Mar 31, 2018
Report on the Ind AS Financial Statements
1. We have audited the accompanying Ind AS financial statements of âGujarat Themis Biosyn Limited" ("the Company"), which comprise the Balance Sheet as at March 31, 2018,the Statement of Profit and Loss (including Other Comprehensive Income),the Statement of Cash Flows and the Statement of Changes in Equity for the year then ended and a summary of significant accounting policies and other explanatory information (herein referred to as âthe financial statementsâ).
Management''s Responsibility for the Ind AS Financial Statements
2. The Company''s Board of Directors is responsible for the preparation of these Ind AS financial statements in terms of the requirements of Section 134(5) of the Companies Act, 2013 (hereinafter referred to as âthe Actâ) that give a true and fair view of the financial position, financial performance including other comprehensive income, changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards prescribed under Section 133 of the Act read with relevant rules issued thereunder.
This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditor''s Responsibility
3. Our responsibility is to express an opinion on these 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 have conducted our audit of the Ind AS financial statements in accordance with the Standards on Auditingspecified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
6. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the Ind AS financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers the internal financial control relevant to the Company''s preparation of the Ind AS 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 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 Ind AS 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 Ind AS financial statements.
Basis of Qualified Opinion:
a. The outstanding balances as at March 31, 2018 in respect of certain balances of Advances given, liability for expenses, trade payables and creditors for capital expenditure are subject to confirmation from respective parties and consequential impact of reconciliation and adjustment arising there from in the statement, if any, is not ascertainable.
b. The Company is in the process of determining and identifying significant components of fixed assets as prescribed under the provisions of para 4(a) under the heading Notes after Part C in Schedule II of the Companies Act, 2013 and hence no effect of the same has been given in the financial result for the year ended March 31, 2018.
Qualified Opinion
In our opinion and to the best of our information and according to the explanations given to us, except for the effects of the matter described in the âBasis of qualified opinion'' paragraph above, the aforesaid Ind AS 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 , of the state of affairs of the Company as at March 31, 2018, and its financial performance including other comprehensive income, the changes in equity and its cash flows for the year then ended.
Emphasis of Matter:
We draw attention to Note 14(b)(2) to the statement regarding repayment of non-interest bearing unsecured loan of Rs. 350 lakhs to its promoter, pending approval from BIFR / Monitoring agency.
Our Opinion is not qualified in respect of above matter.
Report on Other Legal and Regulatory Requirements
8. As required by the Companies (Auditor''s Report) Order, 2016 (âthe Orderâ) issued by the Central Government of India in terms of sub-section (11) of Section 143 of the Act, we give in the Annexure âA'', a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.
9. 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 of the aforesaid Ind AS financial statements;
b) Except for the effects of the matter described in the âBasis of qualified opinion'' paragraph above, in our opinion, proper books of account as required by law relating to preparation of the aforesaid Ind AS financial statements have been kept so far as it appears from our examination of those books;
c) The Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, the Statement of Changes in Equity and the Statement of Cash Flows dealt with by this Report are in agreement with the books of account maintained for the purpose of preparation of financial statements;
d) Except for the effects of the matter described in the âBasis of qualified opinion'' paragraph above, in our opinion, the aforesaid Ind AS financial statements comply with the Indian accounting standards specified under section 133 of the Act, read with relevant rules issued thereunder;
e) On the basis of written representations received from the directors as on March 31, 2018, taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2018, from being appointed as a director in terms of section 164 (2) of the Act;
f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in âAnnexure B''; and
g) In our opinion and to the best of our information and according to the explanations given to us, we report as under with respect to other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014:
i) The Company has disclosed the impact of pending litigations on its financial position in its financial statements as referred to Note 30 to the financial statement.
ii) The Company did not have any long-term contracts including derivative contracts; as such the question of commenting on any material foreseeable losses thereon does not arise.
iii) There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.
Annexure âAâ to the Independent Auditorsâ Report
(Referred to in paragraph 8 under ''Report on Other Legal and Regulatory Requirements'' section of our report of even date)
i. (a) The company has maintained proper records showing full particulars including quantitative details and situation of Property, Plant and Equipment.
(b) Property, Plant and Equipment have been physically verified by the management at regular intervals, 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 physical verification.
(c) According to the information and explanation given to us and on the basis of our verification, title deeds of all immovable properties are held in the name of the company.
ii. According to the information and explanations given to us, physical verification of inventory has been conducted at reasonable intervals by the management and no material discrepancies were noticed on such physical verification during the year.
iii. The Company has not granted any loan, secured or unsecured, to Companies, Firms, Limited Liability Partnerships or other parties covered in the register maintained under Section 189 of the Act. Therefore, the provisions of Clause 3 (iii) (a), (iii)(b) and (iii)(c) of the said Order are not applicable to the Company.
iv. In our opinion and according to the information and explanations given to us, during the year, The company has not granted any loans or made any investments, or provided any guarantees or security to the parties covered under section 185 and 186. Therefore, the provisions of clause 3(iv) of the said order are not applicable to the company.
v. In our opinion and according to the information and explanations given to us, the company has not accepted any deposits from public within the meaning of Section 73 to 76 of the Companies Act, 2013 and the rules framed there under.
vi. According to the information and explanations given to us, the Central Government has not prescribed the maintenance of cost records under section 148(1) of the Companies Act, 2013 for any of the goods dealt by the Company and for any of the services rendered by the Company. Therefore, the provisions of clause 3(vi) of the Order are not applicable to the Company.
vii. (a) According to the information and explanation given to us and on the basis of our examination of our records of the Company, in respect of undisputed statutory dues including provident fund, employees'' state insurance, income tax, wealth tax, sales tax, service tax, duty of customs, duty of excise, value added tax, cess and any other statutory dues have generally been regularly deposited with the appropriate authorities.
According to the information and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were in arrears as at March 31, 2018 for a period of more than six months from the date they became payable.
(b) According to the books of accounts and records as produced and examined by us in accordance with the generally accepted auditing practices in India, as at March 31,2018, the following are the particulars of the dues that have not been deposited on the account of dispute.
Name of the Statute |
Nature of the Dues |
Amount (in Rs.) |
Forum where dispute is pending |
Financial year to which the amount relates |
Income Tax Act, 1961 |
Demand u/s 143 (3) |
10,79,703/- |
Hon. High Court, Gujarat |
A.Y. 2001-2002 |
Income Tax Act, 1961 |
Demand u/s 156 |
250/- |
Income Tax Appellate Tribunal, Ahmedabad |
A.Y. 1996-1997 |
Income Tax Act, 1961 |
Demand u/s 156 |
24,12,247/- |
Income Tax Appellate Tribunal, Ahmedabad |
A.Y. 2011-2012 |
Income Tax Act, 1961 |
Penalty u/s 271 (1)(c) |
8,38,840/- |
Commissioner of Income Tax (Appeals), Valsad |
A.Y. 2011-2012 |
viii. In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to banks during the year under audit. There are no dues to Financial Institution, Government and the Company has not issued any debentures.
ix. According to the information and explanations given to us and based on the records and documents produced before us, during the year the company has not raised money by way of initial public offer or further public offer and the term loans have been applied for the purposes for which they were obtained.
x. To the best of our knowledge and belief and according to the information given to us, no material fraud by the company or on the company by its officers or employees has been noticed or reported during the year.
xi. According to the information and explanations given to us and based on the records and documents produced before us, managerial remuneration has been paid by the company in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act 2013.
xii. As the company is not a Nidhi Company and the Nidhi Rules, 2014 are not applicable to it, therefore the provisions of clause (xii) of paragraph 3 of the Order are not applicable to the company.
xiii. According to the information and explanation given to us all transactions with the related parties are in compliance with Sections 177 and 188 of the Companies Act, 2013. The details of such related party transactions have been disclosed in the financial statements as required under Indian Accounting Standard(Ind AS) 24, Related Party Disclosures.
xiv. According to the information and explanations given to us and based on the records and documents produced before us, the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.
xv. According to the information and explanations given to us, the Company has not entered into any non-cash transactions with directors or persons connected with him under the provisions of section 192 of Companies Act, 2013.
xvi. The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934
Annexure - âB'' to the Auditors'' Report
(Report on the Internal Financial Controls under Clause (f) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act"))
We have audited the internal financial controls over financial reporting of âGujarat Themis Biosyn Limited" ("the Company") as of March 31, 2018 in conjunction with our audit of the Ind AS financial statements of the Company for the year ended on that date.
