Mar 31, 2018
INDEPENDENT AUDITORS'' REPORT
To
The Members,
TRANSGENE BIOTEK LIMITED
Report on the Standalone Ind AS Financial Statements
We have audited the accompanying Standalone Ind AS financial statements of M/s.Transgene Biotek Limited ("The Company"), which comprise the Balance Sheet as at 31st March, 2018, the Statement of Profit and Loss, including the Statement of Other Comprehensive Income, the Cash Flow Statement and the Statement of Changes in Equity for the year ended and a summary of the significant accounting policies and other explanatory information(herein after referred to as "standalone Ind AS financial statements").
Management''s Responsibility for the Standalone Financial Statements
The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these Standalone Ind AS Financial Statements that give a true and fair view of the Financial Position, Financial Performance including Other Comprehensive Income, Cash Flows and the Statement of Changes in Equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards(lnd AS) specified under Section 133 of the Act, read with the Companies (Indian Accounting Standards) Rules, 2015, as amended. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the 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 Standalone Ind AS financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the Standalone Ind AS Financial Statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the Standalone Ind AS Financial Statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances.
An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the Financial Statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Standalone Financial Statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Standalone Ind AS Financial Statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India including the Ind AS, of the financial position of the Company as at 31 March, 2018 and its financial performance including other comprehensive income, its cash flows and changes in equity for the year ended on that date.
Emphasis of Matter
1. Attention is brought to Note No.04 to the ''Notes forming part of the Standalone Financial Statements'' under the heading "Investments" amounting to Rs.9220.10 Lakhs made in the wholly owned subsidiary company viz. Transgene Biotek HK Limited (1,69,52,001 shares of US $ 1 each). The accounts of the said subsidiary have not been audited for the FY 201718. In the absence of alternative methodologies to independently evaluate the same, we are unable to express an opinion whether the said sum as reflected under the above head is recoverable at the value at which it is stated. Management, as a prudent measure, made full provision in the books of account considering the above development.
2. Attention is also brought to the fact that Securities and Exchange Board of India (SEBI) prima facie concluded on conducting Preliminary Enquiry during previous years that the GDR proceeds have been transferred by the Company, directly or indirectly, through foreign subsidiary for undisclosed purposes under the grab of consideration for technology transfer and consequently passed an interim Order inter alia, refraining the Company from issuing any securities. The Company has appealed against the said Order. We are unable to comment, at this stage, on the impact this Order will have on the Company as a going concern. We are also unable to quantify, at the stage, the financial impact of this Order on the Company, as the Management has informed us that the Company is in the process of taking steps for recovery of amounts raised in the GDR.
3. The findings of the SEBI as per their Order on the utilization/transfer of GDR proceeds for undisclosed purposes point out towards violations of the provisions of the Foreign Exchange Management Act as well as GDR approval conditions, the impact of which we are unable to quantify at this stage.
4. Attention is brought to the fact that there is an outstanding balance of Rs. 2302.00 lakhs which pertains to advance given to a Party out of the proceeds of GDR. Consequent to the order of the SEBI as aforesaid and the contention of the management that the payments were made without Company''s authorization or knowledge, we are unable to opine whether this amount is recoverable or not as we are unable to obtain confirmation from the concerned Party. However, the Management as a prudent measure, made full provision for the amount,
in the Books of Accounts considering the above facts.
Report on Other Legal and Regulatory Requirements
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.
As required by Section 143 (3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;
(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;
(c) The Balance Sheet, Statement of Profit and Loss including Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.
(d) In our opinion, the aforesaid 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 Written Representation received from the directors as on 31 st March 2018, and taken on record by the Board of Directors, we report that none of the directors are disqualified as on 31st March, 2018 from being appointed as a director in terms of Subsection 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 "Annexure" to this report; and
(g) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements.
ii. There is no requirement for any provision as required by any act or Accounting standards for material for foreseeable losses, if any on long term contracts including derivative contracts.
iii. There are no amounts which are required to be transferred to Investor Education and Protection Fund by the Company.
Annexure referred to in paragraph 3 and 4 of the Independent Auditor''s Report of even date of
TRANSGENE BIOTEK LIMITED, Hyderabad on the Standalone Financial Statements for year ended March 31, 2018 :
1) In terms of the information and explanations sought by us and given by the company and the books and records examined by us in the normal course of audit and to the best of our knowledge and belief, we state the following:
a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets. ln case of Technology item, we have been informed that certain balancing components are yet to be received without which the technology is incomplete for the full effective intended usage. Subject to this, the other fixed assets have been physically verified by the management and this revealed no material discrepancies.
b) All the assets have been physically verified by the management during the year and there is a regular program of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.
c) According to information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds/lease deeds of immovable properties included in Property, Plant and Equipment are held in the name of the Company.
2) Inventory:
a) The inventory has been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.
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. No material discrepancies were noticed on verification of the physical stocks with the records.
3) As informed to us, the company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 189 of the Companies Act. Thus clause (iii) of Companies (Auditor''s Report) Order, 2016 is not applicable.
4) As informed to us, the Company has not granted any loans or made any investments, or provided any guarantees or security to the parties covered under section 185 and 186 of the Act. Therefore, clause (iv) of Companies (Auditor''s Report) Order, 2016 is not applicable.
5) According to the information and explanations given to us, the Company has not accepted deposits against the terms of directives issued by Reserve Bank of India and the provisions of Sections 73 to 76 or any other relevant provisions of the Companies Act and the rules framed there under. Hence clause (v) of Companies (Auditor''s Report) Order, 2018 is not applicable.
