Mar 31, 2018
INDEPENDENT AUDITOR''S REPORT
To
The Members of Mangalam Organics Limited
Report on the Indian Accounting Standards (Ind AS) Financial Statements
We have audited the accompanying financial statements of Mangalam Organics Limited, which comprise the Balance Sheet as at 31st March, 2018, the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information.
Management''s Responsibility for the Ind AS Financial Statements
The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("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 specified in the Companies (Indian Accounting Standards) Rules, 2015 (as amended) under Section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding 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 Ind AS financial statements based on our audit. We have taken into account the provisions of the Act and the Rules made there under including 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 and other applicable authoritative pronouncements issued by the Institute of Chartered Accountants of India. Those Standards and pronouncements 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 the disclosures in the Ind AS financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the Ind AS financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of 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 Ind AS financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Ind AS financial statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the 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:
a) of the state of affairs of the Company as at March 31, 2018;
b) its total comprehensive income (comprising of profit and other comprehensive income),
c) of the cash flows for the year ended on that date, and
d) of 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 sub-section (11) of section 143 of the Act 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 explanation given to us, we give in the Annexure A, a statement on the matters specified in the paragraphs 3 and 4 of the Order.
2. As required by section 143(3) of the Act, we report that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;
b) In our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books.
c) The Balance Sheet, Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and 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 Ind AS financial Statement comply with the Indian Accounting Standards specified under section 133 of the Act, read with Rule 7 of the Companies Accounts (Rules), 2014;
e) On the basis of written representations received from the Directors as on 31 March, 2018 and taken on record by the Board of Directors, none of the Directors were disqualified as on 31st March, 2018 from being appointed as a Director in terms of section 164(2) of the Act.
f) with respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in "Annexure B" ; and
g) With respect to the other matters to be included in the Auditor''s Report and to the best of our information and according to explanation given to us:
1. The Company has disclosed the impact of pending litigation on its financial position in its Ind-AS financial statement- Refer Note 27 of the financial statements.
2. The Company does not have any long-term contracts including derivatives contracts for which there are no material foreseeable losses.
3. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended 31 March 2018.
4. The reporting on disclosures relating to Specified Bank Notes is not applicable for the year ended 31st March, 2018.
The Annexure referred to in our Independent Auditors'' Report to the members of the Company on the Financial Statements for the year ended 31st March, 2018 we report that:
i) (a) (a) The Company has not maintained proper records showing full particulars, including quantitative
details and situation of fixed assets. However, the Company has informed us that it is in process of compilation.
(b) According to the information and explanation given to us, all the fixed assets have been physically verified by the management during the year and we are informed that the management on such verification has noticed no material discrepancies. In our opinion the frequency of verification is reasonable.
c) The title deeds of immovable properties are held in the name of the Company except that they are mortgaged to bank as per the report given by the external valuer during the year and as per the management and we have relied upon the same.
ii) (a) The management has conducted physical verification of inventory at reasonable intervals during the year.
(b) As explained to us, there is no material discrepancy noticed on physical verification of inventory as compared to book records.
iii) (a) In our opinion and according to the information and explanation given to us the Company has not
granted any secured or unsecured loans to companies, firms , limited liability partnerships or other parties covered in the register maintained under section 189 of the Companies Act, 2013 and therefore clause iii b and iii c are not applicable.
iv) In our opinion and according to the information and explanation provided to us in respect of loans , investments , guarantees and security , the provisions of section 185 and 186 of the Companies Act, 2013 have been complied with.
v) In our opinion and according to the information and explanation given to us by the management, the Company has not accepted any deposit from the public and 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) The Central Government has prescribed maintenance of the cost records under sub section (1) of section 148 of the Companies Act, 2013 in respect to the Company''s products. We have broadly reviewed the books of accounts & records maintained by the Company in this connection and are of the opinion that prima facie, the prescribed accounts and records have been made & maintained. We have however, not made a detailed examination of the records with a view to determining whether they are accurate or complete.
vii) (a) According to the records of the Company, undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income tax, value added tax, custom duty, Excise duty, service tax, cess and goods and service tax with effect from 1 July 2017 other material statutory dues applicable to it have generally been regularly deposited with the appropriate authorities and no undisputed amounts payable in respect of these were outstanding, at the year end, for a period of more than six months from the date they became payable.
(b) According to the information and explanation given to us, there are no dues outstanding of income-tax, sales-tax, service tax, customs duty, excise duty and cess on account of any dispute except as stated below:-
Name of the statute |
Nature of dues |
Amount of demand |
Payment of demand |
Period to which the amount relate |
Forum where dispute is pending |
The Central Excise Act, 1944 |
Camphor Price difference Excise Duty |
64,52,240 |
11,12,067 (our cum duty calculation as per supreme court order |
Feb-2004 to May-2005 |
CESTAT |
The Central Excise Act, 1944 |
Excise Duty |
10,91,99,456 |
NIL |
Apr-1999 to Aug-2003 |
High Court |
The Central Excise Act, 1944 |
Excise Duty |
1,68,88,229 |
1,45,58,818 (Cum Duty) |
Sept-2003 to Nov-2004 |
High Court |
The Central Excise Act, 1944 |
Excise Duty |
81,44,105 |
70,01,466 (Cum Duty) |
Dec-2004 to Sept-2005 |
CESTAT |
The Central Excise Act, 1944 |
Interest |
1,68,38,001 |
1,68,38,001 |
July-1999 to Jan-2004 |
Commissioner of Central Excise and Customs (Appeals) for excess calculation of Interest of Rs. 91,30,615 paid under protest |
The Central Excise Act, 1944 |
Interest |
2,20,73,762 |
2,20,74,070 |
Sept-2003 to Nov-2004 |
CESTAT |
viii) 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 financial institutions or banks. Further, the Company has not issued any debenture.
ix) The Company did not raise any money by way of initial public offer or further public offer (including debt instruments). As per the information and explanation given to us by the management, term loans were applied for the purpose for which the loans were obtained.
x) During the course of our examination of the books and records of the Company and according to the information and explanation given to us, we have neither come across any instances of fraud on or by the Company or any fraud on the Company by its officers or employees, which has been noticed or reported during the current year, nor we have been informed of such case by the management.
xi) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has paid / provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Act.
xii) In our opinion and according to the information and explanations given to us, the Company is not a Nidhi Company. Accordingly, paragraph 3(xii) of the Order is 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 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) This clause is not applicable since the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review.
xv) The Company has not entered into non-cash transactions with Directors or persons connected with them. Accordingly, paragraph 3(xv) 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. Accordingly, paragraph 3(xvi) of the Order is not applicable.
Report on the Internal Financial Controls under Clause (I) of Sub-Section 143 of the Companies Act, 2013 ("The Act")
We have audited the internal financial controls over financial reporting of Mangalam Organics Limited (''the Company''), as of 31st March 2018 in continuation with our audit of the financial statements of the Company for the year ended on that date.
Management''s Responsibility for Internal Financial Controls
The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (''ICAI''). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to Company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.
Auditors'' Responsibility
Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the "Guidance Note") and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013 to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our Audit of internal financial controls over financial reporting included obtaining and understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A Company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A Company''s internal financial control over financial reporting includes those policies and procedures that:
(1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;
(2) Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and Directors of the Company ; and
(3) Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company''s assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31st March, 2018 based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
For NGST & Associates
Chartered Accountants
(Registration No. 135159W)
(Bhupendra Gandhi)
Partner
Membership No. 122296
Place: Mumbai
Date: 19th May, 2018
Mar 31, 2016
INDEPENDENT AUDITOR''S REPORT
We have audited the accompanying financial statements of Mangalam Organics Limited (Formerly known as Dujodwala Products Limited), which comprise the Balance Sheet as at 31st March, 2016, and the Statement of Profit and Loss and Cash Flow Statement for the year ended 31st March, 2016, and a summary of significant
Management''s Responsibility for the Financial Statements
The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding 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
Our responsibility is to express an opinion on these financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.
We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether 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
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit
In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:
a) In the case of the Balance Sheet, of the state of affairs of the Company as at March 31,2016.
b) In the case of the Profit and Loss Account, of the loss for the year ended on that date; and
c) In the case of the Cash Flow Statement, of the cash flows for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 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 a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.
a) We have sought and obtained all the information and explanations which to the best of our knowledge
b) In our opinion proper books of account as required by law have been kept by the Company so far as
c) The Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are
d) In our opinion, the aforesaid financial Statement 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 written representations received from the directors as on 31st March, 2016 and 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 other matters included in the Auditor''s Report and to the best of our information and
1. The Company has disclosed the impact of pending litigation on its financial position in its financial statement- Refer Note 28 of the financial statements.