Management''s Responsibility for Internal Financial Controls
The Company''s management 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 (''ICAI''). 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 its 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 Companies Act, 2013.
Auditors'' Responsibility
Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the "Guidance Note") and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and both issued by the Institute of Chartered Accountants of India. 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 internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, 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.
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 internal financial controls system over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A company''s internal financial control over financial reporting 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 internal financial control over financial reporting 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
Because of the inherent limitations of internal financial controls over financial reporting, 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 internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Qualified Opinion
According to the information and explanation given to us and based on our audit, the following material weaknesses have been identified as at 31st March, 2018.
a. The outstanding balances as at March 31, 2018 in respect of certain balances of Advances given, liability for expenses, trade payables and creditors for capital expenditure are subject to confirmation from respective parties and consequential impact of reconciliation and adjustment arising there from in the statement, if any, is not ascertainable.
A ''material weakness'' is a deficiency, or a combination of deficiencies, in internal financial control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company''s annual or interim financial statements will not be prevented or detected on a timely basis.
In our opinion, except for the effects / possible effects of the material weakness described above on the achievement of the objectives of the control criteria, the Company has maintained, in all material respects, adequate internal financial controls over financial reporting as of March 31, 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.
We have considered the material weakness identified and reported above in determining the nature, timing and extent of audit tests applied in our audit of the Financial Statements of the company as of March 31, 2018 and these material weakness do not affect our opinion on the Financial Statements of the Company.
For GMJ & Co
Chartered Accountants
Firm No. 103429W
Sd/-
(CA Sanjeev Maheshwari)
M. No. 038755
Place: Mumbai
Date: May 9, 2018
Mar 31, 2016
INDEPENDENT AUDITOR''S REPORT TO THE MEMBERS OF GUJARAT THEMIS BIOSYN LIMITED Report on the Financial Statements
We have audited the accompanying financial statements of GUJARAT THEMIS BIOSYN LIMITED (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2016, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and summary of the significant accounting policies and other explanatory information.
Managementâs Responsibility for the Financial Statements
The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditorâs Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit.
We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.
We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10)of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether duet fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis forour audit opinion on the financial statements.
Basis for Qualified Opinion
(i) The outstanding balances as at March 31, 2016 in respect of certain balances of loans & advances, liability for expenses, trade payables and creditors for capital expenditure are subject to confirmation from respective parties and consequential reconciliation and adjustment arising there from, if any. Consequential impact thereof on the financial statements is not ascertainable [Refer note no. 29].
(ii) The Company has not determined and identified significant components of fixed assets as prescribed under the provisions of para 4(a) under the heading Notes after Part C in Schedule II of the Companies Act, 2013. The impact of the same on financial statements is not ascertainable [Refer note no. 9(b)].
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 matters described in the Basis for Qualified Opinion paragraph above, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2016, and its profit and its cash flows for the year ended on that date.
Emphasis of Matter
We draw attention to the matter in note no. 4(b) of the financial statements regarding repayment of '' 2,05,98,563/- against the outstanding non-interest bearing unsecured loan of ''3,50,00,000/- during the year, by the company to its promoter Themis Medicare Limited, pending approval from BIFR.
Our opinion is not modified in respect of this matter.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2016 (âthe Orderâ), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Companies Act, 2013, we give in the âAnnexure Aâ,a statement on the matters specified in paragraphs 3 and 4 of the said Order, to the extent applicable.
2. As required by Section 143 (3) of the Act, we report that:
(a) We have sought and, except for the matters described in the Basis for Qualified Opinion paragraph, obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;
(b) Except for the possible effects of the matter described in the Basis for Qualified Opinion paragraph above, in our opinion, proper books of account as required by law have been kept by the Company so faras it appears from our examination of those books.
(c) The Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.
(d) In our opinion, the aforesaid financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
(e) The matters described in the ''Basis for Qualified Opinion'' and âEmphasis of Matter'' paragraphs above, in our opinion, may have an adverse effect on the functioning of the Company.
(f) On the basis of the written representations received from the directors as on March 31, 2016 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2016, from being appointed as a director in terms of Section 164 (2) of the Act.
(g) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in the âAnnexure Bâ.
(h) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements
- Refer Note 34 to the financial statements;
ii. According to the information & explanations given to us, the Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses - Refer Note 35 to the financial statements;
iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company - Refer Note 36 to the financial statements.
âAnnexure Aâ referred to in paragraph 1 under the heading of âReport on Other Legal and Regulatory Requirementsâ of Independent Auditors'' Report to the members of GUJARAT THEMIS BIOSYN LIMITED (âthe Companyâ) for the year ended March 31, 2016. We report that:
(i) a) The Company has maintained proper records showing full particulars including quantitative details and situation of its assets.
b) The Company has physically verified the fixed assets in accordance with a programme of verification which, in our opinion, provides for physical verification of all fixed assets at reasonable intervals. We have been informed that no material discrepancies were noticed on such verification.
c) In our opinion and according to information and explanations given to us and on the basis of an examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company.
(ii) The inventory has been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable. According to the records produced before us for our verification, there were no material discrepancies noticed on physical verification of stocks as compared to the book records and the same have been properly dealt with in the books of account of the Company;
(iii) According to the information and explanations given to us, the Company has not granted any loans, secured or unsecured, to any Companies, Firms, Limited Liability Partnerships or other Parties covered in the register maintained under Section 189 of the Companies Act, 2013, therefore, the provisions of clause 3 (III) of Companies (Auditor''s Report) Order, 2016 are not applicable to the Company.
(iv) In our opinion and according to information and explanations given to us, the Company has complied with provisions of Section 185 and 186 of the Act in respect of loans, investments, guarantees and security.
(v) The Company has not accepted any deposits during the year from public within the meaning of the provisions of section 73 to 76 or any other relevant provisions of the Companies Act, 2013 and the rules made there under.
(vi) We are informed that no cost records are required to be maintained by the Company under Section 148(1) of the Companies Act, 2013.
(vii) a) Undisputed Statutory Dues including Gujarat Value Added Tax (GVAT), Tax Deducted at Source (TDS), Notified Area
Tax, Drainage cess charges, Employeesâ State Insurance (ESIC), ESIC dues in respect of contractors, Service Tax, duty of excise, Provident Fund have generally been regularly deposited with the appropriate authorities however delay have been observed in some cases. According to the information and explanations given to us, there were no undisputed statutory dues which have remained outstanding as at March 31, 2016 for the period of more than six months from the date they became payable except in respect of Provident Fund amounting to '' 8,169/-.
b) According to the information and explanation given to us, there are no dues of income tax, sales tax, service tax, duty of customs, duty of excise and value added tax, which have not been deposited on account of any dispute, except the following:
Name of the Statute |
Nature of the Dues |
Amount ('') |
Period to which the amount relates |
Forum where dispute is pending |
Income Tax Act, 1961 |
Demand u/s 143 (3) |
10,79,703/- |
A.Y. 2001-2002 |
Hon. High Court, Gujarat |
Income Tax Act, 1961 |
Demand u/s 156 |
250/- |
A.Y. 1996-1997 |
Income Tax Appellate Tribunal, Ahmadabad |
Income Tax Act, 1961 |
Demand u/s 156 |
24,12,247/- |
A.Y. 2011-2012 |
Income Tax Appellate Tribunal, Ahmadabad |
(viii) In our opinion and according to the information and explanations given to us, the company has not defaulted in repayment of dues to a financial institution, bank, Government or debenture holders except for delays in repayment of principal and payment of interest relating to Indian rupee term loan from Bank, the details of which are given as under:
Period Of Default |
Indian Rupee Term Loan from Bank |
|
Principal |
Interest |
|
Upto 30 days |
18,30,000 |
5,57,774 |
31 to 60 days |
6,10,000 |
1,91,619 |
(ix) The Company has not raised money by way of initial public offer or further public offer (including debt instruments) during the year. In our opinion, the term loans raised during the year have been applied for the purpose for which they were raised;
(x) According to the information and explanations given to us, no fraud by the Company or on the company by its officers or employees has been noticed or reported during the course of our audit.
