Mar 31, 2023
Refex Industries Limited
REPORT ON THE AUDIT OF THE STANDALONE IND AS FINANCIAL STATEMENTS
Opinion
We have audited the accompanying financial statements of Refex Industries Limited (âthe Companyâ) which comprise the Balance Sheet as at March 31, 2023 and the Statement of Profit and Loss for the year ended, including the statement of Other Comprehensive Income, the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and notes to the Ind AS financial statements, including a summary of significant accounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS financial statements give the information required by the Companies Act, 2013 (âthe Actâ) in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31st 2023, its Profit including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.
Basis for Opinion
We conducted our audit of the Standalone Ind AS financial statements in accordance with the Standards on Auditing (SAs), as specified under section 143(10) of the Act. Our responsibilities under those Standards are
further described in the âAuditorâs Responsibilities for the Audit of the Standalone Ind AS Financial Statementsâ section of our report. We are independent of the Company in accordance with the âCode of Ethicsâ issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Standalone Ind AS financial statements.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone financial statements as a whole and in forming our opinion thereon and we do not provide a separate opinion on these matters. We have determined the matters described below to be the key audit matters to be communicated in our report.
S. No. Key Audit Matters |
Auditorâs Response |
1 Allowance for Expected credit loss on trade |
In view of the significance of the matter, we applied |
receivables. |
the following audit procedures among others, to obtain |
Evaluation of trade receivables for impairment |
sufficient and appropriate audit evidence |
evidence requires exercise of judgement |
⢠Evaluating the accounting policy for impairment |
and involves consideration of various factors. |
of trade receivables terms of the relevant Indian |
These factors include customerâs ability and |
accounting standard; |
willingness to pay the outstanding amounts, past due receivables financial and economic difficulties of customers: |
⢠Testing the design, implementation and operating effectiveness of the Companyâs key internal financial controls. These controls relate to |
measurement of ECL on trade receivables |
|
⢠Evaluated monitoring mechanism by the company |
|
related to credit control collection of trade receivables, follow up for past due amounts and for identification and recognition of corresponding impairment losses: |
S. No. Key Audit Matters |
Auditorâs Response |
This assessment is done for each group of |
⢠For a sample of past due receivables, selected on |
customers resulting from possible defaults over |
the basis of risk, aging and volume, we examined |
the expected life of the receivables. Based on |
the ageing of receivables, impairment losses |
this assessment, credit loss rate is determined in |
provided/reversed during the year and compared |
provision matrix. The credit loss rate is based on |
them to historical experience |
the experience of actual credit losses over past |
⢠Evaluating the Companyâs assessment regarding credit worthiness customers and identification of |
years adjusted to reflect the current economic |
|
conditions and forecasts of future economic conditions. Based on such credit loss rate, the |
the credit impaired customers |
Company records expected credit loss (ECL) |
⢠Balance confirmation requests were circulated to |
allowance for trade receivables. |
some of the customers based on random sampling |
In view of the above, we have considered |
⢠We evaluated the historical credit loss |
measurement of ECL on trade receivables |
experience, current observable data and |
(including retention monies) as a key audit matter |
forward-looking outlook ⢠Assessing the adequacy of the related disclosures in the Standalone Financial Statements with reference to the relevant Indian accounting standards. |
2 Timing of revenue recognition and |
In view of the significance of the matter we applied the |
adjustments for coal quality variances |
following audit procedures in this area, among others |
involving critical estimates |
to obtain sufficient appropriate audit evidence: |
Revenue from the sale of goods is recognised |
⢠Assessing the Companyâs accounting policies |
when control is transferred to the customers and |
for revenue recognition by comparing with the |
when there are no other unfulfilled obligations. This requires detailed analysis of each sale |
applicable accounting standards i.e Ind AS 115; |
agreement/ contract /customer purchase order |
⢠Assessing the appropriateness of the estimated |
regarding timing of revenue recognition. |
adjustments in the process; |
Inappropriate assessment could lead to a risk |
⢠Testing the design, implementation, and |
of revenue being recognized on sale of goods |
operating effectiveness of key internal controls |
before the control in the goods is transferred |
over timing of recognition of revenue from sale of |
to the customer. Subsequent adjustments are made to the |
goods and subsequent adjustments made to the transaction price; |
transaction price due to grade mismatch (GCV) |
⢠Performing testing on selected statistical |
/ slippage of the transferred goods (coal). |
samples of customer contracts. Checked terms and condition related to acceptance of goods, |
The variation in the contract price if not settled |
acknowledged delivery receipts and tested the |
mutually between the parties to the contract is |
transit time to deliver the goods and its revenue |
referred to third party testing and the Company |
recognition. Our tests of details focused on cut-off |
estimates the adjustments required for revenue |
samples to verify only revenue pertaining to current |
recognition pending settlement of such dispute. |
year is recognized based on terms and conditions |
Such adjustments in revenue are made on |
set out in sale agreements/ contracts and delivery |
estimated basis following historical trend. |
documents. We also performed tests to establish the basis of estimation of the consideration and |
Inappropriate estimation could lead to a risk of |
whether such estimates are commensurate with |
revenue being overvalued or undervalued. Accordingly, timing of recognition of revenue and adjustments for coal quality variances involving critical estimates is a key audit matter |
the accounting policy of the Company |
S. No. Key Audit Matters |
Auditorâs Response |
3 Assessment of Contingent liabilities in |
We have obtained an understanding of the Companyâs |
respect of certain litigations relating to |
procedure in respect of estimation and disclosure |
direct taxes, various claims led by other |
of contingent liabilities and adopted the following |
parties not acknowledged as debt. |
audit procedure: |
There is a high level of judgement required |
⢠Reviewing the current status and material |
in estimating the contingent liabilities. The companyâs assessment of contingent |
developments of legal matters. |
liabilities is supported by the facts of the matter, |
⢠Examining recent orders from competent |
Companyâs judgement thereon, past experience |
authorities and/ or communication received from |
and advices from legal and independent tax |
various authorities, judicial forums and follow-up |
consultants wherever necessary. |
action thereon. |
We identified the above area as Key Audit |
⢠Review and analysis of evaluation of the |
Matters in view of associated uncertainty |
contentions of the company through discussions, |
relating to the outcome of these matters. |
collection of details of the subject matter under consideration, the likely outcome and consequent potential outcomes on those issues. ⢠Based on the above procedures performed, the estimation and disclosures of contingent liabilities is considered to be adequate and reasonable. |
Information Other than the Financial Statements and Auditorâs Report thereon
The Companyâs Board of Directors is responsible for the other information. The other information comprises the information included in the Annual report but does not include the Ind AS financial statements and our auditorâs report thereon.
