Auditor Report of ISGEC Heavy Engineering Ltd.
Mar 31, 2023
Isgec Heavy Engineering Limited
REPORT ON THE AUDIT OF THE STANDALONE IND AS FINANCIAL STATEMENTSOPINION
We have audited the accompanying standalone Ind AS financial statements of Isgec Heavy Engineering Limited ("the Company"), which comprise the Balance Sheet as at 31st March, 2023, the Statement of Profit and Loss (including the Statement of Other Comprehensive Income), the Statement of Changes in Equity and the Statement of Cash Flows 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 (hereinafter referred to as "the standalone Ind AS financial statements").
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 ("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, 2023, and its profit including other comprehensive income, its Statement of 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 ''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 standalone Ind AS 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 judgement, were of most significance in our audit of the standalone Ind AS financial statements of the current period. 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. We have determined the matters described below to be the key audit matters to be communicated in our report.
|
Sr. No. |
Key Audit Matter |
Auditorâs Response |
|
1 |
Revenue recognition for Engineering, Procurement and Construction (EPC) contracts The Company''s significant portion of business is undertaken through EPC contracts. Revenue from these contracts is recognized over a period of time in accordance with the requirements of Ind AS 115, "Revenue from Contracts with Customersâ. Due to the nature of the contracts, revenue recognition involves usage of percentage of completion method which is determined based on proportion of contract costs incurred to date compared to estimated total contract costs. The determination of revenues and margin relating to EPC contracts depends on total cost at completion estimated by the management. These estimates are reviewed on a quarterly basis or more frequently in the event of any major development during the progress of projects. This method involves significant judgments, identification of contractual obligations and the Company''s rights to receive payments for performance completed till date, changes in scope and consequential revised contract price and recognition of the liability for loss making contracts. Refer Note 2.4 to the standalone Ind AS financial statements. |
Principal Audit Procedures In the context of our work, the procedures set up in terms of contribution to revenues of EPC contracts consisted of : ⢠Considering the appropriateness of the Company''s revenue recognition accounting policies and assessing compliance with the policies in terms of Ind AS 115. ⢠Performing testing of the design and implementation of controls over revenue recognition with specific focus on controls over determination of progress of completion, recording of costs incurred and estimation of costs to complete the remaining contract obligations. ⢠Performing tests of details, on a sample basis, and verifying the underlying customer contracts, performing review of actual costs incurred with estimated costs to identify significant variations and assess whether those variations have been considered in estimating the remaining costs to complete and consequential determination of stage of completion, which formed the basis of revenue recognition under the input method. We reviewed the management''s evaluation process to recognize revenue over a period of time, status of completion for projects and total cost estimates. We reviewed and verified the estimated cost of contracts, on test check basis, arising from contract modifications and analysed current on-going negotiations and settlements that may impair the profitability of such contracts. ⢠Examining contracts with exceptions including contracts with low or negative margins, loss making contracts, contracts with significant changes in planned cost estimates to determine the level of provisioning required. ⢠Verifying the contractual positions and revenue for the year are appropriately presented and disclosed in the standalone Ind AS financial statements. |
INFORMATION OTHER THAN THE STANDALONE IND AS FINANCIAL STATEMENTS AND AUDITOR''S REPORT THEREON
The Company''s management and Board of Directors are responsible for the other information. The other information comprises the information included in the Company''s 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 the other information is materially inconsistent with the standalone Ind AS financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed on the other information obtained prior to the date of this auditor''s report, 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.
RESPONSIBILITY OF MANAGEMENT AND THOSE CHARGED WITH GOVERNANCE 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, changes in equity and the Statement of cash flows 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 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.
AUDITOR''S RESPONSIBILITY 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 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 standalone Ind AS 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.
Materiality is the magnitude of misstatements in the standalone Ind AS financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the standalone Ind AS financial statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the standalone Ind AS financial statements.
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 of the current period 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 ("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 -A, which forms a part of this report, a statement on the matters specified in paragraph 3 and 4 of the Order, to the extent applicable.
2. As required by Section 143 (3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;
(b) In our opinion, proper books of account, as required by law have been kept by the Company so far, as appears from our examination of such books.
(c) The Balance Sheet, Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the Statement of Cash Flows dealt with by this Report are in agreement with the books of account;
(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 relevant rules issued thereunder.
(e) On the basis of written representations received from the Directors as on 31st March, 2023 and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on 31st March 2023 from being appointed as a Director in terms of Section 164(2) of the Companies Act, 2013.
(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- B".
(g) As required by Rule 11 of the Companies (Audit and Auditors) Rules, 2014 issued by the Central Government of India in terms of clause (j) of sub-section (3) of section 143 of the Act, in our opinion and to the best of our information and according to the explanation given to us:
(a) The Company has disclosed the impact of pending litigations on its financial position in its standalone Ind AS financial statements - Refer Note 43 to the standalone Ind AS financial statements.
(b) The Company has made provision, as required under the applicable law and accounting standards, for material foreseeable losses, if any, on longterm contracts including derivative contracts.
(c) There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
d) i) 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 fund or share premium or any other sources of kinds of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities (" Intermediaries"), 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 ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
ii) 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 entity ("Funding Parties)", with the understanding, whether recording in writing or otherwise, that the Company shall, whether, directly or indirectly, lend or invest in other person or entities identified in any manner whatsoever by or on behalf of Funding Parties ("Ultimate Beneficiaries") or provide any guarantee, security, or the like on behalf of the Ultimate Beneficiaries; and
iii) 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 representation under sub-clause (i) and (ii) contains any material misstatement.
e) The dividend declared and paid by the Company during the year is in accordance with Section 123 of the Companies Act, 2013.
f) Proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 for maintaining books of account using accounting software which has a feature of recording audit trail (edit log) facility is applicable to the Company with effect from 1st April 2023 and accordingly, reporting under Rule 11(g) of Companies (Audit and Auditors) Rules, 2014 is not applicable for the financial year ended 31st March 2023.
3. With respect to the other matters to be included in the Auditor''s Report in accordance with the requirements of section 197(16) of the Act, as amended:
In our opinion and to the best of our information and according to the explanations given to us, the remuneration for the year ended 31st March, 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.
For SCV & Co. LLP
Chartered Accountants Firm Reg. No: 000235N/ N500089
Abhinav Khosla
Partner
Place: Noida Membership No.: 087010
Dated: May 29, 2023 ICAI UDIN: 23087010BGZFEL1951
(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 ''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 standalone Ind AS 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 judgement, were of most significance in our audit of the standalone Ind AS financial statements of the current period. 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. We have determined the matters described below to be the key audit matters to be communicated in our report.
To the Members of
Isgec Heavy Engineering Limited
REPORT ON THE AUDIT OF THE STANDALONE IND AS FINANCIAL STATEMENTSOPINION
We have audited the accompanying standalone Ind AS financial statements of Isgec Heavy Engineering Limited ("the Company"), which comprise the Balance Sheet as at 31st March, 2023, the Statement of Profit and Loss (including the Statement of Other Comprehensive Income), the Statement of Changes in Equity and the Statement of Cash Flows 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 (hereinafter referred to as "the standalone Ind AS financial statements").
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 ("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, 2023, and its profit including other comprehensive income, its Statement of 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
|
Sr. No. |
Key Audit Matter |
Auditorâs Response |
|
1 |
Revenue recognition for Engineering, Procurement and Construction (EPC) contracts The Company''s significant portion of business is undertaken through EPC contracts. Revenue from these contracts is recognized over a period of time in accordance with the requirements of Ind AS 115, "Revenue from Contracts with Customersâ. Due to the nature of the contracts, revenue recognition involves usage of percentage of completion method which is determined based on proportion of contract costs incurred to date compared to estimated total contract costs. The determination of revenues and margin relating to EPC contracts depends on total cost at completion estimated by the management. These estimates are reviewed on a quarterly basis or more frequently in the event of any major development during the progress of projects. This method involves significant judgments, identification of contractual obligations and the Company''s rights to receive payments for performance completed till date, changes in scope and consequential revised contract price and recognition of the liability for loss making contracts. Refer Note 2.4 to the standalone Ind AS financial statements. |
Principal Audit Procedures In the context of our work, the procedures set up in terms of contribution to revenues of EPC contracts consisted of : ⢠Considering the appropriateness of the Company''s revenue recognition accounting policies and assessing compliance with the policies in terms of Ind AS 115. ⢠Performing testing of the design and implementation of controls over revenue recognition with specific focus on controls over determination of progress of completion, recording of costs incurred and estimation of costs to complete the remaining contract obligations. ⢠Performing tests of details, on a sample basis, and verifying the underlying customer contracts, performing review of actual costs incurred with estimated costs to identify significant variations and assess whether those variations have been considered in estimating the remaining costs to complete and consequential determination of stage of completion, which formed the basis of revenue recognition under the input method. We reviewed the management''s evaluation process to recognize revenue over a period of time, status of completion for projects and total cost estimates. We reviewed and verified the estimated cost of contracts, on test check basis, arising from contract modifications and analysed current on-going negotiations and settlements that may impair the profitability of such contracts. ⢠Examining contracts with exceptions including contracts with low or negative margins, loss making contracts, contracts with significant changes in planned cost estimates to determine the level of provisioning required. ⢠Verifying the contractual positions and revenue for the year are appropriately presented and disclosed in the standalone Ind AS financial statements. |
INFORMATION OTHER THAN THE STANDALONE IND AS FINANCIAL STATEMENTS AND AUDITOR''S REPORT THEREON
The Company''s management and Board of Directors are responsible for the other information. The other information comprises the information included in the Company''s 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 the other information is materially inconsistent with the standalone Ind AS financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed on the other information obtained prior to the date of this auditor''s report, 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.
RESPONSIBILITY OF MANAGEMENT AND THOSE CHARGED WITH GOVERNANCE 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, changes in equity and the Statement of cash flows 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 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.
AUDITOR''S RESPONSIBILITY 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 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 standalone Ind AS 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.
Materiality is the magnitude of misstatements in the standalone Ind AS financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the standalone Ind AS financial statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the standalone Ind AS financial statements.
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 of the current period 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 ("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 -A, which forms a part of this report, a statement on the matters specified in paragraph 3 and 4 of the Order, to the extent applicable.
2. As required by Section 143 (3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;
(b) In our opinion, proper books of account, as required by law have been kept by the Company so far, as appears from our examination of such books.
(c) The Balance Sheet, Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the Statement of Cash Flows dealt with by this Report are in agreement with the books of account;
(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 relevant rules issued thereunder.
(e) On the basis of written representations received from the Directors as on 31st March, 2023 and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on 31st March 2023 from being appointed as a Director in terms of Section 164(2) of the Companies Act, 2013.
(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- B".
(g) As required by Rule 11 of the Companies (Audit and Auditors) Rules, 2014 issued by the Central Government of India in terms of clause (j) of sub-section (3) of section 143 of the Act, in our opinion and to the best of our information and according to the explanation given to us:
(a) The Company has disclosed the impact of pending litigations on its financial position in its standalone Ind AS financial statements - Refer Note 43 to the standalone Ind AS financial statements.
(b) The Company has made provision, as required under the applicable law and accounting standards, for material foreseeable losses, if any, on longterm contracts including derivative contracts.
(c) There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
d) i) 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 fund or share premium or any other sources of kinds of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities (" Intermediaries"), 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 ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
ii) 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 entity ("Funding Parties)", with the understanding, whether recording in writing or otherwise, that the Company shall, whether, directly or indirectly, lend or invest in other person or entities identified in any manner whatsoever by or on behalf of Funding Parties ("Ultimate Beneficiaries") or provide any guarantee, security, or the like on behalf of the Ultimate Beneficiaries; and
iii) 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 representation under sub-clause (i) and (ii) contains any material misstatement.
e) The dividend declared and paid by the Company during the year is in accordance with Section 123 of the Companies Act, 2013.
f) Proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 for maintaining books of account using accounting software which has a feature of recording audit trail (edit log) facility is applicable to the Company with effect from 1st April 2023 and accordingly, reporting under Rule 11(g) of Companies (Audit and Auditors) Rules, 2014 is not applicable for the financial year ended 31st March 2023.
3. With respect to the other matters to be included in the Auditor''s Report in accordance with the requirements of section 197(16) of the Act, as amended:
In our opinion and to the best of our information and according to the explanations given to us, the remuneration for the year ended 31st March, 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.
For SCV & Co. LLP
Chartered Accountants Firm Reg. No: 000235N/ N500089
Abhinav Khosla
Partner
Place: Noida Membership No.: 087010
Dated: May 29, 2023 ICAI UDIN: 23087010BGZFEL1951
Mar 31, 2018
INDEPENDENT AUDITOR''S REPORT
TO
THE MEMBERS OF ISGEC HEAVY ENGINEERING LIMITED Report on the Standalone Ind AS Financial Statements
We have audited the accompanying standalone Ind AS financial statements of Isgec Heavy Engineering Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2018, the Statement of Profit and Loss (including other comprehensive income), the Statement of Cash Flows and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information.
Management''s Responsibility 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 Companies Act, 2013 ("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) prescribed under Section 133 of the Act, read with relevant rules issued there under.
This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditor''s responsibility
Our responsibility is to express an opinion on these standalone 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 in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone Ind AS financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the standalone 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 standalone 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 management, as well as evaluating the overall presentation of the standalone 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 standalone Ind AS financial statements.
Opinion
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 Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India including the Ind AS, of the financial position of the Company as at March 31, 2018, its financial performance including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.
Emphasis of Matter
We draw attention to Note 41 (c) to the standalone Ind AS financial statements which describes the nature and expected outcome with respect to the ongoing litigation regarding Bio refinery project in Philippines. Our opinion is not modified in respect of this matter.
Other Matters
The comparative standalone Ind AS financial statements of the Company for the year ended March 31, 2017, prepared in accordance with Ind AS and included in this statement have been audited by the predecessor auditor. The report of the predecessor auditor dated May 29, 2017 on the comparative standalone Ind AS financial statements expressed an unmodified opinion.
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 -A, which forms a part of this report, a statement on the matters specified in paragraph 3 and 4 of the Order, to the extent applicable.
2. As required by Section 143 (3) of the Act, we report that:
(a) we have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;
(b) in our opinion, proper books of account, as required by law have been kept by the Company so far, as appears from our examination of such books.
(c) the Balance Sheet, Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Cash Flows and the 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 relevant rules issued thereunder.
(e) on the basis of written representations received from the Directors and taken on record by the Board of Directors, we report that 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 Companies Act, 2013.
(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- B".
3. As required by Rule 11 of the Companies (Audit and Auditors) Rules, 2014 issued by the Central Government of India in terms of clause (j) of sub-section (3) of section 143 of the Act, in our opinion and to the best of our information and according to the explanation given to us:
(a) The Company has disclosed the impact of pending litigations on its financial position in its standalone Ind AS financial statements - Refer Note 41 to the standalone Ind AS financial statement.
(b) The Company has made provision, as required under the applicable law and accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts.
(c) There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
The Annexure referred to in Independent Auditors'' Report to the members of the Company on the standalone Ind AS financial statements for the year ended March 31, 2018, we report that:
(i) (a) The Company has maintained proper records showing full particulars including quantitative details and situation of its fixed assets.
(b) According to the information and explanations given to us, the fixed assets of the Company have been physically verified by the management at reasonable intervals. No material discrepancies were noticed on such verification as compared to the book records.
(c) According to information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company.
(ii) Physical verification has been carried out by the Management in respect of inventory at reasonable intervals including as on March 31, 2018. In our opinion the frequency of verification is reasonable. According to the information and explanations given to us, discrepancies noticed on physical verification of inventory as compared to the book records were not material and have been dealt with in the books of account.
(iii) (a) According to the information and explanations given to us and based on such tests which we considered necessary, we report that the company has granted unsecured loan to one of the subsidiary covered in the register maintained under section 189 of the Companies Act, 2013, the balance outstanding is Nil as at March 31, 2018.
(b) As explained to us and as per records, the principal and interest is repayable on demand.
(c) As per information and explanations given to us, and as per our examination of records, there is no overdue interest outstanding as on the date of Balance Sheet.
(iv) According to the information and explanations given to us, the Company has not granted any loan to Director in terms of Section 185 of the Companies Act, 2013. Further, Company has complied with the provisions of section 186 of the Companies Act, 2013 in respect of loans, investments, guarantees and security made.
(v) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public during the year under audit. Therefore, directives issued by Reserve Bank of India and the provisions of Sections 73 to 76 or any other relevant provisions of the Companies Act and the rules framed there under are not applicable to the company.
(vi) We have broadly reviewed the cost records maintained by the Company pursuant to the sub-section (1) of section 148 of the Companies Act, specified by the Central Government 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) (a) According to the information and explanations given to us and records of the Company examined by us, in our opinion, the company is regular in depositing undisputed statutory dues including Provident Fund, Employees'' State Insurance, Income tax, Sales tax, Service tax, Value Added Tax, Customs Duty, Excise Duty, and any other statutory dues with the appropriate authorities. According to the information and explanation given to us, no undisputed amounts payable were outstanding as at March 31, 2018 for a period of more than six months from the date they became payable.
