Mar 31, 2018
Report on the Financial Statements
We have audited the accompanying financial statements of WALCHANDNAGAR INDUSTRIES LIMITED (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2018, and the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the Statement of Cash Flows for the year then ended and a summary of the significant accounting policies and other explanatory information.
Managementâs Responsibility for the 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 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 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 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 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 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 obtained by us is sufficient and appropriate to provide a basis for our audit opinion on the financial statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2018, and its Loss, total comprehensive income, the changes in equity and its cash flows for the year ended on that date.
Emphasis of Matter
We draw attention to the following matter in Notes to Financial Statements:
a) Refer Note 54 regarding non-moving inventory of work-in-progress amounting to Rs. 2585 Lakhs on account of orders which have been cancelled/put on hold. The Company contends that this stock will either be liquidated or diverted to other projects without any loss arising therefrom.
Our report is not modified in respect of this matter.
Report on Other Legal and Regulatory Requirements
1. As required by Section 143(3) of the Act, based on our audit 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 and proper returns adequate for the purpose of our audit have been received from overseas divisions at Zambia and Ethiopia not visited by us. In case of Ethiopia, overseas Auditorsâ Report has been forwarded to us and appropriately dealt with. In case of division at Zambia, since there were no operations on account of closure of site, the returns received from the division are unaudited.
c) the Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, Statement of Changes in Equity and the Statement of Cash Flow dealt with by this Report are in agreement with the books of account and with the returns from the divisions at Zambia and Ethiopia.
d) in our opinion, the aforesaid financial statements comply with the Indian Accounting Standards prescribed 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 of the Company as on March 31, 2018 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2018 from being appointed as a director in terms of Section 164(2) of the Act.
f) with respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure 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 financial statements. - Refer Note 50 to the financial statement.
ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
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.
ANNEXURE âAâ TO THE INDEPENDENT AUDITORâS REPORT
(Referred to in paragraph 1(f) under âReport on Other Legal and Regulatory Requirementsâ section of our report to the Members of WALCHANDNAGAR INDUSTRIES LIMITED of even date)
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 WALCHANDNAGAR INDUSTRIES LIMITED (âthe Companyâ) as of March 31, 2018 in conjunction with our audit of the financial statements of the Company for the year ended on that date.
Managementâs Responsibility for Internal Financial Controls
The Board of Directors of the Company 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, 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 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, 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.
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, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2018, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
ANNEXURE âBâTO THE INDEPENDENT AUDITORâS REPORT
(Referred to in paragraph 2 under âReport on Other Legal and Regulatory Requirementsâ section of our report to the Members of WALCHANDNAGAR INDUSTRIES LIMITED of even date)
i. In respect of the Companyâs fixed assets:
(a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
(b) The Company has a program of verification to cover all the items of fixed assets in a phased manner which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the program, certain fixed assets were physically verified by the management during the year. According to the information and explanations given to us, no material discrepancies were noticed on such verification.
(c) According to the information and explanations given to us, the records examined by us and based on the examination of the conveyance deeds provided to us, we report that, the title deeds, comprising all the immovable properties of land and buildings which are freehold, are held in the name of the Company as at the balance sheet date except in respect of land Survey Nos. 317/1B, 303 A/2 and 337 are not available.
ii. The Management has conducted physical verification of the inventory at reasonable intervals other than material lying with sub-contractors.
iii. The Company has not granted any secured or unsecured loans to companies, firms or other parties covered in the Register maintained under section 189 of the Companies Act, 2013. Therefore, clause 3 (iii) of the said Order is not applicable.
iv. In our opinion and according to the information and explanations given to us, the company doesnât have any loans, investments, guarantee or security to which the provisions of section 185 and 186 of the Companies Act 2013 apply.
v. The Company has not accepted any deposits during the year to which the provisions of section 73 to 76 of the Companies Act, 2013 and Companies (Acceptance of deposits) Rules, 2014 apply. According to the information and explanation given to us no order has been received from Company Law Board, National Company Law Tribunal or Reserve Bank of India or any court or tribunal by the Company.
vi. We have broadly reviewed the cost records maintained by the Company specified by the Central Government under section 148(1) of the Companies Act, 2013 and are of the opinion that, prima facie, the prescribed cost records have been maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.
vii. 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, Value Added Tax, Customs Duty, Excise Duty, 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, Value Added Tax, Goods and Service Tax, Customs Duty, Excise Duty, Cess and other material statutory dues in arrears as at March 31, 2018 for a period of more than six months from the date they became payable.