(xi) According to the information and explanations give to us and based on our examination of the records of the Company, the Company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Act.
(xii) In our opinion and according to the information and explanations given to us, the Company is not a Nidhi Company. Accordingly the provisions of clause 3 (xii) of Companies (Auditor''s Report) Order, 2016 are not applicable to the Company.
(xiii) According to the information and explanations given to us, all transactions with the related parties are in compliance with Section 177 and 188 of the Companies Act, 2013, where applicable and the details have been disclosed in the financial statements as required by the applicable accounting standards.
(xiv) According to the information and explanations given to us and based on our examination of the records of the company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.
(xv) According to the information and explanations given to us and based on our examination of the records of the company, the Company has not entered into non-cash transactions with directors or persons connected with him.
(xvi) The Company is not required to be registered under section 45 IA of the Reserve Bank of India Act, 1934. Accordingly the provisions of clause 3 (xvi) of Companies (Auditor''s Report) Order, 2016 are not applicable to the Company.
âAnnexure Bâ referred to in paragraph 2(h) under the heading of âReport on Other Legal and Regulatory Requirementsâ of Independent Auditors'' Report to the members of GUJARAT THEMIS BIOSYN LIMITED (âthe Companyâ) for the year ended March 31, 2016.
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (âthe Actâ)
We have audited the internal financial controls over financial reporting of GUJARAT THEMIS BIOSYN LIMITED (âthe Companyâ) as of March 31, 2016 in conjunction with our audit of the financial statements of the Company for the year ended on that date.
Managementâs Responsibility for Internal Financial Controls
The Company''s management 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 its 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 Companies Act, 2013.
Auditorâs Responsibility
Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the âGuidance Noteâ) and the Standards on Auditing, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. 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 internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, 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.
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 internal financial controls system over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A company''s internal financial control over financial reporting 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 internal financial control over financial reporting 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
Because of the inherent limitations of internal financial controls over financial reporting, 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 internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 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 KHANDELWAL JAIN & CO.
Chartered Accountants,
Firm Registration No. 105049W
Sd/-
(NARENDRA JAIN)
PARTNER
Membership No.048725
Place : Mumbai
Date : 11th May, 2016
Mar 31, 2015
We have audited the accompanying standalone financial statements of
GUJARAT THEMIS BIOSYN LIMITED ("the Company"), which comprise the
Balance Sheet as at March 31,2015, the Statement of Profit and Loss,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
The Company's Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 ("the Act") with respect
to the preparation and presentation of these 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. This responsibility also
includes maintenance of adequate accounting records in accordance with
the provisions of the Act for safeguarding the assets of the Company
and for preventing and detecting frauds and other irregularities;
selection and application of appropriate accounting policies; making
judgments and estimates that are reasonable and prudent; and
design,implementation and maintenance of adequate internal financial
controls, that were operating effectively for ensuring the accuracy and
completeness of the accounting records, relevant to the preparation and
presentation of the financial statements that give a true and fair view
and are free from material misstatement, whether due to fraud or error.
Auditor's' Responsibility
Our responsibility is to express an opinion on these standalone
financial statements based on our audit. We have taken into account the
provisions of the Act, the accounting and auditing standards and
matters which are required to be included in the audit report under the
provisions of the Act and the Rules made thereunder.
We conducted our audit in accordance with the Standards on Auditing
specified under Section 143(10)of the Act. Those Standards require that
we comply with ethical requirements and plan and perform the audit to
obtain reasonable assurance about whether the financial statements are
free from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and the disclosures in the financial statements. The
procedures selected depend on the auditor's judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal financial control relevant
to the Company's preparation of the financial statements that give a
true and fair view in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing
an opinion on whether the Company has in place an adequate internal
financial control system over financial reporting and the operating
effectiveness of such controls. An audit also includes evaluating the
appropriateness of the accounting policies used and the reasonableness
of the accounting estimates made by the Company's Directors, as well as
evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our qualified audit opinion on the
standalone financial statements.
Basis for Qualified Opinion
1. Financial Statements have been prepared on going concern basis in
spite of Company has accumulated losses of Rs.10,37,05,584/- and
negative net worth of Rs.78,53,651/- as at March 31, 2015. The Company
also has working capital deficiency. The company is also a sick company
within the meaning of Section 3 (1) (o) of the Sick Industrial
Companies (Special Provisions) Act 1985 and the Company has been
registered with the BIFR. Further the Rehabilitation Scheme had been
sanctioned by the Board for Industrial and Financial Reconstruction
(BIFR) in the hearing held January 12, 2012. These factors raise doubts
about, the Company's ability to continue as a going concern which is
dependent upon infusion of long terms funds for its future operations.
The accompanying financial statements do not include any adjustments
relating to the recoverability and classification of assets carrying
amounts or the amount and classification of liabilities that might
result, should the Company be unable to continue as a going concern.
(Refer note no. 30). Consequential impact thereof on the financial
statements is not ascertainable.
2. The outstanding balances as at March 31, 2015 in respect of certain
balances, of trade receivables, deposits, loans & advances, liability
for expenses, trade payables and creditors for capital expenditure are
subject to confirmation from respective parties and consequential
reconciliation and adjustment arising there from, if any(Refer note no.
29). Consequential impact thereof on the financial statements is not
ascertainable.
Qualified Opinion
In our opinion and to the best of our information and according to the
explanations given to us, except for the effects of the matter
described in the Basis for Qualified Opinion paragraph above;
consequential cumulative effect thereof is not ascertainable, 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 March 31, 2015, and its
profit and its cash flows for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order, 2015 ("the
Order"), issued by the Central Government of India in terms of
sub-section (11) of section 143 of the Companies Act, 2013, we give in
the Annexure a statement on the matters specified in paragraphs 3 and 4
of the Order, to the extent applicable.
2. As required by Section 143 (3) of the Act, we report that:
a) We have sought and obtained all the information and explanations
which to the best of our knowledge and belief were necessary for the
purposes of our audit.
b) In our opinion, proper books of account as required by law have been
kept by the Company so far as it appears from our examination of those
books.
c) The Balance Sheet, the Statement of Profit and Loss, and the Cash
Flow Statement dealt with by this Report are in agreement with the
books of account.
d) In our opinion, the aforesaid 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.
e) On the basis of the written representations received from the
directors as on March 31, 2015,taken on record by the Board of
Directors, none of the directors is disqualified as on March 31,2015
from being appointed as a director in terms of Section 164 (2) of the
Act.
f) The matter described in the Basis for Qualified Opinion paragraph
above, in our opinion, may have an adverse effect on the functioning of
the Company.
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 has disclosed the impact of pending litigations on its
financial position in its financial statements - Refer Note 33 to the
financial statements;
ii. According to the information & explanations given to us, the
Company did not have any long-term contracts including derivative
contracts for which there were any material foreseeable losses - Refer
Note 34 to the financial statements;
iii. There were no amounts which were required to be transferred to the
Investor Education and Protection Fund by the Company - Refer Note 35
to the financial statements.
Annexure referred to in paragraph 1 under the heading of "Report on
Other Legal and Regulatory Requirements" of Independent Auditors' Report
to the members of GUJARAT THEMIS BIOSYN LIMITED ("the Company") for the
year ended March 31,2015. We report that:
i) a) The Company has maintained proper records showing full particulars
including quantitative details and situation of its fixed assets.
b) The Company has physically verified the fixed assets in accordance
with a programme of verification which, in our opinion, provides for
physical verification of all fixed assets at reasonable intervals. We
have been informed that no material discrepancies were noticed on such
verification;
ii) a) The inventory has been physically verified during the year by the
management. In our opinion, the frequency of verification is reasonable;
b) According to the information and explanations given to us, the
procedures followed for physical verification of the inventory are, in
our opinion, reasonable and adequate in relation to the size of the
Company and the nature of its business;
c) According to the records produced before us for our verification,
there were no material discrepancies noticed on physical verification
of stocks referred to in Para ii (a) above as compared to the book
records and the same have been properly dealt with in the books of
account of the Company;
iii) According to the information & 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
189 of the Act. Therefore, the provisions of clause 3(iii) of Companies
(Auditor's Report) Order, 2015 are not applicable to the Company.
iv) In our opinion and according to the information and explanations
given to us, there are adequate internal control systems commensurate
with the size of the company and the nature of its business with
regards to purchase of inventory and fixed assets and for the sale of
goods and for rendering of services. During the course of our audit, we
have not observed any continuing failure to correct major weaknesses in
internal controls system;
(v) The Company has not accepted any deposits during the year from the
public within the meaning of the provisions of Section 73 to 76 or any
other relevant provisions of the Companies Act, 2013 and the rules made
thereunder.