(b) According to the information and explanations given to us, there are no dues of income tax, sales tax, service tax, duty of customs or value added tax which have not been deposited on account of any dispute except as given under:
|
Name of the Statute |
Nature of Dues |
Disputed Amount (Rs, in lakhs) |
Period to which it relates |
Forum where Dispute is pending |
|
Central Excise Act |
Excise Duty |
5.00 |
1994-95 |
Hon''ble High Court, Allahabad |
|
8.00 |
1994-96 |
Tribunal New Delhi |
||
|
8.58 |
2002-10 |
CESTAT, New Delhi |
||
|
3.57 |
2012-13 |
Assistant Commissioner, Panchkula |
||
|
Service Tax |
Service Tax |
61.28 |
2011-12 |
Commissioner Central Excise (Panchkula) |
|
11.92 |
2011-12 |
Commissioner Central Excise (Panchkula) |
||
|
0.34 |
2013-14 |
Commissioner Central Excise (Panchkula) |
||
|
0.77 |
2015-16 |
Assistant Commissioner of Central Excise, U.P |
||
|
14.40 |
2010-14 |
Additional Commissioner of Central Excise, U.P |
||
|
0.33 |
2015-16 |
Superintendent, Central Excise Yamuna Nagar |
||
|
0.04 |
2016-17 |
Superintendent, Central Excise Yamuna Nagar |
||
|
563.80 |
2011-12 |
Commissioner, Custom (Appeals), Ahmedabad |
||
|
Sales Tax Act |
Sales Tax |
9.02 |
1993-94 |
Sales Tax Tribunal, Orissa |
|
17.00 |
1995-96 |
Sales Tax Tribunal, Orissa |
||
|
5.00 |
1996-97 |
Sales Tax Tribunal, Orissa |
||
|
6.00 |
1971-73 |
Commissioner Sales Tax, Lucknow |
||
|
8.09 |
2009-14 |
Joint Commissioner of Sales Tax |
||
|
4.00 |
1987-88 |
Deputy Commissioner of Commercial Taxes (appeals), Kolkata |
||
|
34.00 |
1995-96 |
Deputy Commissioner of Commercial Taxes (appeals), Kolkata |
||
|
61.00 |
1994-95 |
Deputy Commissioner of Commercial Taxes (appeals), Kolkata |
||
|
0.82 |
2006-07 |
Deputy Commissioner of Commercial Taxes, Tamil Nadu |
||
|
203.63 |
2008-12 |
Additional Commissioner Appeals, U.P |
||
|
6.62 |
2014-15 |
Deputy Commissioner of Commercial Taxes, Kerala |
||
|
0.58 |
2016-17 |
Deputy Commissioner of Commercial Taxes, Kerala |
||
|
7.43 |
2015-16 |
Excise & Tax Officer, Punjab |
||
|
134.61 |
2013-14 |
Additional Commissioner Grade-2 (Appeal), Muzaffarnagar |
||
|
59.32 |
2009-10 |
Assistant Commissioner (WC) Department of Commercial Taxes, Ernakulam |
||
|
0.37 |
2010-11 |
Assistant Commissioner (WC) Department of Commercial Taxes, Ernakulam |
||
|
21.67 |
2013-14 |
Deputy Commissioner of Sales Tax, Mumbai |
||
|
Income Tax Act |
Income Tax |
85.72 |
2014-15 |
Deputy Commissioner of Income Tax, Yamuna Nagar |
|
1.44 |
2013-14 |
Deputy Commissioner of Income Tax, Yamuna Nagar |
|
(viii) In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of loans or borrowing to any financial institution, bank or government . The Company does not have any debenture holders. |
(ix) In our opinion and according to the information and explanations given to us, the Company has not raised money by way of initial public offer or further public offer (including debt instruments) or term loans during the year. Hence reporting under clause 3(ix) of the Order is not applicable to the Company.
(x) According to the information and explanations given to us, no fraud by the Company or any fraud on the Company by its officers or employees has been noticed or reported during the year under review.
(xi) According to the information and explanations given to us and based on our examination of records of the Company, the Company has paid / provided for the managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act , 2013.
(xii) According to the information and explanation given to us, the company is not a Nidhi Company. Therefore the provisions of paragraph 3(xii) of the Order are not applicable.
(xiii) According to the information and explanations given to us, and based on our examination of the records of the Company, transactions with the related parties are in compliance with section 177 and 188 of the Companies Act, 2013. Further the details of the transactions have been disclosed in the standalone Ind AS financial statements as required by the applicable accounting standards.
(xiv) According to the information and explanations given to us, the Company has not made preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review . Therefore the provisions of paragraph 3(xiv) of the Order are not applicable.
(xv) According to information and explanations given to us, and based on our examination of the records of the Company, the Company has not entered into any non-cash transactions with directors or persons connected with him. Accordingly, provisions of paragraph 3 (xv) of the Order are not applicable.
(xvi) According to the information and explanations given to us, the Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.
ANNEDURE-B TO THE INDEPENDENT AUDITOR''S REPORT 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 Isgec Heavy Engineering Limited ("the Company") as of March 31, 2018, in conjunction with our audit of the standalone Ind AS financial statements of the Company for the year ended on that date.
Management''s Responsibility for Internal Financial Controls
The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the "Guidance Note") issued by the Institute of Chartered Accountants of India (''ICAI''). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to Company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.
Auditors'' Responsibility
Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the Ind AS financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A Company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A Company''s internal financial control over financial reporting includes those policies and procedures that;
a. pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;
b. 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
c. 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, 2018, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
For SCV & Co. LLP
Chartered Accountants
Firm Reg. No: 000235N/ N500089
(Abhinav Khosla)
Place: Noida Partner
Date: May 28, 2018 Membership No. 087010
Mar 31, 2017
TO
THE MEMBERS OF ISGEC HEAVY ENGINEERING LIMITED
Report on the Standalone Financial Statements
We have audited the accompanying Financial Statements of Isgec Heavy Engineering Limited ("the Company") which comprises the Balance Sheet as at 31st March, 2017, the statement of profit and loss (including other comprehensive income), the statement of cash flows and the statement of changes in equity for the year then ended and a summary of the significant accounting policies and other explanatory information (herein after referred to as "Ind AS financial statements").
Management''s Responsibility for the Standalone Financial Statements
The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation 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) prescribed under section 133 of the Act read with relevant rules issued there under.
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 judgment 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 Ind AS financial statements that give a true and fair view and are free from material misstatements, whether due to fraud or error.
Auditor''s 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 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 Ind AS 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 the material misstatement of the Ind AS financial statements, whether due to error or fraud. In making those risk assessments, the auditor considers internal 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 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 Ind AS financial statements.
Opinion
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 Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India including the Ind AS, of the financial position of the Company as at March 31, 2017 and its financial performance 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 ("the Order") issued by the Central Government
of India in terms of Section 143(11) of the Act, we give in the "Annexure A" 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 standalone Ind As financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014;
e) On the basis of the written representations received from the directors as on 31st March, 2017 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 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 B".
g) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note 43 to the financial statements;
ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts;
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
iv. The company has provided requisite disclosure in its Ind AS financial statements as to holdings as well as dealings in Specified Bank Notes during the period from 8th November, 2016 to 30th December, 2016 and on the basis of information & explanation provided these are in accordance with the books of accounts maintained by the company. Refer Note 55 to the Ind AS financial statements.
Report on the matters specified in paragraph 3 of the Companies (Auditor''s Report) Order, 2016 ("the Order") issued by the Central Government of India in terms of section 143(11) of the Companies Act, 2013 ("the Act") as referred to in paragraph 1 of ''Report on Other Legal and Regulatory Requirements'' section
(i) (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets;
(b) The Company has physically verified these fixed assets as per its program of physical verification that covers every item of fixed assets over a period of three years except for certain building and vehicles situated in Pakistan (carrying value of Rs 1). No material discrepancies were noticed on such verification;
(c) The title deeds of immovable properties are held in the name of the Company, as verified from the photocopies of original title deeds. The original title deeds are pledged with banks as security against term loans.
(ii) The physical verification of inventory has been conducted at reasonable intervals by the management. No material discrepancies were noticed on such physical verification;
(iii) (a) As informed to us, the Company has granted unsecured loans to its one of the subsidiary covered in the register maintained under section 189 of the Companies Act, 2013, the balance outstanding is Rs. 7270.00 Lakhs.
(b) As explained to us and as per records the principle and interest is repayable on demand.
(c) As per information & explanation and as per records there is no overdue interest outstanding as on the date of Balance Sheet.
(iv) The Company has not granted any loan to Directors in terms of Section 185 of the Companies Act, 2013 (Act). Further, the Company has complied with the provisions of Section 186 of the Act in respect of loans, investments, guarantees, and security made;
(v) As per information and explanation provided to us, the Company has not accepted any public deposits during the year. Further, we have not come across any such deposit(s) nor the management has reported any such deposit(s), therefore the directives issued by the Reserve Bank of India and the provisions of sections 73 to 76 or any other relevant provisions of the Act and the rules framed there under are not applicable;
(vi) We have broadly reviewed the books and records required to be maintained as specified by the Central Government under sub-section (l) of section 148 of the Companies Act, 2013 and we are of the opinion that prima facie, the prescribed accounts and records are being maintained;
(vii) (a) The Company is generally regular in depositing undisputed statutory dues including provident fund, employees'' state insurance, income-tax, sales-tax, service tax, duty of customs, duty of excise, value added tax, cess and any other statutory dues to the appropriate authorities. There are no arrears of outstanding statutory dues as at the last day of the financial year concerned for a period of more than six months from the date they became payable.
(b) The particulars of dues of income tax or sales tax or service tax or duty of customs or duty of excise or value added tax have not been deposited on account of any dispute are as under:
|
Name of Statute |
Duty/Tax |
Year |
Forum where dispute is pending |
Amount (Rs. in lakhs) As at March 31, 2017 |
Amount (Rs. in lakhs) As at March 31, 2016 |
|
Central Excise Act |
Excise Duty |
1994-95 |
Hon''ble High Court, |
5.00 |
5.00 |
|
Allahabad |
|||||
|
1994-96 |
Tribunal New Delhi |
8.00 |
8.00 |
||
|
2002-10 |
CESTAT, New Delhi |
8.58 |
8.58 |
||
|
2009-13 |
Commissioner Appeal, Meerut |
14.92 |
14.92 |
||
|
2013-16 |
Commissioner Appeal, Meerut |
6.53 |
2.90 |
||
|
2015-16 |
Commissioner Central Excise (Panchkula) |
37.48 |
- |
||
|
2011-12 |
Assistant commissioner, Panchkula |
3.57 |
- |
||
|
Service Tax |
Service Tax |
2004-06 |
CESTAT, New Delhi |
- |
6.00 |
|
2005-07 |
CESTAT, New Delhi |
- |
22.31 |
||
|
2008-09 |
CESTAT, New Delhi |
- |
8.36 |
||
|
2009-12 |
Commissioner Central Excise (Panchkula) |
- |
63.56 |
||
|
2011-12 |
Commissioner Central Excise (Panchkula) |
61.28 |
61.28 |
||
|
2008-09 |
Commissioner, Central Excise (Vadodara) |
60.31 |
60.31 |
||
|
2008-13 |
Commissioner Central Excise (Panchkula) |
- |
36.97 |
||
|
2011-12 |
Commissioner Central Excise (Panchkula) |
11.92 |
25.56 |
||
|
2007-10 |
Commissioner Central Excise (Panchkula) |
0.34 |
9.22 |
||
|
2008-09 |
Commissioner Central Excise (Panchkula) |
- |
9.69 |
||
|
2014-15 |
Commissioner Central Excise (Panchkula) |
- |
45.14 |
||
|
2011-12 |
Commissioner (Appeals) Delhi |
- |
0.17 |
||
|
2015-16 |
Assistant commissioner of Central Excise, U.P. |
0.77 |
- |
||
|
2015-16 |
Commissioner, Panchkula |
0.39 |
- |
||
|
2010-14 |
Additional commissioner of Central Excise, U.P. |
14.40 |
- |
|
Sales Tax Act |
Sales Tax |
1993-94 |
Sales Tax Tribunal, Orissa |
9.02 |
9.02 |
|
1995-96 |
Sales Tax Tribunal, Orissa |
17.00 |
17.00 |
||
|
1996-97 |
Sales Tax Tribunal, Orissa |
5.00 |
5.00 |
||
|
1992-93 |
Sr. Joint Commissioner of Commercial Taxes, Kolkata |
90.00 |
90.00 |
||
|
1993-94 |
Sr. Joint Commissioner of Commercial Taxes, Kolkata |
120.59 |
155.00 |
||
|
1971-73 |
Commissioner Sales Tax, Lucknow |
6.00 |
6.00 |
||
|
1987-88 |
Dy Comm. of Commercial Taxes(appeals), Kolkata |
4.00 |
4.00 |
||
|
1995-96 |
Dy Comm. of Commercial Taxes, Kolkata |
34.00 |
34.00 |
||
|
1994-95 |
Dy Comm. of Commercial Taxes(appeals), Kolkata |
61.00 |
61.00 |
||
|
2006-07 |
Dy Comm. Of Commercial Tax, Tamilnadu |
0.82 |
0.82 |
||
|
2009-10 |
Sr. Joint Commissioner of Commercial Taxes, Kolkata |
4.66 |
4.72 |
||
|
2009-10 |
Sr. Joint Commissioner of Commercial Taxes, Kolkata |
8.05 |
9.51 |
||
|
2009-12 |
Additional commissioner Appeals |
203.63 |
76.05 |
||
|
2008-09 |
Dy. Commissioner, Commercial Tax, Kerala |
7.20 |
6.62 |
||
|
2015-16 |
Excise & Tax Officer, Punjab |
5.55 |
7.44 |
||
|
Local Area development Tax Act ,2002 |
Local area tax |
2006-07 |
Hon''ble High Court of Punjab & Haryana |
20.00 |
14.00 |
|
Haryana State Pollution Control Law |
Water Cess |
1992-93 |
Hon''ble Supreme Court of India |
15.82 |
15.28 |
|
Total |
834.36 |
903.43 |
|||
(viii) The Company has not defaulted in repayment of loans or borrowing to a financial institution, bank or government. The Company has not issued any debentures;
(ix) The Company did not raise any money by way of initial public offer or further public offer (including debt instruments) during the year. Term loans were applied for the purposes for which those are raised;
(x) According to the information and explanations given to us, no fraud by the Company or fraud on the Company by its officers or employees has been noticed or reported during the year;
(xi) According to the information and explanation given to us and based on our examination of the records of the Company, the Company has paid or provided for the managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Act;
(xii) The Company is not a Nidhi Company, hence clause (xii) of the Order is not applicable to the Company;
(xiii) According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with sections 177 and 188 of the act where applicable and details of such transactions have been disclosed in the financial statements as required by the applicable accounting standards;
(xiv) The Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under audit.
(xv) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into non-cash transactions with directors or persons connected with him. Accordingly, clause (xv) of paragraph 3 of the Order is not applicable;
(xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934;
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act") as referred to in paragraph 2(f) of ''Report on Other Legal and Regulatory Requirements'' section
We have audited the internal financial controls over financial reporting of Isgec Heavy Engineering Limited ("the Company") as of March 31, 2017 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.
Management''s Responsibility for Internal Financial Controls
The Company''s management is responsible for establishing and maintaining internal financial controls based on "the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India". These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.
Auditors'' Responsibility
Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit.
We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the "Guidance Note") and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness.
Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that:
a) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;
b) 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
c) 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 31stMarch, 2017, based on "the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India".
For S S Kothari Mehta & Co.
Chartered Accountants
Firm''s Registration No. 000756N
(Neeraj Bansal)
Place: Noida Partner
Date: May 29, 2017 Membership No. 95960
Mar 31, 2016
We have audited the accompanying standalone financial statements of
Isgec Heavy Engineering Limited ("the Company"), which comprise the
Balance Sheet as at 31st March, 2016, the Statement of Profit and Loss,
the Cash Flow Statement for the year then ended, and a summary of the
significant accounting policies and other explanatory information.
Management''s Responsibility for the Standalone Financial Statements
The Company''s Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 ("the Act") with respect
to the preparation of these standalone financial statements that give a
true and fair view of the financial position, financial performance and
cash flows of the Company in accordance with the accounting principles
generally accepted in India, including the Accounting Standards
specified under Section 133 of the Act, read with Rule 7 of the
Companies (Accounts) Rules, 2014.
This responsibility also includes maintenance of adequate accounting
records in accordance with the provisions of the Act for safeguarding
of the assets of the Company and for preventing and detecting frauds
and other irregularities; selection and application of appropriate
accounting policies; making judgments and estimates that are reasonable
and prudent; and design, implementation and maintenance of adequate
internal financial controls, that were operating effectively for
ensuring the accuracy and completeness of the accounting records,
relevant to the preparation and presentation of the financial
statements that give a true and fair view and are free from material
misstatement, whether due to fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these standalone
financial statements based on our audit.
We have taken into account the provisions of the Act, the accounting
and auditing standards and matters which are required to be included in
the audit report under the provisions of the Act and the Rules made
thereunder.