6) The central government has not prescribed the maintenance of cost records under section 148(1) of the Act, for any of the services rendered by the company Thus clause (vi) of Companies (Auditor''s Report) Order, 2018 is not applicable
7) a) The company is not regular in depositing undisputed statutory dues. The amount of arrears, as at 31 st March, 2018 outstanding for a period of more than six months from the date they became payable are as mentioned below:
Income tax (Asst year 2009-2010) |
Rs. 7.61 lakhs |
Income Tax (Asst Year 2011-2012) |
Rs. 3.86 lakhs |
Income tax in the nature of TDS |
Rs. 10.03 lakhs |
PF Payable |
Rs. 0.65 lakhs |
ESI Payable |
Rs. 1.92 lakhs |
PT Payable |
Rs. 0.42 lakhs |
Income Tax Demand (Asst year 2009-2010) |
Rs. 0.68 lakhs |
Income Tax Demand (Asst year 2013-2014) |
Rs. 73.36 lakhs |
b) According to the information and explanations given to us, there are no dues of sales tax, income tax and excise duty which have not been deposited on account of any dispute except the following:
Nature of Dues |
Amount (Rs.) |
Period |
Forum where dispute is pending |
Customs Duty demand raised for Non-fulfillment of Export Obligation. |
59.37 lakhs |
2002 |
CESTAT, Chennai |
Service Tax liability due to difference of opinion on classification of service. |
76.15 lakhs |
2011-12 |
Chief Commissioner of Customs, Excise & Service, Hyderabad. |
Service Tax liability due to difference of opinion on, classification of service |
7.36 lakhs |
2010-11 |
Chief Commissioner of Customs, Excise & Service, Hyderabad. |
8) The company does not have any outstanding dues to financial institutions, banks or debenture holders during the year. Thus clause (viii) of Companies (Auditor''s Report) Order, 2016 is not applicable.
9) The company has not raised moneys by way of initial public offer or further public offer (including debt instruments) and term loans during the year. Thus clause (ix) of the Companies (Auditor''s Report) Order, 2016 is not applicable.
10) Based upon the audit procedures performed and the information and explanations given by the management, we report that no fraud by the Company or on the Company by its officers or employees has been noticed or reported during the year
11) According to the information and explanations given to us the company has not provided for any managerial remuneration as mandated under the provisions of Section 197, read with Schedule V of the act.
12) As the company is not a Nidhi Company and the Nidhi Rules 2014 are not applicable to it, the provisions of clause (xii) of the Companies (Auditor''s Report) Order, 2016 are not applicable to the Company
13) In our opinion and according to the information and explanations given to us, the company has not entered into any transaction with the related parties. Thus clause (xiii) of Companies (Auditor''s Report) Order, 2016 is not applicable.
14) Based upon the audit procedures performed and the information and explanations given by the management, the Company has not made any preferential allotment or private placement of shares or fully convertible debentures during the year. Accordingly, the clause (xiv) of Companies (Auditor''s Report) Order, 2016 is not applicable.
15) Based upon the audit procedures performed and the information and explanations given by the management, the Company has not entered into any non-cash transactions with directors or persons connected with him. Thus clause (xv) of Companies (Auditor''s Report) Order, 2018 is not applicable.
16) In our opinion, the company is not required to be registered under section 45 IA of the Reserve Bank of India Act, 1934 and accordingly, the provisions of clause 3 (xvi) of the Order are not applicable to the Company
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act")
We have audited the internal financial controls over financial reporting of M/s. TRANSGENE BIOTEKLIMITED as on March 31,2018 in conjunction with our audit of the Standalone Financial Statements of the Company for the year ended on that date.
Management''s Responsibility for Internal Financial Controls
The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (''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, as specified under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of Financial Statements for external purposes in accordance with generally accepted accounting principles. A Company''s internal financial control over financial reporting includes those policies and procedures that
(1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;
(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the company; and
(3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company''s assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
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 Lakshmi and Associates
Chartered accountants,
Firm Registration No. 012482S
N.LAKSHMI
PLACE : HYDERABAD Partner
DATE : 14.11.2018 M.No:223790
Mar 31, 2015
We have audited the accompanying financial statements of TRANSGENE
BIOTEK LIMITED("the Company"),
which comprise the Balance Sheet as at March 31,2015,
the Statement of Profit and Loss and the Cash Flow Statement for the
year 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 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 provisions of the Act for safeguarding the assets of the company
and for preventing and detecting fraud and other irregularities,
selection and application of 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 thereunder.
We conducted our audit in accordance with the Standards on Auditing
specified under section 143(10) of the Act. Those Standards require
that we comply with ethical requirements and plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and 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 and fair presentation of the financial statements that give
true and fair view in order to design audit procedures that are
appropriate in the circumstances. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of
the accounting estimates made by management, as well as evaluating the
overall presentation of the 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; and
b) in the case of the Profit and Loss Account, of the Loss for the
period ended March 31,2015.
c) in the case of the cash flow statement, of the Cash Flows, for the
period ended March 31,2015.
Emphasis of Matter
1. Attention is brought to Note No.10 to the Notes on Accounts under
the heading "Non-Current Investments" amounting to Rs.9220.10 Lakhs
made in the wholly owned subsidiary company (1,69,52,001 shares of US $
1 each). Keeping in view the comments of the Auditor of the Subsidiary
Company, in the Independent Auditor's Report wherein they commented
that they are unable to express an opinion on the financial statements
of the said Subsidiary Company and also in the absence of alternative
methodologies to independently evaluate the same, we are unable to
express an opinion whether the said sum as reflected under the above
head is recoverable at the value at which it is stated. Management, as
a prudent measure, made full provision in the books of accounts
considering the above development.
2. Attention is also brought to the fact that Securities and Exchange
Board of India (SEBI) had conducted Preliminary Inquiry on receiving
certain complaints on the matter of GDRs issued by the Company and its
utilization thereof, basically on the angle of protection of Investors'
interest.