2. The Company does not have any long-term contracts including derivatives contracts for which there
3. During the current year, there is no amount which needs to be transferred to the Investor Education
Annexure referred to in Point 1 of the Auditors'' Report of even date to the members of Mangalam Organics Limited (formerly Dujodwala Products Ltd.) for the year ended as on March 31, 2016.
On the basis of such checks as we considered appropriate and the information and explanations given to us during
i) (a) The Company has not maintained proper records showing full particulars, including quantitative details and situation of fixed assets. However, the Company has informed us that it is in process of compilation.
(b) According to the information and explanation given to us, all the fixed assets have been physically verified by the management during the year along with the technical expert but we cannot comment neither on any material discrepancies which were noticed on such verification nor we can comment on whether the same has been properly dealt with in the books of accounts as records were not available for
c) The title deeds of immovable properties are held in the name of the Company except that they are mortgaged to bank as per the report given by the external valuer during the year and as per the
ii) (a) The inventory has been physically verified during theyear by the management and we have relied on the
same. There are no material discrepancies noticed except for the inventory which was lost due to fire but
iii) (a) In our opinion and according to the information and explanation given to us the Company has not
granted any secured or unsecured loans to companies, firms , limited liability partnerships or other parties covered in the register maintained under section 189 of the Companies Act,2013 and therefore
iv) In our opinion and according to the information and explanation provided to us in respect of loans , investments, guarantees and security, the provisions of section 185 and 186 of the Companies Act 2013
v) In our opinion and according to the information and explanation given to us by the management, the Company has not accepted any deposit from the public and 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
vi) The Central Government has prescribed maintenance of the cost records under sub section (1) of section 148 of the Companies Act, 2013 in respect to the Company''s products. We have broadly reviewed the books of accounts & records maintained by the Company in this connection and are of the opinion that prima facie, the prescribed accounts and records have been made & maintained. We have however, not made a detailed examination of the records with a view to determining whether they are accurate or complete.
vii) (a) 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, custom duty, Excise duty, service tax, cess and other material statutory dues applicable to it have generally been regularly deposited with the appropriate authorities and no undisputed amounts payable in respect of these were outstanding, at the year end, for a period of more than six months from the date they
(b) According to the information and explanation given to us, there are no dues outstanding of income tax, sales-tax, wealth-tax, service tax, customs duty, excise duty and cess on account of any dispute except as stated below:-
Name of the statute |
Nature of dues |
Amount of demand |
Payment of demand |
Period to which the amount relate |
Forum where dispute is pending |
The Central Excise Act, 1944 |
Camphor Price Difference Excise Duty |
2,47,49,315 |
11,12,067 (our cum duty calculation as per supreme court order |
Feb-2004 to May-2005 |
Commissioner of Central Excise Raigad |
The Central Excise Act, 1944 |
Excise duty |
10,91,99,456 |
NIL |
Apr-1999 to Aug-2003 |
High Court |
The Central Excise Act, 1944 |
Excise Duty |
1,68,88,229 |
1,45,58,818 (Cum Duty) |
Sept-2003 to Nov-2004 |
High Court |
The Central Excise Act, 1944 |
Excise Duty |
81,44,105 |
70,01,466 (Cum Duty) |
Dec-2004 to Sept-2005 |
CESTAT |
The Central Excise Act, 1944 |
Interest |
1,68,38,001 |
1,68,38,001 |
July-1999 to Jan-2004 |
Commissioner of Central Excise and Customs (Appeals) for excess calculation of Interest of Rs. 91,30,615 paid under protest |
The Central Excise Act, 1944 |
Interest |
2,20,73,762 |
1,83,52,526 |
Sept-2003 to Nov-2004 |
Commissioner of Central Excise and Customs (Appeals) |
viii) Based on our audit procedures and the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to financial institutions and banks due to restructuring of loans with the bank. There are no Debenture holders of the Company.
ix) In our opinion and according to the information and explanations given to us and on an overall examination of the records and relying on the information compiled by the Company for co-relating the funds raised to the end use of term loans as per the restructuring of the loans from the bank, we have to state that, the Company has, prima facie, applied the term loans for the purpose for which the loans were obtained. There have been no moneys raised by way of initial public offer or further public offer( including debt instruments).
x) During the course of our examination of the books and records of the Company and according to the information and explanation given to us, we have neither come across any instances of fraud on or by the Company or any fraud on the Company by its officers or employees, which has been noticed or reported during the current year, nor we have been informed of such case by the management.
xi) During the course of our examination and as verified we state that the managerial remuneration has been paid or provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act.
xii) This clause is not applicable being the Company is not the nidhi Company.
xiii) As verified by us all the transactions with the related parties are in compliance with sections 177 and section 188 of the Companies Act 2013 where applicable and the details have been disclosed in the Financial Statements, etc as required by the Accounting Standard 18.
xiv) This clause is not applicable since the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review.
xv) As verified the Company has not entered in to any non-cash transactions with directors or persons connected with him.
xvi) This clause is not applicable since the Company is not required to be registered under section 451A of the Reserve Bank of India Act,1934.
Company") as of March 31,2016 in conjunction with our audit of the financial statements of the Company for the year ended on that date.
Management''s responsibility for Internal Financial Controls
The Company''s management is responsible for establishing and maintaining internal financial controls based on "the internal control over financial reporting criteria established 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 Companies policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.
Auditors'' Responsibility
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") issued by ICAI and the Standards on Auditing prescribed under section 143(10) of the Companies Act 2013, to the extent applicable to an audit of internal financial controls. 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 respect.
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 and understanding of internal financial controls over 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 risk 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
The 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. The Company''s internal financial control over financial reporting includes those policies and procedures that:
(1) Pertain to the maintenance of records that, in reasonable details, accurately and fairly reflects the
(2) Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of
(3) Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company''s assets that could have a material effect on the financial
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 changed in conditions, or that the degree of compliance with the policies or
In our opinion, to the best of our information and according to the explanations given to us, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31,2016 based on "the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over financial reporting issued By the institute character Accountants of Indiaâ.
For R.Kabra & co.
Chartered Accountants
Sd/-
(Deepa Rathi)
Partner
M.ship No.104808 FRN:104502W
Place: Mumbai
Date 26th April,2016
Mar 31, 2015
We have audited the accompanying financial statements of Mangalam
Organics Limited (Formerly known as Dujodwala Products Limited), which
comprise the Balance Sheet as at 31st March, 2015, and the Statement of
Profit and Loss and Cash Flow Statement for the year ended 31st March,
2015, and a summary of significant accounting policies and other
explanatory information.
Management's Responsibility for the Financial Statements
The Company's Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 ("the Act") with respect
to the preparation of these financial statements that give a true and
fair view of the financial position, financial performance and cash
flows of the Company in accordance with the accounting principles
generally accepted in India, including the Accounting Standards
specified under Section 133 of the Act, read with Rule 7 of the
Companies (Accounts) Rules, 2014. This responsibility also includes
maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding 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 financial
statements based on our audit. We have taken into account the
provisions of the Act, the accounting and auditing standards and
matters which are required to be included in the audit report under the
provisions of the Act and the Rules made there under.
We conducted our audit in accordance with the Standards on Auditing
specified under Section 143(10) of the Act. Those Standards require
that we comply with ethical requirements and plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and the disclosures in the financial statements. The
procedures selected depend on the auditor's judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether 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 financial
statements.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the financial statements give the information
required by the Act in the manner so required and give a true and fair
view in conformity with the accounting principles generally accepted in
India:
a) In the case of the Balance Sheet, of the state of affairs of the
Company as at March 31,2015;
b) In the case of the Profit and Loss Account, of the profit for the
year ended on that date; and
c) In the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order, 2015 ("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
statement on the matters specified in paragraphs 3 and 4 of the Order,
to the extent applicable.
