Mar 31, 2018
Report on the Standalone Ind AS Financial Statements
We have audited the accompanying standalone Ind AS financial statements of TVS Electronics Limited (âthe Companyâ), which comprise the Balance Sheet as at 31st March, 2018, and the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of the significant accounting policies and other explanatory information.
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 including other comprehensive income, cash flows and changes in equity of the Company in accordance with the Indian Accounting Standards (Ind AS) prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, and other accounting principles generally accepted in India.
This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditorâs Responsibility
Our responsibility is to express an opinion on these standalone Ind AS financial statements based on our audit.
In conducting 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 and the Order issued under section 143(11) of the Act.
We conducted our audit of the standalone Ind AS financial statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone Ind AS financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditorâs 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 Companyâs 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 Companyâs Directors, as well as evaluating the overall presentation of the standalone Ind AS financial statements.
We believe that the audit evidence obtained by us and other auditors in terms of their report referred to in the Other Matters paragraph below, is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us,and based on the consideration of the report of the other auditor on separate financial statements/ financial information of an erstwhile subsidiary company, Prime Property Holdings Limited, (refer note 32) to the Ind AS financial statements which describes the merger of Prime Property Holdings Limited with the Company) referred to in the Other Matters paragraph below, 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 Ind AS and other accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2018, and its profit, total comprehensive income, its cash flows and the changes in equity for the year ended on that date.
Other Matters
a) We did not audit the financial statements/ financial information of an erstwhile subsidiary company whose financial statements/financial information reflect total assets of Rs. 804 Lakhs as at 31st March, 2018 and total revenues of Rs. Nil for the year ended on that date, as considered in the standalone Ind AS financial statements. The financial statements/ financialinformation of erstwhile subsidiary company have been audited by other auditors whose report has been furnished to us, and our opinion in so far as it relates to the amounts and disclosures included in respect of this erstwhile subsidiary company, is based solely on the report of theother auditors.
Our opinion on the standalone financial statements and our report on Other Legal and Regulatory Requirements below is not modified in respect of this matter.
b) The comparative financial information of the Company for the year ended 31st March 2017 and the transition date opening balance sheet as at 1st April 2016 included in these standalone Ind AS financial statements, are based on the statutory financial statements prepared in accordance with the Companies (Accounting Standards) Rules, 2006 audited by the predecessor auditor whose report for the years ended 31st March 2017 and 31st March 2016 dated 12th May 2017 and 4th May 2016, respectively, expressed a modified opinion on those standalone financial statements. The modification for the year ended 31st March, 2017 relates to remuneration of Rs. 1.50 Lakhs paid to the Managing Director in excess of the amount approved by the Central Government and provisions of Section 197 of the Companies Act, 2013 read with Schedule V of the Act. The modification for the year ended 31st March, 2016 relates to an unsecured loan of Rs. 150 Lakhs granted to a wholly owned subsidiary, which had no principal business activity.The said financial statements have been restated to comply with Ind AS. Adjustments made to the previously issued said financial information prepared in accordance with the Companies (Accounting Standards) Rules, 2006 to comply with Ind AS have been audited by us.
c) The comparative financial information of the aforesaid erstwhile subsidiary company for the year ended 31st March 2017 and the transition date opening balance sheet as at 1st April 2016 prepared in accordance with Ind AS included in these Standalone Ind AS financial statements have been audited by the other auditor.
Our opinion on the standalone Ind AS financial statements is not modified in respect of these matters.
Report on Other Legal and Regulatory Requirements
1. As required by Section 143(3) of the Act, based on our audit and on the consideration of the reports of the auditors of the erstwhile subsidiary company referred to in the Other Matters paragraph above 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 purposes of our audit.
b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
c) The Balance Sheet, the Statement of Profit and Loss including 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 Indian Accounting Standards prescribed under section 133 of the Act.
e) Because of the written representations received from the directors of the Company as on 31st March, 2018 taken on record by the Board of Directors none of the directors is disqualified as on 31st March, 2018 from being appointed as a director in terms of Section 164(2) of the Act.
f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and its aforesaid erstwhile subsidiary company which is a company incorporated in India and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Aâ. Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Companyâs internal financial controls over financial reporting.
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, as amended, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its standalone Ind AS financial statements
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.
iii. There are no amounts that are required to be transferred to the Investor Education and Protection Fund by the Company.
2. As required by the Companies (Auditorâs Report) Order, 2016 (âthe Orderâ) issued by the Central Government in terms of Section 143(11) of the Act, we give in âAnnexure Bâ a statement on the matters specified in paragraphs 3 and 4 of the Order.
Report on the Internal Financial Controls Over Financial Reporting 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 TVS Electronics Limited (âthe Companyâ) as of 31st March, 2018and its erstwhile subsidiary company - Prime Property Holdings Limitedwhich got merged with the Company with the appointed date of 1st April 2016,in conjunction with our audit of the standalone Ind AS 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 the 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.
Auditorâs Responsibility
Our responsibility is to express an opinion on the Companyâs internal financial controls over financial reporting of the Company 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) issued by the Institute of Chartered Accountants of India and the Standards on Auditing prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material 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 judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained and the audit evidence obtained by the auditors of erstwhile subsidiary company - Prime Property Holdings Limited in terms of their report referred to in the Other Matters paragraph below, 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 authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the 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, to the best of our information and according to the explanations given to us and based on the consideration of the report of the auditorof the aforesaid erstwhile subsidiary company referred to in the Other Matters paragraph below, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31st March, 2018, based on the criteria for internal financial control over financial reporting 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.
Other Matters
Our aforesaid report under Section 143(3)(i) of the Act on the adequacy and operating effectiveness of the internal financial controls over financial reporting insofar as it relates to aforesaid erstwhile subsidiary company, a Company incorporated in India, is based on the corresponding report of the auditors of the erstwhile subsidiary company.
Our opinion is not modified in respect of this matter.
Our reporting on the Order includes that relating to erstwhile subsidiary company- Prime Property Holdings Limited, a Company incorporated in India, which got merged with the Company with the appointed date of 1st April 2016, and which has been audited by other auditor and our report in respect of this entity is based solely on the report of the said auditor, to the extent considered applicable for reporting under the Order in case of the standalone financial statements.
(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of the property plant and equipment.
(b) Some of the property plant and equipment were physically verified during the year by the Management in accordance with a programme of verification, which in our opinion provides for physical verification of all the property plant and equipment at reasonable intervals. According to the information and explanations given to us, no material discrepancies were noticed on such verification.
(c) Immovable properties of Land and buildings whose title deeds have been pledged with banks as security for term loans are held in the name of the Company based on the Mortgage deed executed between the bank and the Company for which confirmations have been obtained from the bankers.
(ii) As explained to us, the inventories were physically verified during the year by the management at reasonable intervals and no material discrepancies were noticed on physical verification.
(iii) The Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under Section 189 of the Companies Act, 2013.
(iv) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Sections 185 and 186 of the Companies Act, 2013 in respect of grant of loans, making investments and providing guarantees and securities, as applicable.
(v) According to the information and explanations given to us, the Company has not accepted any deposit during the year.
(vi) The maintenance of cost records has been specified by the Central Government under section 148(1) of the Companies Act, 2013 in respect of machinery and mechanical appliances. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Records and Audit) Rules, 2014, as amended prescribed by the Central Government under sub- section(1) of Section 148 of the Companies Act, 2013 and are of the opinion that prima facie, the prescribed cost records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.
(vii) According to the information and explanations given to us, in respect of statutory dues:
(a) The Company has generally been regular in depositing undisputed statutory dues, including Provident Fund, Employeesâ State Insurance, Income-tax, Sales Tax, Service Tax,Goods and Service Tax, Customs Duty, Excise Duty, Value Added Tax, Cess and other material statutory dues applicable to it with the appropriate authorities.
(b) There were no undisputed amounts payable in respect of Provident Fund, ,Employeesâ State Insurance, Income-tax, Sales Tax, Service Tax, Goods and Service Tax, Customs Duty, Excise Duty, Value Added Tax, cess and other material statutory dues in arrears as at 31 st March 2018 for a period of more than six months from the date they became payable.
(c) Details of dues of Income-tax, Excise Duty and Provident Fundwhich have not been deposited as on 31st March 2018 on account of disputes are given below:
Name of Statue |
Nature of Dues |
Forum where Dispute is Pending |
Period to which amount relates |
Amount Unpaid (Rs. in Lakhs) |
Income Tax Act, 1961 |
Income Tax dues |
Income Tax Appellate Tribunal, Income Tax officer |
A.Y 2005-06 to 2018-19 |
47 (net of Rs. 50 deposited) |
Central Excise Act, 1944 |
Excise Duty |
Customs, Excise and Service Tax Apellate Tribunal, Chennai |
2005-06 |
13 |
Central Sales Tax/Value added tax of various states |
Sales tax dues |
Apellate authorities of various states |
2003-04 to 2014-15 |
49 (Net of Rs. 4 deposited) |
(viii) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of loans to banks. The Company has not issued any debentures.