(vi) We are informed that no cost records are required to be maintained
by the Company under Section 148(1) of the Companies Act, 2013.
vii) a) Undisputed Statutory Dues including Gujarat Value Added Tax
(GVAT), Tax Deducted at Source (TDS), Notified Area Tax, Drainage cess
charges, Employees' State Insurance (ESIC), ESC dues in respect of
contractors, Service Tax, Duty of excise, Provident Fund have generally
been regularly deposited with the appropriate authorities however delay
have been observed in some cases. According to the information and
explanations given to us, there were no undisputed statutory dues which
have remained outstanding as at March 31, 2015 for the period of more
than six months from the date they became payable.
b) According to the information and explanation given to us, there are
no dues of sales tax, service tax, income tax, duty of excise, duty of
customs, wealth tax, value added tax, excise duty and cess, which have
not been deposited on account of any dispute, except the following:
Name of the Statute Nature of the Dues Amount (Rs.)
Income Tax Act, 1961 Demand u/s 143 (3) 10,79,703/-
Income Tax Act, 1961 Demand u/s 156 48,88,257/-
Income Tax Act, 1961 Demand u/s 156 32,34,870/-
Name of the Statute Period to which the Forum where dispute is
amount relates pending
Income Tax Act, 1961 A.Y 2001-2002 Hon. High Court, Gujarat
Income Tax Act, 1961 A.Y 1996-1997 Income Tax Appellate Tribunal,
Ahmedabad
Income Tax Act, 1961 A.Y 2011-2012 Commissioner of Income-tax
(Appeals), Valsad
c) According to the information and explanations given to us, there
were no amounts which were required to be transferred to the Investor
Education and Protection Fund by the Company in accordance with the
relevant provisions of the Companies Act, 1956 (1 of 1956) and rules
made thereunder.
(viii) The accumulated losses of the company are more than fifty
percent of its net worth. The company has, without considering the
effect of the matter described in the Basis for Qualified Opinion
paragraph, has not incurred cash losses during the financial year
covered by our audit and in the immediately preceding financial year.
(ix) In our opinion and according to the information and explanations
given to us, the company has not defaulted in repayment of dues to a
financial institution, bank or debenture holders except for delays in
repayment of principal and payment of interest relating to Indian Rupee
Term Loan and cash credit, the detail of which are given as under:
Period Of Default Indian Rupee Cash
Term Loan Credit
Principal Interest Interest
Upto 30 days 36,60,000 14,26,978 2,09,325
31 to 60 days 42,50,000 17,32,936 -
61 to 90 days 20,000 - -
Period Of Default Remarks
Upto 30 days In respect of Indian Rupee Term Loan, Principal and
Interest amount of Rs. 6,10,000/- and Rs. 1,91,619/-
respectively is outstanding as on March 31,2015.
31 to 60 days
61 to 90 days
(x) According to the information and explanations given to us, the
company has not given any guarantee for loans taken by others from bank
or financial institutions.
(xi) In our opinion, the term loans raised during the year have been
applied for the purpose for which they were raised.
(xii) Based upon the audit procedures performed and information and
explanations given by the management, we report that no fraud on the
Company or by the Company has been noticed or reported during the
course of our audit.
For KHANDELWAL JAIN & CO.
Chartered Accountants,
Firm Registration No. 105049W
Sd/-
(NARENDRA JAIN)
Place: Mumbai PARTNER
Date: May 28, 2015 Membership No. 048725
Mar 31, 2014
We have audited the accompanying financial statements of Gujarat Themis
Biosyn Limited ("the Company"), which comprise the Balance Sheet as at
March 31, 2014, 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
the Accounting Standards referred to in sub-section (3C) of section 211
of the Companies Act, 1956 ("the Act") read with the General Circular
15/2013 dated September 13, 2013 of the Ministry of Corporate Affairs
in respect of Section 133 of the Companies Act, 2013 and in accordance
with the accounting principles generally accepted in India. 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 entity''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
1. Financial Statements have been prepared on going concern basis in
spite of brought forward losses of Rs. 19,45,11,078/-, which has
resulted in negative net worth of Rs. 5,33,99,635/- as at March 31,
2014. The Company also has working capital deficiency. The Company is
also a sick Company within the meaning of Section 3 (1) (o) of the Sick
Industrial Companies (Special Provisions) Act 1985 and the Company has
been registered with the BIFR. Further the Rehabilitation Scheme had
been sanctioned by the Board for Industrial and Financial
Reconstruction (BIFR) in the hearing held January 12, 2012. These
factors raise doubts about, the Company''s ability to continue as a
going concern which is dependent upon infusion of long terms funds for
its future operations. The accompanying financial statements do not
include any adjustments relating to the recoverability and
classification of assets carrying amounts or the amount and
classification of liabilities that might result, should the Company be
unable to continue as a going concern. (Refer note no. 31).
Consequential impact thereof on the financial statements is not
ascertainable.
2. The outstanding balances as at March 31, 2014 in respect of certain
balances, of trade receivables, deposits, loans & advances, liability
for expenses, trade payables and creditors for capital expenditure are
subject to confirmation from respective parties and consequential
reconciliation and adjustment arising there from, if any. (Refer note
no. 30). Consequential impact thereof on the financial statements is
not ascertainable.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, except for the effects of the matter
described in the Basis for Qualified Opinion paragraph; consequential
cumulative effect thereof is not ascertainable, 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 March 31, 2014;
(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.
Emphasis of Matter
We draw attention to Note No. 9(b) regarding non-maintenance of proper
records showing full particulars including quantitative details and
situation of fixed assets and no physical verification of such fixed
assets carried out by the management during the year. Consequently, the
discrepancies if any between the book records and the physical
availability of assets could not be ascertained. However in the opinion
of management there will be no material discrepancies between Fixed
Assets records as per Books and its physical availability. Our opinion
is not qualified in respect of this matter.
Report on Other Legal and Regulatory Requirements
1. 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 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) 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, the Statement of Profit and Loss and the Cash
Flow Statement dealt with by this Report are in agreement with the
books of account;
(d) In our opinion, the Balance Sheet, the Statement of Profit and Loss
and the Cash Flow Statement comply with the Accounting Standards
referred to in sub-section (3C) of section 211 of the Act read with the
General Circular 15/2013 dated September 13, 2013 of the Ministry of
Corporate Affairs in respect of Section 133 of the Companies Act, 2013;
(e) On the basis of written representations received from the directors
as on March 31, 2014, and taken on record by the Board of Directors,
none of the directors is disqualified as on March 31, 2014, 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
Annexure referred to in paragraph 1 under the heading of "Report on
Other Legal and Regulatory Requirements" of Independent Auditors''
Report to the members of Gujarat Themis Biosyn Limited ("the Company")
for the year ended March 31, 2014. We report that:
i) a) The Company has not maintained proper records showing full
particulars including quantitative details and situation of its assets.
b) We were informed that the fixed assets were not physically verified
by the management, during the year. Hence, the discrepancies if any
between book records and physical availability could not be
ascertained;
c) We were informed that, no substantial part of fixed assets of
Company have been disposed off during the year.
ii) a) The inventory has been physically verified during the year by
the management. In our opinion, the frequency of verification is
reasonable;
b) According to the information and explanations given to us, the
procedures followed for physical verification of the inventory are, in
our opinion, reasonable and adequate in relation to the size of the
Company and the nature of its business;
c) According to the records produced before us for our verification,
there were no material discrepancies noticed on physical verification
of stocks referred to in Para ii (a) above as compared to the book
records and the same have been properly dealt with in the books of
account of the Company;
iii) a) According to the information and explanations given to us, the
Company has not granted any loans, secured or unsecured, to any
Companies, Firms or other Parties listed in the register maintained
under Section 301 of the Companies Act, 1956.
