Mar 31, 2023
REPORT ON THE AUDIT OF THE STANDALONE IND AS FINANCIAL STATEMENTS OPINION
We have audited the accompanying standalone Ind AS financial statements of Hindustan Zinc Limited (âthe Companyâ), which comprise the Balance sheet as at March 31 2023, the Statement of Profit and Loss, including the statement of Other Comprehensive Income, the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and notes to the standalone Ind AS financial statements, including a summary of significant accounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS financial statements give the information required by the Companies Act, 2013, as amended (âthe Actâ) 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 31,2023, its profit including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.
We conducted our audit of the standalone Ind AS financial statements in accordance with the Standards on Auditing (SAs), as specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the âAuditor''s Responsibilities for the Audit of the Standalone Ind AS Financial Statements'' section of our report. We are independent of the Company in accordance with the âCode of Ethics'' issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone Ind AS financial statements for the financial year ended March 31,2023. These matters were addressed in the context of our audit of the standalone Ind AS financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. For each matter below, our description of how our audit addressed the matter is provided in that context.
We have determined the matters described below to be the key audit matters to be communicated in our report. We have fulfilled the responsibilities described in the Auditor''s responsibilities for the audit of the standalone Ind AS financial statements section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the standalone Ind AS financial statements. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying standalone Ind AS financial statements.
Key audit matters |
How our audit addressed the key audit matter |
Claims and exposure relating to taxation and litigation (as described in Note 3(III)(B), 30 and 32 of the standalone Ind AS financial statements) |
|
The Company is subject to several legal and tax related claims and exposures which have been either disclosed |
Our audit procedures included the following: |
or accounted for in the accompanying standalone Ind |
⢠Gained an understanding of the process of identification of |
claims, litigations and contingent liabilities and identified key |
|
Taxation and litigation exposures have been identified |
controls in the process. For selected controls, we have performed test of controls. |
as a key audit matter due to complexities involved in |
⢠Obtained the year end summary of Company''s legal and tax |
these matters, timescales involved for resolution and |
cases and critically assessed management''s position through |
the potential financial impact of these on the standalone |
discussions with the Legal Counsel, Head of Tax and operational |
Ind AS financial statements. Further, significant |
management, on both the probability of success in significant |
management judgement is involved in assessing the exposure of each case and thus a risk that such cases |
cases, and the magnitude of any potential loss. |
may not be adequately provided for or disclosed. Accordingly, this matter has been identified as a |
⢠Inspected external legal opinions and/ or past judicial orders, wherever considered necessary, and other evidence to evaluate the management''s assessment in respect of legal claims. |
key audit matter. |
⢠Engaged tax specialists to technically assess the management''s assessment on tax disputes and positions. ⢠Assessed the relevant disclosures made within the standalone Ind AS financial statements to address whether they reflect the facts and circumstances of the respective tax and legal exposures as per the requirements of relevant accounting standards. |
Accounting and disclosure of transactions with the related parties (as described in note 37 of the standalone Ind AS financial statements) |
|
The Company has undertaken transactions with related parties including parent company and fellow |
Our procedures included the following: |
subsidiaries for payment of strategic services and brand |
⢠Obtained and read the Company''s policies, processes and |
fee, power delivery agreements, residue treatment |
procedures in respect of identification of such related parties |
contract and IT service agreement. |
in accordance with relevant laws and standards, obtaining approval, recording and disclosure of related party transactions |
Accounting and disclosure of such related |
and identified key controls. For selected controls we have |
party transactions has been identified as a key audit matter due to |
performed tests of controls. ⢠On sample basis tested some related party transactions and balances with the underlying contracts, confirmation letters and |
a) Significance of such related party transactions; |
other supporting documents provided by the Company. |
b) Risk of such transactions being executed without |
⢠Examined, where applicable the approvals of the board and |
proper authorizations; |
audit committee of these transactions. ⢠Obtained and read the reports including the benchmarking |
c) Risk of material information relating to aforesaid |
report issued by the experts engaged by the management for |
transactions not getting disclosed in the standalone |
the payment towards strategic services and brand fees, Power |
Ind AS financial statements. |
delivery agreement & residue treatment contract. ⢠Assessed the competence and objectivity of the external experts. ⢠Engaged internal specialists to assist us in evaluating the arms-length assessment carried out by the management for payment towards strategic services and brand fees. ⢠Held discussions and obtained representations from the management in relation to such transactions. ⢠Read the disclosures made in this regard in the financial statements and assessed whether relevant and material information have been disclosed. |
INFORMATION OTHER THAN THE FINANCIAL STATEMENTS AND AUDITORâS REPORT THEREON
The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in the Annual report, but does not include the standalone Ind AS financial statements and our auditor''s report thereon.
Our opinion on the standalone Ind AS financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone Ind AS financial statements, our responsibility is to read the other information and, in doing so, consider whether such other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
RESPONSIBILITIES OF MANAGEMENT FOR THE STANDALONE IND AS FINANCIAL STATEMENTS
The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these standalone Ind AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended. 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 the design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the standalone Ind AS financial statements, management is responsible for assessing the Company''s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those Board of Directors are also responsible for overseeing the Company''s financial reporting process.
AUDITORâS RESPONSIBILITIES FOR THE AUDIT OF THE STANDALONE IND AS FINANCIAL STATEMENTS
Our objectives are to obtain reasonable assurance about whether the standalone Ind AS financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone Ind AS financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
⢠Identify and assess the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
⢠Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to financial statements in place and the operating effectiveness of such controls.
⢠Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
⢠Conclude on the appropriateness of management''s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company''s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor''s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor''s report. However, future events or conditions may cause the Company to cease to continue as a going concern.
⢠Evaluate the overall presentation, structure and content of the standalone Ind AS financial statements, including the disclosures, and whether the standalone Ind AS financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone Ind AS financial statements for the financial year ended March 31, 2023 and are therefore the key audit matters. We describe these matters in our auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
1. As required by the Companies (Auditor''s Report) Order, 2020 (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 âAnnexure 1â a statement on the matters specified in paragraphs 3 and 4 of the Order.
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 including the Statement of Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;
(d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015, as amended;
(e) On the basis of the written representations received from the directors as on March 31, 2023 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2023 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 with reference to these standalone Ind AS financial statements and the operating effectiveness of such controls, refer to our separate Report in âAnnexure 2â to this report;
(g) I n our opinion, the managerial remuneration for the year ended March 31, 2023 has been paid / provided by the Company to its directors in accordance with the provisions of section 197 read with Schedule V to the Act;
(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, as amended 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 standalone Ind AS financial statements - Refer Note 30 and 32 to the standalone Ind AS financial statements;
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company
iv. a) The management has represented that, to the best of its knowledge and belief, no funds have been advanced
or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities (âIntermediariesâ), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;
b) The management has represented that, to the best of its knowledge and belief, no funds have been received by the Company from any person(s) or entity(ies), including foreign entities (âFunding Partiesâ), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and
c) Based on such audit procedures performed that have been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (a) and (b) contain any material misstatement.
v. The interim dividends declared and paid by the Company during the year and until the date of this audit report is in accordance with section 123 of the Act.
vi. As proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 is applicable for the Company only w.e.f. April 1, 2023, reporting under this clause is not applicable.
For S.R. Batliboi & Co. LLP
Chartered Accountants
ICAI Firm Registration Number: 301003E/E300005
per Tridevlal Khandelwal
Partner
Membership Number: 501160
UDIN: 23501160BGYHCB6377
Place of Signature: Pune
Date: April 21, 2023
Mar 31, 2022
REPORT ON THE AUDIT OF THE STANDALONE IND AS FINANCIAL STATEMENTS
Opinion
We have audited the accompanying standalone Ind AS financial statements of Hindustan Zinc Limited (âthe Companyâ), which comprise the Balance sheet as at March 31 2022, the Statement of Profit and Loss, including the statement of Other Comprehensive Income, the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and notes to the standalone Ind AS financial statements, including a summary of significant accounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS financial statements give the information required by the Companies Act, 2013, as amended (âthe Actâ) 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, 2022, its profit including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.
Basis for Opinion
We conducted our audit of the standalone Ind AS financial statements in accordance with the Standards on Auditing (SAs), as specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the âAuditorâs Responsibilities for the Audit of the Standalone Ind AS Financial Statementsâ section of our report. We are independent of the Company in accordance with the âCode of Ethicsâ issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone Ind AS financial statements for the financial year ended March 31, 2022. These matters were addressed in the context of our audit of the standalone Ind AS financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. For each matter below, our description of how our audit addressed the matter is provided in that context.
We have determined the matters described below to be the key audit matters to be communicated in our report. We have fulfilled the responsibilities described in the Auditorâs responsibilities for the audit of the standalone Ind AS financial statements section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the standalone Ind AS financial statements. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying standalone Ind AS financial statements.
Key audit matters |
How our audit addressed the key audit matter |
Claims and exposure relating to taxation and litigation (as described in Note 3(III)(B), 30 and 32 of the standalone Ind AS |
|
financial statements) |
|
The Company is subject to several legal and |
Our audit procedures included the following: |
tax related claims and exposures which have |
⢠Gained an understanding of the process of identification of claims, |
been either disclosed or accounted for in the |
litigations and contingent liabilities and identified key controls in the |
accompanying financial statements. |
process. For selected controls, we have performed test of controls. |
Taxation and litigation exposures have been identified as a key audit matter due to complexities involved in these matters, timescales involved for resolution and the potential financial impact of these on the |
⢠Obtained the summary of Companyâs legal and tax cases and critically assessed managementâs position through discussions with the Legal Counsel, Head of Tax and operational management, on both the probability of success in significant cases, and the magnitude of any potential loss. |
financial statements. Further, significant |
⢠Inspected external legal opinions and/or past judicial orders, wherever |
management judgement is involved in |
considered necessary, and other evidence to corroborate managementâs |
assessing the exposure of each case and thus |
assessment in respect of legal claims. |
a risk that such cases may not be adequately |
⢠Engaged tax specialists to technically assess the managementâs |
provided for or disclosed. |
assessment on tax disputes and positions. |
⢠Assessed the relevant disclosures made within the financial statements |
|
Accordingly, this matter has been identified as a |
to address whether they reflect the facts and circumstances of the |
key audit matter. |
respective tax and legal exposures as per the requirements of relevant accounting standards. |
Information Other than the Financial Statements and Auditorâs Report Thereon
The Companyâs Board of Directors is responsible for the other information. The other information comprises the information included in the Annual report, but does not include the standalone Ind AS financial statements and our auditorâs report thereon.