(ix) The Company has not raised moneys by way of initial public offer or further public offer (including debt instruments) or term loans and hence reporting under clause (ix) of the CARO 2016 order is not applicable.
(x) To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company or no material fraud on the Company by its officers or employees has been noticed or reported during the year.
(xi) In our opinion and according to the information and explanations given to us, the Company has not provided / paid any managerial remuneration during the year. Hence the provisions of section 197 read with Schedule V to the Companies Act, 2013 is not applicable.
(xii) The Company is not a Nidhi Company and hence reporting under clause (xii) of the CARO 2016 order is not applicable.
(xiii) In our opinion and according to the information and explanations given to us the company is in compliance with Section 177 and 188 of the Companies Act, 2013, where applicable, for all transactions with the related parties and the details of related party transactions have been disclosed in the Ind AS financial statements as required by the applicable accounting standards.
(xiv) During the year, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures and hence reporting under clause (xiv) of CARO 2016, is not applicable to the Company.
(xv) In our opinion and according to the information and explanations given to us, during the year the Company has not entered into any non-cash transactions with its directors/ directors of holding, subsidiary company or persons connected with them and hence provisions of section 192 of the Companies Act, 2013 are not applicable.
(xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.
For Deloitte Haskins & Sells
Chartered Accountants
Firm Registration No: 008072S
Bhavani Balasubramanian
Place : Chennai Partner
Date : May 11, 2018 Membership No: 22156
Mar 31, 2017
Independent Auditorsâ Report
To the Members of,
TVS Electronics Limited,
Chennai.
Report on the Standalone Financial Statements
We have audited the accompanying standalone financial statements of TVS Electronics Limited, Chennai -600 006 (âthe companyâ), which comprise the Balance Sheet as at 31st March 2017, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended and a summary of the significant accounting policies and other explanatory information.
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 the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditorâs 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 there under.
We conducted our audit in accordance with the Standards on Auditing specified under section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditorâs 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 Companyâs preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances.
An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Companyâs 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 qualified audit opinion on the standalone financial statements.
Basis for Qualified Opinion
The company has paid a sum of Rs. 1.50 lakhs as remuneration to the then Managing Director, in excess of the amount approved by the Central Government and provisions of section 197 of the Companies Act, 2013 read with schedule V. The Company is taking steps to seek, from the Central Government, waiver of recovery of excess paid.
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 paragraph above, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India;
a) of the state of affairs of the Company as at 31st March 2017;
b) its Profit for the year ended on that date; and
c) its cash flows for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditorâs Report) Order, 2016 (âthe Orderâ), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure-1, a statement on the matters specified in the paragraphs 3 and 4 of the Order.
As required by section 143(3) of the Act, we report that:
a. We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
b. In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
c. The Balance Sheet, the Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account.
d. In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
e. The matter described in the Basis for Qualified Opinion paragraph above, in our opinion, may not have an adverse effect on the functioning of the Company.
f. On the basis of the written representations received from the directors as on 31st March, 2017 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2017 from being appointed as a director in terms of Section 164(2) of the Act.
g. 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-2â.
h. With respect to the other matters to be included in the Auditorâs Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer note no. 26(5) to the financial statements.
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.
iii. There is no amount, required to be transferred, to the Investor Education and Protection Fund by the Company during the year.
iv. The company has provided requisite disclosures in the financial statements as to holdings as well as dealings in Specified Bank Notes during the period from 08th November 2016 to 30th December 2016. Based on audit procedures and relying on management representation we report that the disclosures are in accordance with the books of accounts maintained by the company and as produced to us by the management. Refer note no. 26(12) to the financial statements.
1. (a) The company is maintaining proper records
Annexure-1 referred to in our report under âReport on Other Legal and Regulatory Requirements Para 1â of even date on the accounts for the year ended 31st March 2017. showing full particulars, including quantitative details and situation of fixed assets;
(b) Fixed assets are verified physically by the management in accordance with a regular programme at reasonable intervals. Discrepancies noticed on such verification have been properly dealt with in the books of accounts.
(c) The title deeds of immovable properties are in the custody of companyâs banker who has certified for the same.
2. The inventory has been physically verified at reasonable intervals during the year by the management. It was represented to us that inventory with third party is also verified from time to time. The discrepancies between the physical stocks and the books were not material and have been properly dealt with in the books of account.
3. During the year, the company has not granted any loan to a company, firm, Limited Liability Partnerships or other parties covered in the register maintained under Section 189 of the Companies Act, 2013.
4. During the year, the company has not granted any loan nor has furnished any guarantee nor provided any security. Hence reporting on whether there is compliance with provisions of section 185 of the Companies Act, 2013 does not arise.
The loan granted to the wholly owned subsidiary company last year is yet to be received from the loaned company.
There are no fresh loans granted or investments made by the company during the year. Hence reporting under section 186 of the Act does not arise.
5. The company has not accepted any deposit within the meaning of sections 73 to 76 of the Companies Act, 2013, during the year.
6. We have broadly reviewed the books of account maintained by the company under sub-section (1) of Section 148 of the Companies Act, 2013, read with rules made by the Central Government for maintenance of cost records and are of the opinion that prima-facie, the prescribed accounts and records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.
7. (a) According to the records provided to us, the company is generally regular in depositing undisputed statutory dues including Provident Fund, Employeesâ State Insurance, Income Tax, Sales Tax, Service Tax, Duty of Customs, Duty of Excise, Value Added Tax, Cess and other statutory dues to the appropriate authorities. However we have observed a few instances of belated remittance of Service Tax, Employeesâ State Insurance, profession Tax and Tax Deducted at Source, into the Government.
(b) According to the information and explanations given to us, no undisputed amounts payable in respect of Income Tax, Sales Tax, Service Tax, Customs Duty, Excise Duty, Value Added Tax and Cess were in arrears, as at 31st March 2017 for a period of more than six months from the date they became payable.
(c) According to information and explanations given to us, the following are the details of the disputed dues that were not deposited with the concerned authorities:
8. Based on our verification and according to the information and explanations given by the management, the company has not defaulted in repayment of dues to its banks. The company has not borrowed from any financial institution and Government nor has issued any debenture.
Name of the statute |
Nature of dues |
Amount ('' In Lakhs) |
Forum where the dispute is pending |
Income Tax Act, 1961 |
Income Tax |
41.07 |
Income Tax Appellate Tribunal, Chennai |
Tax deducted at source and interest thereon |
5.39 |
Assessing Officer |
|
Central Excise Act, 1944 |
Excise Duty |
13.23 |
Customs Excise and Service Tax Appellate Tribunal, Chennai. |
Sales Tax - Central Sales Tax / Value Added Tax of various states. |
Sales tax |
55.40 |
Departmental Authorities of various states |
1.96 |
Honourable High Court of Kerala. |
||
Employeesâ Provident Funds and Miscellaneous Provisions Act, 1952. |
Provident Fund |
55.86 |
Honourable High Court of Judicature at Madras |
9. (a) The company has not raised any money by way of initial public offer or further public offer (including debt instruments) during the year. Hence reporting on utilization of such money does not arise.
(b) The company has not availed any term loan during the year. The term loan availed in earlier year was applied for the purpose for which they were availed.
10. Based on the audit procedures adopted and information and explanations given to us by the management, no fraud by the company has been noticed or reported during the course of our audit.
11. Based on our verification, we observe that the company has paid a sum of Rs. 1.50 lakhs as remuneration, in excess of the amount approved by the Central Government and provisions of section 197 of the Companies Act, 2013 read with Schedule V. The Company is taking steps to seek, from the Central Government, waiver of recovery of excess paid.
12. The Company is not a Nidhi company and as such this clause of the Order is not applicable.
13. (a) In our opinion and according to the information and explanations given to us, all transactions with the related parties are in compliance with sections 177 and 188 of the Companies Act, 2013.
(b) The details of transactions during the year have been disclosed in the Financial Statements as required by the applicable accounting standards. Refer note no. - 26(8) to the financial statements.
14. During the year, the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures under section 42 of the Companies Act, 2013. However, the company has allotted 60,000 numbers of equity shares under ESOP to the then Managing Director.
15. In our opinion and according to the information and explanations given to us, the company has not entered into any non-cash transactions with directors or persons connected with them except for Rs. 1.70 lakhs being the difference between the grant price and market price, debited to Statement of Profit and Loss, pertaining to grant of 60,000 numbers of equity shares to the then Managing Director under ESOP.
16. The company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.
For Sundaram & Srinivasan
Chartered Accountants
Firm Registration No: 004207S
M BALASUBRAMANIYAM
Place : Chennai Partner
Date : May 12, 2017 Membership No: F7945
Notes to Accounts
Mar 31, 2016
To the Members of,
TVS Electronics Limited,
Chennai.