We conducted our audit in accordance with the Standards on Auditing
specified under Section 143(10) of the Act. Those Standards require
that we comply with ethical requirements and plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free from material misstatement. An audit involves performing
procedures to obtain audit evidence about the amounts and the
disclosures in the financial statements. The procedures selected depend
on the auditor''s judgment, including the assessment of the risks of
material misstatement of the financial statements, whether due to fraud
or error. In making those risk assessments, the auditor considers
internal financial control relevant to the Company''s preparation of the
financial statements that give a true and fair view in order to design
audit procedures that are appropriate in the circumstances. 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 standalone
financial statements.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid standalone financial statements
give the information required by the Act in the manner so required and
give a true and fair view in conformity with the accounting principles
generally accepted in India, of the state of affairs of the Company as
at 31st March, 2016, 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, 2016 ("the
Order") issued by the Central Government of India in terms of Section
143(11) of the Act, we give in the "Annexure A" 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 standalone financial statements comply
with the Accounting Standards specified under Section 133 of the Act,
read with Rule 7 of the Companies (Accounts) Rules, 2014;
e) On the basis of the written representations received from the
directors as on 31st March, 2016 taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March, 2016
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 B".
g) With respect to the other matters to be included in the Auditor''s
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its
financial position in its financial statements - Refer Note 21 to the
financial statements;
ii. The Company has made provision, as required under the applicable
law or accounting standards, for material foreseeable losses, if any,
on long-term contracts including derivative contracts;
iii. There has been no delay in transferring amounts, required to be
transferred, to the Investor Education and Protection Fund by the
Company.
Annexure A to the Independent Auditor''s Report to the members of Isgec
Heavy Engineering Limited dated 26th May, 2016
Report on the matters specified in paragraph 3 of the Companies
(Auditor''s Report) Order, 2016 ("the Order") issued by the Central
Government of India in terms of section 143(11) of the Companies Act,
2013 ("the Act") as referred to in paragraph 1 of ''Report on Other
Legal and Regulatory Requirements'' section
(i) (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation of fixed
assets;
(b) The Company has physically verified these fixed assets as per its
program of physical verification that covers every item of fixed assets
over a period of three years except for certain building and vehicles
situated in Pakistan (carrying value of Rs.1). No material
discrepancies were noticed on such verification;
(c) The tide deeds of immovable properties are held in the name of the
Company, as verified from the photocopies of original title deeds. The
original title deeds are pledged with banks as security against term
loans.
(ii) The physical verification of inventory has been conducted at
reasonable intervals by the management. No material discrepancies were
noticed on such physical verification;
(iii) The Company has not given any loan, secured or unsecured to
Companies, firms, or other parties covered in the register maintained
under section 189 of Companies Act, 2013. Accordingly, clauses (ui)(a),
(ui)(b) and (ui)(c) of the Order is not applicable to the Company;
(iv) The Company has not granted any loan to Directors in terms of
Section 185 of the Companies Act, 2013 (Act). Further, the Company has
complied with the provisions of Section 186 of the Act in respect of
loans, investments, guarantees and security made;
(v) As per information and explanation provided to us, the Company has
not accepted any public deposits during the year. Further, we have not
come across any such deposit(s) nor the management has reported any
such deposit(s), therefore the directives issued by the Reserve Bank of
India and the provisions of sections 73 to 76 or any other relevant
provisions of the Act and the rules framed there under are not
applicable;
(vi) We have broadly reviewed the books and records required to be
maintained as specified by the Central Government under sub-section (1)
of section 148 of the Companies Act, 2013 and we are of the opinion
diat prima facie, the prescribed accounts and records are being
maintained;
(vii) (a) The Company is generally regular in depositing undisputed
statutory dues including provident fund, employees'' state insurance,
income-tax, sales-tax, service tax, duty of customs, duty of excise,
value added tax, cess and any other statutory dues to the appropriate
authorities. There are no arrears of outstanding statutory dues as at
the last day of the financial year concerned for a period of more than
six months from the date they became payable.
(b) The particulars of dues of income tax or sales tax or service tax
or duty of customs or duty of excise or value added tax have not been
deposited on account of any dispute are as under:
Name of Statute Duty/Tax Year Forum where dispute
is pending Amount Amount
(Rs.in
lacs) (Rs.in
lacs)
As at As at
31st
March,
16 31st
March,
15
Central Excise
Duty 1994-95 Hon''ble High
Court, Allahabad 5.00 5.00
Excise Act
1994-96 Tribunal New Delhi 8.00 8.00
2002-10 CESTAT, New Delhi 8.58 53.25
2009-13 Joint Commissioner
Central Excise, 14.92 14.98
Muzaffarnagar
2013-14 Joint Commissioner
Central Excise, 2.90 3.00
Muzaffarnagar
Service Tax Service
Tax 2004-06 CEST AT, New Delhi 6.00 6.00
2005-07 CEST AT, New Delhi 22.31 22.31
2008-09 CESTAT, New Delhi 8.36 8.36
2009-12 Commissioner
Central Excise
(Panchkula) 63.56 63.56
2011-12 Commissioner
Central Excise
(Panchkula) 61.28 61.28
2008-09 Commissioner,
Central Excise
(Vadodara) 60.31 60.31
2008-13 Commissioner
Central Excise
(Panchkula) 36.97 36.97
2011-12 Commissioner
Central Excise
(Panchkula) 25.56 25.56
2007-10 Commissioner
Central Excise
(Panchkula) 9.22 9.22
2008-09 Commissioner
Central Excise
(Panchkula) 9.69 9.69
2014-15 Commissioner
Central Excise
(Panchkula) 45.14 -
2011-12 Commissioner
(Appeals) Delhi 0.17 -
Name of
Statute Duty/Tax Year Forum where
dispute is
pending Amount Amount
(Rs.in
lacs) (Rs.in
lacs)
As at As at
31st
March,
16 31st
March,
15
Sales Tax
Act Sales Tax 1993-94 Sales Tax
Tribunal, Orissa 9.02 9.02
1995-96 Sales Tax
Tribunal, Orissa 17.00 17.00
1996-97 Sales Tax
Tribunal, Orissa 5.00 5.00
1992-93 Appellant
Tribunal - West
Bengal 90.00 90.00
1993-94 Appellant
Tribunal - West
Bengal 155.00 155.00
1971-73 Commissioner
Sales Tax,
Lucknow 6.00 6.00
1987-88 Dy Comm. of
Commercial Taxes,
Kolkata 4.00 4.00
1995-96 Dy Comm. of
Commercial Taxes,
Kolkata 34.00 34.00
1994-95 Commercial Tax
Officer, Kolkata 61.00 61.00
2006-07 Dy Comm. Of
Commercial Tax,
Tamilnadu 0.82 0.82
2007-08 Dy Comm. Of
Commercial Tax,
Tamilnadu - 2.41
2008-09 Dy Comm. Of
Commercial Tax,
Tamilnadu - 0.58
2009-10 Joint Comm. of
Commercial Taxes,
Kolkata 4.72 4.72
2009-10 Joint Comm. of
Commercial Taxes,
Kolkata 9.51 9.51
2009-12 Additional
commissioner of
Central Excise-UP 76.05 -
2008-09 Additional
commissioner of
Central Excise-UP - 320.42
2008-09 Additional
commissioner of
Central Excise-UP 6.62 6.62
2015-16 Excise & Tax
Officer, Punjab 7.44 -
Local Area Local area 2006-07 Hon''ble High Court
of Punjab & Haryana 14.00 14.00
development
tax
Tax Act,
2002
Haryana
State Water Cess 1992-93 Hon''ble Supreme
Court of India 15.28 13.20
Pollution
Control
Law
Total 903.43 1140.79
(viii) The Company has not defaulted in repayment of loans or borrowing
to a financial institution, bank or government. The Company has not
issued any debentures;
(ix) The Company did not raise any money by way of initial public offer
or further public offer (including debt instruments) during the year.
Term loans were applied for the purposes for which those are raised;
(x) According to the information and explanations given to us, no fraud
by the Company or fraud on the Company by its officers or employees has
been noticed or reported during the year;
(xi) According to the information and explanation given to us and based
on our examination of the records of the Company, the Company has paid
or provided for the managerial remuneration in accordance with the
requisite approvals mandated by the provisions of section 197 read with
Schedule V to the Act;
(xii) The Company is not a Nidhi Company, hence clause (xii) of the
Order is not applicable to the Company;
(xiii) According to the information and explanations given to us and
based on our examination of the records of the Company, transactions
with the related parties are in compliance with sections 177 and 188 of
the act where applicable and details of such transactions have been
disclosed in the financial statements as required by the applicable
accounting standards;
(xiv) The Company has not made any preferential allotment or private
placement of shares or fully or partly convertible debentures during
the year under audit.
(xv) According to the information and explanations given to us and
based on our examination of the records of the company, the company has
not entered into non-cash transactions with directors or persons
connected with him. Accordingly, clause (xv) of paragraph 3 of the Order
is not applicable;
(xvi) The Company is not required to be registered under section 45-IA
of the Reserve Bank of India Act, 1934;
For S S Kothari Mehta & Co.
Chartered Accountants
Firm''s Registration No. 000756N
K K Tulshan
Place: Noida Partner
Date: 26th May, 2016 Membership No. 085033
Mar 31, 2016
We have audited the accompanying standalone financial statements of
Isgec Heavy Engineering Limited ("the Company"), which comprise the
Balance Sheet as at 31st March, 2016, the Statement of Profit and Loss,
the Cash Flow Statement for the year then ended, and a summary of the
significant accounting policies and other explanatory information.
Management''s Responsibility for the Standalone Financial Statements
The Company''s Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 ("the Act") with respect
to the preparation of these standalone financial statements that give a
true and fair view of the financial position, financial performance and
cash flows of the Company in accordance with the accounting principles
generally accepted in India, including the Accounting Standards
specified under Section 133 of the Act, read with Rule 7 of the
Companies (Accounts) Rules, 2014.
This responsibility also includes maintenance of adequate accounting
records in accordance with the provisions of the Act for safeguarding
of the assets of the Company and for preventing and detecting frauds
and other irregularities; selection and application of appropriate
accounting policies; making judgments and estimates that are reasonable
and prudent; and design, implementation and maintenance of adequate
internal financial controls, that were operating effectively for
ensuring the accuracy and completeness of the accounting records,
relevant to the preparation and presentation of the financial
statements that give a true and fair view and are free from material
misstatement, whether due to fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these standalone
financial statements based on our audit.
We have taken into account the provisions of the Act, the accounting
and auditing standards and matters which are required to be included in
the audit report under the provisions of the Act and the Rules made
thereunder.
We conducted our audit in accordance with the Standards on Auditing
specified under Section 143(10) of the Act. Those Standards require
that we comply with ethical requirements and plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free from material misstatement. An audit involves performing
procedures to obtain audit evidence about the amounts and the
disclosures in the financial statements. The procedures selected depend
on the auditor''s judgment, including the assessment of the risks of
material misstatement of the financial statements, whether due to fraud
or error. In making those risk assessments, the auditor considers
internal financial control relevant to the Company''s preparation of the
financial statements that give a true and fair view in order to design
audit procedures that are appropriate in the circumstances. 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 standalone
financial statements.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid standalone financial statements
give the information required by the Act in the manner so required and
give a true and fair view in conformity with the accounting principles
generally accepted in India, of the state of affairs of the Company as
at 31st March, 2016, 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, 2016 ("the
Order") issued by the Central Government of India in terms of Section
143(11) of the Act, we give in the "Annexure A" 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 standalone financial statements comply
with the Accounting Standards specified under Section 133 of the Act,
read with Rule 7 of the Companies (Accounts) Rules, 2014;
e) On the basis of the written representations received from the
directors as on 31st March, 2016 taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March, 2016
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 B".
g) With respect to the other matters to be included in the Auditor''s
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its
financial position in its financial statements - Refer Note 21 to the
financial statements;
ii. The Company has made provision, as required under the applicable
law or accounting standards, for material foreseeable losses, if any,
on long-term contracts including derivative contracts;
iii. There has been no delay in transferring amounts, required to be
transferred, to the Investor Education and Protection Fund by the
Company.
Annexure A to the Independent Auditor''s Report to the members of Isgec
Heavy Engineering Limited dated 26th May, 2016
Report on the matters specified in paragraph 3 of the Companies
(Auditor''s Report) Order, 2016 ("the Order") issued by the Central
Government of India in terms of section 143(11) of the Companies Act,
2013 ("the Act") as referred to in paragraph 1 of ''Report on Other
Legal and Regulatory Requirements'' section
(i) (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation of fixed
assets;
(b) The Company has physically verified these fixed assets as per its
program of physical verification that covers every item of fixed assets
over a period of three years except for certain building and vehicles
situated in Pakistan (carrying value of Rs.1). No material
discrepancies were noticed on such verification;
(c) The tide deeds of immovable properties are held in the name of the
Company, as verified from the photocopies of original title deeds. The
original title deeds are pledged with banks as security against term
loans.
(ii) The physical verification of inventory has been conducted at
reasonable intervals by the management. No material discrepancies were
noticed on such physical verification;
(iii) The Company has not given any loan, secured or unsecured to
Companies, firms, or other parties covered in the register maintained
under section 189 of Companies Act, 2013. Accordingly, clauses (ui)(a),
(ui)(b) and (ui)(c) of the Order is not applicable to the Company;
(iv) The Company has not granted any loan to Directors in terms of
Section 185 of the Companies Act, 2013 (Act). Further, the Company has
complied with the provisions of Section 186 of the Act in respect of
loans, investments, guarantees and security made;
(v) As per information and explanation provided to us, the Company has
not accepted any public deposits during the year. Further, we have not
come across any such deposit(s) nor the management has reported any
such deposit(s), therefore the directives issued by the Reserve Bank of
India and the provisions of sections 73 to 76 or any other relevant
provisions of the Act and the rules framed there under are not
applicable;
(vi) We have broadly reviewed the books and records required to be
maintained as specified by the Central Government under sub-section (1)
of section 148 of the Companies Act, 2013 and we are of the opinion
diat prima facie, the prescribed accounts and records are being
maintained;
(vii) (a) The Company is generally regular in depositing undisputed
statutory dues including provident fund, employees'' state insurance,
income-tax, sales-tax, service tax, duty of customs, duty of excise,
value added tax, cess and any other statutory dues to the appropriate
authorities. There are no arrears of outstanding statutory dues as at
the last day of the financial year concerned for a period of more than
six months from the date they became payable.
(b) The particulars of dues of income tax or sales tax or service tax
or duty of customs or duty of excise or value added tax have not been
deposited on account of any dispute are as under:
Name of Statute Duty/Tax Year Forum where dispute
is pending Amount Amount
(Rs.in
lacs) (Rs.in
lacs)
As at As at
31st
March,
16 31st
March,
15
Central Excise
Duty 1994-95 Hon''ble High
Court, Allahabad 5.00 5.00
Excise Act
1994-96 Tribunal New Delhi 8.00 8.00
2002-10 CESTAT, New Delhi 8.58 53.25
2009-13 Joint Commissioner
Central Excise, 14.92 14.98
Muzaffarnagar
2013-14 Joint Commissioner
Central Excise, 2.90 3.00
Muzaffarnagar
Service Tax Service
Tax 2004-06 CEST AT, New Delhi 6.00 6.00
2005-07 CEST AT, New Delhi 22.31 22.31
2008-09 CESTAT, New Delhi 8.36 8.36
2009-12 Commissioner
Central Excise
(Panchkula) 63.56 63.56
2011-12 Commissioner
Central Excise
(Panchkula) 61.28 61.28
2008-09 Commissioner,
Central Excise
(Vadodara) 60.31 60.31
2008-13 Commissioner
Central Excise
(Panchkula) 36.97 36.97
2011-12 Commissioner
Central Excise
(Panchkula) 25.56 25.56
2007-10 Commissioner
Central Excise
(Panchkula) 9.22 9.22
2008-09 Commissioner
Central Excise
(Panchkula) 9.69 9.69
2014-15 Commissioner
Central Excise
(Panchkula) 45.14 -
2011-12 Commissioner
(Appeals) Delhi 0.17 -
Name of
Statute Duty/Tax Year Forum where
dispute is
pending Amount Amount
(Rs.in
lacs) (Rs.in
lacs)
As at As at
31st
March,
16 31st
March,
15
Sales Tax
Act Sales Tax 1993-94 Sales Tax
Tribunal, Orissa 9.02 9.02
1995-96 Sales Tax
Tribunal, Orissa 17.00 17.00
1996-97 Sales Tax
Tribunal, Orissa 5.00 5.00
1992-93 Appellant
Tribunal - West
Bengal 90.00 90.00
1993-94 Appellant
Tribunal - West
Bengal 155.00 155.00
1971-73 Commissioner
Sales Tax,
Lucknow 6.00 6.00
1987-88 Dy Comm. of
Commercial Taxes,
Kolkata 4.00 4.00
1995-96 Dy Comm. of
Commercial Taxes,
Kolkata 34.00 34.00
1994-95 Commercial Tax
Officer, Kolkata 61.00 61.00
2006-07 Dy Comm. Of
Commercial Tax,
Tamilnadu 0.82 0.82
2007-08 Dy Comm. Of
Commercial Tax,
Tamilnadu - 2.41
2008-09 Dy Comm. Of
Commercial Tax,
Tamilnadu - 0.58
2009-10 Joint Comm. of
Commercial Taxes,
Kolkata 4.72 4.72
2009-10 Joint Comm. of
Commercial Taxes,
Kolkata 9.51 9.51
2009-12 Additional
commissioner of
Central Excise-UP 76.05 -
2008-09 Additional
commissioner of
Central Excise-UP - 320.42
2008-09 Additional
commissioner of
Central Excise-UP 6.62 6.62
2015-16 Excise & Tax
Officer, Punjab 7.44 -
Local Area Local area 2006-07 Hon''ble High Court
of Punjab & Haryana 14.00 14.00
development
tax
Tax Act,
2002
Haryana
State Water Cess 1992-93 Hon''ble Supreme
Court of India 15.28 13.20
Pollution
Control
Law
Total 903.43 1140.79
(viii) The Company has not defaulted in repayment of loans or borrowing
to a financial institution, bank or government. The Company has not
issued any debentures;
(ix) The Company did not raise any money by way of initial public offer
or further public offer (including debt instruments) during the year.