Our opinion on the standalone Ind AS financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone Ind AS financial statements, our responsibility is to read the other information and, in doing so, consider whether such other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of Management for the Standalone Ind AS Financial Statements
The Companyâs Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these standalone Ind AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended. 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 the design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the standalone Ind AS financial statements, management is responsible for assessing the Companyâs ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those Board of Directors are also responsible for overseeing the Companyâs financial reporting process.
Auditorâs Responsibilities for the Audit of the Standalone Ind AS Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalone Ind AS financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditorâs report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will
always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone Ind AS financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
⢠I dentify and assess the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
⢠Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to financial statements in place and the operating effectiveness of such controls.
⢠Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
⢠Conclude on the appropriateness of managementâs use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Companyâs ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditorâs report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditorâs report. However, future events or conditions may cause the Company to cease to continue as a going concern.
⢠Evaluate the overall presentation, structure and content of the standalone Ind AS financial statements, including the disclosures, and whether the standalone Ind AS financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone Ind AS financial statements for the financial year ended March 31, 2022 and are therefore the key audit matters. We describe these matters in our auditorâs report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditorâs Report) Order, 2020 (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 âAnnexure 1â a statement on the matters specified in paragraphs 3 and 4 of the Order.
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 including the Statement of Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;
(d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015, as amended;
(e) On the basis of the written representations received from the directors as on March 31,2022 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2022 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 with reference to these standalone Ind AS financial statements and the operating effectiveness of such controls, refer to our separate Report in âAnnexure 2â to this report;
(g) In our opinion, the managerial remuneration for the year ended March 31, 2022 has been paid / provided by the Company to its directors in accordance with the provisions of section 197 read with Schedule V to the Act;
(h) With respect to the other matters to be included in the Auditorâs Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its standalone Ind AS financial statements - Refer Note 30 and 32 to the standalone Ind AS financial statements;
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company
iv. a) The management has represented that, to the best of its knowledge and belief, no funds have been
advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the company to or in any other person(s) or entity(ies), including foreign entities (âIntermediariesâ), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;
b) The management has represented that, to the best of its knowledge and belief, no funds have been received by the company from any person(s) or entity(ies), including foreign entities (âFunding Partiesâ), with the understanding, whether recorded in writing or otherwise, that the company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and
c) Based on such audit procedures that were considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (a) and (b) contain any material misstatement.
v. The interim dividend paid during the year by the Company is in compliance with section 123 of the Act.
Chartered Accountants
ICAI Firm Registration Number: 301003E/E300005
Partner
Membership Number: 501160
UDIN: 22501160AHPFFM8630
Place of Signature: Pune
Date: April 22, 2022
Mar 31, 2021
To the Members of Hindustan Zinc Limited
REPORT ON THE AUDiT OF THE IND AS FiNANCiAL STATEMENTS Opinion
We have audited the accompanying Ind AS financial statements of Hindustan Zinc Limited ("the Companyâ), which comprise the Balance sheet as at March 31, 2021, the Statement of Profit and Loss, including the statement of Other Comprehensive Income, the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and notes to the Ind AS financial statements, including a summary of significant accounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Ind AS financial statements give the information required by the Companies Act, 2013, as amended ("the Actâ) 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, 2021, its profit including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.
Basis for Opinion
We conducted our audit of the Ind AS financial statements in accordance with the Standards on Auditing (SAs), as specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the ''Auditor''s Responsibilities for the Audit of the Ind AS Financial Statements'' section of our report. We are independent of the Company in accordance with the ''Code of Ethics'' issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. 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.
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Ind AS financial statements for the financial year ended March 31,2021. These matters were addressed in the context of our audit of the Ind AS financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. For each matter below, our description of how our audit addressed the matter is provided in that context.
We have determined the matters described below to be the key audit matters to be communicated in our report. We have fulfilled the responsibilities described in the Auditor''s responsibilities for the audit of the Ind AS financial statements section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the Ind AS financial statements. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying Ind AS financial statements.
Key audit matters |
How our audit addressed the key audit matter |
(a) claims and exposure relating to taxation and litigation (as described in Note 3(iii)(B), 29 and 31 of the Ind AS financial statements) |
|
The Company is subject to several legal and tax |
Our audit procedures included the following: |
related claims which have been either been disclosed |
⢠Gained an understanding of the process of identification of |
or accounted for in the accompanying financial |
claims, litigations and contingent liabilities and identified |
statements. |
key controls in the process. For selected controls, we have performed test of controls. |
Taxation and litigation exposures have been identified |
⢠Obtained the summary of Company''s legal and tax cases and |
as a key audit matter due to complexities involved in |
critically assessed management''s position through discussions |
these matters, timescales involved for resolution and |
with the Legal Counsel, Head of Tax and operational |
the potential financial impact of these on the financial |
management, on both the probability of success in significant |
statements. Further, significant management |
cases, and the magnitude of any potential loss. |
judgement is involved in assessing the exposure of |
⢠1 nspected external legal opinions and/or past judicial orders, |
each case and thus a risk that such cases may not be |
wherever considered necessary, and other evidence to |
adequately provided for or disclosed. |
corroborate management''s assessment in respect of legal claims. |
Accordingly, this matter has been identified as a key |
⢠Engaged tax specialists to technically assess the management''s |
audit matter. |
positions on tax disputes ⢠Assessed the relevant disclosures made within the financial statements to address whether they reflect the facts and circumstances of the respective tax and legal exposures as per the requirements of relevant accounting standards. |
We have determined that there are no other key audit matters to communicate in our report. information Other than the Financial Statements and Auditor''s Report Thereon
The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in the Annual report, but does not include the Ind AS financial statements and our auditor''s report thereon.
Our opinion on the Ind AS financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the Ind AS financial statements, our responsibility is to read the other information and, in doing so, consider whether such other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of Management for the ind AS financial Statements
The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these Ind AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended. 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 the 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 Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the Ind AS financial statements, management is responsible for assessing the Company''s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those Board of Directors are also responsible for overseeing the Company''s financial reporting process.
Auditor''s Responsibilities for the Audit of the ind AS Financial Statements
Our objectives are to obtain reasonable assurance about whether the Ind AS financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Ind AS financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
⢠Identify and assess the risks of material misstatement of the Ind AS financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
⢠Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to financial statements in place and the operating effectiveness of such controls.
⢠Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
⢠Conclude on the appropriateness of management''s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company''s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor''s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor''s report. However, future events or conditions may cause the Company to cease to continue as a going concern.
⢠Evaluate the overall presentation, structure and content of the Ind AS financial statements, including the disclosures, and whether the Ind AS financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the Ind AS financial statements for the financial year ended March 31, 2021 and are therefore the key audit matters. We describe these matters in our auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2016 ("the 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 1â a statement on the matters specified in paragraphs 3 and 4 of the Order.
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 including the Statement of Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;
(d) In our opinion, the aforesaid Ind AS financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015, as amended;
(e) On the basis of the written representations received from the directors as on March 31, 2021 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2021 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 with reference to these Ind AS financial statements and the operating effectiveness of such controls, refer to our separate Report in "Annexure 2â to this report;
(g) In our opinion, the managerial remuneration for the year ended March 31, 2021 has been paid / provided by the Company to its directors in accordance with the provisions of section 197 read with Schedule V to the Act;
(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, as amended 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 Ind AS financial statements - Refer Note 29 and 31 to the Ind AS financial statements;
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company
Chartered Accountants
ICAI Firm Registration Number: 301003E/E300005
Partner
Membership Number: 41870 UDIN: 21041870AAAAAL8314
Place of Signature: Mumbai Date: April 27, 2021
Mar 31, 2019
Independent Auditor''s Report
TO THE MEMBERS OF HINDUSTAN ZINC LIMITED REPORT ON THE AUDIT OF THE IND AS FINANCIAL STATEMENTS
Opinion
We have audited the accompanying Ind AS financial statements of Hindustan Zinc Limited ("the Company"), which comprise the Balance Sheet as at March 31,2019, the Statement of Profit and Loss, including the statement of Other Comprehensive Income, the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and notes to the financial statements, including a summary of significant accounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Ind AS financial statements give the information required by the Companies Act, 2013, as amended ("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 31,2019, its profit including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.
Basis for Opinion
We conducted our audit of the Ind AS financial statements in accordance with the Standards on Auditing (SAs), as specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the ''Auditor''s Responsibilities for the Audit of the Ind AS Financial Statements'' section of our report. We are independent of the Company in accordance with the ''Code of Ethics'' issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. 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.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Ind AS financial statements for the financial year ended March 31, 2019. These matters were addressed in the context of our audit of the Ind AS financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. For each matter below, our description of how our audit addressed the matter is provided in that context.
We have determined the matters described below to be the key audit matters to be communicated in our report. We have fulfilled the responsibilities described in the Auditor''s Responsibilities for the Audit of the Ind AS Financial Statements section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the Ind AS financial statements. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the Ind AS financial statements.
Key audit matters |
How our audit addressed the key audit matter |
Claims and exposure relating to taxation and litigation (as described in Note 3(III)(B) and 29 of the Ind AS financial statements). |
|
The Company is subject to a large number of legal and tax related claims which have been disclosed /provided for in the financial statements based on the facts and circumstances of each case. Taxation and litigation exposures have been identified as a key audit matter due to complexities involved in these matters, times-cales involved for resolution and the potential financial impact of these on the financial statements. Further, significant management judgement is involved in assessing the exposure of each case and thus a risk that such cases may not be adequately provided for or disclosed. |
Our audit procedures included the following:- Gained an understanding of the process of identification of claims, litigations and contingent liabilities and identified key controls in the process. For selected controls, we have performed tests of controls. Obtained the summary of Company''s legal and tax cases and critically assessed management''s position through discussions with the Legal Counsel, Head of Tax and operational management, on both the probability of success in significant cases, and the magnitude of any potential loss. Inspected external legal opinions, wherever considered necessary, and other evidence to corroborate management''s assessment of the risk profile in respect of legal claims. Engaged tax specialists to technically appraise the tax position taken by the management with respect to local tax issues. Assessed the relevant disclosures made within the financial statements to address whether they appropriately reflect the facts and circumstances of the respective tax and legal exposures and the requirements of relevant accounting standards. |
Key audit matters |
How our audit addressed the key audit matter |
Revenue recognition (as described in Note 3(I) (d) and 20 of the Ind AS financial statements) |
|
We have identified revenue recognition cut-off as a key audit matter, since the variety of terms that define when control is transferred to the customer, as well as the high value of the transactions near the period end, give rise to the risk that revenue is not recognised in the correct period. |
Our audit procedures included the following:- Considered the appropriateness of the Company''s revenue recognition accounting policies and assessing compliance with the policies in terms of Ind AS 115. Performed walkthroughs and test of controls, assisted by IT specialists, of the revenue recognition processes and assessed the design and operating effectiveness of key controls. Selected a sample of sales made pre and post year end, and agreed the date of revenue recognition to the contract terms as per the agreement and third party delivery documents, such as bills of lading, to confirm sales are recognized according to contract conditions. |
We have determined that there are no other key audit matters to communicate in our report.