SEBI prima facie concluded that the GDR proceeds have been transferred
by the Company, directly or indirectly, through foreign subsidiary for
undisclosed purposes under the garb of consideration for technology
transfer and consequently passed an interim Order inter alia,
refraining the Company from issuing any securities. The Company has
appealed against the said Order. We are unable to comment, at this
stage, on the impact this Order will have on the Company as a going
concern. We are also unable to quantify, at the stage, the financial
impact of this Order on the Company, as the Management has informed us
that the Company is in the process of taking steps for recovery of
amounts raised in the GDR.
3. The findings of the SEBI as per their Order on the
utilization/transfer of GDR proceeds for undisclosed purposes point out
towards violations of the provisions of the Foreign Exchange Management
Act as well as GDR approval conditions, the impact of which we are
unable to quantify at this stage.
4. Attention is brought to the fact that there is an outstanding
balance of Rs. 2302.00 lakhs which pertains to advance given to a Party
out of the proceeds of GDR. Consequent to the order of the SEBI as
aforesaid and the contention of the management that the payments were
made without Company's authorization or knowledge, we are unable to
opine whether this amount is recoverable or not as we are unable to
obtain confirmation from the concerned Party. However, the Management
as a prudent measure, made full provision for the amount, in the Books
of Account considering the above facts.
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 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 statement on the matters specified in the
paragraphs 3 and 4 of the Order to the extent applicable to the
company.
2. As required by section 143(3) of the Act, we report that:
a. We sought and 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 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, the Balance Sheet, Statement of Profit and Loss and
the Cash Flow Statement comply with the Accounting Standards specified
under Section 133 of the Companies Act, 2013 read with rule 7 of the
Companies (Accounts) Rules, 2014.
e. On the basis of written representations received from the directors
as on March 31,2015, and taken on record by the Board of Directors, none
of the directors are disqualified as on March 31,2015, from being
appointed as a director in terms of section 164(2) of the Act.
f. With respect to the other matters to be included in Auditor's Report
in accordance with Rule 11 of Companies (Audit and Auditors),Rules 2014,
in our opinion and to the best of our information and according to the
explanation given to us;
i. The Company has disclosed the impact of pending litigation on its
financial position in its financial statements.
ii. In our opinion and as per the information and explanations
provided to us, the Company has not entered into any long term
contracts including derivate contracts, requiring provision under
applicable laws or accounting standards for material foreseeable
losses, and
iii. There has been no delay in transferring the amounts, required to
be transferred, to the Investor Education and Protection Fund by the
Company.
ANNEXURETO THE INDEPENDENT AUDITOR'S REPORT
Re: TRANSGENE BIOTEK LIMITED
Referred to in Paragraph 1 under section (Report on other Legal and
Regulatory Requirements of our Report of even date)
(i) (a) The company has maintained proper records showing full
particulars including quantitative details and situation of fixed
assets.In case of Technology item, we have been informed that certain
balancing components are yet to be received without which the technology
is incomplete for the full effective intended usage. Subject to this,
the other fixed assets have been physically verified by the management
and this revealed no material discrepancies.
(b) All the assets have been physically verified by the management
during the year and 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. In our opinion, the frequency of verification is
reasonable.
(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. No
material discrepancies were noticed on verification of the physical
stocks with the records.
(iii) The company has not granted any loan to the parties covered in
the register maintained under section 189 of the Companies Act, 2013.
(iv) In our opinion and according to the information and explanations
given to us, 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.
(v) According to the information and explanations given to us, the
Company has accepted deposits against the terms of directives issued by
Reserve Bank of India and the provisions of Sections 73 to 76 or any
other relevant provisions of the Companies Act and the rules framed
there under. During the year deposits accepted to the tune of Rs. 34.00
lakhs.
(vi) The maintenance of cost records has not been prescribed by the
Central Government under sub section (1) of section 148 of the
Companies Act, 2013 for the activities of the Company.
(a) The company is not regular in depositing undisputed statutory dues
. The amount of arrears, as at
31st March, 2015 outstanding for a period of more than six months from
the date they became payable are as mentioned below:
Nature of Dues Amount(Rs) Period Forum where
dispute is pending
Customs Duty demand raised 59.37 lakhs 2002 CESTAT, Chennai
for Non-fulfillment of
Export Obligation
(c) In our opinion and 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 Companies Act, 1956 (1 of 1956) and Rules made there
under.
(vii) In our opinion, the company has accumulated losses as on 31st
March, 2015 to the tune of Rs.13862.25 lakhs. The Company has incurred
cash losses during the financial year covered by our audit and also in
the immediately preceding financial year.
(viii) In our opinion and according to the information and explanations
given to us, the company has defaulted in repayment of dues to
financial institutions and banks.
The Company is not regular in repayment of Term loans within due date
and the loan accounts with Union bank of India and SIBRI are classified
as Non-Performing Asset by the banks due to non-payment as per payment
schedule of Term loan and non-application of interest on the loan
account after the account becoming NPA. In the absence of confirmation
of the loan balance, we are not in a position to quantify the exact
arrears at the year end.
(b) According to the information and explanations given to us, there
are no dues of sales tax, income tax an excise duty which have not bee
deposited on account of any dispute except the following :
(ix) 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, the terms and conditions whereof are
prejudicial to the interest of the Company.
(x) According to the information and explanations given to us, the
company has not obtained any Term Loans during the period under audit.
(xix) Based upon the audit procedures performed and 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.