2. As required by section 143(3) of the Act, we report that:
a) We have sought and obtained all the information and explanations
which to the best of our knowledge and belief were necessary for the
purpose of our audit;
b) In our opinion proper books of account as required by law have been
kept by the Company so far as appears from our examination of those
books.
c) The Balance Sheet, Statement of Profit and Loss, and Cash Flow
Statement dealt with by this Report are in agreement with the books of
account.
d) In our opinion, the aforesaid financial Statement 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 written representations received from the directors
as on 31 March, 2015 and taken on record by the Board of Directors,
none of the directors is disqualified as on 31st March, 2015, from
being appointed as a director in terms of section 164(2) of the Act.
f) With respect to the other matters included in the Auditor's Report
and to the best of our information and according to explanation given
to us:
1. The Company has disclosed the impact of pending litigation on its
financial position in its financial statement- Refer Note 28 of the
financial statements.
2. The Company does not have any long-term contracts including
derivatives contracts for which there were any material foreseeable
losses.
3. During the current year, there is no amount which needs to be
transferred to the Investor Education and Protection Fund by the
Company.
ANNEXURE TO THE AUDITORS' REPORT
(Referred to in our report of even date)
Annexure referred to in Point 1 of the Auditors' Report of even date to
the members of Mangalam Organics Limited for the year ended as on March
31, 2015.
On the basis of such checks as considered appropriate and in terms of
the information and explanations given to us, we state as under:
i) (a) The company has not maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets. However, the Company has informed us that it is in process of
compilation.
(b) According to the information and explanation given to us, all the
fixed assets have not been physically verified by the management during
the year though the company has verification on a random basis but we
cannot comment on its reasonability and therefore further we cannot
comment on the material discrepancies.
ii) (a) The inventory has been physically verified during the year by the
management and we have relied on the same. In our opinion the frequency
of verification is reasonable.
(b) In our opinion and according to the information and explanation
given to us, the procedures of physical verification of inventory
followed by the management are reasonable and adequate in relation to
the size of the company and the nature of its business.
(c) In our opinion and according to the information and explanation
given to us, the company is maintaining proper record of inventory. As
explained to us, there is no material discrepancy noticed on physical
verification of inventory as compared to book record and have been
properly dealt with in the books of accounts.
iii) In our opinion and according to the information and explanation
given to us the company has not granted unsecured loans to companies,
firms or other parties covered in the register maintained under section
189 of the Companies Act, 2013.
iv) In our opinion and according to the information and explanation
given to us by the management, 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 or the sale
of goods and services. During the course of our audit, we have not
observed any major weakness or continuing failure to correct any major
weakness in the internal control system of the company in respect of
these areas.
v) In our opinion and according to the information and explanation
given to us by the management, the company has not accepted any deposit
from the public and 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) The Central Government has prescribed maintenance of the cost
records under sub section (1) of section 148 of the Companies Act, 2013
in respect to the company's products. We have broadly reviewed the
books of accounts & records maintained by the company in this
connection and are of the opinion that prima facie, the prescribed
accounts and records have been made & maintained. We have however, not
made a detailed examination of the records with a view to determining
whether they are accurate or complete.
vii) (a) 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, custom
duty, Excise duty, service tax, cess and other material statutory dues
applicable to it have generally been regularly deposited with the
appropriate authorities and no undisputed amounts payable in respect of
these were outstanding, at the year end, for a period of more than six
months from the date they became payable.
(b) According to the information and explanation given to us, there are
no dues outstanding of income-tax, sales-tax, wealth-tax, service tax,
customs duty, excise duty and cess on account of any dispute except as
stated below:-
Name of the statute Nature of Amount of Payment of
dues demand demand
The Central Excise Interest 1,68,38,001 1,39,59,131
Act, 1944
The Central Excise Excise duty 11,58,94,818 NIL
Act, 1944
The Central Excise Excise Duty 1,01,92,867 NIL
Act, 1944
The Income Tax Income Tax 6,97,536 6,97,536
Act, 1961
Name of the statute Period to Forum where
which the dispute is pending
amount relate
The Central Excise July 1999 to Commissioner of Central
Act, 1944 January 2004 Excise and Customs (Appeals)
The Central Excise April 1999 to High Court
Act, 1944 March 2004
The Central Excise April 2004 to High Court
Act, 1944 November 2004
The Income Tax A.Y. 2009-10 Income Tax Appellate Tribunal
Act, 1961
(c) According to the information and explanation given to us there were
no amount required to be transferred to Investor Education and
Protection Fund in accordance with the relevant provision of the
Companies Act 1956 (1 of 1956) and rules there under and therefore no
amount has been transferred to such fund within the time.
viii) The company has no accumulated losses and the company has not
incurred any cash losses during the financial year covered under audit
or in the immediately preceding financial year.
ix) Based on our audit procedures and the information and explanations
given by the management, we are of the opinion that the company has not
defaulted in repayment of dues to financial institutions and banks.
There are no Debenture holders of the company.
x) On the basis of the information and explanation given to us and
records produced before us, the company has not given any guarantee for
loans taken by others from bank or financial institutions.
xi) In our opinion and according to the information and explanations
given to us and on an overall examination
of the records and relying on the information compiled by the Company
for co-relating the funds raised to the end use of term loans, we have
to state that, the company has, prima facie, applied the term loans for
the purpose for which the loans were obtained.
xii) 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
explanation given to us, we have neither come across any instances of
fraud on or by the company, noticed or reported during the current
year, nor we have been informed of such case by the management.
For R. Kabra & Co.
Chartered Accountants
(Registration NO.104502W)
(Deepa Rathi)
Partner
M. Ship No. 104808
FRN : 104502W
Place: Mumbai
Date: 30th May, 2015
Mar 31, 2014
Report on the financial statements
We have audited the accompanying financial statements of Mangalam
Organics Limited (the Company), which comprise the Balance Sheet as at
31 March 2014 and the statement of Profit and Loss and Cash Flow
statement for the year then ended, and a summary of significant
accounting policies and other explanatory information.
Management''s responsibility for the financial statements
Management is responsible for the preparation of these financial
statements that give a true and fair view of the financial position,
financial performance and cash flows of the Company in accordance with
the Accounting Standards referred to in sub-section (3C) of section 211
of the Companies Act, 1956 ("the Act") read with the General Circular
15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs
in respect of Section 133 of the Companies Act, 2013. This
responsibility includes the design, implementation and maintenance of
internal control relevant to the preparation and presentation of the
financial statements that give a true and fair view and are free from
material misstatement, whether due to fraud or error.
Auditor''s responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The procedures
selected depend on the auditor''s judgment, including the assessment of
the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the Company''s preparation and
fair presentation of the financial statements in order to design audit
procedures that are appropriate in the circumstances, but not for the
purpose of expressing an opinion on the effectiveness of the Company''s
internal control. An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of the accounting
estimates made by management, as well as evaluating the overall
presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the financial statements give the information
required by the Act in the manner so required and give a true and fair
view in conformity with the accounting principles generally accepted in
India:
a. In the case of the balance sheet, of the state of affairs of the
Company as at 31 March 2014.
b. In the case of the statement of profit and loss, of the profit for
the year ended on that date, and
c. In the case of the cash flow statement, of the cash flows for the
year ended on that date.
Report on other legal and regulatory requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order") issued by the Central Government of India in terms of
sub-section (4A) of section 227 of the Act, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
2. As required by section 227(3) of the Act, we report that:
a. We have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purpose of our
audit.
b. In our opinion proper books of account as required by law have been
kept by the Company so far as appears from our examination of those
books.
c. The Balance Sheet, statement of Profit and Loss and Cash Flow
statement dealt with by this report are in agreement with the books of
account.
d. 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 read
with the General Circular 15/2013 dated 13 September 2013 of the
Ministry of Corporate Affairs in respect of Section 133 of the
Companies Act ;
e. On the basis of written representations received from the Directors
as on 31 March 2014, and taken on record by the Board of Directors,
none of the Directors are disqualified as on 31 March 2014, from being
appointed as a Director in terms of clause (g) of sub-section (1) of
section 274 of the Companies Act, 1956.
ANNEXURE TO THE AUDITORS'' REPORT
(Referred to in our report of even date)
Annexure referred to in Point 1 of the Auditors'' Report of even date to
the members of Mangalam Organics Limited for the year ended as on March
31, 2014.