Information Other than the Financial Statements and Auditor''s Report Thereon
The Company''s Board of Directors is responsible for the Other Information. The Other Information comprises the information included in the Annual report, but does not include the Ind AS financial statements and our auditor''s report thereon.
Our opinion on the Ind AS financial statements does not cover the Other Information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the Ind AS financial statements, our responsibility is to read the Other Information and, in doing so, consider whether such Other Information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this Other Information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of Management for the Ind AS Financial Statements
The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these Ind AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended. 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 the 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 Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the Ind AS financial statements, management is responsible for assessing the Company''s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Board of Directors are also responsible for overseeing the Company''s financial reporting process.
Auditor''s Responsibilities for the Audit of the Ind AS Financial Statements
Our objectives are to obtain reasonable assurance about whether the Ind AS financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Ind AS financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the Ind AS financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such controls.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management''s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company''s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor''s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor''s report. However, future events or conditions may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the Ind AS financial statements, including the disclosures, and whether the Ind AS financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the Ind AS financial statements for the financial year ended March 31, 2019 and are therefore the key audit matters. We describe these matters in our auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2016 ("the Order"), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give
in the "Annexure 1" a statement on the matters specified in paragraphs 3 and 4 of the Order.
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 including the Statement of Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;
(d) In our opinion, the aforesaid Ind AS financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015, as amended;
(e) On the basis of the written representations received from the directors as on March 31, 2019 and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2019 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 with reference to these Ind AS financial statements and the operating effectiveness of such controls, refer to our separate Report in "Annexure 2" to this report;
(g) In our opinion, the managerial remuneration for the year ended March 31, 2019 has been paid / provided by the Company to its directors in accordance with the provisions of section 197 read with Schedule V to the Act;
(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, as amended, 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 Ind AS financial statements - Refer Note 29 to the Ind AS financial statements;
ii. The Company did not have any long term contracts including derivative contracts for which there were any material foreseeable losses;
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
For S.R. Batliboi & Co. LLP Chartered Accountants ICAI Firm Registration Number: 301003E/E300005 per Raj Agrawal Partner Membership Number: 82028 Place of Signature: Gurugram Date: May 02, 2019 |
annexure 1
Referred to in paragraph 1 under the heading "Report on other legal and regulatory Requirement''s of our report of even date
RE: HINDUSTAN ZINC LIMITED (''THE COMPANY'')
(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
(b) All fixed assets have not been physically verified by the management during the year but there is a regular programme of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.
(c) According to the information and explanations given by the management, the title deeds of immovable properties included in property, plant and equipment are held in the name of the Company.
(ii) The management has conducted physical verification of inventory at reasonable intervals during the year and no material discrepancies were noticed on such physical verification.
(iii) According to the information and explanations given to us, the Company has not granted any loans, secured or unsecured, to companies, firms, limited liability partnerships or other parties covered in the register maintained under section 189 of the Companies Act, 2013. Accordingly, the provisions of clause 3(iii) (a), (b) and (c) of the Order are not applicable to the Company and hence not commented upon.
(iv) In our opinion and according to the information and explanations given to us, there are no loans, investments, guarantees, and securities given in respect of which provisions of sections 185 and 186 of the Companies Act 2013 are applicable and hence not commented upon.
(v) The Company has not accepted any deposits within the meaning of sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended). Accordingly, the provisions of clause 3(v) of the Order are not applicable.
(vi) We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under section 148(1) of the Act, related to the manufacture of products and generation of electricity, and are of the opinion that prima facie, the specified accounts and records have been made and maintained. We have not, however, made a detailed examination of the same.
(vii) (a) The Company is regular in depositing with appropriate authorities undisputed statutory dues including provident fund, income-tax, sales-tax, service tax, duty of custom, duty of excise, value added tax, goods and services tax, cess and other statutory dues applicable to it. The provisions relating to employees'' state insurance are not applicable to the Company.
(b) According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, income-tax, service tax, sales-tax, duty of custom, duty of excise, value added tax, goods and services tax, cess and other statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable. The provisions relating to employees'' state insurance are not applicable to the Company.
(c) According to the records of the Company, the dues outstanding of income-tax, sales-tax, service tax, duty of custom, duty of excise, value added tax and cess on account of any dispute, are as follows:
Name of the statute |
Nature of the dues |
(Amount in Crore)* |
Period (Financial year) to which amount relates |
Forum where the dispute is pending |
Income tax act, 1961 |
Income tax |
1,601 |
1997-98 to 2010-11, 2014-2015 |
Commissioner of Income Tax (Appeals) |
2,677 |
1988-1989 to 1990-1991, 1992-1993, 1997-98, 2007-2008, 2012-13 to 2013-14 |
Income Tax Appellate Tribunal |
||
2,765 |
1989-90 to 2011-12 |
High Court/ Supreme Court |
||
Customs Act, 1962 |
Customs duty |
41 |
2008-09 to 2013-14 |
CESTAT |
Central Excise Act, 1944 |
Excise duty |
106 |
1989-90 to 1992-93, 1995-96 to 2016-17 |
CESTAT |
6 |
1999-02, 2002-03, 2006 to 2017-18 |
Commissioner (Appeals) |
||
7 |
1998-99, 2001-02 to 2014-15 |
High Court |
||
Rajasthan sales tax act, 1994 |
Sales tax |
62 |
1990-91 to 1991-92,1994-95 to 2003-04, 2005-06 to 2015-16 |
Deputy Commissioner (Appeals) |
4 |
2007-08 |
High Court |
||
Finance Act, 1994 |
Service tax |
23 |
2002-03 to 2016-17 |
Commissioner (Appeals) |
26 |
1997-98, 2004-05 to 2015-16 |
CESTAT |
||
19 |
2004-05 to 2011-12 |
High Court |
*Net of amount paid under protest / adjusted against refunds
(viii) In our opinion and according to the information and explanations given by the management, the Company has not defaulted in repayment of loans or borrowing to financial institutions or banks. The Company did not have any outstanding dues in respect of government and debenture holders during the year.
(ix) According to the information and explanations given by the management, the Company has not raised any monies by way of initial public offer / further public offer / debt instruments or term loans and accordingly, reporting under clause 3(ix) is not applicable to the Company and hence not commented upon.
(x) Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management, we report that no material fraud on the Company by the officers and employees of the Company has been noticed or reported during the year.
(xi) According to the information and explanations given by the management, the managerial remuneration has been paid / provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Act.
(xii) In our opinion, the Company is not a nidhi company.
Therefore, the provisions of clause 3(xii) of the Order are not applicable to the Company and hence not commented upon.
(xiii) According to the information and explanations given by the management, transactions with the related parties are in compliance with sections 177 and 188 of Companies Act, 2013 where applicable and the details have been disclosed in the notes to the financial statements, as required by the applicable accounting standards.
(xiv) According to the information and explanations given to us and on an overall examination of the balance sheet, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review and accordingly, reporting requirements under clause 3(xiv) are not applicable to the company and hence not commented upon.
(xv) According to the information and explanations given by the management, the Company has not entered into any non-cash transactions with directors or persons connected with him as referred to in section 192 of Companies Act, 2013.
(xvi) According to the information and explanations given to us, the provisions of section 45-IA of the Reserve Bank of India Act, 1934 are not applicable to the Company.
For S.R. Batliboi & Co. LLP
Chartered Accountants
ICAI Firm Registration Number: 301003E/E300005
per Raj Agrawal
Partner
Membership Number: 82028
Place: Gurugram Date: May 02, 2019
annexure 2
To the Independent Auditor''s Report of Even Date on the Financial Statements of Hindustan Zinc Limited
REPORT ON THE INTERNAL FINANCIAL CONTROLS UNDER CLAUSE (I) 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 Hindustan Zinc Limited ("the Company") as of March 31, 2019 in conjunction with our audit of the 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 under the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO 2013 criteria), which considers 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 the 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.
AUDITOR''S 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 as specified under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, 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 judgement, 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 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 authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.
INHERENT LIMITATIONS OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING
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, 2019, based on the internal control over financial reporting in COSO 2013 criteria, 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 S.R. Batliboi & Co. LLP
Chartered Accountants
ICAI Firm Registration Number: 301003E/E300005
per Raj Agrawal
Partner
Membership Number: 82028
Place: Gurugram Date: May 02, 2019
Mar 31, 2018
INDEPENDENT AUDITORâS REPORT
TO THE MEMBERS OF HINDUSTAN ZINC LIMITED
REPORT ON THE IND AS FINANCIAL STATEMENTS
We have audited the accompanying Ind AS financial statements of Hindustan Zinc Limited (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2018, the Statement of Profit and Loss including the statement of Other Comprehensive Income, the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information.
MANAGEMENTâS RESPONSIBILITY FOR THE IND AS 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 Ind AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act, read with the Companies (Indian Accounting Standards)
Rules, 2015, as amended. 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 the 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 Ind AS 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 Ind AS 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 of the Ind AS financial statements in accordance with the Standards on Auditing, issued by the Institute of Chartered Accountants of India, as 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 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 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. 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.
OPINION
In our opinion and to the best of our information and according to the explanations given to us, the 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, of the state of affairs of the Company as at March 31, 2018, its profits including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.
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 Act, we give in the Annexure 1 a statement on the matters specified in paragraphs 3 and 4 of the Order.