Our opinion on the standalone Ind AS financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone Ind AS financial statements, our responsibility is to read the other information and, in doing so, consider whether such other information is materially inconsistent with the financial statements, or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
Managementâs Responsibility for the Standalone Ind AS Financial Statements
The Companyâs board of directors is responsible for the matters stated in section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these Standalone Ind AS 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
prescribed under Section 133 of the Act read with relevant rules issued thereunder.
This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding 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.
In preparing the Standalone Ind AS financial statements, management is responsible for assessing the Companyâs ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those Board of Directors are also responsible for overseeing the Companyâs financial reporting process.
Auditorâs Responsibility for the Audit of the Standalone Ind AS Financial Statements
Our objectives are to obtain reasonable assurance about whether the Standalone Ind AS financial statements as a whole are free from material misstatement, whether
due to fraud or error, and to issue an auditorâs report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone Ind AS financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
⢠Identify and assess the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
⢠Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to financial statements in place and the operating effectiveness of such controls.
⢠Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
⢠Conclude on the appropriateness of managementâs use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Companyâs ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditorâs report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditorâs report. However, future events or conditions may cause the Company to cease to continue as a going concern.
⢠Evaluate the overall presentation, structure, and content of the standalone Ind AS financial statements, including the disclosures, and whether
the standalone Ind AS financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Materiality is the magnitude of misstatements in the financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the financial statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the financial statements.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
Report on other legal and regulatory requirements
1. As required by the Companies (Auditorâs Report) Order, 2020 (âthe Orderâ), issued by the Central Government of India in terms of sub-section (11) of Section 143 of the Companies Act, 2013, we enclose in the Annexure - B, a statement on the matters specified in paragraphs 3 and 4 of the said Order.
2. As required by Section 143 (3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;
(b) In our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;
(c) The Balance Sheet, the Statement of Profit and Loss including the Statement of Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;
(d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Companies
(Indian Accounting Standards) Rules, 2015, as amended;
(e) On the basis of the written representations received from the directors as on March 31, 2023 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2023 from being appointed as a director in terms of Section 164 (2) of the Act;
(f) With respect to the adequacy of the internal financial controls over financial reporting of the Company with reference to these standalone Ind AS financial statements and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Aâ to this report;
(g) With respect to the other matters to be included in the Auditorâs Report in accordance with the requirements of section 197 (16) of the Act, as amended:
In our opinion and to the best of our information and according to the explanations given to us, the remuneration paid by the Company to its directors during the year is in accordance with the provisions of section 197 of the Act.
(h) With respect to the other matters to be included in the Auditorsâ Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:
(i.) The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements as mentioned in Note No: 31
(ii.) The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;
(iii.) There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.
(iv.) The management has represented that, to the best of its knowledge and belief, other than as disclosed in the notes to the accounts,
⢠no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the company to or in any other person(s) or entity(ies), including foreign entities âIntermediariesâ, with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly
or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company âUltimate Beneficiariesâ or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and
⢠no funds have been received by the company from any person(s) or entity(ies), including foreign entities âFunding Partiesâ, with the understanding, whether recorded in writing or otherwise, that the company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party âUltimate Beneficiariesâ or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
⢠Based on audit procedures carried out by us, that we have considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us believe that the representations under sub-clause (i) and (ii) contain any material misstatement.
v. ) The Company has not declared or paid any
dividends during the year and accordingly reporting on the compliance with section 123 of the Companies Act, 2013 is not applicable for the year under consideration.
vi. ) Proviso to Rule 3(1) of the Companies
(Accounts) Rules, 2014 for maintaining books of account using accounting software which has a feature of recording audit trail (edit log) facility is applicable with effect from April 1, 2023 to the Company and accordingly, reporting under Rule 11(g) of Companies (Audit and Auditors) Rules, 2014 is not applicable for the financial year ended March 31, 2023.
For ABCD & Co,
Chartered Accountants Firm No: 016415S
Vinay Kumar Bachhawat
Partner
Place: Chennai Membership No: 214520
Date: 28/6/2023 UDIN: 23214520BGWTAF9471
Mar 31, 2018
Report on the Standalone Financial Statements
We have audited the accompanying standalone financial statements of Refex Industries Limited (âthe Companyâ), which comprise the Balance Sheet as at 31 st March, 2018, 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.
Managementâs Responsibility for the Standalone Financial Statements
The Companyâs Board of Directors is responsible for the matters stated in section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to preparation and presentation of these standalone financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditorsâ Responsibility
Our responsibility is to express an opinion on these standalone financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.
We conducted our audit in accordance with the Standards on Auditing specified u/s 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the standalone financial statements. The procedures selected depend on the auditorâs judgment, including the assessment of the risks of material misstatement of the standalone financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Companyâs preparation of the standalone financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness ofthe accounting estimates made by Management, as well as evaluating the overall presentation of the standalone financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.
Basis for Qualified Opinion:
The Company is not providing for liability for gratuity as per actuarial valuation which is not in accordance of the Accounting Standard on Provision for Gratuity (AS-15) (Refer Note 2(i) forming part of Financial Statements) issued by The Institute of Chartered Accountants of India and the impact of which is unascertainable.