As per our report attached
For GOPAL & RAJAN
Chartered Accountants
Firm Regd. No. 000953S
Sd/-
K.Goutham Subbaiah
Partner
(M. No. 203237)
Mar 31, 2014
We have audited the accompanying financial statements of M/S. TRANSGENE
BIOTEK LIMITED ("the Company") which comprises the Balance sheet as at
31st March 2014, the Statement of Profit and Loss for the year ended on
that date and the Cash fFlow Statement for the year and a summary of
significant accounting policies and other explanatory information.
Management''s Responsibility for the Financial Statements
The Company''s Management is responsible for the preparation of these
financial statements that give a true and fair view of the position,
financial performance and cash flows of the company in accordance with
the accounting standards notified under the Companies Act, 1956 ("the
Act") (which continue to be applicable in respect of Section 133 of the
Companies Act, 2013 in terms of General Circular 15/2013 dated
September 13, 2013 of the Ministry of Corporate Affairs) and in
accordance with the accounting principles generally accepted in India.
This responsibility includes the design, implementation and maintenance
of internal control relevant to the preparation and presentation of the
financial statements that give a true and fair view and are free from
material misstatement, whether due to fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conduct 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 judgement, including the assessment of
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 the management,
as well as evaluating the overall presentation of the financial
statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the 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, subject to our comments under the heading "Emphasis of Matter"
and in para (a) and para (b) (4) of ''Report on other Legal and
Regulatory requirements'' mentioned hereunder:
a) In the case of Balance sheet, of the State of affairs of the Company
as at 31 st March 2014;
b) In the case of Statement of Profit and Loss, of the Loss for the
year ended on that date; and
c) In the case of Cash flow statement of the cash flows for the year
ended on that date.
Emphasis of Matter
1. Attention is bought to Note No. 10 to the Notes on Accounts under
the heading "Non-Current Investments" amounting to Rs.9220.10 Lakhs
made in the wholly owned subsidiary company (1,69,52,001 shares of US $
1 each). Keeping in view the comments of the Auditor of the Subsidiary
Company, in the Independent Auditor''s Report wherein they commented
that they are unable to express an opinion on the financial statements
of the said Subsidiary Company and also in the absence of alternative
methodologies to independently evaluate the same, we are unable to
express an opinion whether the said sum as reflected under the above
head is recoverable at the value at which it is stated or not.
Management, as a prudent measure, made full provision in the books of
accounts considering the above development.
2. Attention is also bought to the fact that the regulator, Securities
and Exchange Board of India had conducted Preliminary Inquiry on
receiving certain complaints on the matter of GDR''s issued by the
Company in the past and its utilization thereof, basically on the angle
of protection of Investors'' interest, . and SEBI prima facie concluded
that the GDR proceeds have been transferred by the Company, directly or
indirectly, through foreign subsidiary for undisclosed purposes under
the garb of consideration for technology transfer and consequently
passed an interim Order, after the end of the financial year but before
this reporting date, inter alia, refraining the Company from issuing
any securities. Management has informed us that the Company is in the
process of conducting its own inquiry into the matters mentioned in the
Order and taking steps for protection of amounts raised in the GDR. We
are unable to quantify, at the moment, the financial impact of this
Order on the Company, as the Company is yet to quantify and make any
provision towards this purported loss. We are also unable to comment,
at this stage, on the impact this Order will have on the Company as a
going concern.
3. The findings of the SEBI as per their Order on the
utilization/transfer of GDR proceeds for undisclosed purposes point out
towards violations as per the provisions of the Foreign Exchange
Management Act as well as GDR approval conditions, the impact of which
we are unable to quantify at the moment.
4. Attention is bought to the fact that there is an outstanding balance
of Rs.2684.08 Lakhs which pertains to advance given out of the proceeds
of GDR. Consequent to the order of the SEBI as aforesaid and of the
counter contention of the CMD as to transfer of payments were made
unauthorizedly without his knowledge and also considering the fact that
confirmation from the party could not be obtained, we are unable to
opine whether this amount is recoverable or not. However, the
Management as a prudent measure, made full provision in the books of
accounts considering the above development.
Report on Other Legal and Regulatory
Requirements
a. As required by the Companies'' (Auditor''s Report) Order, 2003, ("the
Order") as amended issued by the Central Government of India in terms
of Section 227 (4A) of ''The Companies'' Act, 1956, (the ''Act'') and on
the basis of such checks as we considered appropriate and according to
the information and explanations given to us, we set out in the
Annexure a statement on the matters specified in paragraphs 4 and 5 of
the said Order.
b. As required by the section 227(3) of the Act, we report that:
1. 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, except loan balance confirmations and others stated elsewhere in
our report.
2. 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.
3. The Balance Sheet, Statement of Profit and Loss and Cash Flow
Statement dealt with by this report are in agreement with the books of
accounts.
4. In our opinion, the Balance Sheet, Statement of Profit and Loss and
Cash flow statement dealt with by this report comply with the
Accounting Standards referred to in sub section (3C) of section 211 of
the Companies Act, 1956, except the compliance of Accounting Standard
15 & 22, the effect of which we are unable to determine.
5. On the basis of written representations received from the Directors
as on March 31st 2014, and taken on record by the Board of Directors,
none of the Directors are disqualified as on March 31st 2014 from being
appointed as Director in terms of clause (g) of sub section (1) of
Section 274 of the Companies Act, 1956.
6. The Company had neither provided nor paid for cess payable u/s 441A
of the Companies Act, 1956 since the aforesaid section is not yet be
made effective by the Central Government.
ANNEXURE REFERREDTO IN ''REPORT ON OTHER LEGAL AND REGULATORY
REQUIREMENTS'' OF AUDIT REPORT OF EVEN DATE ON THE ACCOUNTS OF TRANSGENE
BIOTEK LIMITED (''THE COMPANY'') FOR THE YEAR ENDED 31 ST MARCH 2014
1. (a) As per the information and explanations given to us, the Company
is in the process of updating its records showing full particulars
including quantitative details and situation of Fixed Assets.