Report on the Standalone Financial Statements
We have audited the accompanying standalone financial statements of TVS Electronics Limited, Chennai - 600 006 (âthe companyâ), which comprise the Balance Sheet as at 31st March 2016, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended and a summary of the significant accounting policies and other explanatory information.
Managementâs 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 (âthe Actâ) with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditorâs 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 there under.
We conducted our audit in accordance with the Standards on Auditing specified under section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances.
An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified audit opinion on the standalone financial statements.
Basis for Qualified Opinion
The company has granted an unsecured loan of Rs. 150 lakhs to its wholly owned subsidiary which has no âprincipal businessâ activity. It was represented to us that the loan was granted to subsidiary company to enable it to pursue investment activities and to pay advance income tax.
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 paragraph above, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India;
a) of the state of affairs of the Company as at 31st March 2016;
b) its Profit for the year ended on that date; and
c) its cash flows for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2016 (âthe Orderâ), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure-1, a statement on the matters specified in the paragraphs 3 and 4 of the Order.
As required by section 143(3) of the Act, we report that:
a. We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
b. In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
c. The Balance Sheet, the Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account.
d. In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
e. The matter described in the Basis for Qualified Opinion paragraph above, in our opinion, may not have an adverse effect on the functioning of the Company.
f. On the basis of the written representations received from the directors as on 31st March,
2016 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2016 from being appointed as a director in terms of Section 164(2) of the Act.
g. 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-2â.
h. With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note no. 26(5) to the financial statements.
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
1. (a) The company is maintaining proper records
Annexure-1 referred to in our report under âReport on Other Legal and Regulatory Requirements Para 1â of even date on the accounts for the year ended 31st March 2016.
showing full particulars, including quantitative details and situation of fixed assets;
(b) Fixed assets are verified physically by the management in accordance with a regular programme at reasonable intervals. Discrepancies noticed on such verification have been properly dealt with in the books of account.
(c) The title deeds of immovable properties are in the custody of company''s banker who has certified for the same.
2. The inventory has been physically verified at reasonable intervals during the year by the management. It was represented to us that inventory with third party is also verified from time to time.
3. During the year, the company has granted an unsecured loan of Rs. 150 lakhs to its wholly owned subsidiary company, viz., Prime Property Holdings Limited, Chennai, which is covered in the register maintained under section 189 of the Companies Act, 2013 on 31st March 2016, on an interest of 12.15% per annum. The payment of principal together with interest been stipulated to be on or before March 31, 2017.
The rate of interest charged and other terms of loan are not prejudicial to the company''s interest.
4. The company has granted an unsecured loan of Rs. 150 lakhs to its wholly owned subsidiary which has no âprincipal businessâ activity. It was represented to us that the loan was granted to subsidiary company to enable it to pursue investment activities and to pay advance income tax.
The company has complied with the provisions of Section 186 of the Act.
5. The company has not accepted any deposit within the meaning of sections 73 to 76 of the Companies Act, 2013, during the year.
6. We have broadly reviewed the books of account maintained by the company under sub-section (1) of Section 148 of the Companies Act, 2013, read with rules made by the Central Government for maintenance of cost records and are of the opinion that prima-facie, the prescribed accounts and records have been made and maintained.
7. (a) According to the records provided to us, the company is generally regular in depositing undisputed statutory dues including Provident Fund, Employees'' State Insurance, Income Tax, Sales Tax, Service Tax, Duty of Customs, Duty of Excise, Value Added Tax, Cess and other statutory dues to the appropriate authorities. However we have observed a few instances of belated remittance of Service Tax and Tax Deducted at Source, into the Government.
(b) According to the information and explanations given to us, no undisputed amounts payable in respect of Income Tax, Sales Tax, Service Tax, Customs Duty, Excise Duty, Value Added Tax and Cess were in arrears, as at 31st March 2016 for a period of more than six months from the date they became payable.
(c) According to information and explanations given to us, the following are the details of the disputed dues that were not deposited with the concerned authorities:
8. Based on our verification and according to the information and explanations given by the management, the company has not defaulted in repayment of dues to its banks. The company has not borrowed from any financial institution and Government nor has issued any debenture.
Name of the statute |
Nature of dues |
Amount (Rs. In Lakhs) |
Forum where the dispute is pending |
Income Tax Act, 1961 |
Income Tax |
261.80 |
Commissioner of Income Tax (Appeals), Chennai |
Tax deducted at source and interest thereon |
14.96 |
Assessing Officer |
|
Central Excise Act, 1944 |
Excise Duty |
13.23 |
Customs Excise and Service Tax Appellate Tribunal, Chennai. |
Sales Tax - Central Sales Tax / Value Added Tax of various states. |
Sales tax |
55.40 |
Departmental Authorities of various states |
1.96 |
Honourable High Court of Kerala. |
9. (a) The company has not raised any money by way of initial public offer or further public offer (including debt instruments) during the year. Hence reporting on utilization of such money does not arise.
(b) The company has applied the term loans availed for the purpose for which they were availed
10. Based on the audit procedures adopted and information and explanations given to us by the management, no fraud by the company has been noticed or reported during the course of our audit.
However, we were informed that amount of Rs. 56.50 lakhs worth of mobile sets were stolen from one service centre and defalcation of Rs. 5.44 lakhs in some centres. These have been charged off in the Statement of Profit and Loss.
11. In our opinion and according to the information and explanations given to us, managerial remuneration has been paid and provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act, 2013 (including approval by the Central Government).
12. The Company is not a Nidhi company and as such this clause of the Order is not applicable.
13. (a) In our opinion and according to the information and explanations given to us, all transactions with the related parties are in compliance with sections 177 and 188 of the Companies Act, 2013.
(b) The details of transactions during the year have been disclosed in the Financial Statements as required by the applicable accounting standards. Refer note no. - 26(8) to the financial statements.
14. During the year, the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures under section 42 of the Companies Act, 2013. However, the company has allotted 5,30,000 numbers of equity shares under ESOP to a non-independent, non-executive director.
15. In our opinion and according to the information and explanations given to us, the company has not entered into any non-cash transactions with directors or persons connected with them except for Rs.15,55,328/- being the difference between the grant price and market price, debited to Statement of Profit and Loss, pertaining to grant of 60,000 numbers of equity shares to the Managing Director under ESOP.
16. The company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.
We have audited the internal financial controls over financial reporting of TVS ELECTRONICS LIMITED, CHENNAI (âthe Companyâ) as of March 31, 2016 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.
ANNEXURE - 2 Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (âthe Actâ)
Management''s Responsibility for Internal Financial Controls
The Company''s management is responsible for establishing and maintaining internal financial controls based on 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 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 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;
I. pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;
II. 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
III. 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, 2016, based on;
i. existing policies and procedures adopted by the Company for ensuring orderly and efficient conduct of business.
ii. continuous adherence to Company''s policies.
iii. existing procedures in relation to safeguarding of Company''s fixed assets, investments, inventories, receivables, loans and advances made and cash and bank balances.
iv. existing system to prevent and detect fraud and errors.
v. accuracy and completeness of Company''s accounting records; and
vi. existing capacity to prepare timely and reliable financial information.
For Sundaram & Srinivasan
Chartered Accountants
Firm Registration No: 004207S
M BALASUBRAMANIYAM
Place : Chennai Partner
Date : May 04, 2016 Membership No: F7945
Mar 31, 2015
We have audited the accompanying standalone financial statements of TVS
Electronics Limited, Chennai - 600 006 ("the Company"), which comprise
the Balance Sheet as at 31st March, 2015, the Statement of Profit and
Loss, the Cash Flow Statement for the year then ended, and a summary of
the significant accounting policies and other explanatory information.
Management's Responsibility for the Standalone Financial Statements
The Company's Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 ("the Act") with respect
to the preparation of these standalone financial statements that give a
true and fair view of the financial position, financial performance and
cash flows of the Company in accordance with the accounting principles
generally accepted in India, including the Accounting Standards
specified under Section 133 of the Act, read with Rule 7 of the
Companies (Accounts) Rules, 2014. This responsibility also includes
maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding the assets of the Company and
for preventing and detecting frauds and other irregularities; selection
and application of appropriate accounting policies; making judgments
and estimates that are reasonable and prudent; and design,
implementation and maintenance of adequate internal financial controls,
that were operating effectively for ensuring the accuracy and
completeness of the accounting records, relevant to the preparation and
presentation of the financial statements that give a true and fair view
and are free from material misstatement, whether due to fraud or error.
Auditors' Responsibility
Our responsibility is to express an opinion on these 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
We conducted our audit in accordance with the Standards on Auditing
specified under section 143(10) of the Act. Those Standards require
that we comply with ethical requirements and plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and the disclosures in the financial statements. The
procedures selected depend on the auditors' judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal financial control relevant
to the Company's preparation of the financial statements that give a
true and fair view in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing
an opinion on whether the Company has in place an adequate internal
financial controls system over financial reporting and the operating
effectiveness of such controls. An audit also includes evaluating the
appropriateness of the accounting policies used and the reasonableness
of the accounting estimates made by the Company's Directors, as well as
evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion on the standalone
financial statements.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid standalone financial statements
read together with the annexure to our report 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 March 31,2015;
ii. in the case of the Statement of Profit and Loss, 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.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order, 2015 ("the
Order") issued by the Central Government in terms of sub-section (11)
of section 143 of the Act, we give in Annexure, a statement on the
matters specified in paragraph 3 and 4 of the Order.
