
1995-1996,
1997-1998, Joint Commissioner of
The Central Excise
Act,1944 2003-2004 Central Excise, Patiala Punjab
The Central Excise
Act,1944 1987-1990 Honorable High Court of Punjab
and Haryana
The Central Excise
Act,1944 2000-2001 Central Excise & Service Tax
Appellate Tribunal, Chandigarh
The Central Excise
Act,1944 2000-2001 Honorable Supreme Court
Finance Act, 1994
(Service Tax) 2008-2009 Commissioner (Appeals), Jaipur,
Rajasthan
Finance Act, 1994
(Service Tax) 2009-2010 to Assistant Commissioner,
Bhiwadi, Rajasthan
2011-2012
Finance Act, 1994
(Service Tax) 2008-2011 Central Excise and Service
Tax Appellate Tribunal, Bengaluru
Finance Act, 1994
(Service Tax) 2011 Commissioner of Central Excise,
Bengaluru
Finance Act, 1994
(Service Tax) 2005-2011 Joint Commissioner of Central
Excise, Patiala, Punjab
Finance Act, 1994
(Service Tax) 2006-2007 Central Excise and Service Tax
Appellate Tribunal, Chandigarh
Finance Act, 1994
(Service Tax) 1999-2003, Joint Commissioner of Central
Excise, Patiala, Punjab
2004-2005
Finance Act, 1994
(Service Tax) 2011 Commissioner Central Excise,
Bengaluru
Finance Act, 1994
(Service Tax) 2011-2012 Honorable High Court of Karnataka
Karnataka VAT Act,
2003 1996-97 to Honorable High Court of Karnataka
2001-02
Karnataka VAT Act,
2003 2005-2006 Honorable High Court of Karnataka
Income tax Act, 1961 2000-2001 Honorable High Court, Delhi
Income tax Act, 1961 2001-2002 Commissioner Income Tax (Appeals)
Income tax Act, 1961 2007-2008 Income tax appellate tribunal
Income tax Act, 1961 2001-2002 Commissioner Income Tax (Appeals)
Income tax Act, 1961 2002-2003 Income Tax Appellate Tribunal
Income tax Act, 1961 2001-2002 Commissioner Income Tax (Appeals)
Income tax Act, 1961 2002-2003 Income Tax Appellate Tribunal
Income tax Act, 1961 2001-2002 Commissioner Income Tax (Appeals)
Income tax Act, 1961 2002-2003 Income Tax Appellate Tribunal
Income tax Act, 1961 2001-2002 Commissioner Income Tax (Appeals)
Income tax Act, 1961 2001-2002 Commissioner Income Tax (Appeals)
Income tax Act, 1961 2002-2003 Income Tax Appellate Tribunal
Income tax Act, 1961 2002-2003 Income Tax Appellate Tribunal
Income tax Act, 1961 2002-2003 Income Tax Appellate Tribunal
Income tax Act, 1961 2002-2003 Income Tax Appellate Tribunal
Income tax Act, 1961 2002-2003 Income Tax Appellate Tribunal
Income tax Act, 1961 2002-2003 Income Tax Appellate Tribunal
Income tax Act, 1961 1997-1998 Honorable High Court, Delhi
Income tax Act, 1961 2002-2003 Income Tax Appellate Tribunal
Income tax Act, 1961 2005-2006 Income Tax Appellate Tribunal
Income tax Act, 1961 1995-1996 & Honorable High Court, Delhi
1996-1997
Name of the Nature of dues Amount Amount
statute (Rs. Paid Under
Lacs) Protest
(Rs in
lacs)
Income tax Act, 1961 Disallowance of exemption
on dividend 66.55
Income tax Act, 1961 Addition of Revaluation
Reserves to book profits 16.71
Income tax Act, 1961 Apportionment of common
administrative costs 1.52
Income tax Act, 1961 Disallowance of lease
rent expenses 345.80
Income tax Act, 1961 Applicability of
interest u/s 234D 0.51
Income tax Act, 1961 Disallowance of
expenditure in relation
to exempt income 21.21
Income tax Act, 1961 Addition to Revaluation
Reserves to book profits 17.65
Income tax Act, 1961 Loss in relation to
diminution in value of
shares disallowed 19.23
2004-2005 Commissioner Income Tax
(Appeals)
UP VAT Difference in VAT rates
(classification issue) 82.78 10.291
Karnataka Tax on
Entry of Goods
Act, 1979 Entry tax on import of
capital goods 147.67
Karnataka Tax on
Entry of Goods
Act, 1979 Entry tax on import of
capital goods 116.52
Karnataka Tax on
Entry of Goods
Act, 1979 Entry tax on import of
capital goods 118.00
Karnataka Tax on
Entry of Goods
Act, 1979 Entry tax on import of
capital goods 40.76
Karnataka Tax on
Entry of Goods
Act, 1979 Entry tax on import of
capital goods 48.38
Finance Act, 1994
(Service Tax) Denial of Cenvat credit
of excise duty/ service
tax paid on common inputs/
input services, 393.78
Finance Act, 1994
(Service Tax) CENVAT credit taken in
respect of the said
inputs or capital goods" 5.81
Finance Act, 1994
(Service Tax) Denial of Cenvat credit
of excise duty/ service
tax paid on common
inputs/ input services, 472.94
Finance Act, 1994
(Service Tax) Payment of Service Tax
under GTA on inwards/
Outwards freight 7.09
Finance Act, 1994
(Service Tax) Payment of Service Tax
under GTA on inwards/
Outwards freight 13.81
Finance Act, 1994
(Service Tax) Payment of Service Tax
under GTA on inwards/
Outwards freight 18.13
Finance Act, 1994
(Service Tax) Service tax credit on
security & advertising
services 6.42
VAT Cenvat credit of excess
paid Service Tax on
royalty 35.12
VAT Non submission of C- Forms 134.40
VAT VAT on Sale of FA payable 613.93
VAT Non submission of C form
and F forms 73.44
VAT non submission of Sales
Invoices & Form F 25.66 16.5
VAT F Form Disallowed 9.20
VAT Disallowance of sales
return 1.76
VAT Disallowance of Pre-
fitment warranty materials 1.18
VAT Disallowance of F form 1.87
VAT Dispute in sales of gross
turnover & stock transfer 1.56
The Central Excise
Act,1944 Demand in respect of
Modvat credits on Input
and Capital goods 1.76
Finance Act, 1994
(Service Tax) Input tax credit on various
expenses 86.44 25
Finance Act, 1994
(Service Tax) Input tax credit on various
expenses 113.70
Income tax Act, 1961 Disallowance of expenditure
in relation to exempt