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 purpose of our audit;
(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;
(c) The Balance Sheet, Statement of Profit and Loss including the Statement of Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;
(d) In our opinion, the aforesaid Ind AS financial statements comply with the Accounting Standards specified under section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015, as amended;
(e) On the basis of written representations received from the directors as on March 31, 2018, and 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 with reference to these standalone Ind AS financial statements and the operating effectiveness of such controls, refer to our separate Report in âAnnexure 2â to this report;
(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 Ind AS financial statements - Refer note 30 to the financial statements;
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
Re: Hindustan Zinc Limited (âthe Companyâ)
(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
(b) All fixed assets have not been physically verified by the management during the year but there is a regular programme of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets.
No material discrepancies were noticed on such verification.
(c) According to the information and explanations given by the management, the title deeds of immovable properties included in property, plant and equipment are held in the name of the Company.
(ii) The management has conducted physical verification of inventory at reasonable intervals during the year and no material discrepancies were noticed on such physical verification.
(iii) According to the information and explanations given to us, the Company has not granted any loans, secured or unsecured, to companies, firms, limited liability partnerships or other parties covered in the register maintained under section 189 of the Act. Accordingly, the provisions of clause 3(iii)(a), (b) and (c) of the Order are not applicable to the Company and hence not commented upon.
(iv) In our opinion and according to the information and explanations given to us, there are no loans, investments, guarantees, and securities given in respect of which provisions of section 185 and 186 of the Act are applicable and hence not commented upon.
Name of the statute |
Nature of the dues |
Amount (Rs, in Crore)* |
Period (Financial year) to which amount relates |
Forum where the dispute is pending |
Income tax act, 1961 |
Income tax |
1,657 |
1997-98, 1998-99, 1999-00, 2000-01, 2001-02, 2002-03, 2003-04, 2004-05, 2005-06, 2006-07, 2007-08, 2013-14 |
Commissioner of Income tax (Appeals) |
1,489 |
1988-89, 1989-90, 1990-91, 1992-93, 1997-98, 2007-08, 2012-13 |
Income tax appellate Tribunal |
||
1,324 |
1989-90, 1990-91, 1991-92, 1992-93, 1993-94, 1994-95, 1995-96, 1996-97, 1998-99, 1999-00, 2000-01, 2001-02, 2002-03, 2003-04, 2004-05, 2005-06, 2006-07, 2007-08, 2008-09, 2009-10, 2010-11, 2011-12 |
High Court / Supreme Court |
||
Customs Act, 1962 |
Customs duty |
42 |
2008-09 to 2013-14 |
CESTAT |
(v) The Company has not accepted any deposits within the meaning of Sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended). Accordingly, the provisions of clause 3(v) of the Order are not applicable.
(vi) We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under section 148(1) of the Act, related to the manufacture of products and generation of electricity, and are of the opinion that prima facie, the specified accounts and records have been made and maintained. We have not, however, made a detailed examination of the same.
(vii) (a) The Company is regular in depositing with
appropriate authorities undisputed statutory dues including provident fund, income-tax, sales-tax, service tax, duty of custom, duty of excise, value added tax, goods and service tax, cess and other statutory dues applicable to it. The provisions relating to employees'' state insurance are not applicable to the Company.
(b) According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, income-tax, service tax, sales-tax, duty of custom, duty of excise, value added tax, goods and service tax, cess and other statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable. The provisions relating to employees'' state insurance are not applicable to the Company.
(c) According to the records of the Company, the dues outstanding of income-tax, sales-tax, service tax, duty of custom, duty of excise, value added tax and cess on account of any dispute, are as follows:
*Net of amount paid under protest / adjusted against refunds
Name of the statute |
Nature of the dues |
Amount (Rs, in Crore)* |
Period (Financial year) to which amount relates |
Forum where the dispute is pending |
Central Excise Act, 1944 |
Excise duty |
11 |
1991-92, 1995-96 to 2015-16 |
CESTAT |
11 |
1991-92, 1999-00 to 2003-04, 2005-06 to 2017-18 |
Commissioner (Appeals) |
||
1 |
1989-90 to 1992-93, 2002-03 to 2011-12 |
High Court |
||
Rajasthan sales tax act, 1994 |
Sales tax |
27 |
1985-86, 1990-91 to 1991-92,199495 to 2003-04,2005-06 to 2014-15, 2017-18 |
Deputy Commissioner (Appeals) |
4 |
2007-08 |
High Court |
||
Finance Act, 1994 |
Service tax |
17 |
2006-07 to 2016-17 |
Commissioner (Appeals) |
25 |
1997-98, 2004-05 to 2015-16 |
CESTAT |
(viii) In our opinion and according to the information and explanations given by the management, the Company has not defaulted in repayment of loans or borrowing to financial institutions. The Company did not have any outstanding dues in respect of banks, government or debenture holders during the year.
(ix) According to the information and explanations given by the management, the Company has not raised any monies by way of initial public offer / further public offer / debt instruments or term loans hence, reporting under clause 3(ix) is not applicable to the Company and hence not commented upon.
(x) Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management, we report that no material fraud on the Company by the officers and employees of the Company has been noticed or reported during the year.
(xi) According to the information and explanations given by the management, the managerial remuneration has been paid / provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Act.
(xii) In our opinion, the Company is not a nidhi company. Therefore, the provisions of clause 3(xii) of the Order are not applicable to the Company and hence not commented upon.
(xiii) According to the information and explanations given by the management, transactions with the related parties are in compliance with section 177 and 188 of Act where applicable and the details have been disclosed in the
notes to the financial statements, as required by the applicable accounting standards.
(xiv) According to the information and explanations given to us and on an overall examination of the balance sheet, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review and hence, reporting requirements under clause 3(xiv) of the Order are not applicable to the Company and, not commented upon.
(xv) According to the information and explanations given by the management, the Company has not entered into any non-cash transactions with directors or persons connected with him as referred to in section 192 of Act.
(xvi) According to the information and explanations given to us, the provisions of section 45-IA of the Reserve Bank of India Act, 1934 are not applicable to the Company.
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 Hindustan Zinc Limited (âthe Companyâ) 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.
managementâs responsibility FOR INTERNAL FINANOIAL CONTROLS
The Company''s Management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established under the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (âCOSO 2013 criteria''), which considers 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 the Company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.
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 as specified under section 143(10) of the Act, to the extent applicable to an audit of internal financial controls, 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 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, 2018, based on the internal control over financial reporting in COSO 2013 criteria, 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 S.R. Batliboi & Co. LLP
Chartered Accountants
ICAI Firm Registration Number: 301003E/E300005
per Raj Agrawal
Partner
Membership Number: 82028
Place: Gurugram
Date: April 30, 2018
Mar 31, 2017
Report on the Ind AS Financial Statements
We have audited the accompanying Ind AS financial statements of Hindustan Zinc Limited (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2017, the Statement of Profit and Loss, including Other Comprehensive Income, the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information.
Managementâs Responsibility for the Financial Statements
The Companyâs Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these Ind AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act, read with the Companies (Indian Accounting Standards) Rules, 2015, as amended. 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 the 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 Ind AS 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 Ind AS 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 of the Ind AS financial statements in accordance with the Standards on Auditing, issued by the Institute of Chartered Accountants of India, as 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 disclosures in the Ind AS financial statements. The procedures selected depend on the auditorâs 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 internal financial control relevant to the Companyâs 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 Companyâs Directors, as well as evaluating the overall presentation of the Ind AS financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Ind AS financial statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the 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, of the state of affairs of the Company as at March 31, 2017, its profits including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditorâs 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 1 a statement on the matters specified in paragraphs 3 and 4 of the Order.
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 purpose of our audit;
b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;
c) The Balance Sheet, Statement of Profit and Loss including Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;
d) In our opinion, the aforesaid Ind AS financial statements comply with the Accounting Standards specified under section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015, as amended;
e) On the basis of written representations received from the directors as on March 31, 2017, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2017, 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 Annexure 2 to this report;
g) With respect to the other matters to be included in the Auditorâs Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, 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 Ind AS financial statements - Refer Note 30 to the financial statements;
ii) The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;
iii) There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
iv) As per books of accounts of the Company and as represented by the management of the Company, the Company did not have cash balance as on November 8, 2016 and December 30, 2016 and has no cash dealings during this period.
Other Matter
The comparative financial information of the company for the year ended March 31, 2016 and the transition date opening balance sheet as at April 1, 2015 prepared in accordance with Ind AS, included in these Ind AS financial statements, have been audited by the predecessor auditor who had audited the financial statements for the relevant periods. The report of the predecessor auditor on the comparative financial information and the opening balance sheet dated April 20, 2017 expressed an unmodified opinion.
ANNEXURE1
REFERRED TO IN PARAGRAPH 1 UNDER THE HEADING âREPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTSâ OF OUR REPORT OF EVEN DATE
Re: Hindustan Zinc Limited (âthe Companyâ)
(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
(b) All fixed assets have not been physically verified by the management during the year but there is a regular programme of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.
(c) According to the information and explanations given by the management, the title deeds of immovable properties included in property, plant and equipment are held in the name of the Company.
(ii) The management has conducted physical verification of inventory at reasonable intervals during the year and no material discrepancies were noticed on such physical verification.
(iii) (a) The Company had granted loan to one company covered in the register maintained under section 189 of the Act. In our opinion and according to the information and explanations given to us, the terms and conditions of the grant of such loan was not prejudicial to the companyâs interest.
(b) The schedule of repayment of principal and payment of interest has been stipulated for the loan granted and the repayment/receipts were regular.
(c) There are no amounts of loan granted to the company listed in the register maintained under section 189 of the Act, which were overdue for more than ninety days.
(iv) In our opinion and according to the information and explanations given to us, there are no loans, investments, guarantees, and securities given in respect of which provisions of section 185 and 186 of the Act are applicable and hence not commented upon.
(v) The Company has not accepted any deposits within the meaning of Sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended). Accordingly, the provisions of clause 3(v) of the Order are not applicable.
(vi) We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under section 148(1) of the Act, related to the manufacture of products and generation of electricity, and are of the opinion that prima facie, the specified accounts and records have been made and maintained. We have not, however, made a detailed examination of the same.
(vii) (a) Undisputed statutory dues including provident fund, income-tax, sales-tax, service tax, duty of custom, duty of excise, value added tax, cess and other statutory dues have generally been regularly deposited with the appropriate authorities though there has been a slight delay in a few cases. The provisions relating to employeesâ state insurance are not applicable to the Company.