Re: Mangalam Organics Limited (formerly Dujodwala Products Limited)
(the Company)Re: Mangalam Organics Limited (formerly Dujodwala Products
Limited) (the Company)
On the basis of such checks as considered appropriate and in terms of
the information and explanations given to us, we state as under:
i. a. The Company has not maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets. However, the Company has informed us that it is in the process
of compilation.
b. According to the information and explanation given to us, all the
fixed assets have not been physically verified by the management during
the year though the Company has a verification on random basis but we
cannot comment on its reasonability & therefore further we cannot
comment on the material discrepancies.
c. The Company has not disposed of any substantial part of fixed
assets during the year so as to affect its going concern.
ii. a. The inventory has been physically verified during the year by
the management and we have relied on the same. In our opinion the
frequency of verification is reasonable.
b. In our opinion and according to the information and explanation
given to us, the procedures of physical verification of inventory
followed by the management are reasonable and adequate in relation to
the size of the Company and the nature of its business.
c. In our opinion and according to the information and explanation
given to us, the Company is maintaining proper records of inventory. As
explained to us, there is no material discrepancy noticed on physical
verification of inventory as compared to book records and have been
properly dealt with in the books of accounts.
iii. a. As per the information and explanation given to us, the Company
has granted unsecured loans to companies covered in the register
maintained under section 301 of the Companies Act, 1956. The number of
such parties involved is 10 and the maximum balance during the year is
Rs. 5,47,82,176/- and the closing balance as on year end is Rs. NIL.
b. Except Interest free loan, other terms & conditions of loan given
by the Company are prima facie not prejudiced to the interest of the
Company.
c. The receipt of principal amount and interest are on demand basis.
d. As per the information and explanation given to us, the Company has
taken unsecured loans from companies, firms, or other parties covered
in the register maintained under section 301 of the Companies Act,
1956. The number of such parties involved is 3 and the maximum balance
during the year is Rs. 7,17,99,753/- and the closing balance as on year
end is Rs 1,28,55,072/-. Out of the closing balance as on year end of
Rs. 1,28,55,072/-, Rs. 1,25,66,400/- amount outstanding is pertaining
to regular purchases done by the party.
e. The loans taken are interest free and other terms & conditions of
loan given by the Company are prima facie not prejudiced to the
interest of the Company,
f. The payment of principal amount and interest are on demand basis.
iv. In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business, for the
purchase of inventory and fixed assets and for the sale of goods and
services. During the course of our audit, we have not observed any
major weakness or continuing failure to correct any major weakness in
the internal control system of the Company in respect of these areas.
v. a. In our opinion and according to the information & explanation
given to us, the particulars of or arrangement referred to in Section
301 of the act have been entered in the register required to be
maintained under that section.
b. As explained to us, the 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.
vi. In our opinion and according to the information and explanations
given to us, the Company has not accepted any deposit from the public
and hence the directive issued by the Reserve Bank of India and
provisions of section 58A and 58AA of the Companies Act, 1956 and the
Companies (Acceptance of Deposit) Rule, 1975 are not applicable.
vii. In our opinion, the Company has an internal audit system through
internal control system and the scope and coverage of which needs to be
strengthened with the size and nature of the business of the Company.
viii. The Central Government has prescribed maintenance of the cost
records U/S 209(l)(d) of the Companies Act, 1956 in respect to the
Company''s products. We have broadly reviewed the books of accounts &
records maintained by the Company in this connection and are of the
opinion that prima facie, the prescribed accounts and records have been
made & maintained. We have however, not made a detailed examination of
the records with a view to determining whether they are accurate or
complete.
ix. a. 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, custom
duty, Excise duty, service tax, cess and other material statutory dues
applicable to it have generally been regularly deposited with the
appropriate authorities.
b. According to the information and explanations given to us, no
undisputed amounts payable in respect of provident fund, investor
education and protection fund, employees'' state insurance, income-tax,
wealth-tax, service tax, sales-tax, customs duty, excise duty, cess and
other material statutory dues were outstanding at the year end, for a
period of more than six months from the date they became payable.
c. According to the information and explanation given to us, there are
no dues outstanding of income- tax, sales-tax, wealth-tax, service tax,
customs duty, excise duty and cess on account of any dispute except as
stated below:
Name of the Nature of Amount of Payment of
statute dues demand demand
The Central Interest 1,68,38,001 77,07,386
Excise Act, 1944
The Central Excise duty 11,58,94,818 NIL
Excise Act, 1944
The Central Excise Duty 1,01,92,867 NIL
Excise Act, 1944
The Income Tax Income Tax 6,97,536 6,97,536
Act, 1961
Name of the Period to which Forum where dispute
statute the amount relate is pending
The Central July 1999 to Commissioner of
Excise Act, 1944 January 2004 Central Excise and
Customs (Appeals)
The Central April 1999 to High Court
Excise Act, 1944 March 2004
The Central April 2004 to High Court
Excise Act, 1944 November 2004
The Income Tax AY 2009-10 Income Tax
Act, 1961 Appellate Tribunal
x. The Company has no accumulated losses and the Company has not
incurred any cash losses during the financial year covered under audit
or in the immediately preceding financial year
xi. Based on our audit procedures and as per the information and
explanations given by the management, we are of the opinion that the
Company has not defaulted in repayment of dues to a financial
institution, bank or debenture holders.
xii. According to the information and explanations given to us and
based on the documents and records produced before us, the Company has
not granted loans and advances on the basis of security by way of
pledge of shares, debentures and other securities.
xiii. In our opinion, the Company is not a chit fund or a nidhi/mutual
benefit fund/society. Therefore, the provisions of clause 4(xiii) of
the Companies (Auditor''s Report) Order, 2003 (as amended) are not
applicable to the Company.
xiv. In our opinion, the Company is not regularly dealing in or trading
in shares, securities, debentures and other investments other than of
Long term in nature for which they have maintained proper records of
the transactions & contract in respect of investment held by the
Company. Accordingly, the provisions of clause 4(xiv) of the Companies
(Auditor''s Report) Order, 2003 (as amended) are not applicable to the
Company.
xv. According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from bank
or financial institutions.
xvi. In our opinion and according to the information and explanations
given to us and on an overall examination of the records and relying on
the information compiled by the Company for co-relating the funds
raised to the end use of term loans, we have to state that, the Company
has, prima facie, applied the term loans for the purpose for which the
loans were obtained.
xvii. According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company and after
placing reliance on the reasonable assumptions made by the Company for
classification of long term and short term usage of the funds, we
report that no funds raised on short-term basis have been used for
long-term investment.
xviii. According to the information and explanations given to us, the
Company has not made any preferential allotment of shares to parties or
Companies covered in the register maintained under section 301 of the
Companies Act, 1956.
xix. According to the information and explanations given to us, during
the year covered by our audit report, the Company has not issued any
secured debentures.
xx. According to the information and explanations given to us the
Company has not raised any money by public issue during the period
covered by our audit report.
xxi. Based upon the audit procedures performed for the purpose of
reporting the true and fair view of the financial statements and as per
the information and explanations given by the management, we report
that no fraud on or by the Company has been noticed or reported during
the year nor we have been informed about such case by the management.
For R. Kabra & Company
Chartered Accountants
Firm reg. number: 104502W
Place: Mumbai
Date: 9th May 2014 sd/-
R L Kabra
Partner
Membership No.: 016216
Mar 31, 2013
Report on the financial statements
We have audited the accompanying financial statements of Dujodwala
Products Limited (the Company), which comprise the balance sheet as at
31 March, 2013 and the statement of profit and loss and cash flow
statement for the year then ended and as ummary of signi ficant
accounting policies and other explanatoryin formation.
Management''s responsibilitvforthefinancial 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 principles generally accepted in India, including
accounting standards referred to in sub-section (3C) of section 211 of
the Companies Act, 1956 ("the Act"). This responsibility includes the
design, implementation and maintenance ofinternal control relevant to
the preparationand presentation of thefinancial statements that give
atrueandfairviewandarefreefrom material misstatement, whether due to
fraud or error.
Auditor''s responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonableassuranceaboutwhetherthefinancialstatementsarefreefrom
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''sjudgment, including the assessment of
the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the Company''s preparation and
fair presentation of the financial statements in order to design audit
procedures that are appropriate in the circumstances, but not for the
purpose of expressing an opinion on the effectiveness of the Company''s
internal control. An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of the accounting
estimates made by management, as well as evaluating the overall
presentation of the financial statements. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a
basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the financial statements give the information
required by the Act subject to note no. 35 of notes on financial
statements in respect of sales tax deferment liability, in the manner
so required and give a true and fair view in conformity with
theaccountingprinciplesgenerallyaccepted in India:
In the case of the balance sheet, of the state of affairs of the
company as at 31st March, 2013. b. In the case of the statement of
profit and loss of the profit for the year ended on that dateand In the
case of the cash flow statement of the cash flows for the year ende don
that date.