income 1.99
Wealth tax act, 1957 Disallowance of debt
relating to taxable wealth 3.90
Income tax Act, 1961 Default notices on account
of short term deduction/
short payment of tax
deduction at source 7.51
Income tax Act, 1961 Interest free loan to
subsidiary 32.80
Income tax Act, 1961 Disallowance of
expenditure in relation to
exempt income 3.56
Income tax Act, 1961 Interest free loan to
subsidiary 70.68
Income tax Act, 1961 Disallowance of prior
period expenses 14.45
Income tax Act, 1961 Disallowance of
proportionate royalty
expense 73.29
Income tax Act, 1961 Disallowance of Club
Expenses 1.63
Income tax Act, 1961 Default notices on account
of short deduction/
short payment of tax
deduction at Source 19.71
Next Appellate Auth. Sale made on concessional
form. 1.36
Sales tax demand Non Submission of
Statutory Form on the
concessional sale 1.00
Sales tax demand Non Submission of
Statutory Form on the
concessional sale 2.14
Sales tax demand Non submission of
Statutory Form on the
concessional sale &
Export Forms at the time
of Assessment. 9.44
Sales tax demand Non - submission of
Concessional form on the
concessional sale at the
time of audit. 339.10
Sales tax demand VAT Demand on the stock
transfer - not allowed
and tax on the stock
transfer 32.11
Sales tax demand Demand issued for non -
submission of Stock
Transfer forms in the
audit. 30.19
Service Tax Service tax credit
disallowed on the health
service 134.00
Name of the Status Period to Forum where dispute is
which the pending
amount
relates
Income tax Act, 1961 1998-1999 Supreme Court
Income tax Act, 1961 1998-1999 Supreme Court
Income tax Act, 1961 1997-1998 Honorable High Court, Delhi
Income tax Act, 1961 1997-1998 Honorable High Court, Delhi
Income tax Act, 1961 2000-2001 Honorable High Court, Delhi
Income tax Act, 1961 1999-2000 Honorable High Court, Delhi
Income tax Act, 1961 1999-2000 Honorable High Court, Delhi
Income tax Act, 1961 2007-2008 Commissioner (Appeals), Ghaziabad
2004-2005 2006-2007 Honorable Supreme Court
UP VAT 2007-2008 Honorable Supreme Court
Karnataka Tax on
Entry of Goods
Act, 1979 2008-2009 Honorable Supreme Court
Karnataka Tax on
Entry of Goods
Act, 1979 2009-2010 Honorable Supreme Court
Karnataka Tax on
Entry of Goods
Act, 1979 2010-2011 Honorable Supreme Court
Karnataka Tax on
Entry of Goods
Act, 1979 2012-2013 Commissioner & Commissioner Appeal
Karnataka Tax on
Entry of Goods
Act, 1979 2012-2013 Commissioner of Central Excise
Finance Act, 1994
(Service Tax) 2012-2013 Commissioner & Commissioner Appeal
Finance Act, 1994
(Service Tax) 2012-2013 Commissioner (Appeals)
Finance Act, 1994
(Service Tax) 2009-2012 Commissioner(Appeals)
Finance Act, 1994
(Service Tax) 2012-2013 Joint Commissioner (Appeals)
Finance Act, 1994
(Service Tax) 2011-2013 Joint Commissioner (Appeals)
Finance Act, 1994
(Service Tax) 2012-2013 Additional Commissioner
VAT 2011-2012 Asstt. Commissioner, Bhiwadi
VAT 2007-2008 Delhi - Commissioner
VAT 2008-2009 Delhi - Commissioner
VAT 2005-2006 ITAT
VAT 2000-2001 ITAT
VAT 2006-2007 Commissioner(Appeals)
VAT 2006-2007 Commissioner(Appeals)
VAT 2004-2005 Commissioner(Appeals)
VAT 2001-2002 Commissioner(Appeals)
VAT 1997-1999 Asstt. Commissioner
The Central Excise
Act,1944 2006-2007 Commissioner Appeals
The Central Excise
Act,1944 May 2005 to CESTAT July 2005
Finance Act, 1994
(Service Tax) 2004-2005 Commissioner Income Tax (Appeals)
Finance Act, 1994
(Service Tax) 2006-2007 Commissioner Income Tax (Appeals)
Income tax Act, 1961 2006-2007 Commissioner Income Tax (Appeals)
Wealth tax act, 1957 2006-2007 Commissioner Income Tax (Appeals)
Income tax Act, 1961 2008-2009 Commissioner Income Tax (Appeals)
Income tax Act, 1961 2008-2009 Commissioner Income Tax (Appeals)
Income tax Act, 1961 2008-2009 Commissioner Income Tax (Appeals)
Income tax Act, 1961 2008-2009 Commissioner Income Tax (Appeals)
Income tax Act, 1961 2008-2009 Commissioner Income Tax (Appeals)
Income tax Act, 1961 2012-2013 Income tax Officer
Income tax Act, 1961 2007-2008 Asstt. Commissioner
Income tax Act, 1961 2007-2008 Asstt. commissioner, Bhiwadi
Next Appellate Auth. 2008-2009 Asstt. commissioner, Bhiwadi
Sales tax demand 2009-2010 Asstt. commissioner, Bhiwadi
Sales tax demand 2011-2012 Asstt. commissioner, Bhiwadi
Sales tax demand 2012-2013 Commissioner, UP
Sales tax demand 2008-2009 Pune, Dy Commissioner,
Service Tax 2006-2011 Commissioner
x. In our opinion, the Company has no accumulated losses at the end of
the financial year and it has not incurred cash losses in the current
and the immediately preceding financial year.
xi. The Company has not defaulted in repayment of dues to any bank or
financial institution during the year. The Company did not have any
outstanding debentures during the year.
xii. The Company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
Accordingly, the provisions of clause 4(xii) of the Order are not
applicable.
xiii. In our opinion, the Company is not a chit fund or a nidhi/ mutual
benefit fund/ society. Accordingly, provisions of clause 4(xiii) of
the Order are not applicable.
xiv. In our opinion, the Company is not dealing or trading in shares,
securities, debentures and other investments. Accordingly, the
provisions of clause 4(xiv) of the Order are not applicable.
xv. The Company has not given any guarantees for loans taken by others
from banks or financial institutions.