2. As required by Section 143(3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations
which to the best of our knowledge and belief were necessary for the
purposes of our audit.
(b) In our opinion, proper books of account as required by law have
been kept by the Company so far as it appears from our examination of
those books.
(c) The Balance Sheet, the Statement of Profit and Loss, and the Cash
Flow Statement dealt with by this Report are in agreement with the
books of account.
(d) In our opinion, the aforesaid standalone financial statements
comply with the Accounting Standards specified under Section 133 of the
Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
(e) On the basis of the written representations received from the
directors as on 31st March, 2015 taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March, 2015
from being appointed as a director in terms of Section 164 (2) of the
Act.
(f) With respect to the other matters to be included in the Auditors'
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its
financial position in its financial statements - Refer note no. 26(5)
to the financial statements;
ii. The Company did not have any long-term contracts including
derivative contract for which there were any material foreseeable
losses.
iii. There has been no delay in transferring amounts, required to be
transferred, to the Investor Education and Protection Fund by the
Company.
i. a) The Company has maintained proper records showing full
particulars including quantitative details and situation of fixed
assets.
(b) The Assets are physically verified, in phases, by the management
during the year as per the 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 physical verification. The discrepancies noticed on such
verification have been appropriately dealt with in the books of
accounts.
(ii) (a) The inventory has been physically verified at reasonable
intervals during the year by the management. In our opinion, the
frequency of such verification is adequate. It was represented to us
that inventories with third parties are also verified from time to
time.
(b) In our opinion and according to the information and explanations
given to us, the procedures for physical verification of inventory
followed by the management were reasonable and adequate in relation to
the size of the company and the nature of its business.
(c) In our opinion, the company has maintained proper records of
inventory. The discrepancies between the physical stocks and the book
stocks were not material and have been properly dealt with in the books
of account.
(iii) During the year, the company has not granted loan to any company,
firm or other parties covered in the register maintained under section
189 of the Companies Act, 2013.
(iv) In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
commensurate with the size of the company and the nature of its
business, with regard to purchase of inventory, fixed assets and for
the sale of goods and services. During the course of our audit, no
continuing failure has been noticed in the internal control system.
(v) The company has not accepted deposits within the meaning of
sections 73 to 76 of the Companies Act, 2013, during the year.
(vi) We have broadly reviewed the books of account maintained by the
Company pursuant to the rules made by the Central Government under
section 148(1) of the Companies Act, 2013 for maintenance of cost
records and are of the opinion that prima-facie, the prescribed
accounts and records have been made and maintained. We have, however,
not made a detailed examination of the cost records with a view to
determine whether they are accurate or complete.
(vii) (a) According to the records provided to us, the company is
regular in depositing undisputed statutory dues including Provident
Fund, Employees' State Insurance, Income Tax, Sales Tax, Wealth Tax,
Duty of Customs, Duty of Excise, Value Added Tax, Cess and other
statutory dues with the appropriate authorities. However, we have
observed a few instances of belated remittance of Service Tax and Tax
Deducted at Source.
(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, Duty of Customs, Duty of Excise, Value Added Tax and
Cess were in arrears, as at 31st March 2015 for a period of more than
six months from the date they became payable.
(c) According to information and explanations given to us, the
following are the details of the disputed dues, that were not deposited
with the concerned authorities:
Name of the Amount
Nature of dues
Statute (Rs. in lakhs)
Sales Tax - Sales tax 84.69
Central Sales Tax /
Value Added Tax of 7.25
various states
Income Tax Act, Income Tax 429.08
1961
Tax deducted at Source 14.09
and interest thereon
Central Excise Excise Duty 13.23
Act, 1944
Name of the
Statute Forum where dispute is pending
Sales Tax -
Central Sales Tax /
Value Added Tax of
various states Departmental Authorities of various States
Kerala Agricultural Income Tax & Sales
Tax Appellate Tribunal
Income Tax Act,
1961 Commissioner of Income Tax (Appeals),
Chennai.
Central Excise
Act, 1944 Customs, Excise and Service Tax
Appellate Tribunal, Chennai (CESTAT).
(d) During the year the company has transferred the amount required to
be transferred to Investor Education and Protection Fund in accordance
with the relevant provisions of the Companies Act, 1956 and rules made
there under within time.
viii. The Company neither has accumulated losses as at the end of the
financial year nor has incurred cash losses during the financial year
and in the immediately preceding financial year.
(ix) Based on our verification and according to the information and
explanations given by the management, the company has not defaulted in
repayment of dues to its bank.
(x) The Company has not furnished any guarantees for loans taken by
others from a bank or a financial institution.
(xi) The company has not availed any fresh term loan during the year.
The loan availed in earlier year was applied for the purpose for which
it was availed.
(xii) Based on the audit procedures adopted and information and
explanations given to us by the management, no fraud on or by the
company has been noticed or reported during the course of our audit.
For Sundaram & Srinivasan
Chartered Accountants
Firm Registration No: 004207S
M BALASUBRAMANIYAM
Chennai Partner
May 06, 2015 Membership No: F7945
Mar 31, 2014
We have audited the accompanying financial statements of TVS
Electronics Limited, Chennai - 600 006 ("the Company"), which comprise
of Balance Sheet as at 31st March 2014, the Statement of Profit & Loss
and Cash Flow Statement for the year then ended and a summary of
significant accounting policies and other explanatory information.
Management''s Responsibility for the Financial Statements
Management is responsible for the preparation of these financial
statements that give a true and fair view of the financial position,
financial performance and cash flows of the Company in accordance with
the Accounting Standards referred to in sub-section (3C) of section 211
of the Companies Act, 1956 ("the Act"). This responsibility includes
the design, implementation and maintenance of internal control relevant
to the preparation and presentation of the financial statements that
give a true and fair view and are free from material misstatement,
whether due to fraud or error.
Auditors'' Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The procedures
selected depend on the auditor''s judgment, including the assessment of
the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the Company''s preparation and
fair presentation of the financial statements in order to design audit
procedures that are appropriate in the circumstances, but not for the
purpose of expressing an opinion on the effectiveness of the entity''s
internal control.
An audit also includes evaluating the appropriateness of accounting
policies used and the reasonableness of the accounting estimates made
by management, as well as evaluating the overall presentation of the
financial statements. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our audit
opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the financial statements give the information
required by the Act in the manner so required and give a true and fair
view in conformity with the accounting principles generally accepted in
India:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March 2014
(b) in the case of the Statement of Profit and Loss, of the Profit for
the year ended on that date; and
(c) in the case of Cash Flow Statement, of the cash flows for the year
ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order") issued by the Central Government of India in terms of
sub-section (4A) of section 227 of the Act, and on the basis of such
checks of the books and records of the Company as we considered
appropriate and according to the information and explanations given to
us, we give in the annexure a statement on the matters specified in the
paragraphs 4 and 5 of the said Order.
2. As required by section 227(3) of the Act, we report that:
(a) we have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purpose of our
audit;
(b) in our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books;
(c) the Balance Sheet, Statement of Profit and Loss and Cash Flow
Statement dealt with by this report are in agreement with the books of
account;
(d) in our opinion, the Balance Sheet, Statement of Profit and Loss and
Cash Flow Statement comply with the Accounting Standards referred to in
sub-section (3C) of section 211 of the Companies Act, 1956.
(e) On the basis of written representations received from the directors
as on 31st March 2014 and taken on record by the Board of Directors,
none of the directors is disqualified as on 31st March 2014 from being
appointed as a director in terms of clause (g) of sub-section (1) of
section 274 of the Companies Act, 1956.
Annexure referred to in our report of even date on the accounts for the
year ended 31st March, 2014
1. a) The Company has maintained proper records showing full
particulars including quantitative details and situation of the fixed
assets.
b) The assets are physically verified, in phases, by the Management
during the year as per the 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 physical verification. The discrepancies noticed on such
verification have been appropriately dealt with in the books of account
of the Company.
c) The assets disposed off during the year are not substantial and
therefore do not affect the going concern status of the Company.
2. a) The stock of raw materials, stores, spare parts and finished
goods other than in transit were physically verified during the year by
the Management. In our opinion, the frequency of verification is
reasonable. In respect of inventory with third parties, which have not
been physically verified, there is a process of obtaining confirmation
from such parties.
b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventory
followed by the Management are reasonable and adequate in relation to
the size of the Company and the nature of its business.
c) In our opinion, the Company has maintained proper records of
inventory. The discrepancies noticed on verification between the
physical stocks and the book records were not material and have been
properly dealt with in the books of account.