Report on other legal and regulatory requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order") issued by the Central Government of India in terms of
sub-section (4A) of section 227 of the Act, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
2. Asrequiredbysection227(3)oftheAct,wereportthat:
a. We have obtained all the information and explanations which to the
best of our knowledge and belief were necessary forthe purpose of
ouraudit.
b. In our opinion proper books of account as required by law have been
kept by the Company so far as appearsfromourexamination of those books.
c. The balance sheet, statement of profit and loss and cash flow
statement dealt with by this report are in agreement with the books of
account.
d. 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 except
as referred in note no. 35 of notes on financial statements in respect
of sales tax deferment liability.
On the basis of written representations received from the directors as
on 31 March 2013, and taken on record by the Board of Directors, none
of the Directors is disqualified as on 31 March 2013, from being
appointed as a director in terms of clause (g) of sub-section (1) of
section 274 of the Companies Act, 1956.
ANNEXURE TO THE AUDITORS1 REPORT
(REFERREDTO IN OUR REPORTOF EVEN DATETOTHE MEMBERSOF DUJODWALA PRODUCTS
LIMITED AS AT 31st MARCH 2013)
[I] [a] The Company has not maintained proper records showing full
particulars including quantitative details and situation of fixed
assets. However, the Company has informed us that it is in the process
of maintaining register showing proper records.
[b] According to the information and explanations given to us, all the
assets have not been physically verified by the management during the
year but there is a regular programme of verification which in our
opinion, is reasonable having regard to the size of the Company and the
nature of its assets. We are informed that the management on such
verification has noticed no material discrepancies.
[c] The Company has not disposed of any substantial part of fixed
assets during the year so as to affect itsgoingconcern.
[II] [a] The inventory has been physically verified during the year by
the management and we have relied on thesame.
lnouropinion,thefrequencyofverification is reasonable.
[b] In our opinion and according to the information and explanation
given to us, the procedures of physical verification of inventory
followed by the management are reasonable and adequate in relation to
the size of the Company and the nature of its business.
[c] In our opinion and according to the information and explanation
given to us, the Company is maintaining proper records of inventory. As
explained to us, there is no material discrepancy noticed on physical
verification of inventory as compared to book records and have been
properly dealt with in the books of accounts.
[III] [a] According to the information and explanationsgiven to us, the
Company has not granted any loans, secured or unsecured to companies,
firms or other parties covered in the register maintained under section
301 of the Companies Act, 1956. Accordingly, the provisions of clause
4(iii)(a) to (d) of theorderarenotapplicabletotheCompanyand hence not
commented upon.
[b] According to information and explanations given to us, the Company
has not taken any loans, secured or unsecured, from Companies, Firms or
other parties covered in the register maintained under section 301 of
the Companies Act,1956.Accordingly,the provisions of
clause4(iii)(e)to(g)of theorderarenotapplicabletotheCompanyand hence
not commented upon.
[IV] control system commensurate with the size of the Company and the
nature of its business, for the purchase of inventory and fixed assets
and for the sale of goods and services. During the course of our audit,
we have not observed any major weakness or continuing failure to
correct any major weakness in the internal control system of the
Company in respect of these areas.
[V] [a] To the best of our knowledge and belief and according to
nformation and explanations given to us, we are of the opinion that the
particulars of contracts or arrangements referred to in section 301 of
the Companies Act, 1956 that need to be entered into the register
maintained under section 301 have not been entered so far.
[b] In our opinion and according to the information and explanations
given to us, the 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.
[VI] In our opinion and according to the information and explanations
given to us, the Company has not accepted any deposit from the public
and hence the directive issued by the Reserve Bank of India and
provisions of section 58A and 58AA of the Companies Act, 1956 and the
Companies (Acceptance of Deposit) Rule, 1975arenotapplicable.
[VII] In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
[VIII] We have broadly reviewed the books of account maintained by the
Company pursuantto the rules made by the Central Government for the
maintenance of cost records under section 209(l)(d) of the Companies
Act, 1956, and are of the opinion that prima facie, the prescribed
accounts and records have been made and maintained. We have not,
however, made a detailed examination of the same.
[IX] [a] 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, custom
duty, Excise duty, service tax, cess and other material statutory dues
applicable to it have generally been regularly deposited with the
appropriate authorities.
[b] According to the information and explanations given to us, no
undisputed amounts payable in respect of provident fund, investor
education and protection fund, employees'' state insurance, income-tax,
wealth-tax, service tax, sales-tax, customs duty, excise duty, cess and
other material statutory dues were outstanding, at the year end, for a
period of more than six months from the date they became payable.
xi. Based on our audit procedures and as per the information and
explanations given by the management, we are of the opinion that the
Company has not defaulted in repayment of dues to a financial
institution, bankor debenture holders.
xii. According to the information and explanations given to us and
based on the documents and records produced before us, the Company has
not granted loans and advances on the basis of security by way of
pledge of shares, debentures and other securities.
xiii. In our opinion, the Company is not a chit fund or a nidhi/mutual
benefit fund/society. Therefore, the provisions of clause 4(xiii) of
the Companies (Auditor''s Report) Order, 2003 (as amended) are not
applicabletotheCompany.
xiv. In our opinion, the Company is not dealing in or trading in
shares, securities, debentures and other investments. Accordingly, the
provisions of clause 4(xiv) of the Companies (Auditor''s Report) Order,
2003(asamended)arenotapplicabletotheCompany.
According to the information and explanationsgiven to us, the Company
has not given any guarantee for loanstaken by othersfrom
bankorfinancial institutions.
xvi. In our opinion and according to the information and explanations
given to us and on an overall examination of the records and relying on
the information compiled by the Company for co-relating the funds
raised to the end use of term loans, we have to state that, the Company
has, prima facie, applied thetermloansforthe purpose forwhich the loans
were obtained.
xvii. According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company and after
placing reliance on the reasonable assumptions made by the Company for
classification of long term and short term usage of the funds, we
report that no funds raised on short- term basis have been used for
long-term investment.
xviii. According to the information and explanations given to us, the
Company has not made any preferential allotment of shares to parties or
Companies covered in the register maintained under section 301 of the
Companies Act, 1956.
xix. According to the information and explanations given to us, during
the year covered by our audit report, the Company has not issued any
secured debentures.
According to the information and explanations given to us the Company
has not raised any money by publicissueduringtheperiod covered
byourauditreport.
xxi. Based upon the audit procedures performed for the purpose of
reporting the true and fair view of the financial statements and as per
the information and explanations given by the management, we report
that no fraud on or by the Company has been noticed or reported during
the year.
For:Sundarlal,Desai&Kanodia
Chartered Accountants
Registration No. 110560W
Sd/-
H.P. Kanodia
Partner
Mem. No. 40617
Place : Mumbai
Dated: 12th May, 2013.
Mar 31, 2012
We have audited the accompanying financial statements of Dujodwala
Products Limited (the company), which comprise the balance sheet as at
31 March 2012, and the statement of profit and loss and cash flow
statement for the year then ended, and a summary of significant
accounting policies and other explanatory information.
Management's responsibility for the financial statements
Management is responsible for the preparation of these financial
statements that give a true and fair view of the financial position,
financial performance and cash flows of the company in accordance with
the accounting principles generally accepted in India, including
accounting standards referred to in sub-section (3C) of section 211 of
the Companies Act, 1956 ("the Act"). This responsibility includes the
design, implementation and maintenance of internal control relevant to
the preparation and presentation of the financial statements that give a
true and fair view and are free from material misstatement, whether due
to fraud or error.
Auditor's responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The procedures
selected depend on the auditor's judgment, including the assessment of
the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the company's preparation and
fair presentation of the financial statements in order to design audit
procedures that are appropriate in the circumstances, but not for the
purpose of expressing an opinion on the effectiveness of the company's
internal control. An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of the accounting
estimates made by management, as well as evaluating the overall
presentation of the financial statements. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a
basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the financial statements give the information
required by the Act subject to note no. 35 of notes on financial
statements in respect of sales tax deferment liability, 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 31 March 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.