Accordingly, the provisions of clause 4(xv) of the Order are not
applicable.
xvi. In our opinion, the Company has applied the term loans for the
purpose for which these loans were obtained.
xvii. In our opinion, the Company has used funds raised on short-term
basis for long-term investment.
xviii. During the year, 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. Accordingly, the provisions of
clause 4(xviii) of the Order are not applicable.
xix. The Company has neither issued nor had any outstanding debentures
during the year. Accordingly, the provisions of clause 4(xix) of the
Order are not applicable.
xx. The Company has not raised any money by public issues during the
year. Accordingly, the provisions of clause 4(xx) of the Order are not
applicable.
xxi. No fraud on or by the Company has been noticed or reported during
the period covered by our audit.
For Walker, Chandiok & Co.
Chartered Accountants
Firm Registration No.: 001076N
per David Jones
Partner
Place : New Delhi Membership
Date : February 28, 2014 No.: 98113
Dec 31, 2012
1. We have audited the attached Balance Sheet of Federal-Mogul Goetze
(India) Limited (''the Company''), as at 31 December 2012, and also
the Statement of Profit and Loss and the Cash Flow Statement for the
year ended on that date annexed thereto (collectively referred as the
''financial statements''). 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 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 (Auditor''s Report) Order, 2003
(''the Order'') (as amended) issued by the Central Government of
India in terms of sub-section (4A) of Section 227 of the Companies Act,
1956 (''the Act'') , we enclose in the Annexure a statement on the
matters specified in paragraphs 4 and 5 of the Order.
4. As detailed in note 47 of the accompanying financial statements,
the Company is pursuing a matter regarding certain discrepancies noted
in availing sales tax benefits. The matter is currently pending with
the appropriate authorities, management based on certain internal
assessment has accrued a provision to an extent of Rs. 625.81 lacs
(including estimated interest and penalties) to meet future tax
obligations. Out of this provision, the Company has deposited Rs 398.03
lacs with the appropriate authorities during the year. However, the
extent of exact future liabilities that may arise is presently not
determinable. Accordingly, we are unable to comment upon the adequacy
of provision recorded in this respect and the consequential impact of
the outcome of the proceedings.
5. 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 financial statements dealt with by this report are in agreement
with the books of account;
(d) On the basis of written representations received from the
directors, as on 31 December 2012 and taken on record by the Board of
Directors, none of the directors is disqualified as on 31 December 2012
from being appointed as a director in terms of clause (g) of sub-
section (1) of Section 274 of the Act;
(e) Subject to our comments in Para 4 above, in our opinion and to the
best of our information and according to the explanations given to us,
the financial statements dealt with by this report comply with the
accounting standards referred to in sub-section (3C) of Section 211 of
the Act and 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, in the case of:
(i) the Balance Sheet, of the state of affairs of the Company as at 31
December 2012;
(ii) the Statement of Profit and Loss, of the loss for the year ended
on that date; and
(iii) the Cash Flow Statement, of the cash flows for the year ended on
that date.
Annexure to the Auditors'' Report of even date to the members of
Federal- Mogul Goetze (India) Limited, on the financial statements for
the year ended 31 December 2012
Based on the audit procedures performed for the purpose of reporting a
true and fair view on the financial statements of the Company and
taking into consideration the information and explanations given to us
and the books of account and other records examined by us in the normal
course of audit, 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 program of physical verification of its
fixed assets under which fixed assets are verified in a phased manner
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.
No material discrepancies were noticed on such verification.
(c) In our opinion, a substantial part of fixed assets has not been
disposed off during the year.
ii. (a) The management has conducted physical verification of
inventory at reasonable intervals during the year.
(b) 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) The Company is maintaining proper records of inventory and no
material discrepancies were noticed on physical verification.
iii. (a) The Company has not granted any loan, secured or unsecured to
companies, firms or other parties covered in the register maintained
under Section 301 of the Act. Accordingly, the provisions of clauses
4(iii)(b) to 4(iii)(d) of the Order are not applicable.
(b) The Company has not taken any loans, secured or unsecured from
companies, firms or other parties covered in the register maintained
under Section 301 of the Act. Accordingly, the provisions of clauses
4(iii)(f) and 4(iii)(g) of the Order are not applicable.
iv. In our opinion, 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. During the course of our audit, no major
weakness has been noticed in the internal control system in respect of
these areas.
v. (a) The Company has not entered into any contracts or arrangements
referred to in Section 301 of the Act. Accordingly, the provisions of
clause 4(v) of the Order are not applicable.
vi. The Company has not accepted any deposits from the public within
the meaning of Sections 58A and 58AA of the Act and the Companies
(Acceptance of Deposits) Rules, 1975. Accordingly, the provisions of
clause 4(vi) of the Order are not applicable.
vii. In our opinion, the Company has an internal audit system
commensurate with its size and the nature of its business.
viii. We have broadly reviewed the cost records maintained by the
Company pursuant to the Companies (Cost Accounting Records) Rules, 2011
prescribed by the Central Government under Section 209(1)(d) of the
Companies Act, 1956 and are of the opinion that prima facie the
prescribed cost records have been maintained. We have, however, not
done a detailed examination of the cost records with a view to
determine whether they are accurate or complete.