(b) As per the information and explanations given to us, the fixed
assets have been physically verified by the management during the year.
In case of Technology item, we have been informed that certain
balancing components are yet to be received without which the
technology is incomplete for the full effective intended usage. Subject
to this, the other fixed assets have been physically verified by the
management and this revealed no material discrepancies. the Company
had carried out the physical verification of the Fixed Assets during
the year under review and we have been informed that such verification
did not reveal any material discrepancies.
(c) As per the information & explanations given to us, the Company has
not disposed off any fixed assets during the year, which will affect
the going concern status of the company.
2 (a) As per the information & explanations given to us, the inventory
has been physically verified during the year by the management at
periodical intervals. In our opinion the frequency of verification
appears to be reasonable.
(b) Based on the information & explanations to 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 present business.
(c) As per the information & explanations given to us, the Company is
maintaining records of inventory and no material discrepancies have
been noticed by the management on the physical verification done by
them.
3. (a) As per the information and explanations given to us, as 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 Act, and accordingly, the provisions of Clause 4(iii) (a) to
4 (iii)
(d) are not applicable to the Company for the current year.
(b) According to the information and explanations given to us, the
Company had taken interest free unsecured loan from three parties
listed in the register maintained under Section 301 of the Act. The
amount involved is Rs. 306.28 1249.52 Lakhs and the maximum outstanding
balance during the year was Rs. 1259.59 Lakhs.
(c) In our opinion, terms and conditions of unsecured loan taken from
the parties listed in the register maintained under Section 301 of the
Act, being interest free, are not prima facie prejudicial to the
interest of the Company.
(d) According to the information and explanations given to us, no
specific terms have been stipulated for payment of the principal amount
and interest thereon. Hence we are not in a position to make any
specific comment as to whether the company is regular in payment of the
principal amount and interest thereon.
4. Based on the information & explanations given to us, we are of the
opinion that the matters as to adequacy of the internal control
procedures regarding purchase of inventory and fixed assets and sale of
goods and services as compared to the size of the Company and nature of
its business needs to be strengthened. However, we have not come
across instances of continuing major weaknesses, apart from
strengthening the existing internal controls during the year under
review.
5. According to the information and explanation given to us and as
confirmed by the Management, there are no transactions with the parties
which need to be entered into the register maintained under Section 301
of the Act. Accordingly, the provisions of clause 4 (v) (a) & (b) are
not applicable for the year under review.
6. As the Company has not accepted any deposits from public covered by
the directives issued by the Reserve Bank of India and the provisions
of section 58A and 58AAA or any other relevant provisions of the Act,
the provisions of clause 4(vi) of the Order are not applicable to the
Company for the current year.
7. As per information and explanation given to us, the Company does not
have Internal Audit system commensurate with the size and nature of the
business.
8. According to information and explanation given to us, the Central
Government has not prescribed the maintenance of cost records under
clause (d) of sub-section (1) of section 209 of the Act, for any of the
activities of the company, and accordingly the provisions of clause
4(viii) of the order is not applicable to the Company for the current
year.
9. (a) According to the information and explanations given to us, the
Company is not regular in depositing undisputed statutory Statutory
dues of Income Tax, Service Tax and other statutory dues. The amount
of arrears of outstanding dues as on 31st March 2014, outstanding for a
period of more than six months from the date they became payable are
Income Tax Rs. 554.11 Lakhs, Fringe Benefit Tax Rs.0.58 Lakhs, Income
tax in the nature of Tax deducted at source Rs.24.16 Lakhs, Service Tax
Rs.8.37 Lakhs.
(b) As per the records and according to the information and explanation
given to us, there are no dues of Sales tax, Income Tax, Wealth Tax,
Excise duty and Cess which have not been deposited on account of any
dispute as on 31.03.2014, except a disputed claim of Customs Duty net
of amount paid under protest, as per the details given below
Nature of Dues Amount (Rs) Period Forum where
Dispute is
pending
Customs Duty demand
raised for Non-fulfilment
of Export
obligation 59.37 Lakhs 2002 CESTAT, Chennai
10. According to the information and explanation given to us and
overall examination of the financial statements of the Company, we
report that the Company does not have any accumulated losses at the end
of the current financial year. The Company had incurred cash losses
during the year as well as in the immediately preceding financial year.
11. The Company is not regular in repayment of Term loans within due
date and the account is classified as Non Performing Asset by the bank
during the year under review. Due to non- repayment as per payment
schedule of Term loan and non- application of interest on the loan
account after the account becoming NPA, and In the absence of
confirmation of the loan balance, we are not in a position to quantify
the exact arrears at the end of the year.
12. According to the information and explanation given to us, the
Company has not granted any loans and advances on the basis of security
by way of pledge of shares, debentures and other securities, the
provisions of clause 4 (xii) of the Order are not applicable to the
Company for the current year.
13. In our opinion, The Company is not a Chit Fund/Nidhi/Mutual Benefit
Fund/Society. Therefore the provisions of clause 4(xiii) of the Order
are not applicable to the Company for the current year.
14. In our opinion, as the Company is not dealing or trading in shares,
securities, debentures and other investments, the provisions of clause
4(xiv) of the Order are not applicable to the Company.
15. According to information and explanations given to us the Company
has not given any Guarantee to any banks / financial institutions
during the year under review for the loan taken by any third party, the
provisions of Clause 4 (xv) of the Order are not applicable to the
Company
16. As per information and explanations given to us, no fresh term
loans have been raised by the Company and the as per the past records
of the Company, the earlier term loans have been applied for the
purpose for which they were raised.
17. 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 purposes.