b) Since 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 provisions of clause 4
(iii) (b) (c) (d) are not applicable to the Company.
c) According to the information and explanations given to us, the
Company has not taken any loan during the year from companies, firms or
other parties listed in the register maintained under Section 301 of
the Companies Act, 1956. Accordingly, provisions of clause 4 (iii) (f)
(g) are not applicable to the Company.
iv) In our opinion and according to the information and explanations
given to us, there are adequate internal control systems commensurate
with the size of the Company and the nature of its business with
regards to purchase of inventory and fixed assets and with regards to
sale of goods and services. During the course of our audit, we have not
observed any continuing failure to correct major weaknesses in internal
controls system;
v) a) According to the information and explanations given to us and
based on our verification, we are of the opinion that
the transactions that need to be entered into the register maintained
under section 301 of the Companies Act, 1956 have been entered;
b) Further, according to the information and explanations given to us,
each of these transactions made in pursuance of such contracts or
arrangements have been made at prices which are reasonable having
regard to the prevailing market prices at the relevant time;
vi) According to the information and explanations given to us, 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 are informed that no cost records are required to be
maintained by the Company under clause (d) of sub-section (1) of
Section 209 of the Companies Act, 1956;
ix) a) Undisputed Statutory Dues including Gujarat Value Added Tax
(GVAT), Tax Deducted at Source (TDS), Notified Area Tax, Drainage cess
charges, Employees'' State Insurance (ESIC), ESIC dues in respect of
contractors, Service Tax, Excise duty, Provident Fund have generally
been regularly deposited with the appropriate authorities however delay
have been observed in some cases. According to the information and
explanations given to us, there were no undisputed statutory dues which
have remained outstanding as at March 31, 2014 for the period of more
than six months from the date they became payable.
b) According to the information and explanation given to us, there are
no dues of Sales Tax, Service Tax, Income Tax, Customs Duty, Wealth
tax, Excise duty and Cess, which have not been deposited on account of
any dispute, except the following:
Name of the Statute Nature of the Dues Amount (Rs.)
Income Tax Act, 1961 Demand u/s 143 (3) 10,79,703/-
Income Tax Act, 1961 Demand u/s 156 48,88,257/-
Income Tax Act, 1961 Demand u/s 156 32,34,870/-
Name of the Statute Period to which Forum where dispute is
the amount relates pending
Income Tax Act, 1961 A.Y 2001-2002 Hon. High Court, Gujarat
Income Tax Act, 1961 A.Y 1996-1997 Income Tax Appellate
Tribunal, Ahmedabad
Income Tax Act, 1961 A.Y 2011-2012 Commissioner of Income-
tax (Appeals), Valsad
x) The accumulated losses of the Company are more than fifty percent of
its net worth. The Company has, without considering the effect of the
matter described in the Basis for Qualified Opinion paragraph and
Emphasis of Matter paragraph in the main report, has not incurred cash
losses during the financial year covered by our audit and in the
immediately preceding financial year.
xi) In our opinion and according to the information and explanations
given to us, the Company has defaulted in repayment of dues to a
financial institution, bank or debenture holders. Details of such
defaults is given as under :-
a) In case of Gujarat Industrial Investment Corporation Limited (GIIC),
where repayment of unsecured loan amounting to Rs. 26,00,000/- has not
been made as in the opinion of the Company, GIIC is also a promoter and
as per the BIFR sanctioned scheme the loan which was sub-ordinated to
the dues of the Banks and Financial Institutions would be repaid only
after clearing the dues to banks and Financial Institutions. However,
pursuant to para 12.9 of Order dated January 12, 2012, the Hon''ble BIFR
directed Gujarat Industrial Investment Corporation Ltd. (GIIC Ltd.) to
accept principal amount of unsecured loan of Rs. 26,00,000/- in three
equal yearly installments commencing from April 01, 2011 or
alternatively the entire amount as would be decreed by the court will
be payable by the Company before the end of the Scheme 2018. Upto 31st
March 2013, as the GIIC had not communicated for repayment in three
equal annual instalments, the same was treated as non-current
borrowing. During the year, as per the communication received from GIIC
Ltd., the Company has paid an amount of Rs. 31,00,000/- to GIIC Ltd. as
full and final settlement payment towards their unsecured loan of Rs.
26,00,000/- & Rs. 5,00,000/- paid as compensation. [Refer note no. 25]
b) In case of Indian rupee term loan, cash credit facility and devolved
letter of credit taken from Union Bank of India (UBI), the details of
defaults / delay in repayments of principal and interest are as under:
-
Period of Indian Rupee Cash
Default Term Loan Credit
Principal Interest Interest
Upto 30 days 54,83,438 27,47,747 12,45,573
31 to 60 days 12,20,000 6,19,529 3,55,002
61 to 90 days 12,20,000 6,09,309 -
91 to 120 days - 2,319 -
121 to 150 days - 2,566 -
Period of Devolved Letter Remarks
Default of Credit
Principal
Upto 30 days 12,01,225 In respect of Indian Rupee
Term Loan, Principal and
Interest amount of
Rs. 6,03,438 and Rs. 2,53,798
respectively is outstanding
as on March 31, 2014.
31 to 60 days 21,56,551
61 to 90 days 21,01,995
91 to 120 days
121 to 150 days
xii) According to the informations and explanations given 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 are not
applicable to the Company;
xiv) In our opinion, the Company is not dealing in or trading in
shares, securities, debentures and other investments. Accordingly, the
provisions of clause 4 (xiv) of the Companies (Auditor''s Report) Order,
2003 are not applicable to the Company;
xv) According to the informations and explanations given to us, the
Company has not given any guarantee for loan taken by others from bank
or financial institutions;
xvi) In our opinion, the term loans raised during the year have been
applied for the purpose for which they were raised;
xvii) In our opinion and according to the information & explanations
given to us and on an overall examination of the balance sheet of the
company, we report that short term funds amounting to Rs.
11,68,58,845/- have been used for long term purposes primarily for
losses of the Company;
xviii) According to the informations and explanations given to us, the
Company has not made any preferential allotment of shares to parties
and companies covered in the register maintained under Section 301 of
the Companies Act, 1956;
xix) According to the information and explanations given to us, the
Company has not issued debentures;
xx) According to the information and explanations given to us, the
Company has not raised money by public issues during the year;
xxi) According to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
For KHANDELWAL JAIN & CO.
Chartered Accountants,
Firm Registration No. 105049W
(NARENDRA JAIN)
Place: Mumbai PARTNER
Date : May 14, 2014 Membership No. 048725
Mar 31, 2012
We have audited the attached Balance Sheet of GUJARAT THEMIS BIOSYN
LIMITED, as at 31st March 2012 and the Statement of Proft and Loss and
the Cash Flow Statement for the year ended on that date annexed
thereto. These fnancial statements are the responsibility of the
Company's Management. Our responsibility is to express an opinion on
these fnancial statements based on our audit. 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 fnancial statements are free of
material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the fnancial
statements. An audit also includes assessing the accounting principles
used and signifcant estimates made by management, as well as evaluating
the overall fnancial statement presentation. We believe that our audit
provides a reasonable basis for our opinion.
1. As required by the Companies (Auditor's Report) Order, 2003 (As
Amended) issued by the Central Government of India in terms of
sub-section (4-A) of Section 227 of the Companies Act, 1956, we enclose
in the Annexure a statement on the matters specifed in paragraphs 4 & 5
of the said Order, to the extent applicable to the Company.