(b) According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, income-tax, service tax, sales-tax, duty of custom, duty of excise, value added tax, cess and other statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable. The provisions relating to employeesâ state insurance are not applicable to the Company.
(c) According to the records of the Company, the dues of income-tax, sales-tax, service tax, duty of custom, duty of excise, value added tax and cess on account of any dispute, are as follows:
Name of the statute |
Nature of the dues |
Amount * (Rs. in Crore) |
Period (Financial year) to which amount relates |
Forum where the dispute is pending |
Income tax act, 1961 |
Income tax |
2,558 |
1995-96, 1996-97, 1998-99, 2007-08, 2009-10, 2011-12, 2012-13 |
Commissioner of Income tax (Appeals) |
1,350 |
1988-89 to 1990-91, 1992-93, 1995-96, 1997-98, 1999-00 to 2008-09, 2010-11 |
Income Tax Appellate Tribunal |
||
113 |
1989-90 to 1996-97, 1998-99, 2000-01 to 2008-09 |
High Court / Supreme Court |
||
Customs Act, 1962 |
Customs duty |
42 |
2008-09 to 2013-14 |
CESTAT |
Central Excise Act, 1944 |
Excise duty |
304 |
1991-92, 1995-96 to 2015-16 |
CESTAT |
32 |
1997-98 to 2002-03, 2006-07 to 2015-16 |
Commissioner (Appeals) |
||
_** |
2002-03 to 2011-12 |
High Court |
||
Rajasthan sales tax act, 1994 |
Sales tax |
27 |
1994-95, 1996-97 to 2003-04 , 2005-06 to 2013-14 |
Deputy Commissioner (Appeals) |
Finance Act, 1994 |
Service tax |
20 |
2002-03 to 2004-05, 2007-08 to 2014-15 |
Commissioner (Appeals) |
38 |
1997-98, 1998-99, 2004-05 to 2015-16 |
CESTAT |
* Net of amounts paid under protest/adjusted against refunds
** Amount involved is Rs.44 Lakhs.
(viii) In our opinion and according to the information and explanations given by the management, the Company has not defaulted in repayment of loans or borrowings to financial institutions. The Company did not have any outstanding dues in respect of banks, government or debenture holders during the year.
(ix) According to the information and explanations given by the management, the Company has not raised any monies by way of initial public offer / further public offer / debt instruments or term loans hence, reporting under clause 3(ix) is not applicable to the Company and hence not commented upon.
(x) Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management, we report that no fraud by the Company or material fraud on the Company by the officers and employees of the Company has been noticed or reported during the year.
(xi) According to the information and explanations given by the management, the managerial remuneration has been paid / provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Act.
(xii) In our opinion, the Company is not a nidhi company. Therefore, the provisions of clause 3(xii) of the order are not applicable to the Company and hence not commented upon.
(xiii) According to the information and explanations given by the management, transactions with the related parties are in compliance with section 177 and 188 of Companies Act, 2013 where applicable and the details have been disclosed in the notes to the financial statements, as required by the applicable accounting standards.
(xiv) According to the information and explanations given to us and on an overall examination of the balance sheet, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review and hence, reporting requirements under clause 3(xiv) are not applicable to the Company and not commented upon.
(xv) According to the information and explanations given by the management, the Company has not entered into any non-cash transactions with directors or persons connected with them as referred to in section 192 of Companies Act, 2013.
(xvi) According to the information and explanations given to us, the provisions of section 45-IA of the Reserve Bank of India Act, 1934 are not applicable to the Company.
For S.R. Batliboi & CO. LLP
Chartered Accountants
ICAI Firm Registration Number: 301003E/E300005
per Raj Agrawal
Partner
Membership Number: 82028
Place: Mumbai Date: April 20, 2017
Mar 31, 2015
We have audited the accompanying financial statements of HINDUSTAN ZINC
LIMITED ("the Company"), which comprise the Balance Sheet as at 31st
March, 2015, the Statement of Profit and Loss and the Cash Flow
Statement for the year then ended, and a summary of the significant
accounting policies and other explanatory information.
Management''s Responsibility for the 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 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.
Auditors'' 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
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 controls system over financial reporting and the operating
effectiveness of such controls. An audit also includes evaluating the
appropriateness of the accounting policies used and the reasonableness
of the accounting estimates made by the Company''s Directors, as well as
evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion on the financial
statements.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, 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 31st March, 2015, and its profit and its cash flows for the year
ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2015 ("the
Order") issued by the Central Government in terms of Section 143 (11)
of the Act, we give in the Annexure a statement on the matters
specified in paragraphs 3 and 4 of the Order.
2. As required by Section 143(3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations
which to the best of our knowledge and belief were necessary for the
purposes of our audit.
(b) In our opinion, proper books of account as required by law have
been kept by the Company so far as it appears from our examination of
those books.
(c) The Balance Sheet, the Statement of Profit and Loss, and the Cash
Flow Statement dealt with by this Report are in agreement with the
books of account.
(d) In our opinion, the aforesaid financial statements comply with the
Accounting Standards specified under Section 133 of the Act, read with
Rule 7 of the Companies (Accounts) Rules, 2014), together with the
early adoption by the Company of Accounting Standard (AS) 30 Financial
Instruments, Recognition and Measurement, effective April 1, 2007, and
the consequential limited revisions as has been announced by the
Institute of Chartered Accountants of India to certain Accounting
Standards, as stated in Note 2 (a) and 38.
(e) On the basis of the written representations received from the
directors as on 31st March, 2015 taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March, 2015
from being appointed as a director in terms of Section 164(2) of the
Act.
(f) With respect to the other matters to be included in the Auditor''s
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its
financial position in its financial statements - Refer to Note 25 to
the financial statements;
ii. The Company did not have any long-term contracts including
derivative contracts for which there were any material foreseeable
losses;
iii. There has been no delay in transferring amounts, required to be
transferred, to the Investor Education and Protection Fund by the
Company
ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT (REFERRED TO IN
PARAGRAPH 1 UNDER ''REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS''
SECTION OF OUR REPORT OF EVEN DATE)
(i) In respect of its fixed assets:
(a) The Company has maintained proper records showing full particulars,
including quantitative details and situation of the fixed assets.
(b) Some of the fixed assets were physically verified during the year
by the Management in accordance with a programme of verification, which
in our opinion provides for physical verification of all the fixed
assets at reasonable intervals. According to the information and
explanations given to us no material discrepancies were noticed on such
verification.
(ii) In respect of its inventories:
(a) As explained to us, the inventories (excluding inventories with
third parties) were physically verified during the year by the
Management at reasonable intervals.
(b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the Management were reasonable and adequate in relation to
the size of the Company and the nature of its business.
(c) In our opinion and according to the information and explanations
given to us, the Company has maintained proper records of its
inventories and no material discrepancies were noticed on physical
verification.
(iii) 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 Companies Act, 2013.
(iv) In our opinion and according to the information and explanations
given to us,having regard to the explanations that some of the items
purchased are of special nature and suitable alternative sources are
not readily available for obtaining comparable quotations,there is an
adequate internal control system commensurate with the size of the
Company and the nature of its business for the purchase of inventory
and fixed assets and for the sale of goods. During the year, the
Company did not have transactions in respect of sale of services.During
the course of our audit we have not observed any major weaknesses in
such internal control system.
(v) According to information and explanations given to us, the Company
has not accepted any deposits from public during the year. In respect
of unclaimed deposits, the Company has complied with the provisions of
sections 73 to 76 or any other relevant provisions of the Companies
Act, 2013 and the rules made thereunder.
(vi) We have broadly reviewed the cost records maintained by the
Company pursuant to the Companies (Cost Records and Audit) Rules, 2014
read with Companies (Cost Records and Audit) Amendment Rules, 2014
prescribed by the Central Government under Section 148 of the Companies
Act, 2013 and are of the opinion that, prima facie, the prescribed cost
records have been maintained. We have, however, not made a detailed
examination of the cost records with a view to determine whether they
are accurate or complete.
(vii) According to the information and explanations given to us in
respect of statutory dues:
(a) The Company has generally been regular in depositing undisputed
statutory dues, including Provident Fund, Income-tax, Sales Tax, Wealth
Tax, Service Tax, Duty of customs, Duty of excise, Value added tax,
Cess and any other material statutory dues with the appropriate
authorities. We are informed that the provisions of Employees'' State
Insurance Act, 1948 are not applicable to the Company
There were no undisputed statutory dues in arrears as at 31st March,
2015 for a period of more than six months from the date they became
payable.
(b) Details of dues of Income-tax, Sales Tax, Wealth Tax, Service Tax,
Customs duty, Excise duty, Value added tax and Cess which have not been
deposited as on March 31, 2015 on account of disputes are given below:
Period to
Name of Nature of dues which the
Statute amount relates
Company''s appeals
Sales Tax
Claims Disputes in respect of sales tax
difference F.Y. 1980-81 to
/ classification and stock transfers
treated 2014-15
as sales.
Central
Excise Admissibility of Modvat / Cenvat
credit on F.Y. 1985-86 to
Duty inputs, capital goods, alleged duty 2014-15
demand on captive use of intermediate
goods, reversal of the amount on
dispatch of by-products, duty on
valuation and storage/ handling losses.
Income Tax Disputes in respect appeals pending AY 1996-97,
1997-98,
before CIT (A). 1999-2000,
2008-09
and 2011-12.
Department''s Relief granted by CIT (A) for differences AY 1989-90 to
1991-
appeals in computation, allowances of certain 92, 1993-94,
1998-
Income Tax expenses and enhancement of rebate, etc. 99 and 2000-01
to
2009-10
Relief granted by Tribunal for
differences in AY 1990-91 to
1994-
computation, allowances of certain 95 and 1996-97
expenses and enhancement of rebate, etc.
Sub Total
Total
Name of Statue Amount
Forum where dispute
is Pending (Rs.in
Crore)
Company''s appeals
Sales Tax Claims Deputy Commissioner, Joint 104.40
Commissioner, Commercial Tax
Department, Tribunal, High Court
and Supreme Court.
Central Excise
Duty Central Excise & Service Tax 419.35
Appellate Tribunal, Commissioner
(Appeals) and High Court /
Supreme Court.