18. According to the Information and explanations given to us, the
Company had made preferential allotment of shares to one party covered
under the register maintained under Section 301 of the Act during the
year under review, which has been made at price which is not
prejudicial to the interest of the Company.
19. As the Company has not issued any debentures during the year, which
requires creation of security or charge, the provisions of clause 4
(xix) of the Order, are not applicable to the Company for the current
year.
20. According to the Information and explanations given to us and on
overall examination of the books of accounts of the company, the
Company has not raised any money by public issue during the year under
review. However, the Company had, in the preceeding year(s), have
issued Global Depository Receipts outside India and the majority
proceeds of GDRs have been utilized through wholly owned subsidiary
abroad, which is not audited by us and accordingly, we are unable to
express any opinion on the end use of moneys raised through GDRs.
Further, during the current year, the auditor who conducted the audit
in respect of overseas subsidiary also could not express his opinion
regarding the existence, valuation of the deposits and
prepayments/advances and technical know how, as stated in his audit
report.
21. During the course of examination of the books and records of the
Company carried out in accordance with the generally accepted auditing
practices in India, and as per the representation given by the Company
and relied on by us, we have neither come across any instance material
fraud on or by the Company, noticed or reported during the year, nor
have we been informed of such cases by the management. Attention is
bought to the fact that after the end of the financial year and before
the issue of our Audit Report, SEBI had passed an order against the
Company as well as promoters/directors wherein it has alleged that
there is a prima facie case of acts, omissions and concealment by the
Company and its promoters/Directors which amount to ''Fraud'' within the
meaning of regulation 2(1 )(c ) of the SEBI (Prohibition of Fraudulent
and UnfairTrade Practices relating to Securities Market) Regulations
2003. SEBI further stated that the Company and the promoters/directors
have violated the provisions of Regulations 3(a), (c) and (d), read
with regulation 4(1) and 4 (2)(f) of the above regulations as well as
Section 12A(b) and (c ) of SEBI Act, 1992. Accordingly, we are unable
to quantify the impact of the above Order in financial terms and
further unable to state whether this affects the going concern of the
Company.
For Sarath & Associates
Chartered Accountants
Firm Regd. No. 005120S
Sd/-
PLACE: HYDERABAD P. Sarath Kumar
DATE: 06.12.2014 Partner
(M. No. 021755)
Mar 31, 2011
1. We have audited the attached Balance Sheet of TRANSGENE BIOTEK
LIMITED ("the Company") as at 31 st March 2011, the Profit and Loss
Account and also the Cash Flow Statement for the year ended on that
date annexed thereto, which we have signed under reference to this
report.
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 bur audit in accordance with the auditing standards
generally accepted in India. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basts for
our opinion.
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("Act") and on the basis of such
checks as we considered appropriate and according to the information
and explanations given to us, we set out 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 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 comply with the Accounting
Standards referred to in Sub-section (3C) of Section 211 of the
Companies Act, 1956, to the extent applicable;
e. The Company has neither paid nor provided for the Cess payable
under section 441A of the Companies Act,1956 since the aforesaid
section is not yet been made effective by the Central Government of
India;
f. 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 31 st 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;
g. In our opinion and to the best of our information and according to
the explanations given to us, the said accounts together with the notes
thereon give the information required by the Companies Act,1956, in the
manner so required and give a true and fair view in conformity with the
accounting - principles generally acxepted in India:
i. in the case of the Balance Sheet, of the state of affairs of the
Company as at 31 st March, 2011;
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 Cash Flow Statement, of the cash flow for the year
ended on that date.
ANNEXURE REFERRED TO IN PARAGRAPH- 3 OF AUDIT REPORT OF EVEN DATE ON
THE ACCOUNTS OF TRANSGENE BIOTEK LIMITED FOR THE YEAR ENDED 31 ST
March, 2011.
I a The Company is in the process of updating its records showing full
particulars including quantitative details and situation of Fixed
Assets.
b As informed to us, the Company had carried out the physical
verification of Fixed Assets during the year under review and such
verification did not reveal any material discrepancies.
c The Company has not disposed off any fixed assets during the year,
which will affect the going concern status of the Company.
II a As explained to us, inventories have been physically verified at
reasonable intervals during the year by the management.
b The procedures of physical verification of inventory followed by the
management are reasonable and adequate in relation to the size of the
Company and nature of its business.
c As informed to us, no material discrepancies were noticed on such
verification of inventories as compared to book records.
III a As per the information and explanations given to us, as 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, the Provisions of Clause 4(iii) (a) to
4 (iii) (d) are not applicable to the Company for the current year.
b The Company has taken interest free unsecured loan from one party
listed in the register maintained under Section 301 of the Act,
amounting to Rs. 10,05,41,788/- and the maximum amount involved during
the year Rs. 10,92,10,470/-.
c In our opinion, the rate of interest and other terms and conditions
of unsecured loan taken from the party listed in the register
maintained under Section 301 of the Act, are not prima facie
prejudicial to the interest of the Company.
d The Company is regular in repayment, where applicable, of principal
amount of loan taken from the party listed in the register maintained
under Section 301 of the Companies Act, 1956.
IV In our opinion, the adequacy of internal control systems for the
purchase of inventory and fixed assets and for the sale of goods and
services as compared to the size of the Company and the nature of its
business needs to be strengthened. However, we have not come across any
continuing major weakness in the overall internal control system
existed in the Company during the current year.
V a According to the information and explanations given to us and as
confirmed by the Managing Director of the Company, the transactions of
the Company which need to be entered into the register maintained under
Section 301 of the Act, have been entered.
b In our opinion and according to the information and explanations
given to us, there are no transactions made in pursuance of contracts
or arrangements entered in the register maintained under section 301 of
the Act and exceeding the value of Rs.5,00,000/- in respect of each
party during the year.