3. a) During the year, the Company has granted interest bearing loan
of Rs. 52 lakhs to a Company covered in the Register maintained under
section 301 of the Companies Act, 1956.The rate of interest and other
terms of the loan are not prima facie prejudicial to the interest of
the company. The receipt of interest is regular. The said sum of Rs. 52
Lakhs along with the Opening Balance of Rs. 308.50 lakhs amounting to
Rs. 360.50 Lakhs has been repaid by the Loanee.
b) During the year the Company has not availed any loan from companies
covered in the Register maintained under Section 301 of the Companies
Act, 1956.
4. 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 purchase of inventory and fixed assets and for
the sale of goods and services. During the course of our audit, no
major or minor weaknesses have been noticed in the internal control
system.
5. a) Based on the audit procedures applied by us and according to the
information and explanations provided by the Management, we are of the
opinion that the contracts or arrangements that need to be entered in
the Register maintained in pursuance of Section 301 of the Companies
Act, 1956 have been properly entered in the said Register. b) In our
opinion and according to the information and explanations given to us,
the transactions entered in the Register maintained under Section 301
and exceeding during the financial year by Rs. 5.00 lakhs in respect of
each party have been made at prices which are reasonable having regard
to the prevailing market prices at the relevant time.
6. The Company has not accepted any deposits from the public.
7. The internal audit system of the company is entrusted to a firm of
Chartered Accountants, which in our opinion, is commensurate with its
size and nature of its business.
8. We have broadly reviewed the books of account maintained by the
Company pursuant to the rules made by the Central Government under
Section 209(1)(d) of the Companies Act, 1956 for maintenance of cost
records and are of the opinion that, prima facie, the prescribed
accounts and records have been made and maintained. We have, however,
not made a detailed examination of the cost records with a view to
determine whether they are accurate or complete.
9. a) According to the records provided to us, the Company is
generally regular in depositing undisputed statutory dues including
Provident Fund, Investor Education and Protection Fund, Employees''
State Insurance, Income-Tax, Sales-Tax, Service Tax, Customs Duty,
Excise Duty, Cess and other statutory dues with the appropriate
authorities. However delays were noticed in respect of remittance of
Professional tax, Service tax and Income tax deducted at source in a
few cases.
b) According to the information and explanations given to us, no
undisputed amounts payable in respect of Income Tax, Sales Tax, Service
Tax, Customs Duty, Excise Duty and Cess were in arrears, as at 31st
March, 2014 for a period of more than six months from the date they
became payable.
c) According to the information and explanations given to us, the
following are the details of the disputed dues, that were not deposited
with the concerned authorities.
Name of the Amount
Statute Nature of dues (Rs. in Forum where dispute
lakhs) is pending
Sales Tax - Sales tax 120.84 Departmental
Central Sales Tax / Authorities of
Value Added Tax of various States
various states
7.25 Tribunal
Income Tax Act, Income Tax 267.91
1961 Commissioner of
Tax deducted 14.09 Income Tax
at Source and (Appeals), Chennai.
interest thereon
Finance Act, Service Tax 121.15 Customs, Excise
1994 and Service Tax
Appellate Tribunal,
Chennai ( CESTAT).
Central Excise Excise Duty 13.23 Customs, Excise
Act, 1944 and Service Tax
Appellate Tribunal,
Chennai (CESTAT).
10. The Company has made cash profit during the year as also in the
immediately preceding financial year. Taking into account, the brought
forward loss of the preceding year, the surplus is negative. However,
this is not in excess of fifty percentage of net worth.
11. Based on our verification and according to the information and
explanations given by the Management, the Company has not defaulted in
repayment of dues to any financial institution or bank.
12. Based on our examination and according to the information and
explanations given to us, the Company has not granted loans and
advances on the basis of security by way of pledge of shares,
debentures and other securities.
13. The Company is not a chit / nidhi / mutual benefit fund / society
and as such clause (xiii) of the Order is not applicable.
14. The Company is not dealing or trading in shares, securities,
debentures and other investments. The Company is holding only Long Term
Investments. During the year, the Company''s wholly owned subsidiary,
namely, Tumkur Property Holdings Limited, Chennai was dissolved and
8000 units in TVS Shriram Growth Fund have been sold to another wholly
owned subsidiary of the Company, namely, Prime Property Holdings
Limited, Chennai. Proper records have been maintained and timely
entries are made in Investment Register maintained pursuant to Section
372 of the Companies Act, 1956. All investments are held in the
Company''s own name except in the case of investment in wholly owned
subsidiary where certain numbers of shares are held by nominees as
provided in Section 49 (3) of the Companies Act, 1956.
15. The Company has not furnished any guarantee for loans taken by
others from bank or financial institution.
16. In our opinion, the term loans were applied for the purpose for
which the loans were obtained.
17. On the basis of our examination, the Company has not used the
funds raised on short-term basis for long-term investments.
18. During the year, the Company has not allotted any shares on
preferential basis to parties and companies covered in the Register
maintained under section 301 of the Companies Act, 1956. 3,50,000
Equity shares allotted during the year on preferential basis to a
person not covered in Register under section 301of the Companies Act,
1956.
19. During the year, the Company has not issued any debentures.
20. During the year, the Company has not raised any money by public
issue.
21. During the year, one customer has informed the Company of some
misappropriation of spare parts by one of the employees of the Company.
However, no claim has been made by the Customer. The matter is under
investigation.
For Sundaram & Srinivasan
Chartered Accountants
Firm Registration No: 004207S
M BALASUBRAMANIYAM
Chennai Partner
May 08, 2014 Membership No: F7945
Mar 31, 2013
We have audited the accompanying fnancial statements of TVS Electronics
Limited, Chennai - 600 006 ("the Company") which comprise of Balance
Sheet as at 31st March 2013, and the Statement of Proft and Loss and
Cash Flow Statement for the year ended on that date along with Notes on
accounts.
Management''s Responsibility for the Financial Statements
Management is responsible for the preparation of these fnancial
statements that give a true and fair view of the fnancial position,
fnancial performance and cash fows of the Company in accordance with
the Accounting Standards refrred 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 fnancial 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 fnancial
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 consolidated fnancial statements
are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the fnancial statements. The procedures
selected depend on the auditor''s judgement, including the assessment of
the risks of material misstatement of the fnancial 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 fnancial 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 fnancial statements.
We believe that the audit evidence we have obtained is suffcient 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 fnancial statements give the information
required by the Act in the manner so required and 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 31st March 2013;
(b) in the case of the Statement of Proft and Loss, of the loss for the
year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash fows for the
year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order") issued by the Central Government of India in terms of
sub-section (4A) of section 227 of the Act, we give in the Annexure a
statement on the matters specifed 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 Proft and Loss, and Cash Flow
Statement dealt with by this Report are in agreement with the books of
account;
d) in our opinion, the Balance Sheet, Statement of Proft 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 31st March 2013, and taken on record by the Board of Directors,
none of the directors is disqualifed as on 31st March 2013, from being
appointed as a Director in terms of clause (g) of sub-section (1) of
section 274 of the Companies Act, 1956.
f) Levy and collection of Cess on Turnover or Gross Receipts.
Since the Central Government has not issued any notifcation 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.
1. a) The Company has maintained proper records showing full
particulars including quantitative details and situation of the fixed
assets.
b) The assets are physically verified, in phases, by the Management
during the year as per the 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 physical verification. The discrepancies noticed on such
verification have been appropriately dealt with in the books of account
of the Company.
c) The assets disposed off during the year are not substantial and
therefore do not affect the going concern status of the Company.
2. a) The stock of raw materials, stores, spare parts and
finished goods other than in transit were physically verified during
the year by the Management. In our opinion, the frequency of
verification is reasonable. In respect of inventory with third
parties, which have not been physically verified, there is a process of
obtaining confirmation from such parties.
b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventory
followed by the Management are reasonable and adequate in relation to
the size of the Company and the nature of its business.
c) In our opinion, the Company has maintained proper records of
inventory. The discrepancies noticed on verification between the
physical stocks and the book records were not material and have been
properly dealt with in the books of account.
3. a) During the year, the Company has granted interest bearing loan
of ? 108.50 lakhs to a Company covered in the Register maintained under
Section 301 of the Companies Act, 1956.The rate of interest and other
terms of the loan are not prima facie prejudicial to the interest of
the company. The receipt of interest is regular. The amount due from
such company as at year end viz 31st March 2013 is ?308.50 lakhs
(including the opening balance as on 01/04/2012 of f 200 lakhs).The
principal is due for repayment on or before 31st March, 2014.
b) During the year the Company has not availed any loan from companies
covered in the Register maintained under Section 301 of the Companies
Act 1956.
4. 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 purchase of inventory and fixed assets and for
the sale of goods and services. During the course of our audit, no
major weaknesses have been noticed in the internal control system.