Qualified Opinion
In our opinion and to the best of our information and according to the explanations given to us, except for the effects of the matter described in the Basis for Qualified Opinion above, the standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India of the state of affairs of the Company as at March 31,2018 and its profit and its cash flow for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditorâs Report) Order, 2016 (âthe Orderâ) issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the âAnnexure Aâ 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 further report, to the extent applicable, that:
a. we have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;
b. in our opinion proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;
c. the Balance Sheet, Statement of Profit and Loss and the Cash Flow Statement dealt with by this Report are in agreement with the books of account;
d. in our opinion, except for the effects of the matter described in the Basis for Qualified opinion paragraph, the aforesaid standalone financial statements comply with the Accounting Standards specified under section 133 of the Act, read with relevant rule issued thereunder.;
e. on the basis of written representations received from the Directors as on 31 st March 2018 taken on record by the Board of Directors, none of the directors is disqualified as on 31 st March 2018 from being appointed as a director in terms of sub-section (2) of section 164 of the Act;
f. with respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Bâ; and
g. with respect to the other matters to be included in the Auditorâs Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements as mentioned in Note 28.1 (i)
ii. The Company did not have any material foreseeable losses on long-term contracts including derivative contracts.
iii. The company had an amount of Rs.43,674/- being the unclaimed dividend declared in the AGM held in Nov 2009 and due for transfer to Investor Education and Protection Fund (IEPF) by the Company., but the same has been transferred to IEPF as on 31 st July 2017.
âANNEXURE Aâ TO THE INDEPENDENT AUDITORSâ REPORT:
The Annexure referred to in Independent Auditorsâ Report to the members of the Company on the standalone financial statements of the Company for the year ended 31 st March 2018, we report that:
1. a) The Company has maintained proper records showing full particulars including quantitative details and situations of fixed assets.
b) 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.
c) The title deeds of immovable properties are held in the name of the company.
2. The inventory has been physically verified during the year by the Management. In our opinion, the frequency of verification is reasonable. The discrepancies noticed on verification between the physical stock and book records such were not material.
3. (a) According to the information & explanations given to us, the Company has not granted loans, secured or unsecured, to companies, firms, LLP or other parties covered in the register maintained u/s.189 of the Act, except that it has granted loans of Rs. 3315.19 lakhs, (Rs.3395.59) the yearend balance being Rs.3423.36 (Rs.2677.59) lakhs to two companies covered in the register maintained under section 189 of the Act. In our opinion, the grant of such loan is not prejudicial to the interest of the company.
(b) In our opinion and according to the information and explanations given to us, the terms of repayment of the loan and payment of interest have not been stipulated; however, they are repayable on the mutual agreement of both the parties involved. As there is no stipulation of payment of interest the question of the receipt of interest does not arise.
(c) As the company has not stipulated the terms and conditions for repayment of principal and interest, we are unable to comment on the overdue amount.
4. In our opinion and according to the information and explanations given to us, the company has not complied with the provisions of section 185 and 186 of the Companies Act, 2013 with respect to the loans, investments, guarantees and security made. The Company has granted a loan of Rs.3527.03(Rs.3035.72) lakhs to a company and a corporate guarantee of Rs.37.48 (Rs.37.48 crs) crores which is notin compliance with section 185 of the Act.
5. The Company has not accepted any deposits from the public.
6. The Central Government has not prescribed maintenance of cost records u/s 148 (1) of the Act.
7. a) The Company is regular in depositing with appropriate authorities, undisputed statutory dues including provident fund, employeesâ state insurance, income-tax, sales-tax, service tax, custom duty, excise duty, VAT, cess and other statutory dues applicable to it with appropriate authorities and that there are no outstanding dues as on the last day of the financial year for a period of more than six months from the date they became payable except in the following cases:
S.No. |
Particulars |
Amount (In Rs.) |
Details |
1. |
Maharashtra VAT |
Rs.46,73,827/- |
Maharashtra Sales Tax Dept |
2. |
Income tax |
Rs.26,24,3827- |
Income Tax for A.Y. 2008-09 |
b) According to the information and explanations given to us, the particulars of dues in respect of income tax, service tax, sales tax, customs duty, excise duty, VAT and cess, which have not been deposited on account of a dispute, are as follows
S.No. |
Particulars |
Amount (In Rs.) |
Details |
1. |
A.Y.2009-10 |
1,70,61,280/- |
Under Appeal with the Honâble Income Tax Appellate Tribunal, Chennai |
2. |
A.Y.2011-12 |
5,81,45,540/- |
Under Appeal with the Honâble Commissioner of Income Tax (Appeals), Chennai |
3. |
2006-07 to 2011-12 |
9,83,01,807/- |
Asst.Commissioner, Thirukazhukundram |
8. The Company does not have any loans or borrowings from any financial institution, banks, government or debenture holders during the year. Accordingly, paragraph 3(viii) of the Order is not applicable.
9. The Company did not raise any money by way of initial public offer or further public offer (including debt instruments) and term loans during the year. Accordingly, paragraph 3 (ix) ofthe Order is not applicable.
10. According to the information and explanations given to us, no material fraud by the Company or on the company by its officers or employees has been noticed or reported during the course of our audit.
11. 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.
12. In our opinion and according to the information and explanations given to us, the Company is not a Nidhi Company. Accordingly, paragraph 3 (xii) ofthe Order is not applicable.
13. 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.
14. According to the information and explanations given to us and based on our examination of the records of the Company, the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.
15. According to the information and explanations given to us and based on our examination of the records of the Company, the company has not entered into non-cash transactions with directors or persons connected with him. Accordingly, paragraph 3 (xv) of the Order is not applicable.
16. The company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.
ANNEXURE B TO THE INDEPENDENT AUDITORâS REPORT
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (âthe Actâ)
We have audited the internal financial controls over financial reporting of Refex Industries Limited (âthe Companyâ) as of March 31, 2018 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.
Managementâs Responsibility for Internal Financial Controls
The Companyâs 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 companyâs policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.