ix. a) Undisputed statutory dues including provident fund, investor
education and protection fund, employees'' state insurance, income-tax,
sales- tax, wealth-tax, service-tax, custom duty, excise duty, cess and
other material statutory dues, as applicable, have generally been
regularly deposited with the appropriate authorities, except in case of
Undisputed amounts payable in respect of Central Sales Tax, which is
outstanding at the year-end for a period of more than six months from
the date they became payable are as follows:
Name of Nature of Amount Period to Due Date Date of
the statute the dues (Rs) which the Payment
amount relates
Central Liability 236.78 FY 2005-06 to - -
Sales Tax related lacs FY 2008-09
to CST
b) The dues outstanding in respect of sales-tax, income-tax, custom
duty, wealth-tax, excise duty, cess on account of any dispute, are as
follows:
Name of the Nature of dues Amount
statute (Rs. Lacs)
The Central Excise
Act,1944 Trade discount 33.74
The Central Excise
Act,1944 Excise duty on turnover discount 42.71
The Central Excise
Act,1944 Excise duty on turnover discount 214.50
The Central Excise
Act,1944 Cenvat credit availed twice 5.04
The Central Excise
Act,1944 Demand on removal of non-saleable
stock 8.57
removed from RG-1
The Central Excise
Act,1944 Excise duty on capital goods 3.19
The Central Excise
Act,1944 Classification of Light metal
cylinder casting 6.97
The Central Excise
Act,1944 Demand on sale of various types of
scrap 3.33
The Central Excise
Act,1944 Demand in respect of Modvat credits
on Input and Capital goods 6.17
The Central Excise
Act,1944 Modvat credit on grinding wheels,
stones, honing sticks 9.34
The Central Excise
Act,1944 Interest on reversal of SAD 14.02
The Central Excise
Act,1944 Conversion of Aluminum Scrap into Ingots 15.14
from Colts department
Finance Act, 1994
(Service Tax) Input tax credit on various expenses 0.09
Finance Act, 1994
(Service Tax) Input tax credit on various expenses 79.02
Finance Act, 1994
(Service Tax) Input tax credit on various expenses 895.38
Finance Act, 1994
(Service Tax) Input tax credit on various expenses 153.84
Finance Act, 1994
(Service Tax) Disallowance of service tax credit on 96.11
various services
Finance Act, 1994
(Service Tax) Disallowance of service tax credit on 19.18
various services
Finance Act, 1994
(Service Tax) Input credit on various services 5.09
Finance Act, 1994
(Service Tax) Service tax on royalty and technical
know how 39.95
Finance Act, 1994
(Service Tax) Payment of Service Tax under GTA on 67.02
inwards/outwards freight
Finance Act, 1994
(Service Tax) Availment of Cenvat on Job work charges 152.21
Finance Act, 1994
(Service Tax) Payment of Service Tax under GTA 78.14
Finance Act, 1994
(Service Tax) Input tax credit on various expenses 4.28
Karnataka VAT Act,
2003 Difference in VAT rates
(classification issue) 301.38
Karnataka VAT Act,
2003 Difference in VAT rates
(classification issue) 278.51
Name of the
Statute Period to which the Forum where dispute is pending
amount relates
The Central Excise
Act,1944 2000 - 2004 Joint Commissioner of Central
Excise, Banguluru
The Central Excise
Act,1944 2000 - 2003 Central Excise and Service Tax
Appellate Tribunal, Chennai
The Central Excise
Act,1944 2001 - 2006 Central Excise and Service Tax
Appellate Tribunal Chandigarh
The Central Excise
Act,1944 2005-07 Central Excise and Service Tax
Appellate Tribunal, Banguluru
The Central Excise
Act,1944 July 2005 to Central Excise and Service Tax
Appellate Tribunal, Banguluru
December 2005
The Central Excise
Act,1944 2010-11 Assistant Commissioner
(Central Excise), Bhiwadi,
Rajasthan
The Central Excise
Act,1944 1998-1999 Joint Commissioner of Central
Excise, Patiala Punjab
The Central Excise
Act,1944 2001-2002 Joint Commissioner of Central
Excise, Patiala Punjab
The Central Excise
Act,1944 1995-1996,1997-1998, Joint Commissioner of Central
Excise, Patiala Punjab
1998-1999,2003-2004
The Central Excise
Act,1944 1987-1990 Honorable High Court of Punjab
and Haryana
The Central Excise
Act,1944 2000-2001 Central Excise & Service Tax
Appellate Tribunal, Chandigarh
The Central Excise
Act,1944 2000-2002 Honorable Supreme Court
Finance Act, 1994
(Service Tax) 2008-2009 Commissioner (Appeals),Jaipur,
Rajasthan
Finance Act, 1994
(Service Tax) 2009-2010 to
2011-2012 Superintendent, Bhiwadi,
Rajasthan
Finance Act, 1994
(Service Tax) 2005-2011 Central Excise and Service
Tax Appellate Tribunal,
Banguluru
Finance Act, 1994
(Service Tax) 2010-12 Commissioner of Central
Excise, Banguluru
Finance Act, 1994
(Service Tax) 2005-2011 Joint Commissioner of Central
Excise, Patiala, Punjab
Finance Act, 1994
(Service Tax) 2006-2007 Central Excise and Service Tax
Appellate Tribunal, Chandigarh
Finance Act, 1994
(Service Tax) 2008-09 Superintendent Audit, Patiala,
Punjab
Finance Act, 1994
(Service Tax) 1999-2005 Joint Commissioner of Central
Excise, Patiala, Punjab
Finance Act, 1994
(Service Tax) 2005-2008 Joint Commissioner of Central
Excise, Patiala, Punjab
Finance Act, 1994
(Service Tax) 2011-2012 Commissioner Central Excise,
Banguluru
Finance Act, 1994
(Service Tax) 2009-2012 Superintendent
Finance Act, 1994
(Service Tax) 2011-2012 Superintendent
Karnataka VAT Act,
2003 1998-1999 to Honorable High Court of
Karnataka
2001-2002 and
2007-08
Karnataka VAT Act,
2003 2005-06 Honorable High Court of
Karnataka
Name of the Nature of dues Amount
statute (Rs. Lacs)
Income tax Act, 1961 Disallowance of expenditure in
relation to exempt income 3.05
Income tax Act, 1961 Disallowance of expenditure in
relation to exempt income 10.59
Income tax Act, 1961 Interest free loan to subsidiary 105.48
Income tax Act, 1961 Disallowance of development
expenditure treated as 68.45
capital in nature
Income tax Act, 1961 Disallowance of development
expenditure treated as 11.61
capital in nature
Income tax Act, 1961 Disallowance of prior period expenses 92.64
Income tax Act, 1961 Disallowance of prior period expenses 57.57
Income tax Act, 1961 Depreciation not allowed on assets of
inactive Vegetable Oil Division 10.17
Income tax Act, 1961 Depreciation not allowed on assets of
inactive Vegetable Oil Division 9.53
Income tax Act, 1961 Loss in relation to diminution in
value of shares disallowed 12.39
Income tax Act, 1961 Disallowance of Commission and
brokerage expenses for 6.52
facilitating loan funds
Income tax Act, 1961 Disallowance of Commission and
brokerage expenses for 37.76
facilitating loan funds
Income tax Act, 1961 Disallowance of loan processing fees
paid to bank 33.99
Income tax Act, 1961 Disallowance of foreign exchange
fluctuation loss 5.04
Income tax Act, 1961 Brought forward losses of the
amalgamating company denied 5,674.45
Income tax Act, 1961 Disallowance of filing fees for
increasing authorized share 2.21