5. a) Based on the audit procedures applied by us and according to the
information and explanations provided by the Management, we are of the
opinion that the contracts or arrangements that need to be entered in
the Register maintained in pursuance of Section 301 of the Companies
Act, 1956 have been properly entered in the said Register.
b) In our opinion and according to the information and explanations
given to us, the transactions entered in the Register maintained under
Section 301 and exceeding during the financial year by ? 5.00 lakhs in
respect of each party have been made at prices which are reasonable
having regard to the prevailing market prices at the relevant time..
6. The Company has not accepted any deposits from the public.
7. The internal audit system, of the Company is entrusted to a firm of
Chartered Accountants, which in our opinion, is commensurate with its
size and nature of its business.
8. We have broadly reviewed the books of account maintained by the
Company pursuant to the rules made by the Central Government under
Section 209(1)(d) of the Companies Act, 1956 for maintenance of cost
records and are of the opinion that, prima facie, the prescribed
accounts and records have been made and maintained.
9. a) According to the records provided to us, the Company is
generally regular in depositing undisputed statutory dues including
Provident Fund, Investor Education and Protection Fund, Employees''
State Insurance, Income-Tax, Sales-Tax, Service Tax, Customs Duty,
Excise Duty, Cess and other statutory dues with the appropriate
authorities. However delays were noticed in respect of remittance of
Service tax and Income tax deducted at source in two instances.
b) According to the information and explanations given to us, no
undisputed amounts payable in respect of Income Tax, Sales Tax, Service
Tax, Customs Duty, Excise Duty and Cess were in arrears, as at 31st
March, 2013 for a period of more than six months from the date they
became payable.
10. The Company neither has accumulated losses as at the end of the
financial year nor has incurred cash loss during the financial year and
in the immediately preceding year.
11. Based on our verification and according to the information and
explanations given by the Management, the Company has not defaulted in
repayment of dues to any financial institution or bank.
12. Based on our examination and according to the information and
explanations given to us, the Company has not granted loans and
advances on the basis of security by way of pledge of shares,
debentures and other securities.
13. The Company is not a chit / nidhi / mutual benefit fund / society
and as such clause (xiii) of the Order is not applicable.
14. The Company is not dealing or trading in shares, securities,
debentures and other investments. The Company is holding only Long Term
Investments. All investments are held in the Company''s own name except
in the case of investment in wholly owned subsidiaries where certain
number of shares are held by nominees as provided in Section 49 (3) of
the Companies Act, 1956.
15. The Company has not given any guarantee for loans taken by others
from bank or financial institution.
16. In our opinion, the term loans were applied for the purpose for
which the loans were obtained.
17. On the basis of our examination, the Company has not used the
funds raised on short-term basis for long-term investments.
18. During the year, the Company has not allotted any shares on
preferential basis to parties and companies covered in the Register
maintained under Section 301 of the Companies Act, 1956.
19. During the year, the Company has not issued any debentures.
20. During the year, the Company has not raised any money by public
issue.
21. Based on the audit procedures adopted and information and
explanations given to us by the Management, no fraud on or by the
Company has been noticed or reported during the course of our audit.
For Sundaram & Srinivasan
Chartered Accountants
Firm Registration No.: 004207S
M. BALASUBRAMANIYAM
Chennai Partner
20th May, 2013 Membership no.: F7945
Mar 31, 2012
We have audited the attached Balance Sheet of M/s. TVS Electronics
Limited, "Jayalakshmi Estates", 29, Haddows Road, Chennai - 600 006 as
at 31s1 March, 2012, the Statement of Profit & Loss for the year ended
31st March, 2012 annexed thereto and the Cash Flow Statement for the
year ended on that date. 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.
1. We conducted our audit in accordance with the Auditing Standards
generally accepted in India. These standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall presentation of the
financial statements. We believe that our audit provides a reasonable
basis for our opinion.
2. As required by the Companies (Auditor's Report) Order, 2003 and
amended by the Companies (Auditor's Report) (Amendment) Order, 2004
issued by the Central Government in terms of sub-section (4A) of
Section 227 of the Companies Act, 1956, we enclose in the annexure a
statement on the matters specified in paragraphs 4 and 5 of the said
Order.
3. Further to our comments in the Annexure referred to above, we state
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 referred to in 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 dealt with by this report comply with the
Accounting Standards, referred to in sub-section (3C) of Section 211 of
the Companies Act, 1956.
(e) On the basis of written representations received from the Directors
of the Company and taken on record by the Board of Directors, we report
that no Director is disqualified from being appointed as a Director in
terms of clause (g) of sub-section (1) of Section 274 of the Companies
Act, 1956 on the said date;
(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
notes thereon, particularly the notes under AS13 (Accounting for
Investments), give the information required by the Companies Act, 1956,
in the manner so required and give a true and fair view in conformity
with the accounting principles generally accepted in India:
(i) in so far as it relates to the Balance Sheet, of the state of
affairs of the Company as at 31st March, 2012;
(ii) in so far as it relates to the Statement of Profit and Loss, of
the profit of the Company for the year ended 31s1 March, 2012; and
(iii) in so far as it relates to the Cash Flow Statement, of the cash
flows for the year ended on that date.
1. a) The Company has maintained proper records showing full
particulars including quantitative details and situation of the fixed
assets.
b) The assets are physically verified, in phases, by the Management
during the year as per the 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 physical verification. The discrepancies noticed on such
verification have been appropriately dealt with in the books of account
of the Company.
c) During the year the Company has disposed off unused assets and the
loss arising there from is disclosed as exceptional item of expenditure.
The assets disposed off during the year are not substantial and
therefore do not affect the going concern status of the Company.
2. a) The stock of raw materials, stores, spare parts and
finished goods other than in transit were physically verified during
the year by the Management. In our opinion, the frequency of
verification is reasonable. In respect of inventory with third
parties, which have not been physically verified, there is a process of
obtaining confirmation from such parties.
b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventory
followed by the Management are reasonable and adequate in relation to
the size of the Company and the nature of its business.
c) In our opinion, the Company has maintained proper records of
inventory. The discrepancies noticed on verification between the
physical stocks and the book records were not material and have been
properly dealt with in the books of account.
3. a) During the year, the Company has granted unsecured loan of Rs 521
lakhs (Balance as at 31.03.2012 Rs 200 lakhs) to a Company covered in
the Register maintained under Section 301 of the Companies Act, 1956.
The rate of interest and other terms and conditions of the loan are not
prima facie prejudicial to the interest of the Company. The receipt of
Principal amount and interest thereon are regular. As on the date of
Balance Sheet there was no overdue amount recoverable on the said
unsecured loans.
b) During the year the Company has not availed any loan from companies
covered in the Register maintained under Section 301 of the Companies
Act, 1956.
4. 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 purchase of inventory and fixed assets and for
the sale of goods and services. During the course of our audit, no
major weaknesses have been noticed in the internal control system.
5. a) Based on the audit procedures applied by us and
according to the information and explanations provided by the
Management, we are of the opinion that the contracts or arrangements
that need to be entered in the Register maintained in pursuance of
Section 301 of the Companies Act, 1956 have been properly entered in
the said Register.
b) In our opinion and according to the information and explanations
given to us, the transactions entered in the Register maintained under
Section 301 and exceeding during the financial year by Rs 5.00 lakhs in
respect of each party have been made at prices which are reasonable
having regard to the prevailing market prices at the relevant time.
6. The Company has not accepted any deposits from the public.
7. The Company has an internal audit system, which in our opinion, is
commensurate with its size and nature of its business.
8. We have broadly reviewed the books of account maintained by the
Company pursuant to the rules made by the Central Government under
Section 209(1 )(d) of the Companies Act, 1956 for maintenance of cost
records and are of the opinion that, prima facie, the prescribed
accounts and records have been made and maintained.
9. a) According to the records provided to us, the Company
is generally regular in depositing undisputed statutory dues including
Provident Fund, Investor Education and Protection Fund, Employees'
State Insurance, Income-Tax, Sales-Tax, Wealth Tax, Service Tax,
Customs Duty, Excise Duty, Cess and other statutory dues with the
appropriate authorities. However marginal delay was noticed in respect
of one Employee State Insurance remittance.
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 and Cess were in arrears,
as at 31st March, 2012 for a period of more than six months from the
date they became payable.
c) According to the information and explanations given to us, the
following are the details of the disputed dues, that were not deposited
with the concerned authorities.
Name of the Nature of dues Amount Forum where dispute is
Statue (Rs in Pending
lakhs)
Sales Tax Statutory Forms 270.08 Assistant Commissioner
Acts of Entry Tax/ /Deputy Commissioner
various Warranty Appellate Authorities -
States replacement Commercial Taxes of
stock related/ various states.
Turnover dispute
Income Tax a) Cost of 220.20 Commissioner of Income Tax
Act, 1961 acquisition of (Appeal), Chennai.
certain capital
asset sold and
determination of
capital gain.
b) Claim of TDS 49.65
disallowed.
c) Inventory 193.82
write-off
disallowed.
d) Wrong levy of 14.42
interest under
various
provisions of
the Act.