Income Tax Commissioner of Income Tax 370.88
(Appeals)
Department''s
appeals
Income Tax Tribunal / Set aside Assessing 609.71
Officer/ CIT (A)
High Court / Supreme Court 113.04
Sub Total 722.75
Total 1,617.38
(c) The amounts required to be transferred to investor education and
protection fund in accordance with the relevant provisions of the
Companies Act, 1956 (1 of 1956) and rules made thereunder has been
transferred to such fund within the prescribed time.
(viii) The Company does not have any accumulated losses as at the end
of the financial year and has not incurred cash losses in the financial
year and in the immediately preceding financial year.
(ix) The Company has not taken any borrowings from banks, financial
institutions or by way of debentures. Accordingly, the provisions of
clause 3(ix) of the Order are not applicable to the Company.
(x) According to the information and explanations given to us and the
records of the Company examined by us, the Company has not given any
guarantees for loans taken by others from banks or financial
institutions. Accordingly, the provisions of clause 3(x) of the Order
are not applicable to the Company.
(xi) The Company has not taken any term loans during the year.
Accordingly the provisions of clause 3(xi) of the Order are not
applicable to the Company.
(xii) To the best of our knowledge and according to the information and
explanations given to us, no fraud by the Company and no material fraud
on the Company has been noticed or reported during the year.
For DELOITTE HASKINS & SELLS LLP
Chartered Accountants
(Firm''s Registration No. 117366W/W-100018)
Jitendra Agarwal
Partner
(Membership No. 87104)
Place: Mumbai
Date : April 20, 2015
Mar 31, 2013
We have audited the accompanying financial statements of HINDUSTAN ZINC
LIMITED ("the Company"), which comprise the Balance Sheet as at March
31, 2013, the Statement of Profit and Loss and the Cash Flow Statement
for the year then ended, and a summary of the significant accounting
policies and other explanatory information.
Management''s Responsibility for the Financial Statements The Company''s
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 Section 211(3C) of the
Companies Act, 1956 ("the Act") 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.
Auditors'' 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 the
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 the internal control relevant to the
Company''s preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Company''s internal control. An audit also includes
evaluating the appropriateness of the accounting policies used and the
reasonableness of the accounting estimates made by the 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.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, 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:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2013;
(b) in the case of the Statement of Profit and Loss, of the profit of
the Company for the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order") issued by the Central Government in terms of Section 227(4A) 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 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 Balance Sheet, the Statement of Profit and
Loss, and the Cash Flow Statement dealt with by this report, comply
with the Accounting Standards referred to in Section 211 (3C) of the
Companies Act, 1956, together with the early adoption by the Company of
Accounting Standard (AS) 30 Financial Instruments, Recognition and
Measurement effective April 1, 2007, and the consequential limited
revisions as have been announced by the Institute of Chartered
Accountants of India to certain Accounting Standards, as stated in Note
2(a) and 38.
(e) On the basis of the written representations received from the
directors as on March 31, 2013 taken on record by the Board of
Directors, none of the directors is disqualified as on March 31, 2013
from being appointed as a director in terms of Section 274(1)(g) of the
Act.
1. Having regard to the nature of the Company''s business/
Activities/results during the year, clauses (x), (xii), (xiii), (xv),
(xvi), (xviii), (xix), and (xx) of paragraph 4 of the Order are not
applicable to the Company. In respect of the other clauses, we report
as under:
2. In respect of its fixed Assets:
i. The Company has maintained proper records showing full particulars,
including quantitative details and situation of fixed assets.
ii. Some of the fixed assets were physically verified during the year
by the Management in accordance with a programme of verification, which
in our opinion provides for physical verification of all the fixed
assets at reasonable intervals. According to the information and
explanations given to us no material discrepancies were noticed on such
verification.
iii. The fixed assets disposed off during the year, in our opinion, do
not constitute a substantial part of the fixed assets of the Company
and such disposal has, in our opinion, not affected the going concern
status of the Company.
3. In respect of its inventories:
i. As explained to us, the inventories were physically verified during
the year by the Management at reasonable intervals.
ii. In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the Management were reasonable and adequate in relation to
the size of Company and the nature of its business.
iii. In our opinion, and according to the information and explanations
given to us, the Company has maintained proper records of its
inventories and no material discrepancies were noticed on physical
verification.
4. The Company has neither granted nor taken any loans, secured or
unsecured, to/from companies, firms or other parties covered in the
Register maintained under Section 301 of the Companies Act, 1956.
5. In our opinion and according to the information and explanations
given to us, having regard to the explanations that some of the items
purchased are of special nature and suitable alternative sources are
not readily available for obtaining comparable quotations, there is an
adequate internal control system commensurate with the size of the
Company and nature of its business with regards to purchases of
inventory and fixed assets and the sale of goods. During the year, the
Company did not have transactions in respect of sale of services.
During the course of our audit, we have not observed any major weakness
in such internal control system.
6. To the best of our knowledge and belief and according to the
information and explanations given to us, there are no contracts or
arrangements that were required to be entered in the Register
maintained in pursuance of Section 301 of the Companies Act.
7. According to the information and explanations given to us, the
Company has not accepted any deposit from the public during the year.
In respect of unclaimed deposits, the Company has complied with the
provisions of Sections 58A, 58AA or any other relevant provisions of
the Companies Act, 1956.
8. In our opinion, the internal audit functions carried out during the
year by an external agency appointed by the Management have been
commensurate with the size of the Company and the nature of its
business.
9. We have broadly reviewed the cost records maintained by the Company
pursuant to the Companies (Cost Accounting Records) Rules, 2011
prescribed by the Central Government under Section 209(1)(d) of the
Companies Act, 1956 and are of the opinion that prima facie, the
prescribed cost records have been made and maintained. We have,
however, not made a detailed examination of the cost records with a
view to determine whether they are accurate or complete.
10. According to the information and explanations given to us in
respect of statutory dues:
i. The Company has been generally regular in depositing undisputed
statutory dues including Provident Fund, Investor Education and
Protection Fund, Income-tax, Sales Tax, Wealth Tax, Service Tax,
Customs Duty, Excise Duty, Cess and any other material statutory dues
applicable to it with the appropriate authorities.
ii. There were no undisputed amounts payable in respect of Provident
Fund, Investor Education and Protection Fund, Income-tax, Sales Tax,
Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess and other
material statutory dues in arrears as at March 31, 2013 for a period of
more than six months from the date they became applicable.
iii. Details of dues of Income-tax, Sales Tax, Wealth Tax, Service Tax,
Customs Duty, Excise Duty and Cess which have not been deposited as on
March 31, 2013 on account of disputes are given below:
Name of Statute Nature of dues Amount
(Rs. In
Crores)
COMPANY''S APPEALS
A Sales Tax Claims Disputes in respect of sales tax 54.12
difference / classification and
stock transfers treated as sales.
Sub Total (A) 54.12
B Central Admissibility of Modvat /Cenvat credit 92.03
Excise Duty on inputs, capital goods, alleged duty
demand on captive use of intermediate
goods, reversal of the amount on
dispatch of by-products, duty on
valuation and storage/ handling
losses.
Sub Total (B) 92.03
C Income Tax Disputes in respect appeals pending 421.51
before Commissioner of Income Tax
(Appeals).
Disputes in respect appeals pending 2.36
before High Court
Sub Total (C) 423.87
DEPARTMENT''S APPEALS
D Income Tax Relief granted by Commissioner of 446.82
Income Tax (Appeals) for differences
in computation, allowances of
certain expenses and enhancement
of rebate, etc.
Relief granted by Tribunal for 52.78
differences in computation,
allowances of certain expenses and
enhancement of rebate, etc.
Sub Total (D) 499.60
Sub Total (E) = (C) (D) 923.47
Total (A) (B) (E) 1,069.62
Name of Statute Period to which the Forum where dispute is
amount relates pending
Sales Tax Claims FY 1980-81 to 2010-11 Deputy Commissioner, Joint
Commissioner, Commercial
Tax Department, Tribunal
and High Court.
Central Excise Duty FY 1985-86 to 2010-11 Central Excise & Service
Tax Appellate Tribunal,
Commissioner (Appeals) and
High Court / Supreme Court.
Income Tax Ay 1996-97, 1997-98, Commissioner of Income
2006-07, 2007-08,
2009-10 Tax (Appeals)
and 2010-11.
AY 1992-93 to 1994-95, High Court
1996-97, 1997-98 and
2003-04.
Income Tax AY 1989-90 to 1991-92, Tribunal / Set aside
1993-94 and 1996-97 to Assessing Officer/
2009-10 Commissioner of Income
Tax (Appeals)
AY 1990-91 to 1994-95
and High Court / Supreme
1996-97 Court
11. In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to
banks. The Company has not obtained any borrowing from financial
institutions or by way of debentures.
12. In our opinion and according to the information and explanations
given to us, the Company is not a dealer or trader in shares,
securities, debentures and other investments. Based on our examination
of the records and evaluation of the related internal controls, the
Company has maintained proper records of the transactions and contracts
in respect of shares, securities, debentures and other investments and
timely entries have been made therein. The aforesaid securities have
been held by the Company in its own name.
13. In our opinion and according to the information and explanations
given to us, and on an overall examination of the Balance Sheet of the
Company, we report that funds raised on short-term basis have, prima
facie, not been used during the year for long-term investment.
14. To the best of our knowledge and according to the information and
explanations given to us, no fraud by the company and no material fraud
on the Company has been noticed or reported during the year.
For DELOITTE HASKINS & SELLS
Chartered Accountants
(Firm Registration No. 117366W)
K. A. Katki
(Partner)
(Membership No. 038568)
Place: Mumbai
Date: April 25, 2013
Mar 31, 2012
1. We have audited the attached Balance Sheet of Hindustan Zinc
Limited (the Company) as at March 31, 2012, the Statement of Profit and
Loss, and Cash Flow Statement of the Company for the year ended on that
date, both annexed thereto. These financial statements are the
responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audit.
2. We conducted our audit in accordance with generally accepted
auditing standards in India. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. We draw attention to Note 40 relating to long-term investment in
equity shares of a power company being classified as an intangible
asset (Note 10.B) and amortised. This treatment is in preference to
requirements of Accounting Standard 30 'Financial Instruments:
Recognition and Measurement', Accounting Standard 26 'Intangible
Assets'; and Schedule XIV of the Companies Act, 1956. This has resulted
in profit after tax being lower by Rs 3.16 Crores (FY2011: Rs 3.49
Crores), investments being lower by Rs 98.41 Crores (FY2011: Rs 98.41
Crores), fixed assets being higher by Rs 46.69 Crores (FY2011: Rs 51.36
Crores), deferred tax liability being lower by Rs 16.78 Crores (FY2011:
Rs 15.27 Crores) and reserves and surplus being lower by Rs 34.94 Crores
(FY2011: Rs 31.78 Crores).