capital of the Company
Income tax Act, 1961 Disallowance for amalgamating expenses 0.69
Income tax Act, 1961 Provision for expenses disallowed 85.17
Income tax Act, 1961 Provision for expenses disallowed 57.64
Income tax Act, 1961 Disallowance of proportionate royalty
expense 39.52
Income tax Act, 1961 Disallowance of proportionate royalty
expense 103.47
Income tax Act, 1961 Distribution of gift coupons to
shareholders at 16.54
Annual General Meeting
Income tax Act, 1961 Disallowance of exemption on dividend 66.55
Income tax Act, 1961 Addition of Revaluation Reserves to
book profits 16.71
Income tax Act, 1961 Provision for diminution in the value
asset added to book profits 38.75
Income tax Act, 1961 Apportionment of common
administrative costs 1.52
Income tax Act, 1961 Disallowance of lease rent expenses 345.80
Income tax Act, 1961 Applicability of interest u/s 234D 0.51
Income tax Act, 1961 Disallowance of expenditure in relation
to exempt income 21.21
Income tax Act, 1961 Addition to Revaluation Reserves to
book profits 17.65
Income tax Act, 1961 Loss in relation to diminution in
value of shares disallowed 19.23
Income tax Act, 1961 Disallowance of Club expenses 2.80
Delhi VAT VAT on assets transaferred to Anil Nanda 64.98
UP VAT Difference in VAT rates
(classification issue) 82.78
Karnataka Tax on
Entry of Goods
Act, 1979 Entry tax on import of capital goods 147.67
Karnataka Tax on
Entry of Goods
Act, 1979 Entry tax on import of capital goods 116.52
Karnataka Tax on
Entry of Goods
Act, 1979 Entry tax on import of capital goods 118.00
Karnataka Tax on
Entry of Goods
Act, 1979 Entry tax on import of capital goods 12.43
Karnataka Tax on
Entry of Goods
Act, 1979 Entry tax on import of capital goods 16.03
Name of the
Statute Period to which
the Forum where dispute is pending
amount relates
Income tax Act, 1961 2000-2001 Honorable High Court
Income tax Act, 1961 2001-2002 &
2004-05 Commissioner Income Tax (Appeals)
Income tax Act, 1961 2006-07 &
2007-2008 Commissioner Income Tax (Appeals)
Income tax Act, 1961 2001-2002 Commissioner Income Tax (Appeals)
Income tax Act, 1961 2002-2003 Income Tax Appellate Tribunal
Income tax Act, 1961 2001-2002 &
2007-2008 Commissioner Income Tax (Appeals)
Income tax Act, 1961 2002-2003 Income Tax Appellate Tribunal
Income tax Act, 1961 2001-2002 Commissioner Income Tax (Appeals)
Income tax Act, 1961 2002-2003 Income Tax Appellate Tribunal
Income tax Act, 1961 2001-2002 Commissioner Income Tax (Appeals)
Income tax Act, 1961 2001-2002 Commissioner Income Tax (Appeals)
Income tax Act, 1961 2002-2003 Income Tax Appellate Tribunal
Income tax Act, 1961 2002-2003 Income Tax Appellate Tribunal
Income tax Act, 1961 2002-2003 Income Tax Appellate Tribunal
Income tax Act, 1961 2002-2003 Income Tax Appellate Tribunal
Income tax Act, 1961 2002-2003 Income Tax Appellate Tribunal
Income tax Act, 1961 2002-03 Income Tax Appellate Tribunal
Income tax Act, 1961 1997-1998 Honorable High Court
Income tax Act, 1961 2002-2003 Income Tax Appellate Tribunal
Income tax Act, 1961 2003-2004 &
2005-2006 Income Tax Appellate Tribunal
Income tax Act, 1961 2004-2005 &
2007-2008 Commissioner Income Tax (Appeals)
Income tax Act, 1961 1995-1996 &
1996-1997 Honorable High Court
Income tax Act, 1961 1998-1999 Honorable High Court
Income tax Act, 1961 1998-1999 Honorable High Court
Income tax Act, 1961 2005-2006 Income Tax Appellate Tribunal
Income tax Act, 1961 1997-1998 Honorable High Court
Income tax Act, 1961 1997-1998 Honorable High Court
Income tax Act, 1961 2000-2001 Honorable High Court
Income tax Act, 1961 1999-2000 Honorable High Court
Income tax Act, 1961 1999-2000 Honorable High Court
Income tax Act, 1961 2004-2005 Commissioner Income Tax (Appeals)
Income tax Act, 1961 2007-2008 Commissioner Income Tax (Appeals)
Delhi VAT 2007-2008 Commissioner (Appeals), Delhi
UP VAT 2007-2008 Commissioner (Appeals), Ghaziabad
Karnataka Tax on
Entry of Goods
Act, 1979 2006-2007 Honorable Supreme Court
Karnataka Tax on
Entry of Goods
Act, 1979 2007-2008 Honorable Supreme Court
Karnataka Tax on
Entry of Goods
Act, 1979 2008-2009 Honorable Supreme Court
Karnataka Tax on
Entry of Goods
Act, 1979 2009-2010 Honorable Supreme Court
Karnataka Tax on
Entry of Goods
Act, 1979 2010-2011 Honorable Supreme Court
x. In our opinion, the Company has no accumulated losses at the end of
the financial year and it has not incurred cash losses in the current
and the immediately preceding financial year.
xi. The Company has not defaulted in repayment of dues to any bank or
financial institution during the year. The Company did not have any
outstanding debentures during the year.
xii. The Company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
Accordingly, the provisions of clause 4(xii) of the Order are not
applicable.
xiii. In our opinion, the Company is not a chit fund or a nidhi/
mutual benefit fund/ society. Accordingly, the provisions of clause
4(xiii) of the Order are not applicable.
xiv. In our opinion, the Company is not dealing or trading in shares,
securities, debentures and other investments. Accordingly, the
provisions of clause 4(xiv) of the Order are not applicable.
xv. In our opinion, the terms and conditions on which the Company has
given guarantee for loans taken by others from banks or financial
institutions are not, prima facie, prejudicial to the interest of the
Company.
xvi. In our opinion, the Company has applied the term loans for the
purpose for which these loans were obtained.
xvii. In our opinion, the Company has used funds raised on short-term
basis for long-term investment. The Company has accepted short term
borrowings amounting to Rs 5242.21 which are both repayable on demand
or within one year and such funds have been invested for acquiring
non-current assets of the Company.
xviii. During the year, the Company has not made any preferential
allotment of shares to parties or companies covered in the register
maintained under Section 301 of the Act. Accordingly, the provisions of
clause 4(xviii) of the Order are not applicable.
xix. The Company has neither issued nor had any outstanding debentures
during the year. Accordingly, the provisions of clause 4(xix) of the
Order are not applicable.
xx. The Company has not raised any money by public issues during the
year. Accordingly, the provisions of clause 4(xx) of the Order are not
applicable.
xxi. According to the information and explanations given to us ana as
described in note 44 to the financial statements, there were certain
discrepancies in respect of availing sales tax benefits at one of the
units of the Company which, at present, are being further investigated
by management. No fraud on or by the Company has been noticed or
reported during the period covered by our audit other than the matter
mentioned above.