Report on other legal and regulatory requirements
1. As required by the Companies (Auditor's Report) Order, 2003 ("the
Order") issued by the Central Government of India in terms of
sub-section (4A) of section 227 of the Act, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
2. As required by section 227(3) of the Act, we report that:
a. We have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purpose of our
audit.
b. In our opinion proper books of account as required by law have been
kept by the company so far as appears from our examination of those
books.
c. The balance sheet, statement of profit and loss and cash flow
statement dealt with by this report are in agreement with the books of
account.
d. 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 except
as referred in note no. 35 of notes on financial statements in respect
of sales tax deferment liability.
On the basis of written representations received from the directors as
on 31 March 2012, and taken on record by the Board of Directors, none
of the directors is disqualified as on 31 March 2012, from being
appointed as a director in terms of clause (g) of sub-section (1) of
section 274 of the Companies Act, 1956
ANNEXURE TO THE AUDITORS1 REPORT
(REFERREDTO IN OUR REPORTOF EVEN DATETOTHE MEMBERSOF DUJODWALA PRODUCTS
LIMITED AS AT31st MARCH 2011)
[I] [a] The Company has not maintained proper records showing full
particulars including quantitative details and situation of fixed
assets. However, the Company has informed us that it is in the process
of maintaining register showing proper records.
[b] According to the information and explanations given to us, all the
assets have not been physically verified by the management during the
year but there is a regular programme of verification which, in our
opinion, is reasonable having regard to the size of the company and the
nature of its assets. No material discrepancies were noticed on such
verification.
[II] [a] The inventory has been physically verified during the year by
the management and we have relied on the same. In our opinion, the
frequency of verification is reasonable.
[b] In our opinion and according to the information and explanation
given to us, the procedures of physical verification of inventory
followed by the management are reasonable and adequate in relation to
the size of the company and the nature of its business.
[ c] In our opinion and according to the information and explanation
given to us, the company is maintaining proper records of inventory. As
explained to us, there is no material discrepancy noticed on physical
verification of inventory as compared to book records and have been
properly dealt with in the books of accounts.
[III] [a] According to the information and explanations given to us,
the company has not granted any loans, secured or unsecured to
companies, firms or other parties covered in the register maintained
under section 301 of the Companies Act, 1956. Accordingly, the
provisions of clause 4(iii)(a) to (d) of the Order are not applicable
to the company and hence not commented upon.
[b] According to information and explanations given to us, the company
has not taken any loans, secured or unsecured, from companies, firms or
other parties covered in the register maintained under section 301 of
the Companies Act, 1956. Accordingly, the provisions of clause
4(iii)(e) to (g) of the Order are not applicable to the company and
hence not commented upon.
[IV] In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the company and the nature of its business, for the
purchase of inventory and fixed assets and for the sale of goods and
services. During the course of our audit, we have not observed any
major weakness or continuing failure to correct any major weakness in
the internal control system of the company in respect of these areas.
[V] [a] To the best of our knowledge and belief and according to
information and explanations given to us, we are of the opinion that the
particulars of contracts or arrangements referred to in section 301 of
the Companies Act, 1956 that need to be entered into the register
maintained under section 301 have not been entered so far.
Nature of Transaction for the whole year Amount (Rs)
Sales of Goods 38,17,617
[b] In our opinion and according to the information and explanations
given to us, the 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.
[VI] In our opinion and according to the information and explanations
given to us, the Company has not accepted any deposit from the public
and hence the directive issued by the Reserve Bank of India and
provisions of section 58A and 58AA of the Companies Act, 1956 and the
Companies (Acceptance of Deposit) Rule, 1975arenotapplicable.
[VII] In our opinion, the company has an internal audit system
commensurate with the size and nature of its business.
[VIII] We have broadly reviewed the books of account maintained by the
Company pursuant to the rules made by the Central Government for the
maintenance of cost records under section 209(l)(d) of the Companies
Act, 1956, and are of the opinion that prima facie, the prescribed
accounts and records have been made and maintained. We have not,
however, made a detailed examination of the same.
[IX] [a] 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, custom
duty, Excise duty, service tax, cess and other material statutory dues
applicable to it have generally been regularly deposited with the
appropriate authorities.
[b] According to the information and explanations given to us, no
undisputed amounts payable in respect of provident fund, investor
education and protection fund, employees' state insurance, income-tax,
wealth-tax, service tax, sales-tax, customs duty, excise duty, cess and
other material statutory dues were outstanding, at the year end, for a
period of more than six months from the date they became payable.
[c] According to the information and explanation given to us, there are
no dues outstanding of income-tax, sales-tax, wealth-tax, service tax,
customs duty, excise duty and cess on account of any dispute except as
stated below:
Name of the Nature of Amount of Payment Period to which Forum where
dispute
statute dues demand of demand the amount is pending
relate
The Central Excise
duty 11,58,94,818 NIL April 1999 to High Court
Excise Act,
1944 March 2004
The Central Custom 1,01,92,867 NIL April 2004 to CESTAT by the
Excise Act,
1944 Duty November 2004 Company
The Income
Tax Income
Tax 6,97,536 6,97,536 AY 2009-10 Comm. Of
Income Tax
Act, 1961 (Appeals)
x. The company has no accumulated losses and the Company has not
incurred any cash losses during the financial year covered under audit
or in the immediately preceding financial year
xi. Based on our audit procedures and as per the information and
explanations given by the management, we are of the opinion that the
company has not defaulted in repayment of dues to a financial
institution, bank or debenture holders.
xii. According to the information and explanations given to us and
based on the documents and records produced before us, the company has
not granted loans and advances on the basis of security by way of
pledge of shares, debentures and other securities.
xiii. In our opinion, the company is not a chit fund or a nidhi/mutual
benefit fund/society. Therefore, the provisions of clause 4(xiii) of
the Companies (Auditor's Report) Order, 2003 (as amended) are not
applicable to the company.
xiv. In our opinion, the company is not dealing in or trading in
shares, securities, debentures and other investments. Accordingly, the
provisions of clause 4(xiv) of the Companies (Auditor's Report) Order,
2003 (as amended) are not applicable to the company.
xv. According to the information and explanations given to us, the
company has not given any guarantee for loans taken by others from
bank or financial institutions.
xvi. In our opinion and according to the information and explanations
given to us and on an overall examination of the records and relying on
the information compiled by the company for co-relating the funds
raised to the end use of term loans, we have to state that, the company
has, prima facie, applied the term loans for the purpose for which the
loans were obtained.
xvii. According to the information and explanations given to us and on
an overall examination of the balance sheet of the company and after
placing reliance on the reasonable assumptions made by the Company for
classification of long-term and short-term usage of the funds, we report
that no funds raised on short- term basis have been used for long-term
investment.
xviii. According to the information and explanations given to us, the
company has not made any preferential allotment of shares to parties or
companies covered in the register maintained under section 301 of the
Companies Act, 1956.
xix. According to the information and explanations given to us, during
the year covered by our audit report, the company has not issued any
secured debentures.
xx. According to the information and explanations given to us the
company has not raised any money by public issue during the period
covered by our audit report.
xxi. Based upon the audit procedures performed for the purpose of
reporting the true and fair view of the financial statements and as per
the information and explanations given by the management, we report
that no fraud on or by the company has been noticed or reported during
the year.
For: Sundarlal, Desai & Kanodia
Chartered Accountants
Registration No.H0560W
Sd/-
H.P. Kanodia
Partner
Mem. No. 40617
Place : Mumbai
Dated: 11th August 2012.
Mar 31, 2011
1] We have audited the attached Balance Sheet of DUJODWALA PRODUCTS
LIMITED ("the Company") as at 31st March, 2011 and its Profit and Loss
Account and also 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 auditing standards
generally accepted in India. These 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
basisforouropinion.
3] As required by the Companies (Auditor's Report) Order, 2003 issued
by the Central Government of India in terms of sub-section (4A) of
section 227 of the Companies Act, 1956, we enclose in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the said
Order.