Auditorsâ Responsibility
Our responsibility is to express an opinion on the Companyâs internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the âGuidance Noteâ) and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditorâs 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 Companyâs internal financial controls system over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A companyâs 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 companyâs 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 unauthorised acquisition, use, or disposition of the companyâs assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2018, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
For M. KRISHNAKUMAR & ASSOCIATES
Chartered Accountants
Firm Registration No. 006853S
Place: Chennai M. KRISHNA KUMAR, B.Sc., FCA
Date: 25th May 2018 Proprietor
Membership No.203929
Mar 31, 2015
We have audited the accompanying financial statements of Refex
Industries Limited ("the Company"), which comprise the Balance Sheet as
at 31st March. 2015. the Statement of Profit and Loss for the year and
Cash Row Statement for the year ending 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 preparation and presentation 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 specified under section 133 of the Act read with Rule 7 of
the Companies (Accounts) Rules. 2014. This responsibility also includes
maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding the assets of the Company and
for preventing and detecting frauds and other irregularities: selection
and application of appropriate accounting policies; making judgments
and estimates that are reasonable and prudent; and design,
implementation and maintenance of adequate internal financial controls,
that were operating effectively for ensuring accuracy and completeness
of accounting records, relevant to the preparation and presentation of
the financial statements that give a true and fair view and are free
from material misstatement, whether due to fraud or error.
Auditors' Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We have taken into account the
provisions of the Act, the accounting and auditing standards and
matters which are required to be included in the audit report under the
provisions of the Act and Rules made there under.
We conducted our audit in accordance with the Standards on Auditing
specified u/s 143(10) of the Act. Those Standards require that we
comply with ethical requirements and plan and perform the audit to
obtain reasonable assurance about whether the financial statements are
free from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The procedures
selected depend on the auditor's judgment, including the assessment of
the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, the auditor
considers internal financial control relevant to the Company's
preparation of the financial statements that give a true and fair view
in order to design audit procedures that are appropriate in the
circumstances but not for the purpose of expressing an opinion on
whether the Company has in place an adequate internal financial
controls system over the financial reporting and the operating
effectiveness of such controls. 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 on the financial
statements.
Basis for Qualified Opinion;
The Company is not providing for liability for gratuity as per
actuarial valuation, which is not in accordance of the Accounting
Standard on Provision for Gratuity (AS-15) (Refer Note 2(i) in Notes
forming part of Financial Statements) issued by The Institute of
Chartered Accountants of India and the impact of which is
unascertainable.
Emphasis of Matter:
The Company has revised its Policy of providing Depreciation in
accordance with the Companies Act, 2013 and the resulting impact has
been explained vide Explanation to Note 27 to the Annual Report.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us. except for the effects of the matter
described in the Basis for Qualified opinion paragraph the accompanying
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
Generally Accepted Accounting Principles in India of the state of
affairs of the Company as at 31 March 2015 and its Loss and its Cash
Flows for the year ended on that date.
Report on other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order, 2015 ('the
Order") issued by the Central Government of India in terms of sub-
section (11) of section 143 of the 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, to the extent
applicable, that.
a. we have sought and obtained all the information and explanations
which to the best of our knowledge and belief were necessary for the
purpose of our audit;
b. in our opinion proper books of account as required by law have been
kept by the Company so far as it appears from our examination of those
books;
c. the Balance Sheet, Statement of Profit and Loss and the Cash Row
statement dealt with by this Report are in agreement with the books
of account;
d. in our opinion, except for the effects of the matter described in
the Basis for Qualified opinion paragraph, the aforesaid financial
statements comply with the Accounting Standards specified under section
133 of the Act;
e. On the basis of written representations received from the directors
as on 31st March 2015 taken on record by the Board of Directors, none of
the directors is disqualified as on 31st March 2015 from being appointed
as a director in terms of sub-section (2) of section 164 of the Act.
f. with respect to the other matters to be included in the Auditor's
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules 2014. in our opinion and to the best of our information and
according to the explanations given to us:
i. According to the information and explanations given to us. there
were no pending litigations which would impact the financial position
of the Company.
ii. The Company did not have any material foreseeable losses on
long-term contracts including derivative contracts.
iii. There were no amounts required to be transferred to the Investor
Education and Protection Fund by the Company.
Annexure to the Independent Auditors' Report:
The Annexure referred to in our Independent Auditors' Report to the
members of the Company on the financial statements for the year ended
31'' March 2015, we report that:
1. a) The Company has maintained proper records showing full
particulars including quantitative details and situations of fixed
assets
b) 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.
c) During the year, the Company has not disposed off a substantial part
of fixed assets that would affect it as a going concern.
2. a) The inventory has been physically verified during the year by
the Management. In our opinion, the frequency of verification is
reasonable.
b) The procedure of physical verification of inventories followed by
the Management is reasonable and adequate in relation to the size of
the Company and the nature of its business.
c) The Company is maintaining proper records of inventory. The
discrepancies noticed on verification between the physical stocks and
the book records were not material.
3. (i) The Company has not granted any loans, secured or unsecured, to
companies, firms or other parties covered in the register maintained
under section 189 of the Companies Act, 2013.
(ii) According to the information and explanations given to us and on
the basis of our examination of the books of account, the Company has
taken loans from companies, firms or other parties listed in the
register maintained under Section 189 of the Companies Act, 2013. The
maximum amount involved during the year was Rs. 1,49,33,038/- (Rs.
6,03,93,875/-) /- and the year-end balance was Rs. 9,05,99,894 /- (Rs.
11,19,74.627/-).
4. In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and nature of its business with regard to
purchase of inventory, fixed assets and with regard to the sale of
goods and services, wherever applicable. We have not observed any major
weakness in internal control system during the course of the audit.
5. The Company has not accepted any deposits from public.
6. We have reviewed the rules prescribed by the Central Government for
maintenance of Cost records under Section 148 (1) of the Companies Act,
2013 and according to the information and explanations given to us, we
are of the opinion that prima facie the said records are not applicable
for the financial year under review.
7. a) The Company is regular in depositing with appropriate
authorities, undisputed statutory dues including provident fund,
employees' state insurance, income-tax, sales-tax, wealth tax, custom
duty, excise duty. VAT, cess and other statutory dues applicable to it
with appropriate authorities and that there are no outstanding dues as
on the last day of the financial year for a period of more than six
months from the date they became payable except in the following cases.