Service Tax Dispute on 121.15 Customs, Excise and Service
availment of Tax Appellate Tribunal,
input tax credit Chennai (CESTAT).
for exempted
and dutiable
goods.
Excise Refund disputed 13.23 Customs, Excise and Service
Tax Appellate Tribunal,
Chennai (CESTAT).
Customs Special 10.25 The Commissioner of Customs
Additional Duty (Appeals), Chennai
refund claim
rejected by
department.
10. The Company neither has accumulated losses as at the end of the
financial year nor has incurred cash losses during the financial year
and in the immediately preceding year.
11. Based on our verification and according to the information and
explanations given by the Management, the Company has not defaulted in
repayment of dues to any financial institution or bank.
12. Based on our examination and according to the information and
explanations given to us, the Company has not granted loans and
advances on the basis of security by way of pledge of shares,
debentures and other securities.
13. The Company is not a chit / nidhi / mutual benefit fund / society
and as such clause (xiii) of the Order is not applicable.
14. The Company is not dealing or trading in shares, securities,
debentures and other investments. All investments are held in the
Company's own name except in the case of investment in wholly owned
subsidiaries where certain number of shares are held by nominees as
provided in Section 49 (3) of the Companies Act, 1956.
15. The Company has not given any guarantee for loans taken by others
from bank or financial institution.
16. In our opinion, the term loans were applied for the purpose for
which the loans were obtained.
17. On the basis of our examination, the Company has not used the funds
raised on short-term basis for long-term investments.
18. During the year, the Company has not allotted any shares on
preferential basis to parties and companies covered in the Register
maintained under Section 301 of the Companies Act, 1956.
19. During the year, the Company has not issued any debentures.
20. During the year, the Company has not raised any money by public
issue.
21. Based on the audit procedures adopted and information and
explanations given to us by the Management, no fraud on or by the
Company has been noticed or reported during the course of our audit.
For SUNDARAM & SRINIVASAN
Chartered Accountants
Firm Registration No: 004207S
M BALASUBRAMANIYAM
Partner
Chennai Membership No. F7945
May 3,2012.
Mar 31, 2011
We have audited the attached Balance Sheet of M/s. TVS Electronics
Limited, "Jayalakshmi Estates", 29, Haddows Road, Chennai - 600 006 as
at 31st March, 2011, the Profit & Loss Account for the year ended 31st
March, 2011 annexed thereto and the Cash Flow Statement for the year
ended on that date. 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.
1. We conducted our audit in accordance with the Auditing Standards
generally accepted in India. These standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall presentation of the
financial statements. We believe that our audit provides a reasonable
basis for our opinion.
2. As required by the Companies (Auditor's Report) Order, 2003 and
amended by the Companies (Auditor's Report) (Amendment) Order, 2004
issued by the Central Government in terms of sub-section (4A) of
Section 227 of the Companies Act, 1956, we enclose in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the said
Order.
3. Further to our comments in the Annexure referred to above, we state
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, Profit and Loss Account and Cash Flow Statement
referred to in this report are in agreement with the books of account;
(d) In our opinion, the Balance Sheet, Profit and Loss Account and the
Cash Flow Statement dealt with by this report comply with the
Accounting Standards, referred to in sub- section (3C) of Section 211
of the Companies Act, 1956;
(e) On the basis of written representations received from the Directors
of the Company and taken on record by the Board of Directors, we report
that no Director is disqualified from being appointed as a Director in
terms of clause (g) of sub-section (1) of Section 274 of the Companies
Act, 1956 on the said date;
(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
notes thereon give the information required by the Companies Act, 1956,
in the manner so required and give a true and fair view in conformity
with the accounting principles generally accepted in India:
(i) in so far as it relates to the Balance Sheet, of the state of
affairs of the Company as at 31st March, 2011;
(ii) in so far as it relates to the Profit and Loss Account, of the
profit of the Company for the year ended 31st March, 2011; and
(iii) in so far as it relates to the Cash Flow Statement, of the cash
flows for the year ended on that date.
Annexure to the Auditors' Report Annexure referred to in our report of
even date on the accounts for the year ended 31st March, 2011
1. a) The Company has maintained proper records showing full
particulars including quantitative details and situation of the fixed
assets.
b) The assets are physically verified, in phases, by the Management
during the year as per the 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 physical verification. The discrepancies noticed on such
verification have been appropriately dealt with in the books of account
of the Company.
c) During the year Company has disposed off unused assets and the loss
arising therefrom is disclosed as exceptional items of expenditure
(vide Schedule XIX). The assets disposed off during the year are not
substantial and therefore does not affect the going concern status of
the Company.
2. a) The stock of raw materials, stores, spare parts and
finished goods other than in transit were physically verified during
the year by the Management. In our opinion, the frequency of
verification is reasonable. In respect of inventory with third parties,
which have not been physically verified, there is a process of
obtaining confirmation from such parties.
b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventory
followed by the management are reasonable and adequate in relation to
the size of the Company and the nature of its business.
c) In our opinion, the Company has maintained proper records of
inventory. The discrepancies noticed on verification between the
physical stocks and the book records were not material and have been
properly dealt with in the books of account.
3. a) During the year, the Company has not granted any unsecured loans
to companies, firms or other parties covered in the Register maintained
under Section 301 of the Companies Act, 1956. Hence reporting on rate
of interest charged and other conditions does not arise. In respect of
unsecured loans in the nature of Inter Corporate Deposits made in an
earlier year outstanding at the commencement of year under report, the
Company has received back the outstanding principal due and interest
thereon in full.
b) During the year the Company has not availed any loan from companies
covered in the Register maintained under Section 301 of the Companies
Act 1956.
4. 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 purchase of inventory and fixed assets and for
the sale of goods and services. During the course of our audit, no
major weaknesses have been noticed in the internal control system.
5. a) Based on the audit procedures applied by us and
according to the information and explanations provided by the
Management, we are of the opinion that the contracts or arrangements
that need to be entered in the Register maintained in pursuance of
Section 301 of the Companies Act, 1956 have been properly entered in
the said Register.
b) In our opinion and according to the information and explanations
given to us, the transactions entered in the Register maintained under
Section 301 and exceeding during the financial year by Rs. 5.00 lakhs
in respect of each party have been made at prices which are reasonable
having regard to the prevailing market prices at the relevant time.
6. The Company has not accepted any deposits from the public.
7. The Company has an internal audit system, which in our opinion, is
commensurate with its size and nature of its business.
8. We have broadly reviewed the books of account maintained by the
Company pursuant to the rules made by the Central Government under
Section 209(1)(d) of the Companies Act, 1956 for maintenance of cost
records and are of the opinion that, prima facie, the prescribed
accounts and records have been made and maintained.
9. a) According to the records provided to us, the Company is
generally regular in depositing undisputed statutory dues including
Provident Fund, Investor Education and Protection Fund, Employees'
State Insurance, Income- Tax, Sales-Tax, Wealth Tax, Service Tax,
Custom Duty, Excise Duty, Cess and other statutory dues with the
appropriate authorities. However, marginal delays were noticed in
respect of ESI remittance in 3 instances.
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 and Cess were in arrears,
as at 31st March, 2011 for a period of more than six months from the
date they became payable.
c) According to the information and explanations given to us, the
following are the details of the disputed dues, that were not deposited
with the concerned authorities.
Name of the Nature of dues Amount
Statute (Rs. in
Lakhs)
Sales Tax Acts of Statutory Forms/Entry Tax/ Warranty 306.98
various states replacement stock related/ Turnover
dispute
Income Tax Act, Disallowance of expenditure relating 1294.22
1961 to valuation assets acquired on
amalgamation.
Income Tax Act, Payments to Foreign Consultants, Cost 228.02
1961 of acquisition of an asset as regards
computation of Capital Gain and time
of taxing of income received in advance
and TDS demand based on E-Return filed.
Service Tax Dispute on availment of input tax 121.15
credit for exempted and dutiable goods
Excise Refund disputed 13.23
Customs Special Additional Duty (SAD) refund 10.25
claim rejected by department
Name of the Forum where dispute
Statute is pending
Sales Tax Acts of Assistant Commissioner/Deputy
various states Commissioner / Appellate authorities -
Commercial Taxes of various states
Income Tax Act, Commissioner of
1961 Income Tax (Appeal), Chennai
Income Tax Act, Commissioner of
1961 Income Tax (Appeal), Chennai
Service Tax Customs, Excise and Service Tax
Appellate Tribunal, Chennai (CESTAT)
Excise Customs, Excise and Service Tax
Appellate Tribunal, Chennai ( CESTAT)
Customs The Commissioner of Customs (Appeals),
Chennai
10. The Company neither has accumulated losses as at the end of the
financial year nor has incurred cash loss during the financial year.
The Company incurred cash loss in the immediately preceding financial
year.
11. Based on our verification and according to the information and
explanations given by the Management, the Company has not defaulted in
repayment of dues to any financial institution or bank.
12. Based on our examination and according to the information and
explanations given to us, the Company has not granted loans and
advances on the basis of security by way of pledge of shares,
debentures and other securities.