For Walker, Chandiok & Co.
Chartered Accountants
Firm Registration No.: 001076N
per David Jones
Partner
Place : New Delhi Membership
Date : February 28, 2013 No.: 98113
Dec 31, 2011
We have audited the accompanying financial statements of Federal-Mogul
Goetze (India) Limited ("the Company"), which comprise the Balance
Sheet as at December 31, 2011, and 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
Management is responsible for 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
accounting principles generally accepted in India, including the
Accounting Standards referred to in sub-section (3C) of section 211 of
the Companies Act, 1956 ("the Act"). This responsibility includes the
design, implementation and maintenance of internal control 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 conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. 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 control relevant to the Company's preparation and
fair presentation of the financial statements in order to design audit
procedures that are appropriate in the circumstances but not for the
purpose of expressing an opinion on the effectiveness of the company's
internal control. An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of the accounting
estimates made by management, 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.
Basis for Qualified Opinion
Refer Note no. 1 9 of Schedule 24 on the Company's investments in G. I.
Power Corporation Limited ('GIPCL') of the value of Rs 1,070.92 lacs
representing investment in equity shares of Rs. 194.48 lacs and in
preference shares of Rs. 876.44 lacs. During the year, Company's
holding in GIPCL was reduced to 6.60% from earlier holding of 26.00%.
The Company has been unable to produce audited financial information
and, as represented to us, is also in discussion for sale of these
investments at par, that are yet to be concluded. In view of these
uncertainties and due to non-availability of audited financial
information as at December 31, 2011, we are not in a position to assess
as to whether provision, if any, needs to be made towards carrying
value of these investments and consequential impact thereof.
Qualified opinion
In our opinion and to the best of our information and according to the
explanations given to us, except for the possible effects of the matter
described in the Basis for Qualified Opinion paragraph, the impact
whereof is unascertainable, the 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 December 31, 2011;
(b) in the case of the Statement of Profit and Loss, of the profit for
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.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order, 2003 ("the
Order") issued by the Central Government of India in terms of
sub-section (4A) of section 227 of the Act, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
2. As required by section 227(3) of the Act, we report that:
(a) Except for the matter described in the Basis for Qualified Opinion
paragraph above, we have 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, Statement of Profit and Loss and Cash Flow
Statement dealt with by this Report are in agreement with the books of
account;
(d) Except for the matter described in the Basis for Qualified Opinion
paragraph above, in our opinion, the Balance Sheet, Statement of Profit
and Loss and Cash Flow Statement comply with the Accounting Standards
referred to in subsection (3C) of section 211 of the Companies Act,
1956;
(e) On the basis of written representations received from the directors
as on December 31, 2011, and taken on record by the Board of Directors,
none of the directors is disqualified as on December 31, 2011, from
being appointed as a director in terms of clause (g) of sub-section (1)
of section 274 of the Companies Act, 1956.
Annexure referred to in paragraph 1 of our report of even date under
Section 'Report on Other Legal and Regulatory Requirements'
Re: Federal-Mogul Goetze (India) Limited ('the Company')
i. (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets, except for certain items of plant and machinery and certain
items of furniture at one of its facilities, where the records are
maintained for group of similar assets and not for each individual
asset.
(b) The Company has a programme for physical verification on a
rotational basis, which, in our opinion, is reasonable having regard to
the size of the Company and the nature of its assets. Accordingly,
certain fixed assets have been physically verified by the management
during the year and no material discrepancies were noticed on such
verification.
(c) There was no disposal of a substantial part of fixed assets during
the year.
ii. (a) The inventory has been physically verified by the management
during the year, except for stores and spares inventory of Rs 585.53
lacs which has not been verified during or at the end of the year. In
our opinion, the frequency of verification is reasonable. Inventories
lying with outside parties (including with transporters, job workers
and at ports) have been confirmed by them as at year end.
(b) The procedures of physical verification of inventory followed by
the management, except for stores and spares inventory of Rs 585.53
lacs, are reasonable and adequate in relation to the size of the
Company and the nature of its business.
(c) The Company is maintaining proper records of inventory, except for
stores and spares inventory of Rs. 585.53 lacs and no material
discrepancies were noticed on physical verification.
iii. (a) According to the information and explanations given to us, the
Company has not granted any loans, secured or unsecured to companies,
firms or other parties covered in the register maintained under section
301 of the Companies Act, 1956. Accordingly, the provisions of clause
4(iii) (a) to (d) of the Order are not applicable to the Company and
hence not commented upon.
(b) According to information and explanations given to us, the Company
has not taken any loans, secured or unsecured, from companies, firms or
other parties covered in the register maintained under section 301 of
the Companies Act, 1956. Accordingly, the provisions of clause 4(iii)
(e) to (g) of the Order are not applicable to the Company and hence not
commented upon.
iv. The Company's significant purchases of fixed assets are from its
group companies and their associates. We are explained that these items
are of unique and specialized nature, and hence, in such cases, it is
not possible to make the comparison of prices with the market rates or
with purchases from other parties. Read with the above, 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. During the
course of our audit, we have not observed any major weakness or
continuing failure to correct any major weakness in the internal
control system of the company in respect of these areas.
v. (a) According to the information and explanations provided by the
management, we are of the opinion that there are no contracts or
arrangements that need to be entered in the register maintained under
Section 301 of the Companies Act, 1956. Accordingly, the provision of
clause 4(v) (b) of the Order is not applicable to the Company.
vi. The Company has not accepted any deposits from the public.
vii. In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
viii. We have broadly reviewed the books of account maintained by the
Company pursuant to the rules made by the Central Government for the
maintenance of cost records under section 209(1) (d) of the Companies
Act, 1956, and are of the opinion that prima facie, the prescribed
accounts and records have been made and maintained. We have, however,
not made a detailed examination of the records with a view to determine
whether they are accurate and complete.
ix. a) 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, cess and
other material statutory dues have generally been regularly deposited
with the appropriate authorities, except for income tax and service
tax, which have not been regularly deposited with the appropriate
authorities in a few cases, though the delays in deposit have not been
serious.
b) According to the information and explanations given to us, no
material undisputed amounts payable in respect of provident fund,
investor education and protection fund, employees' state insurance,
income-tax, wealth-tax, service tax, sales- tax, customs duty, excise
duty, cess and other undisputed statutory dues were outstanding, at the
year end, for a period of more than six months from the date they
became payable.
c) According to the records of the Company, the dues outstanding of
income-tax, sales- tax, wealth-tax, service tax, customs duty, excise
duty and cess on account of any dispute, are as follows:
Name of the Nature of dues Amount Period to
which the Forum where
dispute is pending
statute (Rs.