VI As the Company has not accepted any deposits from public covered by
the directives issued by the Reserve Bank of India and the provisions
of Section 58A and 58AA or any other relevant provisions of the Act and
rules framed there under, the provisions of Clause 4(vi) of the Order
are not applicable to the Company for the current year.
VII In our opinion, the Company does not have an internal audit system
commensurate with its size and nature of its business.
VIII According to information and -explanation given to us, the
maintenance of cost records has not been prescribed by the Central
Government under Clause (d) of Sub- section (1) of Section 209 of the
Act.
IX a As per the information and explanations give to us, the Company is
generally regular in depositing undisputed statutory dues of Provident
fund, Investor Education Fund, Employee State Insurance, Sales Tax,
Wealth Tax, Customs Duty, Excise Duty, Cess and any other statutory
dues with the appropriate authorities and in respect of these dues
there are no dues outstanding for a period of more than six months from
the date they became payable;
The Company is not regular in depositing the undisputed statutory dues
of Income Tax and Service Tax and the arrears of outstanding dues as on
31st March,2011 outstanding for a period of more than six months from
the date they became payable are Income Tax is Rs. 7,37,373/-, Income
Tax in the nature of Tax Deducted at Source is Rs. 12,50,285/'- and
Service Tax is Rs. 9,08,750/-;
b As per the records and according to the information and explanations
given to us, there are no dues of Sales Tax, Income Tax, Wealth Tax,
Excise Duty and Cess which have not been deposited on account of any
dispute as on 31.03.2011, except a disputed claim of Custom Duty net of
amount paid under protest, as per the details given below:
NATURE OF DUES AMOUNT PERIOD FORUM WHERE
RS DISPUTE IS PENDING
Customs Duty Demand
raised by the CESTAT,
Chennai for non- 59.37 Lakhs 2002 CESTAT, Chennai
fulfillment of export
obligation
X As per the information and explanation given to us and on overall
examination of the financial statements of the Company, we report that
the Company does not have any accumulated losses at the end of the
Current financial year nor incurred cash losses in the current and
immediately preceding financial year.
XI The Company is not regular in repayment of term loans with in the
- due date, however there are no outstanding arrears at the end of the
year.
XII As the Company had not granted any loans and advances on the basis
of security by way of pledge of shares, debentures or other securities
to anybody during the year, the provisions of Clause 4(xii) of the
Order are not applicable to the Company for the current year.
XIII As the Company is not a Chit Fund or a Nidhi or Mutual Fund or
Society, the provisions of Clause 4(xiii) of the Order are not
applicable to the Company for the current year.
XIV As the Company is not dealing or trading in shares, securities,
debentures and other investments, the provisions of Clause 4(xiv) of
the order are not applicable to the Company for the current year.
XV As the Company has not given any guarantee for loans taken by others
from banks or financial institutions, the provision of Clause 4(xv) of
the Order are not applicable to the Company for the current year.
XVI As per records of the Company, the term loans have been applied 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, we report
that no funds raised on short term basis have been used for long-term
investment purposes.
XVIII According to the information and explanations given to us and on
overall examination of the balance sheet of the Company, as the Company
has not made any preferential allotment of shares to parties and
Companies covered in the register maintained under Section 301 of the
Act during the year, the provisions of Clause 4(xviii) of the Order are
not applicable to the Company for the current year.
XIX As the Company has not issued any debentures during the year, which
requires creation of security or charge, the provisions of Clause
4(xix) of the Order, are not applicable to the Company for the current
year.
XX According to the information and explanations given to us and on
overall examination of the books of accounts of the Company, the
Company has disclosed the end use of money raised by issue of Global
Depositary Receipts in the Note No: 3 of Schedule XX - Notes to
Accounts.
XXI 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 as per the representation given by the
Company and relied on by us, we have neither come across any instance
of material fraud on or by the Company, noticed or reported during the
year, nor have we informed of such cases
For SARATH & ASSOCIATES,
Firm Regn.No.005120S
Chartered Accountants
P. Sarath Kumar
Place : Hyderabad Partner
Date : 05.09.2011 Membership No: 021755
Mar 31, 2010
1. We have audited the attached Balance Sheet of TRANSGENE BIOTEK
LIMITED (the Company") as at 31st March, 2010, the Profit and Loss
Account and also the Cash Flow Statement for the year ended on that
date annexed thereto, which we have signed under reference to this
report. 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 have 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 whether the financial
statements are free of material misstatements. 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 statements.
We believe that our audit provides a reasonable basis for our opinion.
3. As required by the Companies (Auditors Report) Order, 2003, (the
Order) issued by the Central Government of India in terms of section
227 (4A) of The Companies Act, 1956, (the Act) and on the basis of
such checks as we considered appropriate and according to the
information and explanations given to us, we set out in the Annexure a
statement on the matters specified in paragraph 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 comply with the Accounting
Standards referred to in Section 211 (3C) of the Act, to the extent
applicable.
(e) 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 is disqualified as on 31 st March,
2010 from being appointed as a director in terms of clause (g) of
sub-section (1) of section 274 of the Act.
(f) In our opinion, and to the best of our information and according to
the explanations given to us, the said accounts read in conjunction
with the notes thereon 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:
(i) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31 st March, 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 flow for the
year ended on that date.
Annexure to the Auditors Report
ANNEXURE REFERRED TO IN PARAGRAPH 3 OF AUDIT REPORT OF EVEN DATE ON THE
ACCOUNTS OF TRANSGENE BIOTEK LIMITED (THE COMPANY) FOR THE YEAR ENDED
31ST MARCH, 2010
1.(a) The Company is in the process of updating its records showing full
particulars including quantitative details and situation of Fixed Assets.