S.
No. Particulars Amount Details
1. Income tax Rs.26,24,382/- Due to Income tax Dept for
the A.Y. 2008-09
b) According to the information and explanations given to us, no
undisputed amounts payable in respect of income tax, wealth tax, sales
tax, service tax, customs duty, excise duty, VAT and cess were in
arrears, as at 31st March 2015 However, the following disputed amounts
of Income tax are presently under Appeal with various Appellate
Authorities as on 31st March 2015.
S.
No. Particulars Amount Details
1. A.Y.2009-10 1,70,61,280/- Under Appeal with the
Hon'ble Income Tax Appellate
Tribunal, Chennai
2. A.Y.2009-10 99,50,990/- Under Appeal with the
Hon'ble Commissioner of Income
Tax (Appeals), Chennai
3. A.Y.2011-12 5,81,45,540/- Under Appeal with the
Hon'ble Commissioner of Income
Tax (Appeals), Chennai
c) According to the information and explanations given to us, there are
no amounts required to be transferred to investor education and
protection fund in accordance with the relevant provisions of the Act.
8. The Company has not incurred accumulated losses at the end of
financial year Including cash losses and also in the immediately
preceding financial year.
9. The Company has no outstanding dues to Banks. The Company is
repaying loans taken from financial institutions, and there are no
outstanding towards the loans during the year.
10. According to the information and explanations given to us, the
Company has given Corporate Guarantee Rs.40.48 crores for loans taken
by Group Company from banks or financial institutions.
11. According to the information and explanation given to us. the
Company has no term loans outstanding during the year with Banks.
12. According to the information and explanations given to us, no
material fraud on or by the Company has been noticed or reported during
the course of our audit.
For Bhandari & Keswanl
Chartered Accountants
FRN.000433S
Place: Chennai
Date : 29.05.2015 P. BHANDARI
Partner
M. No. 17411
Mar 31, 2014
We have audited the accompanying financial statements of Refex
Industries Limited ("the Company"), which comprise the Balance Sheet as
at March 31, 2014, and the Statement of Profit and Loss and Cash Flow
Statement for the year then ended, and a summary of significant
accounting policies and other explanatory information.
Management 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"). 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.
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. An audit also
includes evaluating the appropriateness of accounting policies used and
the reasonableness of the accounting estimates made by management, as
well as evaluating the overall presentation of the financial
statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
BASIS FOR QUALIFIED OPINION
The Company is not providing for liability for gratuity as per
actuarial valuation, which is in contravention of Accounting Standard
on Provision for Gratuity (AS-15) (Refer Note 2(i) in Notes forming
part of Financial Statements) issued by The Institute of Chartered
Accountants of India and the impact of which is unascertainable.
In our opinion and to the best of our information and according to the
explanations given to us, except for the effects of the matter
described in the Basis for Qualified opinion paragraph, the financial
statements give the information required by the Act in the manner so
required and give a true and fair view in conformity with the
accounting principles generally accepted in India:
a) in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2014;
b) in the case of the 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.
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, except for the effects of the matter described in
the Basis for Qualified Opinion paragraph, the Balance Sheet, Statement
of Profit and Loss, and Cash Flow Statement comply with the Accounting
Standards referred to in subsection (3C) of section 211 of the
Companies Act, 1956;
e) On the basis of written representations received from the directors
as on March 31, 2014, and taken on record by the Board of Directors,
none of the directors is disqualified as on March 31, 2014, from being
appointed as a director in terms of clause (g) of sub-section (1) of
section 274 of the Companies Act, 1956.
Since the Central Government has not issued any notification as to the
rate at which the cess is to be paid under section 441A of the
Companies Act, 1956 nor has it issued any Rules under the said section,
prescribing the manner in which such cess is to be paid, no cess is due
and payable by the Company.
THE ANNEXURE REFERRED TO IN PARAGRAPH 1 OF OUR REPORT OF EVEN DATE TO
THE MEMBERS OF REFEX INDUSTRIES LIMITED (FORMERLY REFEX REFRIGERANTS
LTD) ON THE ACCOUNTS OF THE COMPANY FOR THE YEAR ENDED 31ST MARCH,
2014.
On the basis of such checks as we considered appropriate and according
to the information and explanation given to us during the course of our
audit, we report that:
1. (a) The company has maintained proper records showing full
particulars including quantitative details and situation of its fixed
assets.
(b) As explained to us, fixed assets have been physically verified by
the management at reasonable intervals; no material discrepancies were
noticed on such verification.
(c) In our opinion and according to the information and explanations
given to us, fixed assets being Factory land and building directly
impacting the business of the Company has been disposed off during the
year but however, to the best of our information and opinion the said
sale does not affect the going concern assumption.
2. (a) As explained to us, inventories have been physically verified
during the year by the management at reasonable intervals.
(b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management are reasonable and adequate in relation to
the size of the company and the nature of its business.
(c) In our opinion and on the basis of our examination of the records,
the Company is generally maintaining proper records of its inventories.
No material discrepancy was noticed on physical verification of stocks
by the management as compared to book records.
3. (a) According to the information and explanations given to us and
on the basis of our examination of the books of account, the Company
has taken interest free unsecured loans from two (two) Body corporates
and one (two) Directors listed in the register maintained under Section
301 of the Companies Act, 1956. The maximum amount involved during the
year was Rs.6,03,93,875/- (Rs.1,34,27,632/-) and the year end balance
was Rs. 11,19,74,627/- (Rs.9,07,07,510/-). The principal amounts are
repayable on demand and there is no repayment schedule. In our opinion
and according to the information and explanations given to us, the rate
of interest and other terms and conditions of the loans given by the
company, are not prima facie prejudicial to the interest of the
company. Consequently, the provisions of clauses iii (b), iii(c) and
iii (d) of the order are not applicable to the Company.
(b) According to the information and explanations given to us and on
the basis of our examination of the books of account, the Company had
neither granted nor taken any loans, secured or unsecured to or from
companies, firms or other parties listed in the register maintained
under Section 301 of the Companies Act, 1956. Thus sub clauses (f) &
(g) are not applicable to the company.