Term loans were applied for the purposes for which those are raised;
(x) According to the information and explanations given to us, no fraud
by the Company or fraud on the Company by its officers or employees has
been noticed or reported during the year;
(xi) According to the information and explanation given to us and based
on our examination of the records of the Company, the Company has paid
or provided for the managerial remuneration in accordance with the
requisite approvals mandated by the provisions of section 197 read with
Schedule V to the Act;
(xii) The Company is not a Nidhi Company, hence clause (xii) of the
Order is not applicable to the Company;
(xiii) According to the information and explanations given to us and
based on our examination of the records of the Company, transactions
with the related parties are in compliance with sections 177 and 188 of
the act where applicable and details of such transactions have been
disclosed in the financial statements as required by the applicable
accounting standards;
(xiv) The Company has not made any preferential allotment or private
placement of shares or fully or partly convertible debentures during
the year under audit.
(xv) According to the information and explanations given to us and
based on our examination of the records of the company, the company has
not entered into non-cash transactions with directors or persons
connected with him. Accordingly, clause (xv) of paragraph 3 of the Order
is not applicable;
(xvi) The Company is not required to be registered under section 45-IA
of the Reserve Bank of India Act, 1934;
For S S Kothari Mehta & Co.
Chartered Accountants
Firm''s Registration No. 000756N
K K Tulshan
Place: Noida Partner
Date: 26th May, 2016 Membership No. 085033
Mar 31, 2016
We have audited the accompanying standalone financial statements of
Isgec Heavy Engineering Limited ("the Company"), which comprise the
Balance Sheet as at 31st March, 2016, the Statement of Profit and Loss,
the Cash Flow Statement for the year then ended, and a summary of the
significant accounting policies and other explanatory information.
Management''s Responsibility for the Standalone Financial Statements
The Company''s Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 ("the Act") with respect
to the preparation of these standalone financial statements that give a
true and fair view of the financial position, financial performance and
cash flows of the Company in accordance with the accounting principles
generally accepted in India, including the Accounting Standards
specified under Section 133 of the Act, read with Rule 7 of the
Companies (Accounts) Rules, 2014.
This responsibility also includes maintenance of adequate accounting
records in accordance with the provisions of the Act for safeguarding
of the assets of the Company and for preventing and detecting frauds
and other irregularities; selection and application of appropriate
accounting policies; making judgments and estimates that are reasonable
and prudent; and design, implementation and maintenance of adequate
internal financial controls, that were operating effectively for
ensuring the accuracy and completeness of the accounting records,
relevant to the preparation and presentation of the financial
statements that give a true and fair view and are free from material
misstatement, whether due to fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these standalone
financial statements based on our audit.
We have taken into account the provisions of the Act, the accounting
and auditing standards and matters which are required to be included in
the audit report under the provisions of the Act and the Rules made
thereunder.
We conducted our audit in accordance with the Standards on Auditing
specified under Section 143(10) of the Act. Those Standards require
that we comply with ethical requirements and plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free from material misstatement. An audit involves performing
procedures to obtain audit evidence about the amounts and the
disclosures in the financial statements. The procedures selected depend
on the auditor''s judgment, including the assessment of the risks of
material misstatement of the financial statements, whether due to fraud
or error. In making those risk assessments, the auditor considers
internal financial control relevant to the Company''s preparation of the
financial statements that give a true and fair view in order to design
audit procedures that are appropriate in the circumstances. 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 standalone
financial statements.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid standalone financial statements
give the information required by the Act in the manner so required and
give a true and fair view in conformity with the accounting principles
generally accepted in India, of the state of affairs of the Company as
at 31st March, 2016, 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, 2016 ("the
Order") issued by the Central Government of India in terms of Section
143(11) of the Act, we give in the "Annexure A" 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 standalone financial statements comply
with the Accounting Standards specified under Section 133 of the Act,
read with Rule 7 of the Companies (Accounts) Rules, 2014;
e) On the basis of the written representations received from the
directors as on 31st March, 2016 taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March, 2016
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 B".
g) With respect to the other matters to be included in the Auditor''s
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its
financial position in its financial statements - Refer Note 21 to the
financial statements;
ii. The Company has made provision, as required under the applicable
law or accounting standards, for material foreseeable losses, if any,
on long-term contracts including derivative contracts;
iii. There has been no delay in transferring amounts, required to be
transferred, to the Investor Education and Protection Fund by the
Company.
Annexure A to the Independent Auditor''s Report to the members of Isgec
Heavy Engineering Limited dated 26th May, 2016
Report on the matters specified in paragraph 3 of the Companies
(Auditor''s Report) Order, 2016 ("the Order") issued by the Central
Government of India in terms of section 143(11) of the Companies Act,
2013 ("the Act") as referred to in paragraph 1 of ''Report on Other
Legal and Regulatory Requirements'' section
(i) (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation of fixed
assets;
(b) The Company has physically verified these fixed assets as per its
program of physical verification that covers every item of fixed assets
over a period of three years except for certain building and vehicles
situated in Pakistan (carrying value of Rs.1). No material
discrepancies were noticed on such verification;
(c) The tide deeds of immovable properties are held in the name of the
Company, as verified from the photocopies of original title deeds. The
original title deeds are pledged with banks as security against term
loans.
(ii) The physical verification of inventory has been conducted at
reasonable intervals by the management. No material discrepancies were
noticed on such physical verification;
(iii) The Company has not given any loan, secured or unsecured to
Companies, firms, or other parties covered in the register maintained
under section 189 of Companies Act, 2013. Accordingly, clauses (ui)(a),
(ui)(b) and (ui)(c) of the Order is not applicable to the Company;
(iv) The Company has not granted any loan to Directors in terms of
Section 185 of the Companies Act, 2013 (Act). Further, the Company has
complied with the provisions of Section 186 of the Act in respect of
loans, investments, guarantees and security made;
(v) As per information and explanation provided to us, the Company has
not accepted any public deposits during the year. Further, we have not
come across any such deposit(s) nor the management has reported any
such deposit(s), therefore the directives issued by the Reserve Bank of
India and the provisions of sections 73 to 76 or any other relevant
provisions of the Act and the rules framed there under are not
applicable;
(vi) We have broadly reviewed the books and records required to be
maintained as specified by the Central Government under sub-section (1)
of section 148 of the Companies Act, 2013 and we are of the opinion
diat prima facie, the prescribed accounts and records are being
maintained;
(vii) (a) The Company is generally regular in depositing undisputed
statutory dues including provident fund, employees'' state insurance,
income-tax, sales-tax, service tax, duty of customs, duty of excise,
value added tax, cess and any other statutory dues to the appropriate
authorities. There are no arrears of outstanding statutory dues as at
the last day of the financial year concerned for a period of more than
six months from the date they became payable.
(b) The particulars of dues of income tax or sales tax or service tax
or duty of customs or duty of excise or value added tax have not been
deposited on account of any dispute are as under:
Name of Statute Duty/Tax Year Forum where dispute
is pending Amount Amount
(Rs.in
lacs) (Rs.in
lacs)
As at As at
31st
March,
16 31st
March,
15
Central Excise
Duty 1994-95 Hon''ble High
Court, Allahabad 5.00 5.00
Excise Act
1994-96 Tribunal New Delhi 8.00 8.00
2002-10 CESTAT, New Delhi 8.58 53.25
2009-13 Joint Commissioner
Central Excise, 14.92 14.98
Muzaffarnagar
2013-14 Joint Commissioner
Central Excise, 2.90 3.00
Muzaffarnagar
Service Tax Service
Tax 2004-06 CEST AT, New Delhi 6.00 6.00
2005-07 CEST AT, New Delhi 22.31 22.31
2008-09 CESTAT, New Delhi 8.36 8.36
2009-12 Commissioner
Central Excise
(Panchkula) 63.56 63.56
2011-12 Commissioner
Central Excise
(Panchkula) 61.28 61.28
2008-09 Commissioner,
Central Excise
(Vadodara) 60.31 60.31
2008-13 Commissioner
Central Excise
(Panchkula) 36.97 36.97
2011-12 Commissioner
Central Excise
(Panchkula) 25.56 25.56
2007-10 Commissioner
Central Excise
(Panchkula) 9.22 9.22
2008-09 Commissioner
Central Excise
(Panchkula) 9.69 9.69
2014-15 Commissioner
Central Excise
(Panchkula) 45.14 -
2011-12 Commissioner
(Appeals) Delhi 0.17 -
Name of
Statute Duty/Tax Year Forum where
dispute is
pending Amount Amount
(Rs.in
lacs) (Rs.in
lacs)
As at As at
31st
March,
16 31st
March,
15
Sales Tax
Act Sales Tax 1993-94 Sales Tax
Tribunal, Orissa 9.02 9.02
1995-96 Sales Tax
Tribunal, Orissa 17.00 17.00
1996-97 Sales Tax
Tribunal, Orissa 5.00 5.00
1992-93 Appellant
Tribunal - West
Bengal 90.00 90.00
1993-94 Appellant
Tribunal - West
Bengal 155.00 155.00
1971-73 Commissioner
Sales Tax,
Lucknow 6.00 6.00
1987-88 Dy Comm. of
Commercial Taxes,
Kolkata 4.00 4.00
1995-96 Dy Comm. of
Commercial Taxes,
Kolkata 34.00 34.00
1994-95 Commercial Tax
Officer, Kolkata 61.00 61.00
2006-07 Dy Comm. Of
Commercial Tax,
Tamilnadu 0.82 0.82
2007-08 Dy Comm. Of
Commercial Tax,
Tamilnadu - 2.41
2008-09 Dy Comm. Of
Commercial Tax,
Tamilnadu - 0.58
2009-10 Joint Comm. of
Commercial Taxes,
Kolkata 4.72 4.72
2009-10 Joint Comm. of
Commercial Taxes,
Kolkata 9.51 9.51
2009-12 Additional
commissioner of
Central Excise-UP 76.05 -
2008-09 Additional
commissioner of
Central Excise-UP - 320.42
2008-09 Additional
commissioner of
Central Excise-UP 6.62 6.62
2015-16 Excise & Tax
Officer, Punjab 7.44 -
Local Area Local area 2006-07 Hon''ble High Court
of Punjab & Haryana 14.00 14.00
development
tax
Tax Act,
2002
Haryana
State Water Cess 1992-93 Hon''ble Supreme
Court of India 15.28 13.20
Pollution
Control
Law
Total 903.43 1140.79
(viii) The Company has not defaulted in repayment of loans or borrowing
to a financial institution, bank or government. The Company has not
issued any debentures;
(ix) The Company did not raise any money by way of initial public offer
or further public offer (including debt instruments) during the year.
Term loans were applied for the purposes for which those are raised;
(x) According to the information and explanations given to us, no fraud
by the Company or fraud on the Company by its officers or employees has
been noticed or reported during the year;
(xi) According to the information and explanation given to us and based
on our examination of the records of the Company, the Company has paid
or provided for the managerial remuneration in accordance with the
requisite approvals mandated by the provisions of section 197 read with
Schedule V to the Act;
(xii) The Company is not a Nidhi Company, hence clause (xii) of the
Order is not applicable to the Company;
(xiii) According to the information and explanations given to us and
based on our examination of the records of the Company, transactions
with the related parties are in compliance with sections 177 and 188 of
the act where applicable and details of such transactions have been
disclosed in the financial statements as required by the applicable
accounting standards;
(xiv) The Company has not made any preferential allotment or private
placement of shares or fully or partly convertible debentures during
the year under audit.
(xv) According to the information and explanations given to us and
based on our examination of the records of the company, the company has
not entered into non-cash transactions with directors or persons
connected with him. Accordingly, clause (xv) of paragraph 3 of the Order
is not applicable;
(xvi) The Company is not required to be registered under section 45-IA
of the Reserve Bank of India Act, 1934;
For S S Kothari Mehta & Co.
Chartered Accountants
Firm''s Registration No. 000756N
K K Tulshan
Place: Noida Partner
Date: 26th May, 2016 Membership No. 085033
Mar 31, 2016
We have audited the accompanying standalone financial statements of
Isgec Heavy Engineering Limited ("the Company"), which comprise the
Balance Sheet as at 31st March, 2016, the Statement of Profit and Loss,
the Cash Flow Statement for the year then ended, and a summary of the
significant accounting policies and other explanatory information.
Management''s Responsibility for the Standalone Financial Statements
The Company''s Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 ("the Act") with respect
to the preparation of these standalone financial statements that give a
true and fair view of the financial position, financial performance and
cash flows of the Company in accordance with the accounting principles
generally accepted in India, including the Accounting Standards
specified under Section 133 of the Act, read with Rule 7 of the
Companies (Accounts) Rules, 2014.
This responsibility also includes maintenance of adequate accounting
records in accordance with the provisions of the Act for safeguarding
of the assets of the Company and for preventing and detecting frauds
and other irregularities; selection and application of appropriate
accounting policies; making judgments and estimates that are reasonable
and prudent; and design, implementation and maintenance of adequate
internal financial controls, that were operating effectively for
ensuring the accuracy and completeness of the accounting records,
relevant to the preparation and presentation of the financial
statements that give a true and fair view and are free from material
misstatement, whether due to fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these standalone
financial statements based on our audit.
We have taken into account the provisions of the Act, the accounting
and auditing standards and matters which are required to be included in
the audit report under the provisions of the Act and the Rules made
thereunder.
We conducted our audit in accordance with the Standards on Auditing
specified under Section 143(10) of the Act. Those Standards require
that we comply with ethical requirements and plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free from material misstatement. An audit involves performing
procedures to obtain audit evidence about the amounts and the
disclosures in the financial statements. The procedures selected depend
on the auditor''s judgment, including the assessment of the risks of
material misstatement of the financial statements, whether due to fraud
or error. In making those risk assessments, the auditor considers
internal financial control relevant to the Company''s preparation of the
financial statements that give a true and fair view in order to design
audit procedures that are appropriate in the circumstances. 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 standalone
financial statements.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid standalone financial statements
give the information required by the Act in the manner so required and
give a true and fair view in conformity with the accounting principles
generally accepted in India, of the state of affairs of the Company as
at 31st March, 2016, 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, 2016 ("the
Order") issued by the Central Government of India in terms of Section
143(11) of the Act, we give in the "Annexure A" 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 standalone financial statements comply
with the Accounting Standards specified under Section 133 of the Act,
read with Rule 7 of the Companies (Accounts) Rules, 2014;
e) On the basis of the written representations received from the
directors as on 31st March, 2016 taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March, 2016
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 B".
g) With respect to the other matters to be included in the Auditor''s
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its
financial position in its financial statements - Refer Note 21 to the
financial statements;
ii. The Company has made provision, as required under the applicable
law or accounting standards, for material foreseeable losses, if any,
on long-term contracts including derivative contracts;
iii. There has been no delay in transferring amounts, required to be
transferred, to the Investor Education and Protection Fund by the
Company.
Annexure A to the Independent Auditor''s Report to the members of Isgec
Heavy Engineering Limited dated 26th May, 2016
Report on the matters specified in paragraph 3 of the Companies
(Auditor''s Report) Order, 2016 ("the Order") issued by the Central
Government of India in terms of section 143(11) of the Companies Act,
2013 ("the Act") as referred to in paragraph 1 of ''Report on Other
Legal and Regulatory Requirements'' section
(i) (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation of fixed
assets;
(b) The Company has physically verified these fixed assets as per its
program of physical verification that covers every item of fixed assets
over a period of three years except for certain building and vehicles
situated in Pakistan (carrying value of Rs.1). No material
discrepancies were noticed on such verification;
(c) The tide deeds of immovable properties are held in the name of the
Company, as verified from the photocopies of original title deeds. The
original title deeds are pledged with banks as security against term
loans.
(ii) The physical verification of inventory has been conducted at
reasonable intervals by the management. No material discrepancies were
noticed on such physical verification;
(iii) The Company has not given any loan, secured or unsecured to
Companies, firms, or other parties covered in the register maintained
under section 189 of Companies Act, 2013. Accordingly, clauses (ui)(a),
(ui)(b) and (ui)(c) of the Order is not applicable to the Company;
(iv) The Company has not granted any loan to Directors in terms of
Section 185 of the Companies Act, 2013 (Act). Further, the Company has
complied with the provisions of Section 186 of the Act in respect of
loans, investments, guarantees and security made;
(v) As per information and explanation provided to us, the Company has
not accepted any public deposits during the year. Further, we have not
come across any such deposit(s) nor the management has reported any
such deposit(s), therefore the directives issued by the Reserve Bank of
India and the provisions of sections 73 to 76 or any other relevant
provisions of the Act and the rules framed there under are not
applicable;
(vi) We have broadly reviewed the books and records required to be
maintained as specified by the Central Government under sub-section (1)
of section 148 of the Companies Act, 2013 and we are of the opinion
diat prima facie, the prescribed accounts and records are being
maintained;
(vii) (a) The Company is generally regular in depositing undisputed
statutory dues including provident fund, employees'' state insurance,
income-tax, sales-tax, service tax, duty of customs, duty of excise,
value added tax, cess and any other statutory dues to the appropriate
authorities. There are no arrears of outstanding statutory dues as at
the last day of the financial year concerned for a period of more than
six months from the date they became payable.