(b) As informed to us, the Company had carried out the physical
verification of Fixed Assets during the year under review and such
verification did not reveal any material discrepancies.
(c) The Company has not disposed off any fixed assets during the year,
which will affect the going concern status of the Company.
2.(a) As per the information and explanations given to us, the inventory
has been physically verified during the year by the management at
periodical intervals. In our opinion the frequency of verification
appears to be reasonable.
(b) As per 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 present business.
(c) As informed to us, no material discrepancies were noticed on such
verification of inventories as compared to book records.
3.(a) As per the information and explanations given to us, as 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 Act, the provisions of Clause 4(iii)(a) to 4(iii)(d) are not
applicable to the Company for the current year.
(b) The Company, during the year, has taken unsecured loan from one
party listed in the register maintained under Section 301 of the Act,
amounting to Rs. Rs. 3,46,71,553/- and the maximum amount outstanding
at the end of the year is Rs,10,58,44,469/-
(c) In our opinion, the rate of interest and other terms and conditions
of unsecured loan taken from the party listed in the register
maintained under Section 301 of the Act, are not prima facie prejudicial
to the interest of the Company.
(d) The Company is regular in repayment, where applicable, of principal
amount and interest on unsecured loan taken from the party listed in
the register maintained under Section 301 of the Act.
4. In our opinion, the adequacy of internal control systems for the
purchase of inventory and fixed assets and for the sale of goods and
services as compared to the size of the Company and the nature of its
business needs to be strengthened. However, we have not come across
any continuing major weaknesses in the overall internal control system
existed in the Company during the current year.
5.(a) According to the information and explanations given to us and
as confirmed by the Managing Director of the Company, the transactions
of the company which need to be entered into the register maintained under
Section 301 of the Act, have been entered in the register maintained
Under Section 301 of the Ac.
(b) According to the information and explanations given to us, there
were no transactions made in pursuance of such contracts or arrangement
during the year.
6. As the Company has not accepted any deposits from public covered by
the directives issued by the Reserve Bank of India and the provisions
of Section 58A,58AA or any other relevant provisions Act, the
provisions of clause 4(vi) of the Order are not applicable to the
Company for the current year.
7.In our opinion, the Company does not have an internal audit system
commensurate with its size and nature of its business.
8.According to information and explanation given to us, the
maintenance of cost records has not been prescribed by the Central
Government under clause (d) of sub-section (1) of section 209 of the
Act.
9. (a) According to the information and explanations given to us, the
Company is not regular in depositing undisputed statutory dues
including provident fund, Employees State Insurance, Income Tax, Cess,
Excise Duty and other appropriate statutory dues with the appropriate
authorities. The amount of the arrears of outstanding statutory dues as
at the last day of the financial year concerned for more than six
months from the date they became payable pertaining to Income Tax
Deducted At Source is Rs. 12.96 lakhs and Income Tax is Rs.16.87 lakhs.
(b) As per the records and according to the information and
explanations given to us, there are no dues of Sales Tax / Income Tax /
Wealth Tax / Excise Duty / Cess which have not been deposited on
account of any dispute as on 31.03.2010, except a disputed claim of
Custom Duty as per the details given below:
Name of
the Statue Nature of Dues Amount Rs. Period Forum where
pending
Customs
Act, 1962 Customs Duty Demand
raised by the CESTAT,
Chennai for
non-fulfillment
of export obligation 59.37 Lakhs 2002 CESTAT, Chennai
10. As per the information and explanation given to us and on overall
examination of the financial statements of the Company, we report that
the Company does not have any accumulated losses at the end of the
current financial year nor incurred cash losses in the current and
immediately preceding financial yea .
11. As the Company has neither availed any loan from any financial
institution or from any bank, nor issued any debentures, the provisions
of Clause 4(xi) of the Order are not applicable to the Company for the
current year.
12. As the Company has not granted any loans and advances on the basis
of security by way of pledge of shares, debentures and other
securities, the provisions of Clause 4(xii) of the Order are not
applicable to the Company for the current year.
13. In our opinion, as the company is not a chit fund, nidhi or a
mutual benefit fund/ society, the provisions of Clause 4(xiii) of the
Order are not applicable to the company for the current year.
14. In our opinion, as the company is not dealing in or trading in
shares, securities, debentures and other investments, the provisions of
Clause 4 (xiv) of the Order are not applicable to the company.
15. As per the information and explanations given to us, as the
company has not given any guarantees for loans taken by others from
bank or financial institution, the provisions of Clause 4(xv) of the
Order are not applicable to the Company for the current year.
16. As the company has not raised any term loans during the current
year, the provisions of Clause 4 (xvi) of the Order are not applicable
to the company for the current year.
17. 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 purposes*.
18. According to the information and explanations given to us and on
overall examination of the balance sheet of the company, as the Company
has not made any preferential allotment of shares to parties and
companies covered in the register maintained under section 301 of the
Act during the year, the provisions of Clause 4(xviii) of the Order are
not applicable to the Company for the current year..
19. As the Company has not issued any debentures during the year,
which requires creation of security or charge, the provisions of Clause
4(xix) of the Order, are not applicable to the Company for the current
year.
20. According to the information and explanations given us and on an
overall examination of the books of accounts of the Company, the
Company has not raised any money by public issue during the year under
review.
21. During the course of examination of the books and records of the
Company carried out in accordance with the generally accepted auditing
practices in India, and as per the representation given by the Company
and relied on by us, we have neither come across any instance material
fraud on or by the Company, noticed or reported during the year, nor
have we been informed of such cases by the management.
For/Sarath & Associates
Firm Registration NO.005120S
Chartered Accountants
Sd/-
P.Sarath Kumar
Place : Hyderabad Partner
Date : 04.09.2010 (M.No.21 755)