2. Further to our comments in the annexure referred to in Paragraph 1
above, we report that: -
a. We have obtained all the informations and explanations, which to
the best of our knowledge and belief were necessary for the purposes of
our audit;
b. In our opinion, proper Books of Account as required by law, have
been kept by the Company so far as appears from our examination of
those books;
c. The Balance Sheet, Statement of Proft and Loss and Cash Flow
Statement dealt with by this report are in agreement with the Books of
Account;
d. In our opinion, the Balance Sheet, Statement of Proft and Loss and
Cash Flow Statement dealt with by this report comply with the
Accounting Standards referred to in sub-section (3C) of Section 211 of
the Companies Act, 1956.
e. On the basis of the written representations received from the
directors as on March 31, 2012 and taken on record by the Board of
Directors, we report that none of the directors is disqualifed as on
March 31, 2012 from being appointed as a director in terms of clause
(g) of sub-section (1) of section 274 of the Companies Act, 1956;
f. Attention is invited to Note No. 9(iii) and paragraph (i) of
Annexure to this Report, regarding non-maintenance of proper records
showing full particulars including quantitative details and situation
of fxed assets and no physical verifcation of such fxed assets carried
out by the management during the year. Consequently, the discrepancies
if any between the book records and the physical availability of assets
could not be ascertained. However in the opinion of management there
will be no material discrepancies between Fixed Assets records as per
Books and its physical availability.
g. (i) Financial Statements have been prepared on going concern basis
in spite of brought forward losses of Rs.27,90,76,856/-, which has
resulted in negative net worth of Rs.13,86,43,883/- as at 31st March,
2012. The Company also has working capital defciency. The Company is
also a sick Company within the meaning of Section 3 (1) (o) of the Sick
Industrial Companies (Special Provisions) Act 1985 and the Company has
been registered with the BIFR. Further the Rehabilitation Scheme has
been sanctioned by the Board for Industrial and Financial
Reconstruction (BIFR) in the hearing held 12th January, 2012. These
factors raise doubts about, the Company's ability to continue as a
going concern which is dependent upon infusion of long terms funds for
its future operations. The accompanying fnancial statements do not
include any adjustments relating to the recoverability and
classifcation of assets carrying amounts or the amount and
classifcation of liabilities that might result, should the Company be
unable to continue as a going concern. (Refer note no. 32)
(ii) The outstanding balances as at 31st March, 2012 in respect of
certain balances of trade receivables, deposits, loans & advances, long
term borrowings, liability for expenses, trade payables and creditors
for capital expenditure are subject to confrmation from respective
parties and consequential reconciliation and adjustment arising there
from, if any. (Refer note no. 30). Consequential impact thereof on the
fnancial statements is not ascertainable.
3. In our opinion and to the best of our information and according to
the explanations given to us, the said accounts, subject to our
comments in paragraph 2(g) above consequential cumulative effect
thereof is not ascertainable and read together with notes thereon, give
the information required by the Companies Act, 1956, 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 31st
March, 2012 and
b) in the case of the Statement of Proft and Loss, of the Proft for the
year ended on that date.
c) in case of the Cash Flow Statement, of the cash fows for the year
ended on that date.
ANNEXURE REFERRED TO IN PARAGRAPH 1 OF OUR REPORT OF EVEN DATE ON THE
ACCOUNTS FOR THE YEAR ENDED 31ST MARCH 2012 OF GUJARAT THEMIS BIOSYN
LIMITED
On the basis of such checks, as we considered appropriate and in terms
of the information and explanations given to us, we state that: -
i) a) The Company has not maintained proper records showing full
particulars including quantitative details and situation of its assets.
b) We were informed that the fxed assets were not physically verifed by
the management, during the year. Hence, the discrepancies if any
between book records and physical availability could not be
ascertained;
c) We were informed that, no substantial part of fxed assets of Company
have been disposed off during the year.
ii) a) The inventory has been physically verifed during the year by the
management. In our opinion, the frequency of verifcation is reasonable;
b) According to the information and explanations given to us, the
procedures followed for physical verifcation of the inventory are, in
our opinion, reasonable and adequate in relation to the size of the
Company and the nature of its business;
c) According to the records produced before us for our verifcation,
there were no material discrepancies noticed on physical verifcation of
stocks referred to in Para 2(a) above as compared to the book records
and the same have been properly dealt with in the books of account of
the Company;
iii) a) According to the information and explanations given to us, the
Company has not granted any loans, secured or unsecured, to any
Companies, Firms or other Parties listed in the register maintained
under Section 301 of the Companies Act, 1956.
b) Since the Company has not granted any loans, secured or unsecured to
Companies, Firms or other parties covered in the register maintained
under section 301of the Companies Act, 1956 provisions of clause 4
(iii) (b) (c) (d) are not applicable to the Company.
c) According to the information and explanations given to us, the
Company has not taken any loan during the year from companies, frms or
other parties listed in the register maintained under Section 301 of
the Companies Act, 1956. Accordingly, provisions of clause 4 (iii) (f)
(g) are not applicable to the Company.
iv) In our opinion and according to the information and explanations
given to us, there are adequate internal control systems commensurate
with the size of the Company and the nature of its business with
regards to purchase of inventory and fxed assets and with regards to
sale of goods and services. During the course of our audit, we have not
observed any continuing failure to correct major weaknesses in internal
controls system;
v) a) According to the information and explanations given to us and
based on our verifcation, we are of the opinion that the transactions
that need to be entered into the register maintained under section 301
of the Companies Act, 1956 have been entered;
b) Further, according to the information and explanations given to us,
each of these transactions made in pursuance of such contracts or
arrangements have been made at prices which are reasonable having
regard to the prevailing market prices at the relevant time;
vi) According to the information and explanations given to us, 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, in respect of the Company's products to which the said rules
are made applicable, 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;
ix) a) Undisputed Statutory Dues including Central Sales Tax, Provident
Fund, Value Added Tax, Profession Tax, Employees' State Insurance
(ESIC), ESIC dues in respect of contractors, Tax Deducted at Source
(TDS), Notifed Area Tax and NA charges have not been regularly
deposited with the appropriate authorities as there have been
substantial delay in depositing such statutory dues. According to the
information and explanations given to us, there were no undisputed
statutory dues which have remained outstanding as at 31st March, 2012
for the period of more than six months from the date they became
payable.
b) According to the information and explanation given to us, there are
no dues of Sales Tax, Service Tax, Income Tax, Customs Duty, Wealth
tax, Excise duty and Cess, which have not been deposited on account of
any dispute, except the following:
Name of the Nature of
the Dues Amount
(Rs.) Period to which Forum where
Statute the amount
relates dispute is pending
Income Tax Demand
u/s 143
(3) 10,79,703/- A.Y. 2001-2002 Hon. High Court,
Gujarat
x) The accumulated losses of the Company are more than ffty percent of
its net worth. The Company has, without considering the effect of our
comments in the paragraph 2 (f) & (g) in the main report, has incurred
cash losses during the fnancial year covered by our audit. It had
incurred cash losses in the immediately preceding fnancial year also,
without considering the effects of our comments made in paragraph 2 (f)
& (g) of our Auditors Report for the said fnancial year.
xi) In our opinion and according to the information and explanations
given to us, the Company has defaulted in repayment of dues to a
fnancial institution, bank or debenture holders. Details of such
defaults is given as under :- (a) In case of Gujarat Industrial
Investment Corporation Limited (GIIC), where repayment of unsecured
loan amounting to Rs.26,00,000/- has not been made as in the opinion of
the company, GIIC is also a promoter and as per the BIFR sanctioned
scheme the loan which was subordinated to the dues of the Banks and
Financial Institutions would be repaid only after clearing the dues to
banks and Financial Institutions. However pursuant to Scheme of
Rehabilitation as approved by BIFR under Sick Industrial Companies
(Special Provision) Act, 1985 on 12th January 2012, the said loan has
been treated as unsecured loan and GIIC to accept principal amount of
Rs.26,00,000/- in three equal annual instalments commencing from 1st
April, 2011 or alternatively the entire amount as would be decreed by
the court will be payable by the Company before the end of the Scheme
2018. Also, the GIIC has not yet communicated for repayment in three
equal annual instalments. [Refer Note no. 4(c)]
(b) In case of Indian rupee term loan, short term loan, cash credit
facility and devolved letter of credit taken from Union Bank of India
(UBI), the details of defaults/delay in repayments of principal and
interest are as under :-
Period Of Indian Rupee Term Short Term Loan
Default Loan
Principal Interest Principal Interest
Less than 30 3,84,000 4,26,016 - -
days
31 to 60 days 12,20,000 6,85,980 20,00,000 96,947
61 to 90 days 33,99,000 12,21,022 17,73,220 1,00,508
91 to 120 days 61,81,480 32,08,198 7,73,220 2,03,510
121 to 150 days 36,36,520 7,07,380 - 1,00,594
151 to 180 days 13,33,000 13,72,214 - 49,566
More than 180 - 14,47,468 - 12,745
days
Period of
Default Cash Devolved Remarks
Credit Letter of
Credit
Interest Principal
Less than 30
days 7,23,957 9,97,911 In respect of Indian Rupee
Term Loan, Principal and
Interest amount of
Rs.3,84,000 and Rs.4,26,016
respectively is outstanding
as on 31.03.2012
31 to 60 days 8,12,027 - In respect of Indian Rupee
Term Loan Interest amount of
Rs.6,85,980 is outstanding
as on 31.03.2012
61 to 90 days 3,17,579 1,11,31,624 In respect of Devolved Letter
of Credit, Principal amount
of Rs.92,45,142 is
outstanding as on 31.03.2012
91 to 120 days 3,49,339 59,94,543 -
121 to 150 days 2,61,634 26,38,581 -
151 to 180 days - 2,11,100 -
More than
180 days - - In respect of Indian Rupee
Term Loan, interest amount
of Rs.58,044 is outstanding
as on 31.03.2012
During the year, there has been reschedulement in respect of repayment
of Indian rupee term loan of UBI w.e.f. 1st November, 2011, pursuant to
Scheme of Rehabilitation as approved by the Board for Industrial and
Financial Reconstruction (BIFR) on 12th January, 2012 under Sick
Industrial Companies (Special Provision) Act, 1985. The defaults /
delay reported above include defaults / delay before and after
aforesaid reschedulement.