(b) The particulars of dues of income tax or sales tax or service tax
or duty of customs or duty of excise or value added tax have not been
deposited on account of any dispute are as under:
Name of Statute Duty/Tax Year Forum where dispute
is pending Amount Amount
(Rs.in
lacs) (Rs.in
lacs)
As at As at
31st
March,
16 31st
March,
15
Central Excise
Duty 1994-95 Hon''ble High
Court, Allahabad 5.00 5.00
Excise Act
1994-96 Tribunal New Delhi 8.00 8.00
2002-10 CESTAT, New Delhi 8.58 53.25
2009-13 Joint Commissioner
Central Excise, 14.92 14.98
Muzaffarnagar
2013-14 Joint Commissioner
Central Excise, 2.90 3.00
Muzaffarnagar
Service Tax Service
Tax 2004-06 CEST AT, New Delhi 6.00 6.00
2005-07 CEST AT, New Delhi 22.31 22.31
2008-09 CESTAT, New Delhi 8.36 8.36
2009-12 Commissioner
Central Excise
(Panchkula) 63.56 63.56
2011-12 Commissioner
Central Excise
(Panchkula) 61.28 61.28
2008-09 Commissioner,
Central Excise
(Vadodara) 60.31 60.31
2008-13 Commissioner
Central Excise
(Panchkula) 36.97 36.97
2011-12 Commissioner
Central Excise
(Panchkula) 25.56 25.56
2007-10 Commissioner
Central Excise
(Panchkula) 9.22 9.22
2008-09 Commissioner
Central Excise
(Panchkula) 9.69 9.69
2014-15 Commissioner
Central Excise
(Panchkula) 45.14 -
2011-12 Commissioner
(Appeals) Delhi 0.17 -
Name of
Statute Duty/Tax Year Forum where
dispute is
pending Amount Amount
(Rs.in
lacs) (Rs.in
lacs)
As at As at
31st
March,
16 31st
March,
15
Sales Tax
Act Sales Tax 1993-94 Sales Tax
Tribunal, Orissa 9.02 9.02
1995-96 Sales Tax
Tribunal, Orissa 17.00 17.00
1996-97 Sales Tax
Tribunal, Orissa 5.00 5.00
1992-93 Appellant
Tribunal - West
Bengal 90.00 90.00
1993-94 Appellant
Tribunal - West
Bengal 155.00 155.00
1971-73 Commissioner
Sales Tax,
Lucknow 6.00 6.00
1987-88 Dy Comm. of
Commercial Taxes,
Kolkata 4.00 4.00
1995-96 Dy Comm. of
Commercial Taxes,
Kolkata 34.00 34.00
1994-95 Commercial Tax
Officer, Kolkata 61.00 61.00
2006-07 Dy Comm. Of
Commercial Tax,
Tamilnadu 0.82 0.82
2007-08 Dy Comm. Of
Commercial Tax,
Tamilnadu - 2.41
2008-09 Dy Comm. Of
Commercial Tax,
Tamilnadu - 0.58
2009-10 Joint Comm. of
Commercial Taxes,
Kolkata 4.72 4.72
2009-10 Joint Comm. of
Commercial Taxes,
Kolkata 9.51 9.51
2009-12 Additional
commissioner of
Central Excise-UP 76.05 -
2008-09 Additional
commissioner of
Central Excise-UP - 320.42
2008-09 Additional
commissioner of
Central Excise-UP 6.62 6.62
2015-16 Excise & Tax
Officer, Punjab 7.44 -
Local Area Local area 2006-07 Hon''ble High Court
of Punjab & Haryana 14.00 14.00
development
tax
Tax Act,
2002
Haryana
State Water Cess 1992-93 Hon''ble Supreme
Court of India 15.28 13.20
Pollution
Control
Law
Total 903.43 1140.79
(viii) The Company has not defaulted in repayment of loans or borrowing
to a financial institution, bank or government. The Company has not
issued any debentures;
(ix) The Company did not raise any money by way of initial public offer
or further public offer (including debt instruments) during the year.
Term loans were applied for the purposes for which those are raised;
(x) According to the information and explanations given to us, no fraud
by the Company or fraud on the Company by its officers or employees has
been noticed or reported during the year;
(xi) According to the information and explanation given to us and based
on our examination of the records of the Company, the Company has paid
or provided for the managerial remuneration in accordance with the
requisite approvals mandated by the provisions of section 197 read with
Schedule V to the Act;
(xii) The Company is not a Nidhi Company, hence clause (xii) of the
Order is not applicable to the Company;
(xiii) According to the information and explanations given to us and
based on our examination of the records of the Company, transactions
with the related parties are in compliance with sections 177 and 188 of
the act where applicable and details of such transactions have been
disclosed in the financial statements as required by the applicable
accounting standards;
(xiv) The Company has not made any preferential allotment or private
placement of shares or fully or partly convertible debentures during
the year under audit.
(xv) According to the information and explanations given to us and
based on our examination of the records of the company, the company has
not entered into non-cash transactions with directors or persons
connected with him. Accordingly, clause (xv) of paragraph 3 of the Order
is not applicable;
(xvi) The Company is not required to be registered under section 45-IA
of the Reserve Bank of India Act, 1934;
For S S Kothari Mehta & Co.
Chartered Accountants
Firm''s Registration No. 000756N
K K Tulshan
Place: Noida Partner
Date: 26th May, 2016 Membership No. 085033
Mar 31, 2016
We have audited the accompanying standalone financial statements of
Isgec Heavy Engineering Limited ("the Company"), which comprise the
Balance Sheet as at 31st March, 2016, the Statement of Profit and Loss,
the Cash Flow Statement for the year then ended, and a summary of the
significant accounting policies and other explanatory information.
Management''s Responsibility for the Standalone Financial Statements
The Company''s Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 ("the Act") with respect
to the preparation of these standalone financial statements that give a
true and fair view of the financial position, financial performance and
cash flows of the Company in accordance with the accounting principles
generally accepted in India, including the Accounting Standards
specified under Section 133 of the Act, read with Rule 7 of the
Companies (Accounts) Rules, 2014.
This responsibility also includes maintenance of adequate accounting
records in accordance with the provisions of the Act for safeguarding
of the assets of the Company and for preventing and detecting frauds
and other irregularities; selection and application of appropriate
accounting policies; making judgments and estimates that are reasonable
and prudent; and design, implementation and maintenance of adequate
internal financial controls, that were operating effectively for
ensuring the accuracy and completeness of the accounting records,
relevant to the preparation and presentation of the financial
statements that give a true and fair view and are free from material
misstatement, whether due to fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these standalone
financial statements based on our audit.
We have taken into account the provisions of the Act, the accounting
and auditing standards and matters which are required to be included in
the audit report under the provisions of the Act and the Rules made
thereunder.
We conducted our audit in accordance with the Standards on Auditing
specified under Section 143(10) of the Act. Those Standards require
that we comply with ethical requirements and plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free from material misstatement. An audit involves performing
procedures to obtain audit evidence about the amounts and the
disclosures in the financial statements. The procedures selected depend
on the auditor''s judgment, including the assessment of the risks of
material misstatement of the financial statements, whether due to fraud
or error. In making those risk assessments, the auditor considers
internal financial control relevant to the Company''s preparation of the
financial statements that give a true and fair view in order to design
audit procedures that are appropriate in the circumstances. 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 standalone
financial statements.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid standalone financial statements
give the information required by the Act in the manner so required and
give a true and fair view in conformity with the accounting principles
generally accepted in India, of the state of affairs of the Company as
at 31st March, 2016, 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, 2016 ("the
Order") issued by the Central Government of India in terms of Section
143(11) of the Act, we give in the "Annexure A" 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 standalone financial statements comply
with the Accounting Standards specified under Section 133 of the Act,
read with Rule 7 of the Companies (Accounts) Rules, 2014;
e) On the basis of the written representations received from the
directors as on 31st March, 2016 taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March, 2016
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 B".
g) With respect to the other matters to be included in the Auditor''s
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its
financial position in its financial statements - Refer Note 21 to the
financial statements;
ii. The Company has made provision, as required under the applicable
law or accounting standards, for material foreseeable losses, if any,
on long-term contracts including derivative contracts;
iii. There has been no delay in transferring amounts, required to be
transferred, to the Investor Education and Protection Fund by the
Company.
Annexure A to the Independent Auditor''s Report to the members of Isgec
Heavy Engineering Limited dated 26th May, 2016
Report on the matters specified in paragraph 3 of the Companies
(Auditor''s Report) Order, 2016 ("the Order") issued by the Central
Government of India in terms of section 143(11) of the Companies Act,
2013 ("the Act") as referred to in paragraph 1 of ''Report on Other
Legal and Regulatory Requirements'' section
(i) (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation of fixed
assets;
(b) The Company has physically verified these fixed assets as per its
program of physical verification that covers every item of fixed assets
over a period of three years except for certain building and vehicles
situated in Pakistan (carrying value of Rs.1). No material
discrepancies were noticed on such verification;
(c) The tide deeds of immovable properties are held in the name of the
Company, as verified from the photocopies of original title deeds. The
original title deeds are pledged with banks as security against term
loans.
(ii) The physical verification of inventory has been conducted at
reasonable intervals by the management. No material discrepancies were
noticed on such physical verification;
(iii) The Company has not given any loan, secured or unsecured to
Companies, firms, or other parties covered in the register maintained
under section 189 of Companies Act, 2013. Accordingly, clauses (ui)(a),
(ui)(b) and (ui)(c) of the Order is not applicable to the Company;
(iv) The Company has not granted any loan to Directors in terms of
Section 185 of the Companies Act, 2013 (Act). Further, the Company has
complied with the provisions of Section 186 of the Act in respect of
loans, investments, guarantees and security made;
(v) As per information and explanation provided to us, the Company has
not accepted any public deposits during the year. Further, we have not
come across any such deposit(s) nor the management has reported any
such deposit(s), therefore the directives issued by the Reserve Bank of
India and the provisions of sections 73 to 76 or any other relevant
provisions of the Act and the rules framed there under are not
applicable;
(vi) We have broadly reviewed the books and records required to be
maintained as specified by the Central Government under sub-section (1)
of section 148 of the Companies Act, 2013 and we are of the opinion
diat prima facie, the prescribed accounts and records are being
maintained;
(vii) (a) The Company is generally regular in depositing undisputed
statutory dues including provident fund, employees'' state insurance,
income-tax, sales-tax, service tax, duty of customs, duty of excise,
value added tax, cess and any other statutory dues to the appropriate
authorities. There are no arrears of outstanding statutory dues as at
the last day of the financial year concerned for a period of more than
six months from the date they became payable.
(b) The particulars of dues of income tax or sales tax or service tax
or duty of customs or duty of excise or value added tax have not been
deposited on account of any dispute are as under:
Name of Statute Duty/Tax Year Forum where dispute
is pending Amount Amount
(Rs.in
lacs) (Rs.in
lacs)
As at As at
31st
March,
16 31st
March,
15
Central Excise
Duty 1994-95 Hon''ble High
Court, Allahabad 5.00 5.00
Excise Act
1994-96 Tribunal New Delhi 8.00 8.00
2002-10 CESTAT, New Delhi 8.58 53.25
2009-13 Joint Commissioner
Central Excise, 14.92 14.98
Muzaffarnagar
2013-14 Joint Commissioner
Central Excise, 2.90 3.00
Muzaffarnagar
Service Tax Service
Tax 2004-06 CEST AT, New Delhi 6.00 6.00
2005-07 CEST AT, New Delhi 22.31 22.31
2008-09 CESTAT, New Delhi 8.36 8.36
2009-12 Commissioner
Central Excise
(Panchkula) 63.56 63.56
2011-12 Commissioner
Central Excise
(Panchkula) 61.28 61.28
2008-09 Commissioner,
Central Excise
(Vadodara) 60.31 60.31
2008-13 Commissioner
Central Excise
(Panchkula) 36.97 36.97
2011-12 Commissioner
Central Excise
(Panchkula) 25.56 25.56
2007-10 Commissioner
Central Excise
(Panchkula) 9.22 9.22
2008-09 Commissioner
Central Excise
(Panchkula) 9.69 9.69
2014-15 Commissioner
Central Excise
(Panchkula) 45.14 -
2011-12 Commissioner
(Appeals) Delhi 0.17 -
Name of
Statute Duty/Tax Year Forum where
dispute is
pending Amount Amount
(Rs.in
lacs) (Rs.in
lacs)
As at As at
31st
March,
16 31st
March,
15
Sales Tax
Act Sales Tax 1993-94 Sales Tax
Tribunal, Orissa 9.02 9.02
1995-96 Sales Tax
Tribunal, Orissa 17.00 17.00
1996-97 Sales Tax
Tribunal, Orissa 5.00 5.00
1992-93 Appellant
Tribunal - West
Bengal 90.00 90.00
1993-94 Appellant
Tribunal - West
Bengal 155.00 155.00
1971-73 Commissioner
Sales Tax,
Lucknow 6.00 6.00
1987-88 Dy Comm. of
Commercial Taxes,
Kolkata 4.00 4.00
1995-96 Dy Comm. of
Commercial Taxes,
Kolkata 34.00 34.00
1994-95 Commercial Tax
Officer, Kolkata 61.00 61.00
2006-07 Dy Comm. Of
Commercial Tax,
Tamilnadu 0.82 0.82
2007-08 Dy Comm. Of
Commercial Tax,
Tamilnadu - 2.41
2008-09 Dy Comm. Of
Commercial Tax,
Tamilnadu - 0.58
2009-10 Joint Comm. of
Commercial Taxes,
Kolkata 4.72 4.72
2009-10 Joint Comm. of
Commercial Taxes,
Kolkata 9.51 9.51
2009-12 Additional
commissioner of
Central Excise-UP 76.05 -
2008-09 Additional
commissioner of
Central Excise-UP - 320.42
2008-09 Additional
commissioner of
Central Excise-UP 6.62 6.62
2015-16 Excise & Tax
Officer, Punjab 7.44 -
Local Area Local area 2006-07 Hon''ble High Court
of Punjab & Haryana 14.00 14.00
development
tax
Tax Act,
2002
Haryana
State Water Cess 1992-93 Hon''ble Supreme
Court of India 15.28 13.20
Pollution
Control
Law
Total 903.43 1140.79
(viii) The Company has not defaulted in repayment of loans or borrowing
to a financial institution, bank or government. The Company has not
issued any debentures;
(ix) The Company did not raise any money by way of initial public offer
or further public offer (including debt instruments) during the year.
Term loans were applied for the purposes for which those are raised;
(x) According to the information and explanations given to us, no fraud
by the Company or fraud on the Company by its officers or employees has
been noticed or reported during the year;
(xi) According to the information and explanation given to us and based
on our examination of the records of the Company, the Company has paid
or provided for the managerial remuneration in accordance with the
requisite approvals mandated by the provisions of section 197 read with
Schedule V to the Act;
(xii) The Company is not a Nidhi Company, hence clause (xii) of the
Order is not applicable to the Company;
(xiii) According to the information and explanations given to us and
based on our examination of the records of the Company, transactions
with the related parties are in compliance with sections 177 and 188 of
the act where applicable and details of such transactions have been
disclosed in the financial statements as required by the applicable
accounting standards;
(xiv) The Company has not made any preferential allotment or private
placement of shares or fully or partly convertible debentures during
the year under audit.
(xv) According to the information and explanations given to us and
based on our examination of the records of the company, the company has
not entered into non-cash transactions with directors or persons
connected with him. Accordingly, clause (xv) of paragraph 3 of the Order
is not applicable;
(xvi) The Company is not required to be registered under section 45-IA
of the Reserve Bank of India Act, 1934;
For S S Kothari Mehta & Co.
Chartered Accountants
Firm''s Registration No. 000756N
K K Tulshan
Place: Noida Partner
Date: 26th May, 2016 Membership No. 085033
Sep 30, 2013
1. Report on the Financial Statements
We have audited the attached financial statements of Isgec Heavy
Engineering Limited ( ACI-the Company ACI-) which comprises the Balance
Sheet as at 30 ACo- September, 2013 and the Statement of Profit and
Loss and the Cash Flow Statement for the year then ended, and Notes to
the Financial Statements comprising of a summary of significant
accounting policies and other explanatory information.
Management''s Responsibility for the Financial Statements
Management is responsible for the preparation of these financial
statements that give a true and fair view of the financial position,
financial performance and cash flows of the Company in accordance with
the Accounting Standards referred to in sub-section (3C) of section 211
of the Companies Act, 1956 now with effect from 12 ACo- September, 2013
section 133 of the Companies Act, 2013 as per notification dated 12th
September, 2013 read with circular no. 16/2013 dated 18th September
2013 issued by Ministry of Corporate Affairs, Government of India. This
responsibility includes the design, implementation, and maintenance of
internal controls relevant to the preparation and presentation of the
financial statements that give a true and fair view and are free from
material misstatements, whether due to fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The procedures
selected depend on the auditor''s judgment, including the assessment of
the risks of the material misstatement of the financial statements,
whether due to error or fraud. In making those risk assessments, the
auditor considers internal control relevant to the Company''s
preparation and fair presentation of the financial statements in order
to design audit procedures that are appropriate in the circumstances.