4. As required by the Companies (Auditor's Report) Order, 2003, issued
by the Central Government of India in terms of sub- section (4A) of
Section 227 of the Companies Act, 1956, we enclose in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the said
Order.
5. Further to our comments in paragraph 3 and the Annexure referred to
in paragraph 4 above, we report that:
a. we have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purposes of our
audit;
b. in our opinion, proper books of accounts 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 Balance Sheet, the Statement of Profit and Loss
and the 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 except for Paragraph 4 above. Additionally, the
Company has chosen to early adopt Accounting Standard 30, Financial
Instruments: Recognition and Measurement arising from the Announcement
of the Institute of Chartered Accountants of India on 29th March, 2008
as stated in Note 41.
e. in our opinion and to the best of our information and according to
the explanations given to us, the said accounts 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:
i. in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2012;
ii. in the case of the Statement of Profit and Loss, of the profit of
the Company for the year ended on that date; and
iii. in the case of the Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
6. On the basis of 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 disqualified as on March 31, 2012
from being appointed as a director in terms of Section 274(1)(g) of the
Companies Act, 1956.
1. In our opinion and according to the information and explanation
given to us, the nature of the Company's business/ activities during
the year are such that clauses (iii), (v), (vi), (x), (xii), (xiii),
(xv), (xvi), (xviii), (xix), and (xx) of Companies (Auditors' Report)
Order 2003, are not applicable to the Company. In respect of the other
clauses, we report as under:
2. In respect of its fixed Assets:
i. The Company has maintained proper records showing full particulars,
including quantitative details and situation of fixed assets.
ii. The fixed assets were physically verified during the year by the
Management in accordance with a regular programme of verification
which, in our opinion, provides for physical verification of all the
fixed assets at reasonable intervals. According to the information and
explanation given to us, no material discrepancies were noticed on such
verification.
iii. In our opinion and according to the information and explanations
given to us, a substantial part of fixed assets has not been disposed
off by the Company during the year.
3. In respect of its inventories:
i. As explained to us, the inventories were physically verified during
the year by the management which is at reasonable intervals.
ii. In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management were reasonable and adequate in relation to
the size of Company and the nature of its business.
iii. In our opinion, and according to the information and explanations
given to us, the Company has maintained proper records of its
inventories and no material discrepancies were noticed on physical
verification.
4. In our opinion and according to the information and explanations
given to us, having regard to the explanations that some of the items
purchased are of special nature and suitable alternative sources are
not readily available for obtaining comparable quotations, there is an
adequate internal control system commensurate with the size of the
Company and nature of its business with regards to purchases of
inventory and fixed assets and the sale of goods. There are no sale of
services. During the course of our audit, we have not observed any
major weakness in such internal control system.
5. In our opinion, the Company has an adequate internal audit system
commensurate with the size of the Company and the nature of its
business.
6. We have broadly reviewed the cost records maintained by the
Company, including pursuant to the Companies (Cost Accounting Records)
Rules, 2011 prescribed by the Central Government under Section
209(1)(d) of the Companies Act, 1956 and are of the opinion that prima
facie the prescribed cost records have been maintained and are being
made up. We have, however, not made a detailed examination of the cost
records with a view to determine whether they are accurate or complete.
7. According to the information and explanations given to us in
respect of statutory dues, and the records of the Company examined by
us:
i. The Company has been regular in depositing with appropriate
authorities undisputed statutory dues including Provident Fund,
Investor Education and Protection Fund, Income-tax, Sales Tax, Wealth
Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other material
statutory dues.
ii. Disputed sales tax, excise duty, and Income-tax dues aggregating Rs
66.03 Crores, Rs 61.91 Crores and Rs 670.06 Crores respectively, have not
been deposited since the matters are pending with the relevant forum as
per annexure 'A' attached.
8. In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to
banks and financial institutions.
9. In our opinion and according to the information and explanations
given to us, the Company is not a dealer or trader in shares,
securities, debentures and other investments. The Company has
maintained proper records of transactions and contracts in respect of
shares, securities, debentures and other investments and timely entries
have been made therein. All shares, securities, debentures and other
investments have been held by the Company in its own name.
10. In our opinion and according to the information and explanations
given to us and on an overall examination of the Balance Sheet, we
report that funds raised on short-term basis have not been used during
the year for long term investment.
11. To the best of our knowledge and according to the information and
explanations given to us, no fraud by the Company and no significant
fraud on the Company has been noticed or reported during the year.
Name of Statute Nature of dues Amount
(Rs in Crores)
Company's appeals:
A Sales Tax Claims Disputes in respect of sales 66.03
tax rate difference /
classification and stock
transfers treated as sales.
Sub Total (a) 66.03
B Central Excise Duty Admissibility of Modvat / 61.91
Cenvat credit on inputs,
capital goods, alleged duty
demand on captive use of
intermediate goods, reversal
of the amount on dispatch of
by-products,duty on valuation
and storage/ handling losses.
Sub Total (b) 61.91
C Income Tax Disputes in respect appeals 165.84
pending before CIT(A).
Disputes in respect appeals 2.36
pending before High Court.
Sub Total (c) 168.20
Department's appeals:
Income Tax Relief granted by CIT (A) for 446.82
differences in computation,
allowances of certain expenses
and enhancement of rebate, etc
Relief granted by Tribunal 55.04
for differences in computation,
allowances of certain expenses
and enhancement of rebate, etc
Sub Total (d) 501.86
Sub Total (e) = (c) (d) 670.06
Total (a) (b) (e) 798.00
Name of Statute Period to which the Forum where dispute is
amount relates pending
Company's appeals:
A Sales Tax Claims F.Y. 1980-81 to 2008-09 Dy Commissioner, Joint
Commissioner, CTO,
Tribunal and High Court.
B Central Excise Duty F.Y. 1985-86 to 2010-11 CESAT, Commissioner
(Appeals) and High
Court / Supreme Court.
C Income Tax A.Y. 1996-97, 1997-98, CIT(A)
2006-07, 2007-08 and
2009-10.
A.Y. 1992-93 to 1994-95, HC
1996-97, 1997-98 and
2003-04.
Department's appeals:
Income Tax A.Y. 1989-90 to 1991- Tribunal / Set Aside
92,1993-94, and 1996-97 AO/C(A)
to 2009-10
A.Y. 1990-91 to 1994- 95 High Court / Supreme
and 1996-97 Court
For Deloitte Haskins & Sells
Chartered Accountants
(Registration No. 117366W)
Shyamak R. Tata
Partner
M. No. 38320
Place: Mumbai
Date: April 19, 2012
Mar 31, 2011
1. We have audited the attached balance sheet of Hindustan Zinc
Limited (the Company) as at 31 March 2011, the profit and loss account
and cash flow statement of the Company for the year ended on that date,
both 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.
2. We conducted our audit in accordance with generally accepted
auditing standards in India. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis
for our opinion.
3. As required by the Companies (Auditors Report) Order, 2003, issued
by the Central Government of India in terms of Sub-section (4A) of
Section 227 of the Companies Act, 1956, we enclose in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the said
Order.
4. We draw attention to Note 15 on Schedule 18, relating to long-term
investment in equity shares of a power Company being classified as an
intangible asset (Schedule 4) and amortised. This treatment is in
preference to requirements of Accounting Standard 30 Financial
Instruments: Recognition and Measurement, Accounting Standard 26
Intangible Assets; and Schedule XIV of the Companies Act, 1956. This
has resulted in profit after tax being lower by Rs. 3.49 Crores (2010: Rs.
3.41 Crores), investments being lower by Rs. 98.41 Crores (2010: Rs. 98.41
Crores), fixed assets being higher by Rs. 51.36 Crores (2010: Rs. 56.03
Crores), deferred tax liability being lower by Rs. 15.27 Crores (2010: Rs.
14.08 Crores) and reserves and surplus being lower by Rs. 31.78 Crores
(2010: Rs. 28.30 Crores).
5. Further to our comments in the Annexure referred to in paragraph 3
above, we report that:
a. we have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purposes of our
audit;
b. in our opinion, proper books of accounts 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 Profit and Loss Account 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 Profit and Loss Account and
the 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 except for Paragraph 4 above. Additionally, the
Company has chosen to early adopt Accounting Standard 30, Financial
Instruments: Recognition and Measurement arising from the Announcement
of the Institute of Chartered Accountants of India on 29 March 2008 as
stated in Note 16 on Schedule 18.
e. in our opinion and to the best of our information and according to
the explanations given to us, the said accounts 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:
i. in the case of the Balance Sheet, of the state of affairs of the
Company as at 31 March 2011;
ii. in the case of the Profit and Loss Account, of the profit of the
Company for the year ended on that date; and
iii. in the case of the Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
6. On the basis of written representations received from the directors
as on 31 March 2011 and taken on record by the Board of Directors, we
report that none of the directors is disqualified as on 31 March 2011
from being appointed as a director in terms of Section 274(1)(g) of the
Companies Act, 1956.
Annexure to the Auditors Report (Referred to in paragraph 3 of
Auditors Report of even date)
1. In our opinion and according to the information and explanation
given to us, the nature of the Companys business/activities during the
year are such that clauses (iii), (v), (vi), (x), (xii), (xiii), (xv),
(xvi), (xviii), (xix), and (xx) of Companies (Auditors Report) Order
2003, are not applicable to the Company. In respect of the other
clauses, we report as under:
2. In respect of its fixed Assets:
i. The Company has maintained proper records showing full particulars,
including quantitative details and situation of fixed assets.
ii. The fixed assets were physically verifed during the year by the
Management in accordance with a regular programme of verifcation which,
in our opinion, provides for physical verifcation of all the fixed
assets at reasonable intervals. According to the information and
explanation given to us, no material discrepancies were noticed on such
verifcation.
iii. In our opinion and according to the information and explanations
given to us, a substantial part of fixed assets has not been disposed of
by the Company during the year.