In December 2011, the Company has received refund of interest on Cash
Credit limit, interest on working capital Indian rupee term loan and
penal interest aggregating to Rs.1,33,75,163/- from Union Bank of
India, Operating Agency, on account of concession in interest rate from
the cut-off date 1st October, 2008 from which the Company is declared
as sick unit, to 30th September 2011 in accordance with scheme
sanctioned by the BIFR. The effect of refund of interest in calculating
delay(s) / default(s) have not been considered till the date of receipt
of the said interest from the Bank.
xii) According to the informations and explanations given 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
beneft fund/ society. Therefore, the provisions of clause 4 (xiii) of
the Companies (Auditor's Report) Order, 2003 are not applicable to the
Company;
xiv) In our opinion, the Company is not dealing in or trading in
shares, securities, debentures and other investments. Accordingly, the
provisions of clause 4 (xiv) of the Companies (Auditor's Report) Order,
2003 are not applicable to the Company;
xv) According to the informations and explanations given to us, the
Company has not given any guarantee for loan taken by others from bank
or fnancial institutions;
xvi) In our opinion, the term loans raised during the year have been
applied for the purpose for which they were raised;
xvii) According to the informations and explanations given to us and on
an examination of the balance sheet of the Company, we report that fund
raised on short term basis amounting to Rs.22,01,53,359/- been used for
long term purposes including for accumulated losses;
xviii) According to the informations and explanations given to us, the
Company has not made any preferential allotment of shares to parties
and companies covered in the register maintained under Section 301 of
the Companies Act, 1956;
xix) According to the information and explanations given to us, the
Company has not issued debentures;
xx) According to the information and explanations given to us, the
Company has not raised money by public issues during the year;
xxi) According to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
For KHANDELWAL JAIN & CO.
Chartered Accountants,
Firm Regn. No. 105049W
(Narendra Jain)
Partner
Membership No.048725
Place : Mumbai
Date : 14th August, 2012
Mar 31, 2010
We have audited the attached Balance Sheet of GUJARAT THEMIS BIOSYN
LIMITED, as at 31st March 2010 and also the Profit and Loss Account and
the Cash Flow statement for the year ended on that date annexed
thereto. These financial statements are the responsibility of the
Companys Management. Our responsibility is to express an opinion on
these financial statements based on our audit.
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.
1. As required by the Companies (Auditors Report) Order, 2003 (As
Amended) issued by the Central Government of India in terms of
sub-section (4-A) of Section 227 of the Companies Act, 1956, we enclose
in the Annexure a statement on the matters specified in paragraphs 4 &
5 of the said Order, to the extent applicable to the Company.
2. Further to our comments in the annexure referred to in Paragraph 1
above, we report that: -
a. We have obtained all the informations and explanations, which to
the best of our knowledge and belief were necessary for the purposes of
our audit;
b. In our opinion, proper Books of Account as required by law, have
been kept by the Company so far as appears from our examination of
those books;
c. The Balance Sheet, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the Books of Account;
d. In our opinion, the Balance Sheet, Profit and Loss Account and Cash
Flow Statement dealt with by this report comply with the Accounting
Standards referred to in sub-section (3C) of Section 211 of the
Companies Act, 1956.
e. On the basis of the written representations received from the
directors as on March 31, 2010 and taken on record by the Board of
Directors, we report that none of the directors is disqualified as on
March 31, 2010 from being appointed as a director in terms of clause
(g) of sub-section (1) of section 274 of the Companies Act, 1956;
f. (i) Attention is invited to Note No. 8 of schedule 20 and paragraph
(i) of Annexure to this Report, regarding non-maintenance of proper
records showing full particulars including quantitative details and
situation of fixed assets and no physical verification of such fixed
assets carried out by the management during the year. Consequently,
the discrepancies if any between the book records and the physical
availability of assets could not be ascertained. However in the opinion
of management there will be no material discrepancies between Fixed
Assets records as per Books and its physical availability.
(ii) Attention is invited to Note No. 18 of Schedule 20 of the accounts
regarding write back of sundry credit balances of Rs.35,18,539/- based
on a review undertaken of old outstanding balances of Sundry Creditors
& Provisions.
g. (i) Note No. 7 of Schedule 20 regarding preparation of accounts on
the basis of a going concern in spite of loss of Rs.
1,08,34,838/-incurred during the year and brought forward losses of
Rs. 23,54,73,998./-, which has resulted in negative net worth ofRs.
Rs. 12,17,43,923/- as at 31s March, 2010. The Company also has working
capital deficiency. The company is also a sick company within the
meaning of Section 3 (1) (o) of the Sick Industrial Companies (Special
Provisions) Act 1985 and the Company has been registered with the BIFR.
These factors raise doubts about, the Companys ability to continue as
a going concern which is dependent upon infusion of long terms funds
for its future operations. The accompanying financial statements do not
include any adjustments relating to the recoverability and
classification of assets carrying amounts or the amount and
classification of liabilities that might result, should the Company be
unable to continue as a going concern.
(ii) The outstanding balances as at 31s March, 2010 in respect of some
sundry debtors, deposits, loans & advances and sundry creditors are
subject to confirmation from respective parties and consequential
reconciliation and adjustment arising there from, if any. (Refer note
no. 9 (a) of Schedule 20) Consequential impact thereof on the financial
statements is not ascertainable.
3. In our opinion and to the best of our information and according to
the explanations given to us, the said Accounts, subject to our
comments in paragraph 2(g) above consequential cumulative effect
thereof is not ascertainable and read together with significant
accounting policies and notes thereon, give the information required by
the Companies Act, 1956, 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 31st March, 2010 and
b) in the case of the Profit and Loss Account, of the Loss for the year
ended on that date.
c) in case of the Cash Flow Statement, of the cash flows for the year
ended on that date.