An audit also includes evaluating the appropriateness of accounting
policies used and reasonableness of the accounting estimates made by
management, as well as evaluating the overall presentation of the
financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
Opinion
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 30th September, 2013 ADs-
ii) In the case of Statement of Profit and Loss, of the profit of the
Company for the year ended on that date ADs- and
iii) In the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 (''the
Order'') issued by the Central Government of India in terms of section
227 of the Act, we give in the Annexure a statement on the matters
specified in paragraphs 4 and 5 of the Order ADs-
2. As required by section 227(3) of the Act, we report that:
a. We have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purpose of our
audit ADs-
b. In our opinion proper books of account as required by law have been
kept by the Company so far as appears from our examination of those
books ADs-
c. The Balance Sheet, Statement of Profit and Loss and Cash Flow
Statement dealt with by this Report are in agreement with the books of
account ADs-
d. In our opinion, the Balance Sheet, Statement of Profit and Loss and
Cash Flow Statement comply with the Accounting Standards referred to in
sub-section (3C) of section 211 of the Companies Act, 1956 ADs-
e. On the basis of written representations received from the directors
as on 30th September, 2013 and taken on record by the Board of
Directors, none of the directors is disqualified as on 30 ACo- September,
2013 from being appointed as a director in terms of clause (g) of
sub-section (1) of section 274 of the Companies Act, 1956 ADs-
Annexure to Independent Auditor''s Report referred to in paragraph 1 on
Other Legal and Regulatory Requirement of our report on the financial
statement of even date,
1. (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) The fixed assets of the Company are physically verified during the
year by the management in accordance with a program designed to cover
all assets except for certain building and vehicles situated in
Pakistan (carrying value - Re 1/-) and no material discrepancies
between the book records and the physical inventory have been noticed.
In our opinion, the frequency of verification is reasonable.
(c) In our opinion and according to the information and explanations
given to us, no substantial part of fixed assets has been disposed-off
by the Company.
2. (a) The inventory has been physically verified during the year by
the management at reasonable intervals in respect of finished goods,
stores, spare parts and raw material. Further, stock in the possession
and custody of third parties and stock in transit as at 30th September,
2013 have been verified by the management with reference to
confirmation or statement of accounts or correspondence of the third
parties or subsequent receipt of goods. In our opinion, the frequency
of such verification is reasonable.
(b) The procedures for the physical verification of inventory followed
by the management are, in our opinion, reasonable and adequate in
relation to the size of the Company and nature of its business.
(c) In our opinion, the Company is maintaining proper records of
inventory. The discrepancies noticed on physical verification of
inventory as compared to book records were not material and have been
properly dealt with in the books of account.
3. (a) The Company had granted unsecured loan to its one subsidiary
company listed in the register maintained under section 301 of the
Companies Act, 1956. Apart from these loans, the Company has not
granted any other loans, secured or unsecured, to companies, firms or
other parties listed in the register maintained under section 301 of
the Companies Act, 1956. The maximum amount outstanding during the year
is Rs. 7660.27 Lacs and year end balance of such loans is NIL.
(b) In our opinion, the rate of interest and other terms and conditions
of such loans were not prima facie prejudicial to the interest of the
Company.
(c) In respect of the aforesaid loan, we are informed that these were
repayable on demand. The parties were regular in payment of interest.
(d) In respect of the aforesaid loans, we are informed that there are
no overdue amounts more than Rupees One Lakh as the loans stand
completely squared up.
(e) The Company has taken unsecured loans of Rs. 29.36 lacs in the form
of fixed deposits from its three Directors and one related party in
earlier years and outstanding at the beginning of the year, the terms ACY-
conditions of which are, prima facie, not prejudicial to the interest
of the Company. Maximum amount outstanding during the year with respect
to these loans was Rs.29.36 Lacs and the yearend balance of such loans
is Rs. 0.66 Lacs, now due to one related party. There are no other
loans, secured or unsecured, from companies, firms or other parties
listed in the register maintained under section 301 of the Companies
Act, 1956.
(f) In our opinion, the rate of interest and other terms and conditions
of such loans are not prima facie prejudicial to the interest of the
Company.
(g) in respect of the aforesaid loans, there are no overdue amounts of
principal and interest.
4. In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchase of inventory and fixed assets and for the sale of goods and
services. Further, on the basis of our examination of the books and
records of the Company, and according to the information and
explanations given to us, we have neither come across nor have been
informed of any continuing failure to correct major weaknesses in the
aforesaid internal control system.
5. (a) In our opinion and according to the information and
explanations given to us, the particulars of contracts or arrangements
referred to in section 301 of the Act have been entered in the register
required to be maintained under that section.
(b) in our opinion and according to the information and explanations
given to us, transactions made in pursuance of such contracts or
arrangements and exceeding the value of Rupees five lakhs in respect of
any party during the year have been made at prices which are reasonable
having regard to the prevailing market prices at the relevant time
where such market prices were made available.
6. The Company has accepted deposits from the public within the
meaning of section 58A and 58AA of the Act and the rules framed there
under. In our opinion and according to the information and explanations
given to us, the provisions of section 58A and section 58AA or any
other relevant provisions of the Companies Act, 1956 including the
Companies (Acceptance of Deposit) Rules, 1975 have been compiled by the
Company with respect to fixed deposits accepted from the public.
7. In our opinion, the Company has an internal audit system
commensurate with its size and nature of its business.
8. We have broadly reviewed the cost accounting records, maintained by
the Company pursuant to the rules prescribed by the Central Government
for the maintenance of cost records under clause (d) of sub-section (1)
of section 209 of the Act and are of the opinion that, prima facie, the
prescribed accounts and records have been made and maintained. We are,
however, not required to make a detailed examination of such books and
records.
9. (a) According to the information and explanations given to us and
the records of the Company examined by us, in our opinion, the Company
is generally regular in depositing the undisputed statutory dues
including provident fund, investor education and protection fund,
employees state insurance, income-tax, sales - tax, wealth - tax,
service - tax, customs duty, excise duty, cess and other material
statutory dues as applicable with the appropriate authorities.
(b) According to the information and explanations given to us and the
records of the Company examined by us, there are no dues of income-tax,
sales - tax, wealth - tax, service - tax, customs duty, excise duty and
cess which have not been deposited on account of any dispute except the
following:
Name of Duty/Tax Year Forum where dispute
is pending Total
Statute (Rs. Lacs)
Central Excise
Act Excise Duty 1994-95 Hon''ble High Court,
Allahabad 5.00
1994-96 Tribunal New Delhi 8.00
2002-08 CESTAT, New Delhi 50.23
2007-11 CESTAT, New Delhi 7.10
Service Tax Service Tax 2004-06 CESTAT, New Delhi 6.00
2005-07 CESTAT, New Delhi 22.31
2008-09 CESTAT, New Delhi 8.36
2009-12 Assisstant
Commissioner, YNR 63.56
2011-12 Commissioner Central
Excise 61.28
2008-09 Commissioner, Central
Excise (Vadodara) 60.31
Sales Tax Act Sales Tax 1993-94 Sales Tax Tribunal,
Orissa 9.02
1995-96 Sales Tax Tribunal,
Orissa 17.00
1996-97 Sales Tax Tribunal,
Orissa 5.00
1992-93 Appellant Tribunal -
West Bengal 90.00
1993-94 Appellant Tribunal -
West Bengal 155.00
1971-73 Commissioner Sales Tax,
Lucknow 6.00
1987-88 Dy Comm. of Commercial
Taxes, Kolkata 4.00
1995-96 Dy Comm. of Commercial
Taxes, Kolkata 34.00
1994-95 Commercial Tax
Officer, Kolkata 61.00
2006-07 Dy Comm. Of Commercial
Tax, Tamilnadu 0.82
2007-08 Adl.CTO Tamilnadu 2.41
2008-09 Adl.CTO Tamilnadu 0.58
2009-10 Dy Comm. of Commercial
Taxes, Kolkata 14.23
2008-09 Joint Commissioner
(Appeal), UP 13.76
2009-10 Sales Tax Tribunal
Muzaffarnagar 257.85
Local Area Local area
tax 2006-07 Hon''ble High Court
of Punjab ACY- Haryana 10.00
development
Tax Act , 2002
Haryana State Water Cess 1992-93 Hon''ble Supreme Court
of India 13.20
Pollution
Control Law
Total 986.02
10. There are no accumulated losses of the Company as at 30 September
2013. The Company has neither incurred cash losses in the financial
year ended on that date or during the immediately preceding financial
year.
11. According to the records of the Company examined by us and the
information and explanation given to us, the Company has not defaulted
in repayment of dues to a financial institution or bank or debenture
holder.
12. The Company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
13. The provisions of any special statute applicable to chit fund/
nidhi/ mutual benefit fund/ societies are not applicable to the
Company.
14. In our opinion, the Company is not a dealer or trader in shares,
securities, debentures and other investments.
15. In our opinion and according to the information and explanations
given to us, the Company has not given any guarantees for loans taken
by others from banks or financial institutions during the year.
16. In our opinion and according to the information and explanations
given to us, on an overall basis, the term loans have been applied for
the purposes for which they were obtained.
17. On the basis of an overall examination of the balance sheet of the
Company, in our opinion and according to the information and
explanations given to us, there are no funds raised on a short term
basis which have been used for long term investment.
18. The Company has not made any preferential allotment of shares to
parties and companies covered in the register maintained under section
301 of the Act during the year.
19. The Company has not issued any debentures during the year.
20. The Company has not raised any money by public issues during the
year.
21. During the course of our examination of the books and records of
the Company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
significant fraud on or by the Company, noticed or reported during the
year, nor have we been informed of any such case by the management.
For S S Kothari Mehta ACY- Co.
Firm Registration Number: 000756N
Chartered Accountants
(K K Tulshan)
Place: Noida Partner
Date: 23 November, 2013 Membership Number: 085033
Sep 30, 2012
1. We have audited the attached balance sheet of Isgec Heavy
Engineering Limited (formerly The Saraswati Industrial Syndicate
Limited), as at 30th September, 2012, and also the statement of profit
and loss and the cash flow statement for the year ended on that date
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 the auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
3. As required by the Companies (Auditor's Report) Order, 2003 (as amended by the Companies (Auditor's Report) (Amendment) Order, 2004) issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956 and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said Order.
4. Further to our comments in the Annexure referred to in paragraph 3 above, we report that:
(i) 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;
(ii) In our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;
(iii) The balance sheet, statement of profit and loss and cash flow statement dealt with by this report are in agreement with the books of account;
(iv) In our opinion, the balance sheet, statement of profit and loss and cash flow statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the Companies act, 1956;
(v) On the basis of written representations received from the directors, as on 30th September, 2012 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 30th September, 2012 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956;
(vi) 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;
a) In the case of the balance sheet, of the state of affairs of the Company as at 30th September, 2012;
b) In the case of the statement of profit and loss, of the profit for the year ended on that date; and;
c) In the case of the cash flow statement, of the cash flows for the year ended on that date.
Annexure to Auditors' Report referred to in paragraph 3 of the Auditors' Report of even date to the members of Isgec Heavy Engineering Limited on the financial statements for the year ended 30 September 2012
1. (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets.
(b) The fixed assets of the Company are physically verified during the year by the management in accordance with a program designed to cover all assets except for certain building and vehicles situated in Pakistan (carrying value - Rs. 1/-) and no material discrepancies between the book records and the physical inventory have been noticed. In our opinion, the frequency of verification is reasonable.
(c ) In our opinion and according to the information and explanations given to us, no substantial part of fixed assets has not been disposed by the Company.
2. (a) The inventory has been physically verified during the year by the management at reasonable intervals in respect of finished goods, stores, spare parts and raw material. Further, stock in the possession and custody of third parties and stock in transit as at 30th September, 2012 have been verified by the management with reference to confirmation or statement of accounts or correspondence of the third parties or subsequent receipt of goods. In our opinion, the frequency of such verification is reasonable.
(b) The procedures for the physical verification of inventory followed by the management are, in our opinion, reasonable and adequate in relation to the size of the Company and nature of its business.
(c) In our opinion, the Company is maintaining proper records of inventory. The discrepancies noticed on physical verification of inventory as compared to book records were not material and have been properly dealt with in the books of account.
3. (a) The Company has granted unsecured loan to its two subsidiary companies listed in the register maintained under section 301 of the Companies Act, 1956. Apart from these loans, the Company has not granted any other loans, secured or unsecured, to companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956. The maximum amount outstanding during the year is Rs. 6892.52 Lacs and year end balances of such loans are Rs. 735.17 Lacs.
(b) In our opinion, the rate of interest and other terms and conditions of such loan are not prima facie prejudicial to the interest of the Company.
(c) In respect of the aforesaid loan, we are informed that these are repayable on demand. The parties are regular in payment of interest.
(d) In respect of the foresaid loan, we are informed that there is no overdue amount more than Rupees One Lakh.
(e) The Company has taken unsecured loans of Rs. 29.68 lacs in the form of fixed deposits from its three Directors and one related party in earlier years and outstanding at the beginning of the year, the terms & conditions of which are, prima facie, not prejudicial to the interest of the Company. Maximum amount outstanding during the year with respect to these loans was Rs. 29.68 Lacs and the year end balance of such loans is Rs. 29.36 Lacs, now due to three Directors and one related party. There are no other loans, secured or unsecured, from companies, firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956.
(f) In our opinion, the rate of interest and other terms and conditions of such loans are not prima facie prejudicial to the interest of the Company.
(g) in respect of the aforesaid loans, there are no overdue amounts of principal and interest.
4. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory and fixed assets and for the sale of goods and services. Further, on the basis of our examination of the books and records of the Company, and according to the information and explanations given to us, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in the aforesaid internal control system.
5. (a) In our opinion and according to the information and explanations given to us, the particulars of contracts or arrangements referred to in section 301 of the Act have been entered in the register required to be maintained under that section.
(b) in our opinion and according to the information and explanations given to us, transactions made in pursuance of such contracts or arrangements and exceeding the value of Rupees five lakhs in respect of any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time where such market prices were made available.
6. The Company has accepted deposits from the public within the meaning of section 58A and 58AA of the Act and the rules framed there under. In our opinion and according to the information and explanations given to us, the provisions of section 58A and section 58AA or any other relevant provisions of the Companies Act, 1956 including the Companies (Acceptance of Deposit) Rules, 1975 have been complied by the Company with respect to fixed deposits accepted from the public.
7. In our opinion, the Company has an internal audit system commensurate with its size and nature of its business.
8. We have broadly reviewed the cost accounting records, maintained by the Company pursuant to the rules prescribed by the Central Government for the maintenance of cost records under clause (d) of sub-section (1) of section 209 of the Act and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. We are, however, not required to make a detailed examination of such books and records.
9. (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is generally regular in depositing the undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income-tax, sales - tax, wealth - tax, service - tax, customs duty, excise duty, cess and other material statutory dues as applicable with the appropriate authorities.
(b) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of income-tax, sales - tax, wealth - tax, service - tax, customs duty, excise duty and cess which have not been deposited on account of any dispute except the following:
Name of Duty/Tax Year Forum where dispute is pending Total Statute (Rs. Lacs)
Central Excise Act Excise Duty 1994-95 Hon'ble High Court,Allahabad 5.00
1994-96 Tribunal New Delhi 8.00
2002-08 CESTAT, New Delhi 59.92
2003-05 Add. Dy. Commissioner, Yamuna Nagar 0.06
2009-10 Commissioner Appeal- Gurgaon 0.40
2007-11 CESTAT, New Delhi 49.04
Service Tax Service Tax 2004-06 CESTAT, New Delhi 6.00
2005-07 CESTAT, New Delhi 22.31
2008-10 CESTAT, New Delhi 6.92
2008-09 Commissioner (Appeals), New Delhi 8.36
2009-12 Assisstant Commissioner, YNR 63.56
2011-12 Commissioner Central Excise 61.28
2007-10 Commissioner (Appeals)- Gurgaon 0.34
Sales Tax Act Sales Tax 1993-94 Sales Tax Tribunal, Orissa 9.02
1995-96 Sales Tax Tribunal, Orissa 17.00
1996-97 Sales Tax Tribunal, Orissa 5.00
1996-2000 Assessing Authority (AO, Yamuna Nagar) 2.34
1992-93 Appelant Tribunal - West Bengal 90.00
1993-94 Appelant Tribunal - West Bengal 155.00
1971-73 Commissioner Sales Tax, Lucknow 6.00
2000-05 Sales Tax Tribunal, Yamuna Nagar 6.63
2005-06 Commissioner Appeals, Muzaffarnagar 3.00
1995-96 Addl. Commissioner of Appeals 3.60
1996-97 Addl. Commissioner of Appeals 7.60
1987-88 Dy Comm. of Commercial Taxes, Kolkata 4.00
1995-96 Dy Comm. of Commercial Taxes, Kolkata 34.00
1994-95 Commercial Tax Officer, Kolkata 61.00
2006-07 Commercial Tax Officer, Kolkata 0.82
2007-08 Adl.CTO Tamilnadu 2.41
2008-09 Adl.CTO Tamilnadu 0.58
2009-10 Dy Comm. of Commercial Taxes, Kolkata 14.23
2008-09 Joint Commissioner (Appeal), UP 13.76
2008-09 Assessing Authority (AO) 2.81
2008-09 Sales Tax Tribunal Muzaffarnagar 3.31
2008-09 Adl Commissioner, Saharanpur 2.48
Local Area Local area tax 2006-07 Hon'ble High Court of Punjab & Haryana 8.00 develop ment Tax Act ,2002
Haryana State Water Cess 1992-93 Hon'ble High Court of Haryana and Punjab 109.66 Pollution Control Law Entry Tax 2008-09 Sales Tax Tribunal Muzaffarnagar 0.75
Total 854.18
10. There are no accumulated losses of the Company as at 30 September 2012. The Company has neither incurred cash losses in the financial year ended on that date or during the immediately preceding financial year.