3. In respect of its inventories:
i. As explained to us, the inventories were physically verifed during
the year by the management which is at reasonable intervals.
ii. In our opinion and according to the information and explanations
given to us, the procedures of physical verifcation of inventories
followed by the management were reasonable and adequate in relation to
the size of Company and the nature of its business.
iii. In our opinion, and according to the information and explanations
given to us, the Company has maintained proper records of its
inventories and no material discrepancies were noticed on physical
verifcation.
4. In our opinion and according to the information and explanations
given to us, having regard to the explanations that some of the items
purchased are of special nature and suitable alternative sources are
not readily available for obtaining comparable quotations, there is an
adequate internal control system commensurate with the size of the
Company and nature of its business with regards to purchases of
inventory and fixed assets and the sale of goods. There are no sale of
services. During the course of our audit, we have not observed any
major weakness in such internal control system.
5. In our opinion, the Company has an adequate internal audit system
commensurate with the size of the Company and the nature of its
business.
6. We have broadly reviewed the books of account and records
maintained by the Company relating to the manufacture of Zinc, Lead,
Sulphuric Acid and generation of electricity, pursuant to the order
made by the Central Government for the maintenance of cost records
under Section 209(1) (d) of the Companies Act, 1956, and are of the
opinion that prima facie the prescribed accounts and records have been
maintained and being made up. We have, however, not made a detailed
examination of the records with a view to determining whether they are
accurate or complete.
7. According to the information and explanations given to us, and the
records of the Company examined by us:
i. The Company has been regular in depositing with appropriate
authorities undisputed statutory dues including Provident Fund,
Investor Education and Protection Fund, Income-tax, Sales Tax, Wealth
Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other material
statutory dues.
ii. Disputed sales tax, excise duty, and Income-tax dues aggregating Rs.
21.24 Crores, Rs. 63.88 Crores and Rs. 561.08 Crores respectively, have not
been deposited since the matters are pending with the relevant forum as
per annexure A attached.
8. In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to
banks and fnancial institutions.
9. In our opinion and according to the information and explanations
given to us, the Company is not a dealer or trader in shares,
securities, debentures and other investments. The Company has
maintained proper records of transactions and contracts in respect of
shares, securities, debentures and other investments and timely entries
have been made therein. All shares, securities, debentures and other
investments have been held by the Company in its own name.
10. In our opinion and according to the information and explanations
given to us and on an overall examination of the Balance Sheet, we
report that funds raised on short- term basis have not been used during
the year for long- term investment.
11. To the best of our knowledge and according to the information and
explanations given to us, no fraud by the Company and no significant
fraud on the Company has been noticed or reported during the year.
Amount
Nature of statute Nature of dues (Rs. in Crores)
Companys appeals:
(a) Sales Tax Claim Disputes in respect of
Sales Tax rate 21.24
difference/classification and
stock transfers treated as
sales for the financial
year 1980-81 to 2009-10
(b) Central Excise
Duty Admissibility of Modvat/Cenvat
credit on 63.88
inputs, capital goods, alleged
duty demand on captive use of
intermediate goods, reversal
of the amount on dispatch of
by-products, duty on valuation
and storage/handling losses,
for the FY 1985-86 to FY 2009-10
(c) Income Tax Disputes in respect appeals
pending 124.40
before CIT(A) for AY 1996-97 and
AY 2008-09
Disputes in respect appeals
pending 4.62
before Tribunal for AY 1998-99 to
AY 2003-04 and AY 2006-07
Disputes in respect appeals
pending before 25.00
High Court for AY 1992-93 to AY 1994-95,
AY 1996-97 AY 1997-98 and AY 2003-04
Sub Total (a): 154.02
Departments appeals:
Income Tax Relief granted by CIT (A)
for AY 1989-90 331.69
to AY 1991-92, AY 1996-97 to
AY 2009-10 for differences in
computation, allowances
of certain expenses and enhancement
of rebate, etc.
Relief granted by Tribunal
for AY 1990-91 75.37
to AY 1994-95 & AY 1996-97 for
differences in computation,
allowances of certain expenses
and enhancement of rebate, etc.
Sub Total (b): 407.06
Sub Total (a) + (b): 561.08
TOTAL 646.21
Name of statue Forum pending at
Companys appeals:
(a) Sales Tax Claim Dy Commissioner,
Joint Commissioner,
CTO, Tribunal and High Court.
(b) Central Excise Duty CESAT, Commissioner
(Appeals) and High Court/
Supreme Court
(c) Income Tax CIT(A)
Tribunal
High Court
Departments appeals:
Income Tax Tribunal/Assessing Officer
High Court/Supreme Court
TOTAL
For Deloitte Haskins & Sells
Chartered Accountants
(Registration No. 117366W)
Shyamak R. Tata
Partner
M. No. 38320
Place : Mumbai
Date : April 21, 2011
Mar 31, 2010
1. We have audited the attached balance sheet of Hindustan Zinc
Limited (the company) as at March 31,2010, the profit and loss account
and cash flow statement of the Company 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.
2. We conducted our audit in accordance with generally accepted
auditing standards in India. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the Companies (Auditors Report) Order, 2003, issued
by the Central Government of India in terms of sub-section (4A) of
Section 227 of the Companies Act, 1956, we enclose in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the said
Order.
4. We draw attention to Note 17 on Schedule 18, relating to long-term
investment in equity shares of a power company being classified as an
intangible asset (Schedule 4) and amortised. This treatment is in
preference to requirements of Accounting Standard 30 Financial
Instruments: Recognition and Measurement, Accounting Standard 26
Intangible Assets; and Schedule XIV of the Companies Act, 1956. This
has resulted in profit aftertax being lower by Rs 3.41 crores (2009: Rs
3.08 crores), investments being lower by Rs 98.41 crores (2009: Rs
98.41 crores), fixed assets being higher by Rs 56.03 crores (2009: Rs
60.70 crores), deferred tax liability being lower by Rs 14.08 crores
(2009: Rs 12.82 crores) and reserves and surplus being lower by Rs
28.30 crores (2009: Rs 24.89 crores).
5. Further to our comments in the Annexure referred to in paragraph 3
above, we report that:
a. we have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purposes of our
audit;
b. in our opinion, proper books of accounts 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 Profit and Loss Account 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 Profit and Loss Account and
the 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 except for Paragraph 4 above. Additionally, the
Company has chosen to early adopt Accounting Standard 30, Financial
Instruments: Recognition and Measurement arising from the Announcement
of the Institute of Chartered Accountants of India on 29th March 2008
as stated in Note 18 on Schedule 18
e. in our opinion and to the best of our information and according to
the explanations given to us, the said accounts 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:
i. in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31,2010;
ii. in the case of the Profit and Loss Account, of the profit of the
Company for the year ended on that date; and
iii. in the case of the Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
6. On the basis of 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 Section
274(l)(g) of the Companies Act, 1956.
Annexure to the Auditors Report
(Referred to in paragraph 3 of Auditors Report of even date)
1. In our opinion and according to the information and explanation
given to us, the nature of the Companys business/activities during the
year are such that clauses, (iii), (v), (vi), (x), (xii), (xiii), (xv),
(xvi), (xviii), (xix), and (xx) of Companies (Auditors Report) Order
2003, are not applicable to the Company. In respect of the other
clauses, we report as under:
2. In respect of its fixed Assets:
i. The Company has maintained proper records showing full particulars,
including quantitative details and situation of fixed assets.
ii. The fixed assets were physically verified during the year by the
Management in accordance with a regular programme of verification
which, in our opinion, provides for physical verification of all the
fixed assets at reasonable intervals. According to the information and
explanation given to us, no material discrepancies were noticed on such
verification.
iii. In our opinion and according to the information and explanations
given to us, a substantial part of fixed assets has not been disposed
off by the Company during the year.
3. In respect of its inventories:
i. As explained to us, the inventories were physically verified during
the year by the management which is at reasonable intervals.
ii. In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management were reasonable and adequate in relation to
the size of Company and the nature of its business.
iii. In our opinion, and according to the information and explanations
given to us, the Company has maintained proper records of its
inventories and no material discrepancies were noticed on physical
verification.
4. In our opinion and according to the information and explanations
given to us, having regard to the explanations that some of the items
purchased are of special nature and suitable alternative sources are
not readily available for obtaining comparable quotations, there is an
adequate internal control system commensurate with the size of the
Company and nature of its business with regards to purchases of
inventory andfixed assets and the sale of goods. There are no sale of
services. During the course of our audit, we have not observed any
major weakness in such internal control system.
5. In our opinion, the Company has an adequate internal audit system
commensurate with the size of the Company and the nature of its
business.
6. We have broadly reviewed the books of account and records
maintained by the Company relating to the manufacture of Zinc, Lead and
Sulphuric Acid, pursuant to the order made by the Central Government
for the maintenance of cost records under Section 209(1) (d) of the
Companies Act, 1956, and are of the opinion that prima facie
theprescribed accounts and records have been made and maintained. We
have, however, not madea detailed examination of the records with a
view to determining whether they are accurate or complete.
7. According to the information and explanations given to us, and the
records of the Company examined by us:
i. The Company has generally been regular in depositing with
appropriate authorities undisputed statutory dues including Provident
Fund, Investor Education and Protection Fund, Income-tax, Sales Tax,
Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other
material statutory dues.
ii. Disputed sales tax, excise duty, and Income-tax dues aggregating
to Rs 21.21 crores, Rs 43.90 crores and Rs 389.02 crores respectively,
have not been deposited since the matters are pending with the relevant
forum as per annexure A attached.
8. In our opinion and according to the information and explanations
given to us,the Company has not defaulted in repayment of dues to banks
and financial institutions.
9. In our opinion and according to the information and explanations
given to us, the Company is not a dealer or trader in shares,
securities, debentures & other investments. The company has maintained
proper records of transactions and contracts in respect of shares,
securities, debentures and other investments and timely entries have
been made therein. All shares, securities, debentures and other
investments have been held by the company in its own name.
10. In our opinion and according to the information and explanations
given to us and on an overall examination of the Balance Sheet, we
report that funds raised on short-term basis have not been used during
the year for long term investment.
11. To the best of our knowledge and according to the information and
explanations given to us, no fraud by the company and no significant
fraud on the Company has been noticed or reported during the year.
For Deloitte Haskins & Sells
Chartered Accountants
(Registration No. 117366W)
Shyamak R. Tata
Partner
M. No. 38320
Place: Mumbai
Date: April 21,2010