4. In our opinion and according to the information and explanations
given to us, there is generally an adequate internal control procedure
commensurate with the size of the company and the nature of its
business, for the purchase of inventories & fixed assets and payment
for expenses & for sale of goods. During the course of our audit, no
major instance of continuing failure to correct any weaknesses in the
internal controls has been noticed.
5. a) Based on the audit procedures applied by us and according to the
information and explanations provided by the management, the
particulars of contracts or arrangements referred to in section 301 of
the Act have been entered in the register required to be maintained
under that section.
b) As per information & explanations given to us and in our opinion,
the transaction entered into by the company with parties covered u/s
301 of the Act does not exceeds five lacs rupees in a financial year
therefore requirement of reasonableness of transactions does not arise.
6. The Company has not accepted any deposits from the public covered
under section 58A and 58AA of the Companies Act, 1956.
7. As per information & explanations given by the management, the
Company has an internal audit system commensurate with its size and the
nature of its business.
8. We have broadly reviewed the Books of Account maintained by the
Company pursuant to the rules prescribed by the Central Government for
maintenance of cost records under clause (d) of sub-section (1) of
section 209 of the Companies Act, in respect of Refrigerant Gases and
we are of the opinion that prima facie the prescribed accounts and
records have been made and maintained.
9. (a) According to the records of the company, undisputed statutory
dues Investor Education and Protection Fund, Income-tax, Sales-tax,
Wealth Tax, Service Tax, Custom Duty, Excise Duty, cess to the extent
applicable and any other statutory dues have generally been regularly
deposited with the appropriate authorities. According to the
information and explanations given to us there were no outstanding
statutory dues as on 31st of March, 2014 for a period of more than six
months from the date they became payable except in the following cases.
Sl. Particulars Amount Details
No
1. VAT payment Rs. 30,62,640/- Due to Maharashtra Sales Tax Dept
2. Income Tax Rs. 26,24,382/- Due to Income tax Dept for the
A.Yr.2008-09
(b) According to the information and explanations given to us, there is
no amounts payable in respect of wealth tax, service tax, sales tax,
customs duty and excise duty which have not been deposited on account
of any disputes. However, the following disputed amounts of Income Tax
are presently under Appeal with various Appellate Authorities as on
31st March, 2014:
Sl. Particulars Amount Details
No
1. A.Y.2009-10 Rs. 1,70,61,280/- Under Appeal with the Hon''ble
Income Tax Appellate Tribunal,
Chennai
2. A.Y.2009-10 Rs. 99,50,990/- Under Appeal with the Hon''ble
Commissioner of Income Tax
(Appeals), Chennai
3. A.Y.2011-12 Rs. 5,81,45,540/- Under Appeal with the Hon''ble
Commissioner of Income Tax
(Appeals), Chennai
10. The Company has accumulated losses of Rs.14,10,39,225/-
(Rs.42,74,55,692/-) and has incurred a cash loss of Rs.Nil during the
financial year covered by our audit and Rs.12,49,92,125/- in the
immediately preceding financial year. The accumulated losses exceed 50%
of its net worth as at 31.03.2014.
11. Based on our audit procedures and on the information and
explanations given by the management, we report that the Company has
settled the dues of State Bank of India by disposing off its Factory
Land and Buildings during the year under review.
12. 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 pledge of shares, debentures and other securities.
13. The Company is not a chit fund or a nidhi /mutual benefit
fund/society. Therefore, the provision of this clause of the Companies
(Auditor''s Report) Order, 2003 (as amended) is not applicable to the
Company.
14. According to information and explanations given to us, except for
long term investments in unlisted securities, the Company is not
trading in Shares, Mutual funds & other Investments. Proper records &
timely entries have been maintained in respect of long term
investments.
15. According to the information and explanations given to us, the
Company has not given any guarantees for loan taken by others from a
bank or financial institution.
16. Based on our audit procedures and on the information given by the
management, we report that the company has not raised any term loans
during the year.
17. Based on the information and explanations given to us and on an
overall examination of the Balance Sheet of the Company as at 31st
March, 2014, we report that no funds raised on short-term basis have
been used for long-term investment by the Company.
18. Based on the audit procedures performed and the information and
explanations given to us by the management, we report that the Company
has not made any preferential allotment of shares during the year.
19. The Company has no outstanding debentures during the period under
audit.
The Company has not raised any money by public issue during the year.
20. Based on the audit procedures performed and the information and
explanations given to us, we report that no fraud on or by the Company
has been noticed or reported during the year, nor have we been informed
of such case by the management.
Place : Chennai For Bhandari & Keswani
Date : 30.05.2014 Chartered Accountants
FRN.000433S
P Bhandari
Partner
Membership No.17411
Mar 31, 2012
1. We have audited the attached Balance Sheet of REFEX REFRIGERANTS
LIMITED as at March 31, 2012, the 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. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
3. As required by the Companies (Auditor's Report) Order, 2003 issued
by the Central Government of India in terms of subsection (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:
a) We have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purposes of our
audit;
b) In our opinion, proper books of account, as required by law, have
been kept by the Company, so far as appears from our examination of
those books;
c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account;
d) In our opinion, the Balance Sheet, Profit and Loss Account and Cash
Flow Statement dealt with by this report are substantially in
compliance with the Accounting Standards referred to in Section 211
(3C) of the Companies Act, 1956.
e) On the basis of written representations received from the Directors
as on March 31, 2012 and taken on record by the Board of Directors, we
report that none of the Directors is disqualified as on March 31,2012
from being appointed as a director in terms of clause (g) of
sub-section (1) of Section 274 of the Companies Act, 1956;
f) In our opinion and to the best of our information and according to
the explanations given to us, the said accounts read together with the
Significant Accounting Policies and notes thereon more particularly
note no 3 given the information required by the Companies Act, 1956, in
the manner so required and give a true and fair view in conformity with
the accounting principles generally accepted in India:
(i)In the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March 2012
(ii) In the case of the Profit and Loss Account, of the Profit for the
year ended on that date; and
(iii) In the case of the Cash Flow Statement, of the Cash flows for the
year ended on that date.