11. According to the records of the Company examined by us and the information and explanation given to us, the Company has not defaulted in repayment of dues.
12. The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.
13. The provisions of any special statute applicable to chit fund/ nidhi/ mutual benefit fund/ societies are not applicable to the Company.
14. In our opinion, the Company is not a dealer or trader in shares, securities, debentures and other investments.
15. In our opinion and according to the information and explanations given to us, the Company has not given any guarantees for loans taken by others from banks or financial institutions during the year (ISGEC COVEMA / Hitachi).
16. In our opinion and according to the information and explanations given to us, on an overall basis, the term loans have been applied for the purposes for which they were obtained.
17. On the basis of an overall examination of the balance sheet of the Company, in our opinion and according to the information and explanations given to us, there are no funds raised on a short term basis which have been used for long term investment.
18. The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act during the year.
19. The Company has not issued any debentures during the year.
20. The Company has not raised any money by public issues during the year.
21. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of significant fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the management.
For S S Kothari Mehta & Co.
Firm Registration Number: 000756N
Chartered Accountants
(K K Tulshan)
Place: Noida Partner
Date: 24th November 2012 Membership Number: 085033
Sep 30, 2011
We have audited the attached Balance Sheet of ISGEC Heavy Engineering
Limited (formerly The Saraswati Industrial Syndicate Limited) (Ãthe
CompanyÃ) as at 30th September, 2011 and also the Profit & Loss Account
and the Cash Flow Statement of the Company for the year ended on that
date annexed thereto. These financial statements are the responsibility
of the CompanyÃs management. Our responsibility is to express an
opinion on these financial statements based on our audit.
We have conducted our audit in accordance with auditing standards
generally accepted in India. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by the management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable
basis for our opinion.
As required by the Companies (Auditorsà Report) Order, 2003 as amended
by the Companies (Auditorsà Report) (Amendment) Order, 2004
(collectively the Order) issued by the Central Government of India in
terms of Section 227 (4A) of the Companies Act, 1956 and on the basis
of such checks as we considered appropriate and according to the
information and explanations given to us, we enclose in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the said
Order.
Further to our comments in the Annexure referred to 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 purpose of our
audit;
b) In our opinion, proper books of account, as required by law, have
been kept by the Company so far as appears from our examination of
those books. In respect of the branches not visited by us, management
certified accounts have been forwarded to us for the purpose of our
audit which has been appropriately dealt with.
c) The Balance Sheet, Profit & Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account;
d) In our opinion, the Balance Sheet, Profit & Loss Account and Cash
Flow Statement, dealt with by this report, comply with the Accounting
Standards referred to in sub - section (3C) of Section 211 of the
Companies Act, 1956.
e) On the basis of written representations received from the directors
as on 30th September, 2011 and taken on record by the Board of
Directors, we report that none of the directors is disqualified as on
30th September, 2011 from being appointed as a director in terms of
clause (g) of sub section (1) of section 274 of the Companies Act,
1956.
f) Since the Central Government has not issued any notification as to
the rate at which the cess is to be paid under section 441A of the
Companies Act, 1956, nor has it issued any rules under the said
section, prescribed the manner in which such cess is to be paid, no
cess is due and payable by the Company.
g) In our opinion and to the best of our information and according to
the explanations given to us, the said accounts read with the
accounting policies and notes thereon give the information required by
the Companies Act, 1956 in the manner so required and give a true and
fair view in conformity with the accounting principles generally
accepted in India;
I. In the case of Balance Sheet, of the state of affairs of the
Company as at 30th September, 2011;
II. In the case of Profit and Loss Account, of the Profit for the year
ended on that date; and
III. In the case of Cash Flow Statement, of the cash flows for the
year ended on that date.
(Annexure referred to in our report of even date)
1. (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) Verification of the fixed assets is being conducted based on a
programme by the management designed to cover all assets during the
year except for the certain building and vehicle situated in Pakistan
(written down value Rs. 1/-). No major discrepancies were noticed as
compared to book records and necessary adjustments have been carried
out in the books of account. In our opinion, the frequency of
verification is reasonable having regard to the size of the Company and
the nature of its assets.
(c) Fixed assets disposed off during the year were not substantial.
2. (a) The inventory has been physically verified during the year by
the management at reasonable intervals in respect of finished goods,
stores and spare parts and raw material. Further, stock in the
possession and custody of third parties and stock in transit as at 30th
September, 2011 have been verified by the management with reference to
confirmation or statement of accounts or correspondence of the third
parties or subsequent receipt of goods. In our opinion, the frequency
of such verification is reasonable.
(b) The procedures for the physical verification of inventory followed
by the management are, in our opinion, reasonable and adequate in
relation to the size of the Company and nature of its business.
(c) In our opinion, the Company is maintaining proper records of
inventory. The discrepancies noticed on physical verification of
inventory as compared to book records were not material and have been
properly dealt with in the books of account.
3 (a) The Company has granted unsecured loan to its two subsidiary
companies listed in the register maintained under section 301 of the
Companies Act, 1956. Apart from these loans, the Company has not
granted any other loans, secured or unsecured, to companies, firms or
other parties listed in the register maintained under section 301 of
the Companies Act, 1956. The maximum amount outstanding during the year
is Rs. 6768.58 Lacs and year end balances of such loans are Rs 1518.22
Lacs.
(b) In our opinion, the rate of interest and other terms & conditions
of such loan are prima facie, not prejudicial to the interest of the
Company.
(c) We are informed that the aforesaid loans are repayable on demand.
The Companies were regular in payment of interest.
(d) We are informed as the aforesaid loans are repayable on demand,
there are no overdue amounts at the year end.
(e) The Company had taken unsecured loans of Rs. 56.50 lacs in the form
of fixed deposits from its four Directors and one related party in
earlier years that were outstanding at the beginning of the year, the
terms & conditions of which are, prima facie, not prejudicial to the
interest of the Company. Maximum amount outstanding during the year
with respect to these loans was Rs. 56.50 Lacs and the year end balance
of such loans is Rs. 29.68 Lacs, now due to three Directors and one
related party; the loan of one director having been paid during the
year by the Company. There are no other loans, secured or unsecured,
from companies, firms or other parties listed in the register
maintained under section 301 of the Companies Act, 1956.
(f) In respect of the above unsecured loans, the Company is regular in
repayment of the principal amount and interest due thereon as per the
terms of the acceptance. There are no overdue amounts at the year end.
4. In our opinion, and according to the information and explanations
given to us during the course of audit, there are adequate internal
control systems commensurate with size of the Company and the nature of
its business with regard to purchase of inventory and fixed assets and
for the sale of goods and services. Further, on the basis of our
examination of the books & records of the Company, carried out in
accordance with the generally accepted auditing practices in India, we
have neither come across nor have we been informed of any instance of
major weaknesses in the aforesaid internal control systems.
5. (a) To the best of our knowledge and according to the information
and explanations given to us, we are of the opinion that transactions
that need to be entered into the register maintained under section 301
of the Companies Act, 1956 have been so entered.
(b) In our opinion, and according to the information and explanations
given to us, the transactions made in pursuance of contracts or
arrangements entered in the register maintained under Section 301 of
the Act and aggregating during the year to rupees five lakhs or more in
respect of each party have been made at prices which are reasonable
having regard to market prices for such transactions, prevailing at the
relevant time, where such market prices are available.
6. In our opinion and according to information and explanations given
to us, the provisions of section 58A and 58AA or any other relevant
provisions of the Companies Act, 1956 including the Companies
(Acceptance of Deposit) Rules, 1975 have been complied with in respect
of fixed deposits accepted from the public.
7. The Company has an in-house internal audit system which in our
opinion is commensurate with the size & nature of its business.
8. We have broadly reviewed the cost accounting records, maintained by
the Company pursuant to the rules prescribed by the Central Government
for the maintenance of cost records under clause (d) of sub-section (1)
of section 209 of the Act and are of the opinion that, prima facie, the
prescribed accounts and records have been made and maintained. We are,
however, not required to make a detailed examination of such books and
records.
9. (a) In our opinion and according to the information and
explanations given to us and according to the records of the Company,
undisputed statutory dues including Provident Fund, Investor Education
and Protection Fund, Employees State Insurance, Income tax, Sales tax,
Wealth-tax, Service Tax, Custom Duty, Excise Duty, Cess and other
material statutory dues, wherever applicable, have been regularly
deposited with the appropriate authorities and there are no such
undisputed statutory dues payable for a period of more than six months
from the date they became payable as at 30th September, 2011.
(b) According to the information and explanations given to us and as
per the books and records examined by us, there are no dues of Wealth
Tax, Custom Duty, Income Tax and other applicable taxes which have not
been deposited on account of any dispute, except the following in
respect of disputed Excise Duty, Sales Tax, Service Tax, Cess etc.
(along with the forum where dispute is pending):
Name of the Nature of Period to Forum Where dispute
is pending Amount
Statute dues which Cases (Rs.in
pertain Lacs)
Central
Excise Act, Excise
Duty 1994-95 HonÃble High Court,
Allahabad 5.00
1944 1994-96 Tribunal, New Delhi 8.00
2002-08 CESTAT, New Delhi 59.92
2003-05 Addl. Dy. Commissioner,
Yamuna Nagar 0.06
Finance
Act, 1994 Service
Tax 2004-06 CESTAT, New Delhi 6.00
2005-07 CESTAT, New Delhi 22.31
2008-10 CESTAT, New Delhi 6.92
2008-09 Commissioner (Appeal),
New Delhi 8.36
2009-12 Assistant Commissioner,
Yamuna Nagar 64.51
2011-12 Commissioner Central Excise 61.28
Sales Tax
Act Sales Tax 1993-94 Sales Tax Tribunal, Orissa 9.02
1995-96 Sales Tax Tribunal, Orissa 17.00
1996-97 Sales Tax Tribunal, Orissa 5.00
1996-00 Assessing Authority (AO, YNR) 2.49
2006-07 Assessing Authority (AO, YNR) 2.74
1992-94 Appellant Tribunal à West
Bengal 245.00
2000-05 Sales Tax Tribunal,
Yamuna Nagar 6.63
1971-73 Commissioner Sales Tax,
Lucknow 6.00
2005-06 Commissioner (Appeal),
Muzaffarnagar 3.00
2005-06 Joint Commissioner (Appeal),
Muzaffarnagar 1.10
1995-96 Addl. Commissioner of Appeals 3.60
1996-97 Addl. Commissioner of Appeals 7.60
1976-77 High Court, Allahabad 0.15
1987-88 Dy Commissioner of
Commercial Tax 4.00
1995-96 Dy Commissioner of
Commercial Tax 34.00
1994-95 Commercial Tax Officer 61.00
Local Area Local
Area 2006-07 HonÃble High Court,
Punjab & Haryana 6.00
development
Tax Tax
Tax Act,
2002
Haryana
State Water
Cess 1992-93 High Court of Haryana
and Punjab 109.66
Pollution
Control
Law
10. There are no accumulated losses of the Company as at the end of
the financial year. There are no cash losses during the financial year
and in the immediately preceding financial year.
11. According to the information and explanations given to us and as
per the books and records examined by us, the Company has not defaulted
in repayment of dues to any financial institution or bank.
12. According to the information and explanations given to us, the
Company has not granted any loans and advances on the basis of security
by way of pledge of shares, debentures and other securities.
13. The Company does not fall within the category of Chit fund / Nidhi
/ Mutual Benefit fund / Society and hence the related reporting
requirements of the Order are not applicable.
14. According to the information and explanations given to us, the
Company is not dealing or trading in shares, securities, debentures and
other investments and hence the related reporting requirements of the
Order are not applicable.
15. According to the information and explanations given to us, the
Company has not given any guarantees for loans taken by others from
banks or financial institutions.
16. In our opinion and according to the information and explanations
given to us, the term loans raised during the year by the Company have
been applied for the purpose for which the said loans were obtained,
where the lenders have stipulated such end use.
17. According to the information and explanations given to us and as
per the books and records examined by us, on an overall examination of
the Balance Sheet of the Company, the funds raised by the Company on
short-term basis have not been applied for long-term investment.
18. The Company has not made any preferential allotment of shares to
parties and companies covered in the register maintained under section
301 of the Companies Act, 1956.
19. The Company has not issued any secured debentures during the year
nor are there any secured debentures outstanding at the year end.
20. The Company has not raised any money by way of public issues
during the year.
21. During the course of our examination of the books and records of
the Company carried out in accordance with the generally accepted
auditing practices in India, we have neither come across any instance
of fraud on or by the Company, noticed and reported during the year,
nor have we been informed of such case by the management.
For S. S. KOTHARI MEHTA & CO.
Chartered Accountants
Firm Regn.No. 000756N
(K. K. TULSHAN )
Place: Noida Partner
Dated: 25 November,2011 Membership No. 085033
Sep 30, 2010
We have audited the attached Balance Sheet of The Saraswati Industrial
Syndicate Limited (the Company) as at 30th September, 2010 and also
the Profit & Loss Account and the Cash Flow Statement (the Financial
Statements) 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.
We have conducted our audit in accordance with auditing standards
generally accepted in India. Those Standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by the management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable
basis for our opinion.
As required by the Companies (AuditorsReport) Order, 2003 as amended
by the Companies (AuditorsReport) (Amendment) Order, 2004
(Collectively the Order) issued by the Central Government of India in
terms of Section 227 (4A) of the Companies Act, 1956 and on the basis
of such checks as we considered appropriate and according to the
information and explanations given to us, we enclose in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the said
Order.
Further to our comments in the Annexure referred to 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 purpose of our
audit;
b) In our opinion, proper books of account, as required by law, have
been kept by the Company so far as appears from our examination of
those books. In respect of the branches not visited by us, Management
certified accounts have been forwarded to us for the purpose of our
audit which have been appropriately dealt with.
c) The Balance Sheet, Profit & Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account;
d) In our opinion, the Balance Sheet, Profit & Loss Account and Cash
Flow Statement, dealt with by this report, comply with the Accounting
Standards referred to in sub - section (3C) of Section 211 of the
Companies Act, 1956.
e) On the basis of written representations received from the directors
as on 30th September, 2010 and taken on record by the Board of
Directors, we report that none of the directors is disqualified as on
30th September, 2010 from being appointed as a director in terms of
clause (g) of sub section (1) of section 274 of the Companies Act,
1956.
f) In our opinion and to the best of our information and according to
the explanations given to us, the said accounts read with the
Accounting policies and Notes thereon give the information required by
the Companies Act, 1956 in the manner so required and give a true and
fair view in conformity with the accounting principles generally
accepted in India;
i) In the case of Balance Sheet, of the state of affairs of the Company
as at 30th September, 2010;
ii) In the case of Profit and Loss Account, of the Profit for the year
ended on that date; and
iii) In the case of Cash Flow Statement, of the cash flows for the year
ended on that date.
ANNEXURE TO AUDITORSREPORT
(Annexure referred to in our report of even date)
1. (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) Verification of the fixed assets is being conducted based on a
programme by the management designed to cover all assets over a period
of three years except for the certain building and vehicle situated in
Pakistan (written down value Rs. 1/-), which, in our opinion, is
reasonable having regard to the size of the company and nature of its
business. No major discrepancies were noticed as compared to book
records and necessary adjustments have been carried out in the books of
account.
(c) Fixed assets disposed off during the year were not substantial.
2. (a) The inventory has been physically verified during the year by
the management at reasonable intervals in respect of finished goods,
stores and spare parts and raw material. Further, stock in the
possession and custody of third parties and stock in transit as at 30th
September, 2010 have been verified by the management with reference to
confirmation or statement of accounts or correspondence with third
parties or subsequent receipt of goods. In our opinion, the frequency
of such verification is reasonable.
(b) The procedures for the physical verification of inventory followed
by the management are, in our opinion, reasonable and adequate in
relation to the size of the Company and nature of its business.
(c) In our opinion, the Company is maintaining proper records of
inventory. The discrepancies noticed on physical verification of
inventory as compared to book records were not material and have been
properly dealt with in the books of account.
3. (a) The company has taken unsecured loans of Rs. 56.50 lacs in the
form of fixed deposits from its four Directors and one related party,
the terms & conditions of which are, prima facie, not prejudicial to
the interest of the company. Maximum amount outstanding during the year
and year end balance of such loans are Rs. 56.50 Lacs. There are no
other loans, secured or unsecured, from companies, firms or other
parties listed in the register maintained under section 30 of the
Companies Act, 1956.