ANNEXURE REFERRED TO IN PARAGRAPH 1 OF OUR REPORT OF EVEN DATE ON THE
ACCOUNTS FOR THE YEAR ENDED 31st MARCH 2010 OF GUJARAT THEMIS BIOSYN
LIMITED
On the basis of such checks, as we considered appropriate and in terms
of the information and explanations given to us, we state that: -
i) a) The Company has not maintained proper records showing full
particulars including quantitative details and situation of its assets.
b) We were informed that the fixed assets were not physically verified
by the management, during the year. Hence, the discrepancies if any
between book records and physical availability could not be
ascertained;
c) We were informed that, no substantial part of fixed assets of
company have been disposed off during the year.
ii) a) The inventory has been physically verified during the year by
the management. In our opinion, the frequency of verification is
reasonable;
b) According to the information and explanations given to us, the
procedures followed for physical verification of the inventory are, in
our opinion, reasonable and adequate in relation to the size of the
Company and the nature of its business;
c) According to the records produced before us for our verification,
there were no material discrepancies noticed on physical verification
of stocks referred to in Para 2(a) above as compared to the book
records and the same have been properly dealt with in the books of
account of the Company;
iii) a) According to the information and explanations given to us, the
Company has not granted any loans, secured or unsecured, to any
Companies, Firms or other Parties listed in the register maintained
under Section 301 of the Companies Act, 1956.
b) Since 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 provisions of clause 4
(iii) (b) (c) (d) are not applicable to the company.
c) Further, according to the information and explanations given to us,
the outstanding royalty amount payable to Yuhan Corporation has been
treated as interest free unsecured Loan (The Amount and the year-end
balance Rs.3,95,10,377/-). Except the above, company has not taken any
Loans, Secured or unsecured from Companies, Firms or other Parties in
the register maintained under section 301 of the Companies Act, 1956; -
d) In our opinion, the rate of interest and other terms and conditions
of loans taken by the company, secured or unsecured, are prima facie
not prejudicial to the interest of the company;
e) As informed to us, there is regular repayment of principal and
interest amounts in respect of loan taken by company, wherever
stipulated;
iv) In our opinion and according to the information and explanations
given to us, there are adequate internal control systems commensurate
with the size of the company and the nature of its business with
regards to purchase of inventory and fixed assets and with regards to
sale of goods and services. During the course of our audit, we have not
observed any continuing failure to correct major weaknesses in internal
controls system;
v) a) According to the information and explanations given to us and
based on our verification, we are of the opinion that the transactions
that need to be entered into the register maintained under section 301
of the Companies Act, 1956 have been entered;
b) Further, according to the information and explanations given to us,
each of these transactions made in pursuance of such contracts or
arrangements have been made at prices which are reasonable having
regard to the prevailing market prices at the relevant time;
vi) According to the information and explanations given to us, 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, in respect of the Companys products to which the said rules
are made applicable, 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;
ix) a) Undisputed Statutory Dues including Employees Provident Fund,
Employees State Insurance (ESIC), Central Sales Tax, Value Added Tax,
Tax Deducted at Source, Notified Area Tax, ESIC dues in respect of
contractors, Tax Collected at source and Profession Tax have not been
regularly deposited with the appropriate authorities as there have been
substantial delay in depositing such statutory dues.
Details of the arrears of undisputed statutory dues as on 31s March,
2010 which are outstanding for more than six months from the date they
became payable are as given below:
Sr. Nature of Dues Amount Year to which
No amount relates
1. Interest on Notified Area Tax 15,826 2005-2006
Interest on Notified Area Tax 42,510 2006-2007
Interest on Notified Area Tax 1,20,070 2007-2008
Interest on Notified Area Tax 1,69,094 2008-2009
Interest on Notified Area Tax 1,57,442 2009-2010
TOTAL 5,04,942
2. NA Charges 61,813 2007-2008
NA Charges 78,714 2008-2009
NA Charges 79,742 2009-2010
TOTAL 2,20,269
b) According to the information and explanation given to us, there are
no dues of Sales Tax, Service Tax, Income Tax, Customs Duty, Wealth
tax, Excise duty and Cess, which have not been deposited on account of
any dispute, except the following:
Name of Nature of Amount Period to
which Forum where
dispute
the Statute the Dues (Rs.) the amount
relates is pending
Income Tax Demand u/s 10,79,703/- A.Y. 2001-2002 Hon. High
Court,
Gujarat
143 (3)
Income Tax Demand u/s 7,65,703/- A.Y. 2007-2008 Hon. Commiss
ioner of In
come
143 (3) r.w.s.
254 tax (Appeals)
Valsad
Income Tax Demand u/s 2,53,647/- A.Y. 2009-2010 Hon. Commiss
ioner of In
come
(TDS) 201(1)/201
(1A) tax (Appeals)
Valsad
x) The accumulated losses of the company are more than fifty percent of
its net worth. The company has, without considering the effect of our
comments in the paragraph 2 (f)(i) & (g) in the main report, has
incurred cash losses during the financial year covered by our audit. It
had incurred cash losses in the immediately preceding financial year
also, without considering the effects of our comments made in paragraph
2 (f)(i) & (g) of our Auditors Report for the said financial year.
xi) In our opinion and according to the information and explanations
given to us, the company has defaulted in repayment of dues to a
financial institution, bank or debenture holders. Details of such
defaults is given as under :-
(a) in case of Gujarat Industrial Investment Corporation Limited
(GIIC), where repayment of unsecured loan amounting to Rs. 26,00,000/-
has not been made as in the opinion of the company, GIIC is also a
promoter and as per the BIFR sanctioned scheme the loan which was
subordinated to the dues of the Banks and Financial Institutions would
be repaid only after clearing the dues to banks and Financial
Institutions.
(b) In case of working capital term loan taken from Union Bank of
India, the details of defaults/delay in repayments of principal are as
under: -
Period Of Default Amount Remarks
Less than 30 Days 13,33,000 Including Rs.13,33,000
outstanding as on 31.03.2010
30 to 90 days 1,48,60,381 Including Rs.13,33,000
outstanding as on 31.03.2010
90 to 120 Days 5,098 Rs.NIL outstanding as on
31.03.2010
More than 120 days 30,000 Rs.NIL outstanding as on
31.03.2010
(c) In case of working capital term loan taken from Union Bank of
India, the details of defaults/delay in payment of interest are as
under: -
Period of Default Amount Remarks
Less than 30 Days 9,20,083 Including Rs.9,20,083
outstanding as on 31.03.2010
30 to 90 days 1,30,03,822 Including Rs.8,47,173
outstanding as on 31.03.2010
90 to 120 Days 44,290 Rs.NIL outstanding as on
31.03.2010
(d) In case of cash credit taken from Union Bank of India, the details
of defaults/delay in payment of interest are as under-
Period of Default Amount Remarks
Less than 30 Days 28,31,829 Including Rs.2,42,697
outstanding as on 31.03.2010
(e) Letters of Credit issued by Union Bank of India have devolved and
details of defaults/delay in repayments of principal of the same are as
under:
Period of Default Amount Remarks
Less than 30 Days 15,73,539 Rs.NIL outstanding as on
31.03.2010
30 to 90 days 45,99,554 Rs.NIL outstanding as on
31.03.2010
90 to 120 Days 54,00,784 Rs.NIL outstanding as on
31.03.2010
More than 120 days 6,05,679 Rs.NIL outstanding as on
31.03.2010
(f) Letters of Credit issued by Union Bank of India have devolved and
details of defaults/delay in payment of interest on the same are as
under:
Period of Default Amount Remarks
Less than 30 Days 1,82,279 Including Rs.5,982
outstanding as on
31.03.2010
30 to 90 days 2,43,510 Rs.NIL outstanding as on
31.03.2010
xii) According to the informations and explanations given 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 (Auditors Report) Order, 2003 are not applicable to the
company;
xiv) In our opinion, the company is not dealing in or trading in
shares, securities, debentures and other investments. Accordingly, the
provisions of clause 4 (xiv) of the Companies (Auditors Report) Order,
2003 are not applicable to the company;
xv) According to the informations and explanations given to us, the
Company has not given any guarantee for loan taken by others from bank
or financial institutions;
xvi) In our opinion, the term loans raised during the year have been
applied for the purpose for which they were raised;
xvii) According to the informations and explanations given to us and on
an examination of the balance sheet of the company, we report that fund
raised on short term basis amounting to Rs.8,49,57,208/- been used for
long term purposes including for accumulated losses;
xviii) According to the informations and explanations given to us, the
Company has not made any preferential allotment of shares to parties
and companies covered in the register maintained under Section 301 of
the Companies Act, 1956;
xix) According to the information and explanations given to us, the
Company has not issued debentures;
xx) According to the information and explanations given to us, the
Company has not raised money by public issues during the year;
xxi) According to the information and explanations given to us, no
fraud on or by the company has been noticed or reported during the
course of our audit.
For KHANDELWAL JAIN & CO.
Chartered Accountants,
Firm Regn. No. 105049W
(NARENDRA JAIN)
Place : Mumbai PARTNER
Date : 21st May, 2010 Membership No.048725