Lacs) amount
relates
Central
Excise
Act, 1944 Trade Discount 33.74 2000-2004 Joint Commissioner
of Central Excise,
Bangalore
Central
Excise
Act, 1944 Excise Duty
on Turnover
Discount 107.18 2000-2006 Central Excise &
Service Tax
Appellate Tribunal,
Bangalore
Central
Excise
Act, 1944 Excise Duty
on Turnover
Discount 214.50 2001-2006 Central Excise &
Service Tax
Appellate Tribunal,
Chandigarh
Central
Excise
Act, 1944 Sale returns 5.28 2001-2003 Central Excise &
Service Tax
Appellate Tribunal,
Bangalore
Central
Excise
Act, 1944 Cenvat
credit
availed
twice 5.04 2006-2007 Central Excise &
Service Tax
Appellate Tribunal,
Bangalore
Central
Excise
Act, 1944 Excise
duty on
Engineering
charges 0.34 2006-2007 Assistant
Commissioner of
Central Excise,
Bangalore
Central
Excise
Act, 1944 Cenvat
Credit
availed
twice 0.93 August
2005 to Deputy Commissioner
of Central Excise,
Bangalore December
2005
Central
Excise
Act, 1944 Demand on
removal
non saleable
stock 8.57 July
2005 to Central Excise &
Service Tax
Appellate Tribunal,
Bangalore
removed
from RG -1 December
2005
Central
Excise
Act, 1944 Excise
duty on
Capital
goods 3.19 2010-2011 Assistant
Commissioner
(Central Excise),
Bhiwadi, Rajasthan
Central
Excise
Act, 1944 Classifi
cation of
Light
metal
cylinder
Casting 6.97 1998-1999 Joint Commissioner
of Central Excise,
Patiala, Punjab
Central
Excise
Act, 1944 Demand on
sale of
various
types of
scrap 3.33 2001-2002 Joint Commissioner
of Central Excise,
Patiala, Punjab
Central
Excise
Act, 1944 Demand in
respect of
Modvat
Credits on 6.17 1995-1996.
1997-1998 Joint Commissioner
of Central Excise,
Patiala, Punjab
Input &
Capital
goods 1998-1999
2003-2004
Central
Excise
Act, 1944 Modvat
credit on
grinding
wheels,
stones, 9.34 1987-1990 Punjab & Haryana
High Court
honing
sticks
Central
Excise
Act, 1944 Interest
on reversal
of SAD 14.02 2000-2001 Central Excise &
Service Tax
Appellate Tribunal,
Chandigarh
Central
Excise
Act, 1944 Conversion
of Aluminum
Scrap into 15.14 2000-2002 Supreme Court
Ingots
from Colts
Department
Finance
Act, 1994
(service
tax) Input tax
credit on
various
expenses 1.25 2008-2009 Commissioner
(Appeals), Jaipur,
Rajasthan
Finance
Act, 1994
(service
tax) Input tax
credit on
various
expenses 50.32 2009-2010
to Assistant
Commissioner/
Joint Commissioner
(Central Excise),
2011-2012 Jaipur, Rajasthan
Finance
Act, 1994
(service
tax) Input tax
credit on
various
expenses 678.79 2005-2010 Central Excise &
Service Tax
Appellate Tribunal,
Bangalore
Finance
Act, 1994
(service
tax) Input tax
credit on
various
expenses 370.43 April 2010
to Commissioner of
Central Excise,
Bangalore
September
2011
Finance
Act, 1994
(service
tax) Service
Tax on
'Common
Inputs
Distribution' 1,017.92 March 2005
to Central Excise &
Service Tax
Appellate Tribunal,
Bangalore
June 2008
Finance
Act, 1994
(service
tax) Disallowance
of service
tax credit
on various
services 96.11 2005-2011 Joint Commissioner
of Central Excise,
Patiala, Punjab
Finance
Act, 1994
(service
tax) Disallowance
of service
tax credit
on various
services 21.57 2006-2007,
2007-2008 Central Excise &
Service Tax
Appellate Tribunal,
Chandigarh
Finance
Act, 1994
(service
tax) Input
credit on
various
services 5.09 2008-2009 Superintendent
Audit, Patiala,
Punjab
Finance
Act, 1994
(service
tax) Service
Tax on
Royalty &
Technical
Know how 23.16 1999-2003 Joint Commissioner
of Central Excise,
Patiala, Punjab
Finance
Act, 1994
(service
tax) Payment
of Service
Tax under
GTA on
inwards 67.02 2005-2008 Joint Commissioner
of Central Excise,
Patiala, Punjab
/Outwards
freight
Finance
Act, 1994
(service
tax) Service
Tax on
Royalty &
Technical
Know how 16.79 2004-2005 Joint Commissioner
of Central Excise,
Patiala, Punjab
Karnataka
VAT Act, 2003 Difference
in VAT
rates 153.02 1998-1999
to Joint Commissioner
(Appeals), Bangalore
2001-2002
and
2007-2008
Karnataka
VAT Act, 2003 Difference
in rates,
Input tax
credit &
other
matters 225.00 2005-2006 Superintendent
Audit, Bangalore
Income
tax Act,1961 Disallowance
of
expenditure
in relation
to exempt
income 3.05 2000-2001 High Court
Income tax
Act,1961 Disallowance
of
expenditure
in relation
to 10.59 2001-2002
& 2004-2005 Commissioner
Income Tax
(Appeals)
exempt
income 2004-2005
Income tax
Act,1961 Interest
free loan
to
subsidiary 105.48 2006-2007
& 2007-2008 Commissioner
Income Tax
(Appeals)
Income tax
Act,1961 Disallowance
of
development
expenditure 22.32 2000-2001 High Court
treated as
capital in
nature
Income tax
Act,1961 Disallowance
of
development
expenditure 68.45 2001-2002 Commissioner
Income Tax
(Appeals)
treated as
capital in
nature
Income tax
Act,1961 Disallowance
of
development
expenditure 11.61 2002-2003 Income Tax
Appellate Tribunal
treated as
capital
in nature
Income tax
Act,1961 Disallowance
of prior
period
expenses 5.10 2000-2001 High Court
Income tax
Act,1961 Disallowance
of prior
period
expenses 92.64 2001-2002
& 2007-2008 Commissioner
Income Tax
(Appeals)
Income tax
Act,1961 Disallowance
of prior
period
expenses 57.57 2002-2003 Income Tax
Appellate Tribunal
Income tax
Act,1961 Depreciation
not allowed
on assets of
inactive 10.17 2001-2002 Commissioner
Income Tax
(Appeals)
Vegetable Oil
Division
Income tax
Act,1961 Depreciation
not allowed
on assets of
inactive 22.23 2002-2003
& Income Tax
Appellate Tribunal
Vegetable Oil
Division 2003-2004
Income tax
Act,1961 Loss in
relation to
diminution
in value of
shares
disallowed 84.80 2000-2001 High Court
Income tax
Act,1961 Loss in
relation to
diminution
in value of
shares
disallowed 12.39 2001-2002 Commissioner
Income Tax
(Appeals)
Income tax