Re: Refex Refrigerants Limited
Referred to in paragraph 3 of our report of even date
(i) (a) The Company has maintained proper records showing full
particulars including quantitative details and situation of the Fixed
Assets.
(b) The fixed assets have been physically verified by the management
during the year which in our opinion is reasonable, having regard to
the size of the Company and the nature of its business. No material
discrepancies have been noticed on such verification.
(c) During the year, the Company has not disposed off a major part of
the plant and machinery. According to the information and explanations
given to us, we are of the opinion that the sale of the small portion
of plant and machinery has not affected the going concern status of the
Company.
(ii) (a) The Inventory has been physically verified during the year by
the management. In our opinion, the frequency of verification is
reasonable.
(b) 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) The Company is maintaining proper records of inventory. The
discrepancies noticed on verification between the physical stocks and
book records were not material.
(iii) (a) During the year under review, the Company has not granted any
loans to the parties covered in the register maintained under Section
301 of the Companies Act.
(b) The Company has taken interest free unsecured loans from two Body
Corporates and three Directors covered in the register maintained under
Section 301 of the Companies Act, 1956. The maximum amount involved
during the year was Rs.3,42,04,256/- (Rs.5,46,66,755/-) and the year-
end balance was Rs.7,35,11,070/- (.4,72,64,608/-) The principal amounts
are repayable on demand and there is no repayment schedule. In our
opinion and according to the information and explanations given to us ,
the rate of interest and other terms and conditions of the loans given
by the Company, are not prima facie prejudicial to the interest of the
Company.
Apart from the above the Company had neither granted nor taken loans,
secured or unsecured to or from Companies, Firms and other parties
covered in the register maintained under Section 301 of the Companies
Act.
(iv) In our opinion and according to the information and explanations
given to us, 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 have
not observed any continuing failure to correct major weaknesses in
internal controls during the course of our Audit.
(v) (a) 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 been so entered.
b) In our opinion and according to the information and explanations
given to us, the Company has not entered into transactions in pursuance
of contracts or arrangements entered in the register maintained under
section 301 of the Companies Act, 1956 and exceeding the value rupees
five lakhs in respect of any party during the year.
(vi) In our opinion and according to the information and explanations
given to us, the company has not accepted Deposits from the Public
within the meaning of Sections 58A and 58AA of the Act and the rules
framed thereunder during the year.
(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 prescribed by the Central Government for
maintenance of Cost records under Section 209 (1) (d) of the Companies
Act, in respect of Refrigerant Gases and are of the opinion that prima
facie the prescribed accounts and records have been made and
maintained.
(ix) (a) According to the information and explanations given to us, the
Company has been generally regular in depositing undisputed amounts
relating to Provident Fund, Employees State Insurance, Income Tax,
Sales Tax, Service Tax, Excise Duty, Customs Duty, Cess and other
material Statutory dues as applicable with the appropriate authorities
and no undisputed amounts payable in respect of Provident Fund,
Employees State Insurance, Income Tax, Sales Tax, Service Tax, Excise
Duty, Customs Duty, Cess and other material Statutory dues were in
arrears as at 31st March 2012 for a period of more than six months from
the date they became payable except in the following cases:
SI.
No Particulars Amount Details
1. Employee State Insurance 30.411 Due for 2 months
2. Provident Fund 70,927 Due for 2 months
3. Tax Deducted at Source 11,17,731 Due for 6 months
4. Tax Deducted at Source 68,185 Interest due on delayed
payment
5. Annual Listing fees 1,77,698 Due to BSE, CDSL, NSDL
and NSE
6. VAT payment 95,23,410 Due to Mumbai S.Tax Dept
(b) According to the information and explanations given to us, there
are no dues of Provident Fund, Employees State Insurance, Income Tax,
Sales Tax, Service Tax, Excise Duty, Customs Duty, Cess and other
material Statutory dues which have not been deposited on account of any
dispute.
(x) In our opinion, the Company does not have accumulated losses at the
end of the financial year. The Company has incurred cash losses during
the financial year but not in the immediately preceding financial year.
(xi) In our opinion, the Company has defaulted in repayment of dues to
a bank. The period and the amount of default is as under:
Particulars Period of default Rs. Period of default Rs.
Loans Repayable As at 31st March
2012 As at 31st March
2011
On demand from
Bank 1 Month 191,801,051 - -
Term Loans
from Bank
Principal 5 Months 30,00,000 - -
Interest 5 Months 28,08,464 - -
(xii) We are of the opinion that the Company has not granted any loans
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 is not applicable to the
Company.
(xiv) In our opinion, the Company is not dealing or trading in shares,
securities, debentures and other investments. Accordingly, the
provisions of clause 4(xiv) of the Companies (Auditor's Report) Order,
2003 is 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
banks or financial institutions.
(xvi) In our opinion, the term loans have been applied for the purpose
for which they were raised.
(xvii) According to the information and explanations given to us and on
an overall examination of the balance sheet of the company, we report
that no funds raised on short- term basis have been used for long-term
investment. No long-term funds have been used to finance short-term
assets except permanent working capital.
(xviii) According to the information and explanations given to us the
Company during the year has not made preferential allotment of shares
to parties and companies covered in the register maintained under
section 301 of the Act.
(xix) According to the information and explanations given to us, during
the period covered by our audit report, the Company has not issued any
debentures.
(xx) 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.