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 forthe purpose 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, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account.
iv) In our opinion, the Balance Sheet, Profit and Loss Account and Cash
Flow Statement dealt with by this report comply with the accounting
standards referred to in sub-section (3C) of section 211 of the
Companies Act, 1956; and subject to Note No. 6 regarding disputed
liability of excise duty, interest, & Note No. 12 in respect of sales
tax defferement.
v) On the basis of written representations received from the Directors,
as on 31st March, 2011 and taken on record by the Board of Directors,
we report that none of the directors is disqualified as on 31st March,
2011 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 read together with
Significant Accounting Policies and subject to Note No. 6 regarding
disputed liability of excise duty, interest & Note No. 12 in respect of
sales tax deferment of Schedule 14 and Notes thereon gives 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 our opinion and according to the information and explanations
given to us in the case of the Balance Sheet, of the state of affairs
of the Company as at 31st March, 2011;
(b) in the case of the Profit and Loss Account, 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 THE AUDITORS' REPORT (REFERREDTO IN OUR REPORTOF EVEN
DATETOTHE MEMBERS OF DUJODWALA PRODUCTS LIMITED AS AT31ST MARCH 2011)
[I] [a] The Company has not maintained proper records showing full
particulars including quantitative details and situation of fixed
assets. However, the Company has informed us that it is in the process
of maintaining register showing proper records.
[b] According to the information and explanations given to us, all the
assets have not been physically verified by the management during the
year but there is a regular programme of verification which, in our
opinion, is reasonable having regard to the size of the company and the
ndfture of its assets. No material discrepancies were noticed on such
verification.
[II] [a] The inventory has been physically verified during the year by
the management and we have relied on the same. In our opinion, the
frequency of verification is reasonable. The inventories lying with
outside parties have been confirmed by the management.
[b] In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management are reasonable and adequate in relation to
the size of the company and the nature of its business.
[c] In our opinion and according to the information and explanations
given to us, the Company is maintaining proper records of inventory.
The discrepancies noticed on verification between the physical stocks
and the book records were not material as informed by the management,
and have been properly dealt with in the books of accounts.
[III] [a] In our opinion and explanation given to us, Company has not
granted loans to Companies, Firms, and other parties listed in the
Register maintained under Section 301 of the Companies Act, 1956.
Therefore, the provisions of sub-clause (a), (b), (c) and (d) of clause
4(iii) are not applicable to the Company
[b] The Company has not taken or granted any loans, secured or
unsecured, from/ to Companies, Firms or other parties listed in the
register maintained under Section 301 of the Companies Act, 1956.
Therefore, the provisions of sub-clauses (b), (c), (d), (e), (f) and
(g) of clause 4 (iii) of the Order are not applicable to the Company.
[IV] In our opinion and according to the information and explanation
given to us, there are adequate internal control procedures
commensurate with the size of the company and the nature of its
business æ with regard to purchases of inventory, fixed assets and with
regard to the sale of goods. During the course of our audit, we
generally have not observed any continuing failure to correct major
weaknesses in internal controls.
[V] [a] To the best of our knowledge and belief and according to the
information and explanations given to us, we are of the opinion that
the transactions that need to be entered into the register maintained
under section 301 of the Companies Act, 1956 have not been entered so
far.
Nature of Transaction for the whole year Amount (Rs)
Sales of Goods 24,81,338
[b] In our opinion and according to the information and explanations
given to us, in absence of the comparable price it is not possible to
compare the transactions made in pursuance of contracts or arrangements
to be entered in the register maintainable under section 301 of the
Companies Act, 1956 and exceeding the value of rupees five lakhs in
respect of any party during the year, we are not able to comment on the
reasonabiiity of price having regard to prevailing market prices at the
relevant time.
[VI] In our opinion and according to the information and explanations
given to us, the company has not accepted any deposits from the public
and hence the directives issued by the Reserve Bank of India and
provisions of sections 58A and 58AA of the Companies Act, 1956 and the
Companies (Acceptance of Deposits) Rules, 1975 are not applicable.
[VII] In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
[VIII] We have broadly reviewed the books of accounts relating to
materials, labour and other items of cost maintained by the Company
pursuant to the rules made by the Central Government for the
maintenance of any cost records under section 209(1) (d} of the
companies Act, 1956 and we are of the opinion that prima-facie the
prescribed accounts and records have been made and maintained. We have
not, however, made a detail examination of the same.
[IX] [a] According to the records of the Company undisputed statutory
dues including provident fund, investor education protection fund,
employees' state insurance^ income-tax, Sales Tax, wealth tax, service
tax, custom duty, excise duty, cess and other material statutory dues
to the extent applicable to it have generally been deposited regularly
with the appropriate authorities.
[b] According to the information and explanations given to us, no
undisputed amounts payable in respect of income tax, wealth tax,
service tax, sales tax, customs duty, excise duty and cess were in
arrears, as at 31s1 March, 2011 for a period of more than six months
from the date they became payable.
[c] According to the information and explanation given to us, there are
no dues of sales tax, income tax, custom duty, wealth tax, service tax,
excise duty and cess which have not been deposited on account of any
dispute, except as stated below:
Nature of
Dues Amount of Payment of Period to which Forum where
Demand Demand amounts relates Dispute is
Pending
Interest on 1,89,31,646/- 25,39,508/- July 1999 to Dec Settlement
Excise Duty 2006 Commission by
Company
Excise Duty 11,58,94,818/- - April 99 to
March CESTAT by the
04 Dept.
Excise Duty 1,01,92,867/- - April 04 to
Nov 04 CESTAT by the
Company
[X] The Company does not have accumulated losses and the Company has
not incurred cash losses during the financial year covered by our audit
and the immediately preceding financial year.
[XI] Based on our audit procedures and as per the information and
explanation given by the management, we are of the opinion that the
Company has not defaulted in repayment of dues to a financial
institution, bank or debenture holders.
[XII] In our opinion and according to the information and explanations
given to us, the Company has not granted loans and advances on the
basis of security by way of pledges of shares, debentures and other
securities.
[XIII] In our opinion and according to the information and explanations
given to us, the Company is not a chit fund or a, nidhi/mutual benefit
fund/ society. Therefore, the provisions of clause4(xiii) of the
Companies (Auditor's Report) Order, 2003 are not applicable to the
company.
[XIV] In our opinion and according to the information and explanations
given to us, the Company is not dealing in or trading in shares,
securities, debentures and other investments. Accordingly, the
provisions of clause 4(xiv) of the Companies (Auditor's Report) Order,
2003 are not applicable to the Company.
[XV] In our opinion and according to the information and explanations
given to us, the Company has not given guarantee for loans taken by
others from banks or financial institutions.
[XVI] In our opinion and according to the information and explanations
given to us, and on an overall examination of the records, and relying
on the information complied by the Company for co-relating the funds
raised to the end use of term loans, we have to state that, the Company
has, prima facie, applied
thetermloansforthepurposesforwhichtheywereobtained. Ã
[XVII] According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company and after
placing reliance on the reasonable assumptions made by the Company for
classification of long term and short-term usages of the funds, we
report that no funds raised on short-term basis have been used for
long-term investment.
[XVIII] According to the information and explanations given to us and
on the basis of records examined by us, the Company has not made any
preferential allotment of shares to companies or parties covered in the
register maintained under section 301 of the Companies Act, 1956 except
19,42,857 share warrants allotted to the promoter group, out of these,
4,31,080 share warrants have been converted into equity shares of Rs.
10/- each at premium of Rs. 8.59/- each.
[XIX] According to the information and explanations given to us, during
the period covered by our audit report, the Company has not issued any
Secured Debenture.
[XX] According to the information and explanations given to us, the
Company has not raised any money by public issue during the year
covered by our audit report.
[XXI] According to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
For: Sundarlal, Desai & Kanodia
Chartered Accountants
Registration No. 110560W
sd/-
H.P. Kanodia
Partner
Mem. No. 40617
Place : Mumbai
Dated : 30th May 2011
Mar 31, 2010
1] We have audited the attached Balance Sheet of DUJODWALA PRODUCTS
LIMITED ("the Company") as at 31st March, 2010 and its Profit and Loss
Account and also the Cash Flow Statement for the year ended on that
date annexed thereto. These financial statements are the responsibility
of the Companys Management. Our responsibility is to express an opinion
on these financial statements based on our audit.
2] We conducted our audit in accordance with auditing standards
generally accepted in India. These 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 dis
-closures in the financial statements. An audit also includes assessing
the accounting principles used and significant estimates made by manage
-ment, as well as evaluating the overall financial statement presenta
-tion. We believe that our audit provides a reasonable basis for our
opinion.