(b) In respect of the above unsecured loans, the company is regular in
repayment of the principal amount and interest due thereon as per the
terms of the acceptance. There are no overdue amounts at the year end.
(c) The company has granted unsecured loan to its two subsidiary
companies listed in the register maintained under section 30 of the
Companies Act, 1956. Apart from these loans, the company has not
granted any other loans, secured or unsecured, to companies, firms or
other parties listed in the register maintained under section 30 of
the Companies Act, 1956.
(d) The maximum amount outstanding during the year is Rs. 8,343.60 Lacs
and year end balances of such loans are Rs.1,539.35 Lacs. In our
opinion, the rate of interest and other terms & conditions of such loan
are prima facie, not prejudicial to the interest of the company.
(e) In respect of the aforesaid loans, the Companies were regular in
payment of interest. We are explained that these loans are repayable on
demand and, therefore, there are no overdue amounts at the year end.
4. In our opinion, and according to the information and explanations
given to us during the course of audit, there are adequate internal
control systems commensurate with size of the Company and the nature of
its business with regard to purchase of inventory and fixed assets and
for the sale of goods and services. Further, on the basis of our
examination of the books & records of the company, carried out in
accordance with the generally accepted auditing practices in India, we
have neither come across nor have we been informed of any instance of
major weaknesses in the aforesaid internal control systems.
5. (a) To the best of our knowledge and according to the information
and explanations given to us, we are of opinion that particulars of
contracts or arrangements that need to be entered into the register
maintained under section 30 of the Companies Act, 1956 have been so
entered.
(b) In our opinion, and according to the information and explanations
given to us, the transactions with parties pursuant to the contracts or
arrangements entered into in the register maintained under Section 301
of the Companies Act, 1956 and exceeding the values of Rupees five
lakhs in respect of each party have been entered into during the
financial year, are at prices, which are reasonable, having regard to
the prevailing market price at the relevant time where such market
prices are available.
6. In our opinion and according to information and explanations given
to us, the provisions of section 58A and 58AA or any other relevant
provisions of the Companies Act, 1956 including the Companies
(Acceptance of Deposit) Rules, 1975 have been complied with in respect
of fixed deposits accepted from the public.
7. In our opinion, the Company has an in-house internal audit system
commensurate with the size & nature of its business.
8. We have broadly reviewed the Cost Accounting records, maintained by
the Company pursuant to the Rules prescribed by the Central Government
for the maintenance of cost records under clause (d) of sub-section (1)
of section 209 of the Act and are of the opinion that, prima facie, the
prescribed accounts and records have been made and maintained. We are,
however, not required to make a detailed examination of such books and
records.
9. (a) In our opinion and according to the information and
explanations given to us, according to the records of the Company,
undisputed statutory dues including Provident Fund, Investor Education
and Protection Fund, Employees State Insurance, Income tax, Sales tax,
Wealth-tax, Service Tax, Custom Duty, Excise Duty, Cess and other
material statutory dues, wherever applicable, have been regularly
deposited with the appropriate authorities and there are no such
undisputed statutory dues payable for a period of more than six months
from the date they became payable as at 30th September, 2010.
(b) According to the information and explanations given to us and as
per the books and records examined by us, there are no dues of Wealth
Tax, Custom Duty, and Income Tax which have not been deposited on
account of any dispute, except the following in respect of disputed
Excise Duty, Sales Tax, Service Tax and Cess along with the forum where
dispute is pending:
Name of the Nature of Period to Forum Where dispute
is pending Amount
Statute dues which cases (Rs. in
pertain Lacs)
Central Exc
ise Act, Excise Duty 1994-95 Honble High Court,
Allahabad 8.00
1944 2002-08 CESTAT, New Delhi 59.92
2008-09 Commissioner (Appe
al), Gurgaon 2.86
2008-09 Commissioner (Appe
al), New Delhi 1.00
2005-10 Addl. Dy. Commiss
ioner, Panchkula 10.94
2003-05 Addl. Dy. Commiss
ioner, Yamuna Nagar 0.06
Finance Act,
1994 Service Tax 2004-06 CESTAT, New Delhi 6.00
2005-07 Commissioner (Appe
al), Gurgaon 22.31
2008-09 Commissioner (Appe
al), New Delhi 8.36
2009-10 Assistant Commissi
oner, Yamuna Nagar 4.96
Sales Tax Act Sales Tax 2000-01 Honble High Court
- Allahabad 6.26
2004-05 Sales Tax Tribunal,
Muzaffarnagar 24.00
1993-97 Sales Tax Tribunal,
Orissa 31.02
1996-00 Assessing Authority
(AO, Yamuna Nagar) 5.23
1992-94 Appellant Tribunal,
West Bengal 245.00
2000-05 Sales Tax Tribunal,
Yamuna Nagar 6.63
1971-73 Commissioner Sales
Tax, Lucknow 6.00
2005-06 Commissioner (Appe
al), Muzaffarnagar 3.00
2005-06 Joint Commissioner
(Appeal), Muzaffar
nagar 10.27
1995-99 Adl. Commissioner
of Appeals, Yamuna
Nagar 23.25
1976-77 Honble High Court,
Allahabad 0.15
1987-96 Dy Commissioner of
Commercial Taxes,
Kolkata 38.00
1994-95 Commercial Tax off
icer,Kolkata 61.00
Local Area Local Area 2006-07 Honble High Court,
Punjab & Haryana 6.00
Development
Tax Tax
Act,2002
Haryana
State Water Cess 1992-93 Honble High Court,
Punjab & Haryana 87.14
Pollution
Control
Law
10. There are no accumulated losses of the Company as at the end of the
financial year. There are no cash losses during the financial year and
in the immediately preceding financial year.
11. According to the information and explanations given to us and as
per the books and records examined by us, the Company has not defaulted
in repayment of dues to any financial institution or bank.
12. According to the information and explanations given to us, the
Company has not granted any loans and advances on the basis of security
by way of pledge of shares, debentures and other securities.
13. The Company does not fall within the category of Chit fund / Nidhi
/ Mutual Benefit fund / Society and hence the related reporting
requirements of the Order are not applicable.
14. According to the information and explanations given to us, the
Company is not dealing or trading in shares, securities, debentures and
other investments and hence the related reporting requirements of the
Order are not applicable.
15. According to the information and explanations given to us, the
Company has not given any guarantees for loans taken by others from
banks or financial institutions.
16. In our opinion and according to the information and explanations
given to us, the term loans raised during the year by the Company have
been applied for the purpose for which the said loans were obtained,
where the lenders have stipulated such end use.
17. According to the information and explanations given to us and as
per the books and records examined by us, on an overall examination of
the Balance Sheet of the company, the funds raised by the Company on
short-term basis have not been applied for long-term investment.
18 The Company has not made any preferential allotment of shares to
parties and Companies covered in the register maintained under section
301 of the Companies Act, 1956.
19. The company has not issued any secured debentures during the year
nor are there any secured debentures outstanding at the year end.
20. The Company has not raised any money by way of public issues
during the year.
21. During the course of our examination of the books and records of
the Company carried out in accordance with the generally accepted
auditing practices in India, we have neither come across any instance
of fraud on or by the Company, noticed and reported during the year,
nor have we been informed of such case by the management.
for S. S. KOTHARI MEHTA & CO.
Chartered Accountants
Firm Regn. No. 000756N
( Arun K. Tulsian )
Place: New Delhi Partner
Dated: 27 November, 2010 Membership No. 89907
Sep 30, 2009
We have audited the attached Balance Sheet of The Saraswati Industrial
Syndicate Limited as at 30th September, 2009 and also the Profit & Loss
Account and the 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.
We have conducted our audit in accordance with auditing standards
generally accepted in India. Those Standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by the management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable
basis for our opinion.
As required by the Companies (Auditors Report) Order, 2003 as amended
by the Companies (Auditors Report) (Amendment) Order, 2004
(Collectively the Order) issued by the Central Government of India in
terms of Section 227 (4A) of the Companies Act, 1956 and on the basis
of such checks as we considered appropriate and according to the
information and explanations given to us, we enclose in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the said
Order.
Further to our comments in the Annexure referred to 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 purpose of our
audit;
b) In our opinion, proper books of account, as required by law, have
been kept by the Company so far as appears from our examination of
those books. In respect of the branches not visited by us, Management
certified accounts have been forwarded to us for the purpose of our
audit which have been appropriately dealt with.
c) The Balance Sheet, Profit & Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account;
d) In our opinion, the Balance Sheet, Profit & Loss Account and Cash
Flow Statement, dealt with by this report, comply with the Accounting
Standards referred to in sub - section (3C.) of Section 211 of the
Companies Act, 1956.
e) On the basis of written representations received from the directors
as on 30th September, 2009 and taken on record by the Board of
Directors, we report that none of the directors is disqualified as on
30th September, 2009 from being appointed as a director in terms of
clause (g) of sub section (1) of section 274 of the Companies Act,
1956.
f) In our opinion and to the best of our information and according to
the explanations given to us, the said accounts read with the
Accounting policies and Notes thereon give the information required by
the Companies Act, 1956 in the manner so required and give a true and
fair view in conformity with the accounting principles generally
accepted in India;
i) In the case of Balance Sheet, of the state of affairs of the Company
as at 30th September, 2009;
ii) In the case of Profit and Loss Account, of the Profit for the year
ended on that date; and
iii) In the case of Cash Flow Statement, of the cash flows for the year
ended on that date.
ANNEXURE TO AUDITORSREPORT
(Annexure referred to in our report of even date)
1. (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) As per the programme, all the fixed assets have been physically
verified by the management during the year except for the certain
building and vehicle situated in Pakistan (written down value Rs. 1/-).
No major discrepancies were noticed as compared to book records arid
necessary adjustments have been carried out in the books of account. In
our opinion, the frequency of verification is reasonable having regard
to the size of the company and the nature of its assets.
(c) Fixed assets disposed off during the year were not substantial.
2. (a) As explained to us, physical verification has been conducted by
the management at reasonable intervals in respect of finished goods,
stores and spare parts and raw material. Further, stock in the
possession and custody of third parties and stock in transit as at 30th
September, 2009 have been verified by the management with reference to
confirmation or statement of accounts or correspondence of the third
parties or subsequent receipt of goods. In our opinion, the frequency
of such verification is reasonable.
(b) The procedures for the physical verification of inventory followed
by the management are, in our opinion, reasonable and adequate in
relation to the size of the Company and nature of its business.
(c) In our opinion, the Company is maintaining proper records of
inventory. The discrepancies noticed on physical verification of
inventory as compared to book records were not material and have been
properly dealt with in the books of account.
3. (a) The company has taken unsecured loans of Rs. 40.58 lacs in the
form of fixed deposits from its four Directors and one party, the terms
& conditions of which are, prima facie, not prejudicial to the interest
of the company. Maximum amount outstanding during the year and year end
balance of such loans are Rs. 40.58 Lacs. There are no other loans,
secured or unsecured, from companies, firms or other parties listed in
the register maintained under section 301 of the companies Act, 1956.
(b) In respect of the above unsecured loans, the company is regular in
repayment of the principal amount and interest due thereon as per the
terms of the acceptance. There are no overdue amounts at the year end.
(c) The company has granted unsecured loan to its two subsidiary
companies listed in the register maintained under section 301 of the
Companies Act, 1956. Apart from these loans, the company has not
granted any other loans, secured or unsecured, to companies, firms or
other parties listed in the register maintained under section 301 of
the Companies Act, 1956.
(d) The maximum amount outstanding during the year is Rs. 2190.72 Lacs
and year end balances of such loans are Rs.1040.40 Lacs. In our
opinion, the rate of interest and other terms & conditions of such loan
are, prima facie, not prejudicial to the interest of the company.
(e) In respect of the aforesaid loans, the Companies were regular in
payment of interest. We are explained that these loans are repayable on
demand and, therefore, there are no overdue amounts at the year end.
4. In our opinion, and according to the information and explanations
given to us during the course of audit, there are adequate internal
control systems commensurate with size of the Company and the nature of
its business with regard to purchase of inventory and fixed assets and
for the sale of goods and services. Further, on the basis of our
examination of the books & records of the company, carried out in
accordance with the generally accepted auditing practices in India, we
have neither come across nor have we been informed of any instance of
major weaknesses in the aforesaid internal control systems.
5. (a) To the best of our knowledge and according to the information
and explanations given to us, we are of opinion that transactions that
need to be entered into the register maintained under section 301 of
the Companies Act, 1956 have been so entered.
(b) In our opinion and according to the information and explanations
given to us, the transactions with parties, with whom transactions
exceeding the values of Rupees Five Lacs in respect of each party have
been entered into during the financial year, are at prices, which are
reasonable, having regard to the prevailing market prices at the
relevant time where such market prices are available.
6. In our opinion and according to information and explanations given
to us, the provisions of section 58A and 58AA or any other relevant
provisions of the Companies Act, 1956 including the Companies
(Acceptance of Deposit) Rules, 1975 have been complied with in respect
of fixed deposits accepted from the public.
7. In our opinion, the Company has an in-house internal audit system
commensurate with the size & nature of its business.
8. We have broadly reviewed the Cost Accounting records, maintained by
the Company pursuant to the Rules prescribed by the Central Government
for the maintenance of cost records under clause (d) of sub-section (1)
of section 209 of the Act and are of the opinion that, prima facie, the
prescribed accounts and records have been made and maintained. We are,
however, not required to make a detailed examination of such books and
records.
9. (a) In our opinion and according to the information and
explanations given to us, according to the records of the Company,
undisputed statutory dues including Provident Fund, Investor Education
and Protection Fund, Employees State Insurance, Income tax, Sales tax,
Wealth-tax, Service Tax, Custom Duty, Excise Duty, Cess and other
material statutory dues, wherever applicable, have been regularly
deposited with the appropriate authorities and there are no such
undisputed statutory dues payable for a period of more than six months
from the date they became payable as at 30th September, 2009.
(b) According to the information and explanations given to us and as
per the books and records examined by us, there are no dues of Wealth
Tax and Income Tax which have not been deposited on account of any
dispute, except the following in respect of disputed Excise duty, Sales
tax, Service tax, Custom Duty, Cess and Entry tax along with the forum
where dispute is pending:
Name of
Statute Nature of dues Forum where dispute
is pending Amount in
(Rs in lacs)
Central
Excise Act Excise Duty Honble High Court, Allahabad 8.00
Honble CESTAT, New Delhi 47.69
Commissioned Appeals),Gurgaon 21.27
Service Tax Commissioner (Appeals), Service
Tax Meerut 6.00
Commissioner (Appeals),
Gurgaon 22.31
Assessing Authority (AO),
Yamunanagar 8.34
Sales Tax
Act Sales Tax Honble High Court-Allahabad 6.26
Sales Tax Tribunal,
Muzaffarnagar 24.00
Sales Tax Tribunal, Orissa 31.02
Sales Tax Tribunal 6.63
Appellate Authority Tribunal-
West Bengal 245.00
Commissioner Sales Tax,
Lucknow 6.00
Commissioner Appeals,
Muzaffarnagar 3.00
Joint Commissioner (Appeals),
Muzaffarnagar 1.09
Additional Comm. of Appeals 23.25
Dy Commissioner of Commercial
Taxes 38.00
Sales Tax Authorities, Jabalpur 4.16
Commercial Tax Officer 61.00
Assessing Authority (AO) 2.49
Work Contract
Tax Assessing Authority, Maharashtra 6.50
Haryana
State Water Cess Honble Punjab & Haryana
High Court 70.26
Pollution
Control
Law
10. There are no accumulated losses of the Company as at the end of
the financial year. There are no cash losses during the financial year
and in the immediately preceding financial year.
11. According to the information and explanations given to us and as
per the books and records examined by us, the Company has not defaulted
in repayment of dues to any financial institution or bank.
12. According to the information and explanations given to us, the
Company has not granted any loans and advances on the basis of security
by way of pledge of shares, debentures and other securities.
13. The Company does not fall within the category of Chit fund / Nidhi
/ Mutual Benefit fund / Society and hence the related reporting
requirements of the Order are not applicable.
14. According to the information and explanations given to us, the
Company is not dealing or trading in shares, securities, debentures and
other investments and hence the related reporting requirements of the
Order are not applicable.
15. According to the information and explanations given to us, the
Company has not given any guarantees for loans taken by others from
banks or financial institutions.
16. In our opinion and according to the information and explanations
given to us, the term loans raised during the year by the Company have
been applied for the purpose for which the said loans were obtained,
where the lenders have stipulated such end use.
17. According to the information and explanations given to us and as
per the books and records examined by us, on an overall examination of
the Balance Sheet of the company, the funds raised by the Company on
short-term basis have not been applied for long-term investment.
18. The Company has not made any preferential allotment of shares to
parties and Companies covered in the register maintained under section
301 of the Companies Act, 1956.
19. The company has not issued any secured debentures during the year
nor are there any secured debentures outstanding at the year end.
20. The Company has not raised any money by way of public issues
during the year.
21. During the course of our examination of the books and records of
the Company carried out in accordance with the generally accepted
auditing practices in India, we have neither come across any instance
of fraud on or by the Company, noticed and reported during the year,
nor have we been informed of such case by the management.
For S. S. Kothari Mehta & Co.
Chart ered Accountants
(Arun K. Tulsian)
Partner
Place: Noida Membership No. 089907
Dated: 29th December, 2009
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