13. The Company is not a chit / nidhi / mutual benefit fund / society
and as such clause (xiii) of the Order is not applicable.
14. The Company is not dealing or trading in shares, securities,
debentures and other investments. All investments are held in the
Company's own name except in the case of investment in wholly owned
subsidiaries where certain number of shares are held by nominees as
provided in Section 49 (3) of the Companies Act, 1956.
15. The Company has not given any guarantee for loans taken by others
from bank or financial institution.
16. In our opinion, the term loans were applied for the purpose for
which the loans were obtained.
17. On the basis of our examination, the Company has not used the
funds raised on short-term basis for long-term investments.
18. During the year, the Company has not allotted any shares on
preferential basis to parties and companies covered in the Register
maintained under Section 301 of the Companies Act, 1956.
19. During the year, the Company has not issued any debentures.
20. During the year, the Company has not raised any money by public
issue.
21. Based on the audit procedures adopted and information and
explanations given to us by the Management, no fraud on or by the
Company has been noticed or reported during the course of our audit.
For SUNDARAM & SRINIVASAN
Chartered Accountants
Firm Registration No: 004207S
M BALASUBRAMANIYAM
Partner
Membership No: F7945
Chennai
May 27, 2011
Mar 31, 2010
We have audited the attached Balance Sheet of M/s. TVS Electronics
Limited, "Jayalakshmi Estates, 29, Haddows Road, Chennai - 600 006 as
at 31st March, 2010, the Profit & Loss Account for the year ended 31st
March, 2010 annexed thereto and the cash flow statement for the year
ended on that date. 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.
1. We conducted our audit in accordance with the auditing
standards generally accepted in India. These standards require that we
plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall presentation of the
financial statements. We believe that our audit provides a reasonable
basis for our opinion.
2. As required by the Companies (Auditors Report) Order, 2003 and
amended by the Companies (Auditors Report) (Amendment) Order, 2004
issued by the Central Government in terms of sub-section (4A) of
Section 227 of the Companies Act, 1956, we enclose in the annexure a
statement on the matters specified in paragraphs 4 and 5 of the said
Order.
3. Further to our comments in the Annexure referred to above, we state
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, Profit and Loss Account and Cash Flow Statement
referred to in this report are in agreement with the books of account;
(d) In our opinion, the Balance Sheet, Profit and Loss account and the
Cash Flow Statement dealt with by this report comply with the
accounting standards, referred to in Sub-section (3C) of Section 211 of
the Companies Act, 1956.
(e) On the basis of written representations received from the directors
of the company, as on March 31, 2010 and taken on record by the Board
of Directors, we report that no director is disqualified from being
appointed as a director in terms of clause (g) of sub-section (1) of
Section 274 of the Companies Act, 1956 on the said date;
(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
notes thereon give the information required by the Companies Act, 1956,
in the manner so required and give a true and fair view in conformity
with the accounting principles generally accepted in India:
(i) in so far as it relates to the Balance Sheet, of the state of
affairs of the Company as at 31st March, 2010;
(ii) in so far as it relates to the Profit and Loss Account, of the
loss of the company for the year ended 31st March, 2010; and
(iii) in so far as it relates to the cash flow statement, of the cash
flows for the year ended on that date.
Annexure to the Auditors Report
Annexure referred to in our report of even date on the accounts for the
year ended 31st March, 2010.
1. a) The company has maintained proper records
showing full particulars including quantitative details and situation
of the fixed assets.
b) The assets are physically verified, in phases, by the Management
during the year as per the 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 physical verification. The discrepancies noticed on such
verification have been appropriately dealt with in the books of account
of the company.
c) The assets disposed off during the year are not substantial and
therefore does not affect the going concern status of the company.
2. a) The stock of raw materials, stores, spare parts and
finished goods other than in transit were physically verified during
the year by the Management. In our opinion, the frequency of
verification is reasonable. In respect of inventory with third parties,
which have not been physically verified, there is a process of
obtaining confirmation from such parties.
b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventory
followed by the management are reasonable and adequate in relation to
the size of the company and the nature of its business.
c) In our opinion, the company has maintained proper records of
inventory. The discrepancies noticed on verification between the
physical stocks and the book records were not material and have been
properly dealt with in the books of account.
3. a) During the year, the company has not granted any
unsecured loans to companies, firms or other parties covered in the
register maintained under section 301 of the Companies Act, 1956. Hence
reporting on rate of interest charged and other conditions does not
arise. However, in respect of unsecured loans in the nature of Inter
Corporate Deposits made in an earlier year outstanding at the
commencement of year under report, the company is regularly receiving
the interest at contracted rate. Principal amount received back
during the year is Rs. 19 lakhs and Principal outstanding is Rs. 164.29
lakhs. The terms and other conditions of the loan are not prima facie
prejudicial to interest of the company. b) During the year the company
has taken unsecured loan of Rs 28 lakhs from the holding company
covered in the register maintained under section 301 of the Companies
Act, 1956. The terms and other conditions of the loan are not prima
facie prejudicial to interest of the company.Principal outstanding is
Rs Nil at the end of the financial year.
4. 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 purchase of inventory and fixed assets and for
the sale of goods and services. During the course of our audit, no
major weaknesses have been noticed in the internal control system.
5. a. Based on the audit procedures applied by us and
according to the information and explanations provided by the
management, we are of the opinion that the contracts or arrangements
that need to be entered in the register maintained in pursuance of
Section 301 of the Companies Act, 1956 have been properly entered in
the said register. b. In our opinion and according to the information
and explanations given to us, the transactions entered in the register
maintained under Section 301 and exceeding during the financial year by
Rs.5.00 lakhs in respect of each party have been made at prices which
are reasonable having regard to the prevailing market prices at the
relevant time.
6. The company has not accepted any deposits from the public. (Please
refer note below Schedule XII).
7. The company has an internal audit system, which in our opinion, is
commensurate with its size and nature of its business.
8. We have broadly reviewed the books of account maintained by the
company pursuant to the rules made by the Central Government under
Section 209(1)(d) of the Companies Act, 1956 for maintenance of cost
records and are of the opinion that, prima facie, the prescribed
accounts and records have been made and maintained.
9. a. According to the records provided to us, the company is generally
regular in depositing undisputed statutory dues including Provident
Fund, Investor Education and Protection Fund, Employees State
Insurance, Income-tax, Sales-tax, Wealth Tax, Service Tax, Custom Duty,
Excise Duty, Cess and other statutory dues with the appropriate
authorities. However, a solitary instance of delay of six days was
noticed in respect of ESI remittance.
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 and cess were in arrears, as at 31st March, 2010 for
a period of more than six months from the date they became payable.
c. According to the information and explanations given to us, the
following are the details of the disputed dues, that were not deposited
with the concerned authorities.
Name of the
Statute Nature of dues Amount Forum where dispute
(Rs.in lakhs) is pending
Sales Tax Act Statutory Forms
/ Entry Tax/ 134.19 Assistant Commiss-
ioner /
various states Warranty replacement
stock Deputy Commissi-
oner / Appellate
related / Turnover
dispute authorities-Comme-
rcial Taxes of
various states
Income Tax Act,
1961 Disallowance of
expenditure 225.85 Income tax Appellate
Tribunal
relating to payments
to foreign constultants,
cost of acquisition of an
asset as regards compu-
tation of capital gain
and time of taxing of
income received in
advance
10. The company has no accumulated losses as at the end of the
financial year. It has incurred cash loss during the financial year.
There is cash loss in the immediately preceding financial year.
11. Based on our verification and according to the information and
explanations given by the management, the company has not defaulted in
repayment of dues to any financial institution or bank.
12. Based on our examination and according to the information and
explanations given to us, the company has not granted loans and
advances on the basis of security by way of pledge of shares,
debentures and other securities.
13. The company is not a chit / nidhi / mutual benefit fund / society
and as such clause (xiii) of the order is not applicable.
14. The company is not dealing or trading in shares, securities,
debentures and other investments. All investments are held in the
companys own name except in the case of investment in wholly owned
subsidiaries where certain number of shares are held by nominees as
provided in Section 49 (3) of the Companies Act, 1956.
15. The company has not given any guarantee for loans taken by others
from bank or financial institution.
16. In our opinion, the term loans were applied for the purpose for
which the loans were obtained.
17. On the basis of our examination, the company has not used the
funds raised on short-term basis for long-term investments.
18. During the year, the company has not allotted any shares on
preferential basis to parties and companies covered in the register
maintained under Section 301 of the Companies Act, 1956.
19. During the year, the company has not issued any debentures.
20. During the year, the company has not raised any money by public
issue.
21. Based on the audit procedures adopted and information and
explanations given to us by the management, no fraud on or by the
company has been noticed or reported during the course of our audit.
For SUNDARAM & SRINIVASAN
Chartered Accountants
Firm Registration No:004207S
M BALASUBRAMANIYAM
Partner
Membership No. F7945
Chennai
29th July, 2010