Act,1961 Disallowance
of Commission
and
Brokerage
expenses 6.52 2001-2002 Commissioner
Income Tax
(Appeals)
for
facilitating
loan funds
Income tax
Act,1961 Disallowance
of Commission
and Brokerage
expenses 37.76 2002-2003 Income Tax
Appellate Tribunal
for
facilitating
loan funds
Income tax
Act,1961 Disallowance
of loan
processing
fee paid to
bank 33.99 2002-2003 Income Tax
Appellate Tribunal
Income tax
Act,1961 Disallowance
of foreign
exchange
fluctuation
loss 5.04 2002-2003 Income Tax
Appellate Tribunal
Income tax
Act,1961 Brought
forward
losses of
the
amalgamating 5,674.45 2002-2003 Income Tax
Appellate Tribunal
company
denied
Income tax
Act,1961 Disallowance
of filing
fee for
increasing
authorized 2.21 2002-2003 Income Tax
Appellate Tribunal
share
capital
of the
Company
Income tax
Act,1961 Disallowance
of
amalgamation
expenses 0.89 2000-2001 High Court
Income tax
Act,1961 Disallowance
of
amalgamation
expenses 0.69 2002-2003 Income Tax
Appellate Tribunal
Income tax
Act,1961 Provision
for expenses
disallowed 85.17 1997-1998 High Court
Income tax
Act,1961 Provision
for expenses
disallowed 57.64 2002-2003 Income Tax
Appellate Tribunal
Income tax
Act,1961 Disallowance
of
proportionate
royalty
expense 52.57 2003-2004
& 2005-2006 Income Tax
Appellate Tribunal
Income tax
Act,1961 Disallowance
of
proportionate
royalty
expense 103.47 2004-2005
&
2007-2008 Commissioner
Income Tax
(Appeals)
Income tax
Act,1961 Distribution
of gift
coupons to
shareholders
at 16.54 1995-1996
& 1996-1997 High Court
Annual
General
Meeting
Income tax
Act,1961 Disallowance
of exemption
on dividend 66.55 1998-1999 High Court
Income tax
Act,1961 Addition of
Revaluation
Reserves to
book profits 16.71 1998-1999 High Court
Income tax
Act,1961 Provision
for
diminution
in the
value of
asset 38.75 2005-2006 Income Tax
Appellate Tribunal
added to
book
profits
Income tax
Act,1961 Apportion
ment of
common
administrative
costs 1.52 1997-1998 High Court
Income tax
Act,1961 Disallowance
of lease
rent expenses 345.80 1997-1998 High Court
Income tax
Act,1961 Applicability
of interest
u/s 234D 0.51 2000-2001 High Court
Income tax
Act,1961 Disallowance
of expenditure
in relation
to exempt
income 21.21 1999-2000 High Court
Income tax
Act,1961 Depreciation
not allowed
on assets
of inactive 13.63 1999-2000 High Court
Vegetable
Oil
Division
Income tax
Act,1961 Addition
of
Revaluation
Reserves
to book
profits 17.65 1999-2000 High Court
Income tax
Act,1961 Loss in
relation
to
diminution
in value
of shares
disallowed 19.23 2004-2005 Commissioner
Income Tax
(Appeals)
Income tax
Act,1961 Disallowance
of Club
Expenses 2.80 2007-2008 Commissioner
Income Tax
(Appeals)
x. The Company has no accumulated losses at the end of the financial
year and it has not incurred cash losses in the current and immediately
preceding financial year.
xi. Based on our audit procedures and as per the information and
explanations given by the management, we are of the opinion that the
Company has not defaulted in repayment of dues to the banks. The
Company has no outstanding dues in respect of a financial institution
or debenture holders.
xii. According to the information and explanations given to us and
based on the documents and records produced to us, the Company has not
granted loans and advances on the basis of security by way of pledge of
shares, debentures and other securities.
xiii. In our opinion, the Company is not a chit fund or a nidhi /
mutual benefit fund / society. Therefore, the provisions of clause
4(xiii) of the Companies (Auditor's Report) Order, 2003 (as amended)
are not applicable to the Company.
xiv. In our opinion, the Company is not dealing in or trading in
shares, securities, debentures ana other investments. Accordingly, the
provisions of clause 4(xiv) of the Companies (Auditor's Report) Order,
2003 (as amended) are not applicable to the Company.
xv. According to the information and explanations given to us, the
Company has given guarantee for loan taken by a subsidiary from a bank;
the terms and conditions whereof in our opinion are not prima-facie
prejudicial to the interest of the Company. There are no other
guarantees given by the Company for loans taken by others from bank or
financial institutions.
xvi. Based on information and explanations given to us by the
management, term loans were applied for the purpose for which the loans
were obtained.
xvii. According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we report
that funds amounting to Rs. 5,049.06 lacs raised on short term basis in
the form of intercorporate deposits and working capital / cash credit
facility from affiliates and banks respectively have been used for
long-term investment representing acquisition of fixed assets.
xviii. The Company has not made any preferential allotment of shares
to parties or companies covered in the register maintained under
section 301 of the Companies Act, 1956.
xix. The Company did not have any outstanding debentures during the
year.
xx. We have verified that the end use of money raised by public issues
is as disclosed in the notes to the financial statements.
xxi. Based upon the audit procedures performed for the purpose of
reporting the true and fair view of the financial statements and as per
the information and explanations given by the management, we report
that no fraud on or by the Company has been noticed or reported during
the course of our audit.
For S.R. BATLIBOI & CO.
Firm registration number: 301003E
Chartered Accountants
per Pankaj Chadha
Partner
Place : Gurgaon Membership
Date : February 29, 2012 No.: 91813