3] As required by the Companies (Auditors Report) Order, 2003 issued
by the Central Government of India in terms of sub-section (4A) of
section 227 of the Companies Act, 1956, we enclose in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the said
Order.
4] 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 purpose 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, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account.
iv) In our opinion, the Balance Sheet, Profit and Loss Account and Cash
Flow Statement dealt with by this report comply with the accounting
standards referred to in sub-section (3C) of section 211 of the
Companies Act, 1956; and subject to Note No. 6 regarding disputed
liability of excise duty, interest, & Note No. 12 in respect of sales
tax deferement.
v) On the basis of written representations received from the Directors,
as on 31st March, 2010 and taken on record by the Board of Directors,
we report that none of the directors are disqualified as on 31st March,
2010 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 read together with
Significant Accounting Policies and subject to Note No. 6 regarding
disputed liability of excise duty, interest & Note No. 12 in respect of
sales tax deferement and Notes thereon gives 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 our opinion and according to the information and explanations
given to us in the case of the Balance Sheet, of the state of affairs
of the Company as at 31st March, 2010;
(b) in the case of the Profit and Loss Account, 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 THE AUDITORSREPORT (REFERRED TO IN OUR REPORT OF EVEN
DATE TO THE MEMBERS OF DUJODWALA PRODUCTS LIMITED AS AT 31ST MARCH,
2010)
[I] [a] The Company has not maintained proper records showing full
particulars including quantitative details and situation of fixed
assets. However, the Company has informed us that it is in the process
of maintaining register showing proper records.
[b] According to the information and explanations given to us, all the
assets have not been physically verified by the management during the
year but there is a regular programme of verification which, in our
opinion, is reasonable having regard to the size of the company and the
nature of its assets. No material discrepancies were noticed on such
verification.
[II] [a] The inventory has been physically verified during the year by
the management and we have relied on the same. In our opinion, the
frequency of verification is reasonable. The inventories lying with
outside parties have been confirmed by the management.
[b] In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management are reasonable and adequate in relation to
the size of the company and the nature of its business.
[c] In our opinion and according to the information and explanations
given to us, the Company is maintaining proper records of inventory.
The discrepancies noticed on verification between the physical stocks
and the book records were not material as informed by the management,
and have been properly dealt with in the books of accounts.
[III] [a] In our opinion and explanation given to us, Company has not
granted loans to companies, firms, and other parties listed in the
Register maintained under Section 301 of the Companies Act, 1956.
Therefore, the provisions of sub-clause (a), (b), (c) and (d) of clause
4(iii) are not applicable to the Company.
[b] The Company has not taken any loans, secured or unsecured, from
companies, firms or other parties listed in the register maintained
under Section 301 of the Companies Act, 1956. Therefore, the provisions
of sub-clauses (e), (f) and (g) of clause 4 (iii) of the Order are not
applicable to the Company.
[IV] In our opinion and according to the information and explanations
given to us, having regard to the explanations that some of the items
purchased are of special nature and suitable alternate source do not
exist for obtaining comparable quotations, therefore we are not able to
comment on the reasonability of the purchase price. There are adequate
internal control procedures commensurate with the size of the company
and the nature of its business with regard to purchases of inventory,
fixed assets and with regard to the sale of goods. During the course of
our audit, we generally have not observed any continuing failure to
correct major weaknesses in internal controls.
[V] [a] To the best of our knowledge and belief and according to the
information and explanations given to us, we are of the opinion that
the transactions that need to be entered into the register maintained
under section 301 of the Companies act, 1956 have not been entered so
far.
Nature of Transaction for the whole year Amount (Rs.)
Sales of Goods (including consignment sales) 52,66,716
Purchase of Goods 27,87,421
[b] In our opinion and according to the information and explanations
given to us, in absence of the comparable price it is not possible to
compare the transactions made in pursuance of contracts or arrangements
to be entered in the register maintainable under section 301 of the
Companies Act, 1956 and exceeding the value of rupees five lakhs in
respect of any party during the year, we are not able to comment on the
reasonability of price having regard to prevailing market prices at the
relevant time.
[VI] In our opinion and according to the information and explanations
given to us, the company has not accepted any deposits from the public
and hence the directives issued by the Reserve Bank of India and
provisions of sections 58A and 58AA of the Companies Act, 1956 and the
Companies (Acceptance of Deposits) Rules, 1975 are not applicable.
[VII] In our opinion, the company has an internal audit system
commensurate with the size and nature of its business.
[VIII] We have broadly reviewed the books of accounts relating to
materials, labour and other items of cost maintained by the Company
pursuant to the rules made by the Central Government for the
maintenance of any cost records under section 209(1) (d) of the
companies Act, 1956 and we are of the opinion that prima-facie the
prescribed accounts and records have been made and maintained. We have
not, however, made a detail examination of the same.
[IX] [a] According to the records of the Company undisputed statutory
dues including provident fund, investor education protection fund,
employees state insurance, income-tax, Sales Tax, wealth tax, service
tax, custom duty, excise duty, cess and other material statutory dues
to the extent applicable to it have generally been deposited regularly
with the appropriate authorities.
[b] According to the information and explanations given to us, no
undisputed amounts payable in respect of income tax, wealth tax,
service tax, sales tax, customs duty, excise duty and cess were in
arrears, as at 31st March, 2010 for a period of more than six months
from the date they became payable.
[c] According to the information and explanation given to us, there are
no dues of sales tax, income tax, custom duty, wealth tax, service tax,
excise duty and cess which have not been deposited on account of any
dispute, except as stated below:
Nature
of Dues Amount of Payment of Period to whi
ch amounts Forum where
Demand Demand relates Dispute is
Pending
Interest on 1,89,31,646/- 25,39,508/- July 1999 to
Dec 2006 Settlement
Excise Duty Commission
by Company
Excise Duty 11,58,94,818/- ------- April 99 to
March 04 CESTAT by
the Dept.
Excise Duty l701,92,867/- ------- April 04 to
Nov 04 CESTAT by
the Company
[X] The Company does not have accumulated losses and the Company has
not incurred cash losses during the financial year covered by our audit
and the immediately preceding financial year.
[XI] Based on our audit procedures and as per the information and
explanation given by the management, we are of the opinion that the
Company has not defaulted in repayment of dues to a financial
institution, bank or debenture holders.
[XII] In our opinion and according to the information and explanations
given to us, the Company has not granted loans and advances on the
basis of security by way of pledges of shares, debentures and other
securities.
[XIII] In our opinion and according to the information and explanations
given to us, the company is not a chit fund or a nidhi/mutual benefit
fund/ society. Therefore, the provisions of clause 4(xiii) of the
Companies (Auditors Report) Order, 2003 are not applicable to the
company.
[XIV] In our opinion and according to the information and explanations
given to us, the company is not dealing in or trading in shares,
securities, debentures and other investments. Accordingly, the
provisions of clause 4(xiv) of the Companies (Auditors Report) Order,
2003 are not applicable to the company.
[XV] In our opinion and according to the information and explanations
given to us, the Company has not given guarantee for loans taken by
others from banks or financial institutions.
[XVI] In our opinion and according to the information and explanations
given to us, and on an overall examination of the records, and relying
on the information complied by the Company for co-relating the funds
raised to the end use of term loans, we have to state that, the Company
has, prima facie, applied the term loans for the purposes for which
they were obtained.
[XVII] According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company and after
placing reliance on the reasonable assumptions made by the Company for
classification of long term and short-term usages of the funds, we
report that no funds raised on short-term basis have been used for
long-term investment.
[XVIII] According to the information and explanatibns given to us and
on the basis of records examined by us, the company has made
preferential allotment of warrants to companies covered in the register
maintained under section 301 of the Companies Act, 1956. In our
opinion, the price at which warrants have been issued is not
prejudicial to the interest of the company.
[XIX] According to the information and explanations given to us, during
the period covered by our audit report, the Company has not issued any
Secured Debenture.
[XX] According to the information and explanations given to us, the
Company has not raised any money by public issue during the year
covered by our audit report.
[XXI] According to the information and explanations given to us, no
fraud on or by the company has been noticed or reported during the
course of our audit.
For SUNDARLAL, OESAI & KANOOIA
CHARTERED ACCOUNTANTS
H. P. Kanodia
Partner
M.S. No. 40617
PLACE: Mumbai
DATED: 25th May, 2010