PLACE: Chennai For BHANDARI & KESWANI
DATE : 29.05.2012 Chartered Accountants
FRN.000433S
P. Bhandari
Partner
Membership No. 17411
Jun 30, 2010
1. We have audited the attached Balance Sheet of REFEX REFRIGERANTS
LIMITED as at June 30, 2010, the 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. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
3. As required by the Companies (Auditors Report) Order, 2003 issued
by the Central Government of India in terms of subsection (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:
a) We have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purposes of our
audit;
b) In our opinion, proper books of account, as required by law, have
been kept by the Company, so far as appears from our examination of
those books;
c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account;
d) In our opinion, the Balance Sheet, Profit and Loss Account and Cash
Flow Statement dealt with by this report are in compliance with the
Accounting Standards referred to in Section 211 (3C) of the Companies
Act, 1956 except with AS-21, relating to preparation of Consolidated
financial Statement, in respect of its Overseas Subsidiary Companies as
mentioned in Note 2 (ii) of Schedule-17.
e) On the basis of written representations received from the Directors
as on 30th June 2010 and taken on record by the Board of Directors, we
report that none of the Directors is disqualified as on 30th June 2010
from being appointed as a director in terms of clause (g) of
sub-section (1) of Section 274 of the Companies Act, 1956;
f) In our opinion and to the best of our information and according to
the explanations given to us, the said accounts read together with the
Significant Accounting Policies and notes thereon given more
particularly note no 2 tt 1 ic) trie information required by the
Companies /ë:.t, 1956. in the manner so required and give a true and
fair view in conformity with the accounting principles generally
accepted in India:
(i)in the case of the Balance Sheet, of the state of affairs of the
Company as at 30th June 2010
(ii) in the case of the Profit and Loss Account, of the Profit for the
year ended on that date; and
(iii) in the case of the Cash Flow Statement, of the Cash flows for the
year ended on that date.
Re: Refex Refrigerants Limited
Referred to in paragraph 3 of our report of even date
(i) (a) The Company has maintained proper records showing full
particulars including quantitative details and situation of the Fixed
Assets.
(b) The fixed assets have been physically verified by the management
during the year which in our opinion is reasonable, having regard to
the size of the Company and the nature of its business. No material
discrepancies have been noticed on such verification.
(c) During the year, the Company has not disposed off a major part of
the plant and machinery. According to the information and explanations
given to us, we are of the opinion that the sale of the small portion
of plant and machinery has not affected the going concern status of the
Company.
(ii) (a) The Inventory has been physically verified during the year by
the management. In our opinion, the frequency of verification is
reasonable.
(b) 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) The Company is maintaining proper records of inventory. The
discrepancies noticed on verification between the physical stocks and
book records were not material.
(iii) (a) During the year under review, the Company has not granted any
loans to the parties covered in the register maintained under Section
301 of the Companies Act.
(b) The Company has taken interest free loans from 3 parties amounting
to Rs.7, 50, 15, 595/- (Rs.8,32,25,000) from the parties covered in the
register maintained under Section 301 of the Companies Act and no
interest has been paid on such loans.
(c) There is no stipulation with respect to repayment of principal and
interest in (a) and (b) above.
Apart from the above the Company had neither granted nor taken loans,
secured or unsecured to or from Companies, Firms and other parties
covered in the register maintained under Section 301 of the Companies
Act.
(iv) In our opinion and according to the information and explanations
given to us, 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 have
not observed any continuing failure to correct major weaknesses in
internal controls during the course of our Audit.
(v) (a) 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 been so entered.
b) In our opinion and according to the information and explanations
given to us, the Company has not entered into transactions in pursuance
of contracts or arrangements entered in the register maintained under
section 301 of the Companies Act, 1956 and exceeding the value rupees
five lakhs in respect of any party during the year.
(vi) In our opinion and according to the information and explanations
given to us, the company has not accepted Deposits from the Public
within the meaning of Sections 58Aand 58AAof the Act and the rules
framed thereunder during the year.
(vii) In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
(viii) We report that no cost records under 209 (1) (d) of the
Companies Act, 1956 have been prescribed for the Company.
(ix) (a) The Company has been generally regular in depositing
undisputed amounts relating to Provident Fund, Employees State
Insurance,
Income Tax, Sales Tax, Service Tax, Excise Duty, Customs Duty, Cess and
other material Statutory dues as applicable with the appropriate
authorities.
(b) According to the information and explanations given to us, no
undisputed amounts payable in respect of Provident Fund, Employees
State Insurance, Income Tax, Sales Tax, Service Tax, Excise Duty,
Customs Duty, Cess and other material Statutory dues were in arrears as
at 30th June 2010 for a period of more than six months from the date
they became payable.
(c) According to the information and explanations given to us, there
are no dues of Provident Fund, Employees State Insurance, Income Tax,
Sales Tax, Service Tax, Excise Duty, Customs Duty, Cess and other
material Statutory dues which have not been deposited on account of any
dispute.
(x) The Company has no accumulated losses at the end of the financial
year and it has not incurred cash loss during the financial year
covered by our audit and in the immediately preceding financial year.
(xi) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to a
financial institution or banks.
(xii) We are of the opinion that the Company has not granted any loans
on the basis of security by way of pledge of shares, debentures and
other securities.
(xiii) In our opinion, th= Company is not a chit fund or a nidhi/mutual
bemrit fund/society. Therefore, the provisions of clause 4(xiii) of the
Companies (Auditors Report) Order, 2003 is not applicable to the
Company.
(xiv) In our opinion, the Company is not dealing or trading in shares,
securities, debentures and other investments. Accordingly, the
provisions of clause 4(xiv) of the Companies (Auditors Report) Order,
2003 is not applicable to the Company.
(xv) According to the information and explanations given to us the
Company has given guarantee for loans taken by two subsidiary Companies
incorporated outside tndia to banks and the terms and conditions are
not prejudicial to the interests of the Company.
(xvi) In our opinion, the term loans have been applied for the purpose
for which they were raised.
(xvii) According to the information and explanations given to us and on
an overall examination of the Balance Sheet of the Company, we report
that no funds raised on short- term basis have been used for long-term
investment. No long-term funds have been used to finance short-term
assets except permanent Working Capital.
(xviii) According to the information and explanations given to us the
Company during the period has not made any preferential allotment of
shares to parties and companies covered in the register maintained
under section 301 of the Act.
(xix) According to the information and explanations given to us, during
the period covered by our audit report, the Company has not issued any
debentures.
(xx) 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.
PLACE: Chennai For BHANDARI & KESWANI
DATE: 28.08.2010 Chartered Accountants
P. Bhandari
Partner