(c) Details of dues of Income Tax, Sales Tax, Service Tax, Excise Duty and Value Added Tax which have not been deposited as at March 31,2018 on account of dispute are given below:
Name of the statute |
Nature of Dues |
Amt. In lakhs) |
Period to which the amount relates |
Forum where the dispute is pending |
Central Excise Act, 1944 |
Denial of exemption availed under notification No. 6/2002 for supply of biomass based boilers |
266.19 (Net of CENVAT reversal and payment) |
June, 2001 to March, 2004 |
Supreme Court |
Central Excise Act, 1944 |
Excise duty demand on bought out items supplied for centrifugals which have already suffered duty at manufacturersâ end. |
188.95 (Net of CENVAT reversal and payment) |
February 1990, to June 2017 |
Supreme Court/CESTAT Tribunal |
Central Excise Act, 1944 |
Excise duty demand on bought out items supplied for centrifugals. |
2.47 |
September, 2009 to January 2011 |
CESTAT, M u m ba i |
Central Sales Tax,1956 |
The exemption from tax for transit sale under section 6(2) (b) is denied. Rs. 30 lakhs paid under protest |
159.83 |
2005-06 |
Sales Tax (Appellate Tribunal), Mumbai |
Maharashtra Vat Act,2002 / Central Sales Tax,1956 |
Demand due to difference in amount of âCâ forms/ other miscellaneous |
1,080.53 |
2013-14 |
Commissioner (Appeals), Sales Tax |
Service Tax |
Demand on value addition of bought out items, Rs. 28.76 lakhs paid under protest. |
362.65 |
2006-10 |
CESTAT, Kolkata |
Customs Act,1962 |
Demand due to customs valuation issues |
64.50 |
July,2008 till date |
Madras High Court, Chennai |
Maharashtra Land Revenue Code |
NA Tax (Rs. 20 lakhs paid under protest) |
86.61 |
1982 to 2003 |
Tahasildar, Indapur |
NATax |
16.18 |
1982 to 2003 |
Tahasildar, Indapur |
|
NATax |
58.58 |
1994 to 2003 |
Tahasildar, Indapur |
|
Pune Municipal Corporation |
Municipal Taxes-Determination of Annual Rateable Value |
89.32 |
2008-09 to 2016-17 |
Court of Small Causes, Pune |
Employees Provident Fund |
EPF-Demand from EPF authorities |
50.68 |
2006-07 |
Mumbai High Court |
viii. There are no loans or borrowings from Government. To the best of our knowledge and according to the information and explanations given to us, except following delays, the Company has not defaulted in repayment of any loans or borrowings from financial institutions, banks and to debenture holders.
Lenderâs Name |
Period of Delay |
Amount-Rs. in lakhs |
Due on |
Actual payment date |
State Bank of India |
3 |
200.00 |
31-Mar-17 |
3-Apr-17 |
Bank of India |
78 |
175.00 |
30-Jun-17 |
16-Sep-17 |
ix. The Company has not raised moneys by way of initial public offer or further public offer. However during the year, the company raised Rs. 57 crores through issue of Non-Convertible Debentures and Rs. 180 crores through Term Loan. To the best of our knowledge and according to the information and explanations given to us, the company has applied these monies for the purposes for which they are raised.
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 paid/provided managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Act.
xii. The Company is not a Nidhi Company and hence reporting under clause 3 (xii) of the Order is not applicable to the Company.
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 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 paid convertible debentures and hence reporting under clause 3 (xiv) of the Order 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 or persons connected to its directors and hence provisions of section 192 of the Companies Act, 2013 are not applicable to the Company.
xvi. The Company is not required to be registered under section 45-IA of the Reserve Bankof India Act, 1934.
For Jayesh Sanghrajka & Co. LLP
Chartered Accountants
ICAI Firm Registration Number: 104184W/W100075
Ashish Sheth
Place: Mumbai Designated Partner
Date: May 28,2018 Membership Number: 107162
Mar 31, 2017
Report on the Financial Statements
We have audited the accompanying financial statements of Walchandnagar Industries Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2017, the Statement of Profit and Loss and the 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
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 and presentation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles 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.
Auditor''s Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit.
We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.
We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud and error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the financial statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2017, and its loss and its cash flows for the year ended on that date.
Emphasis of Matter
We draw attention to
a) Note No. 14.1(a) to the Financial Statements regarding old Trade Receivables of Rs.716.32 Lakhs which are currently under arbitration/ litigation. Pending the ultimate outcome of these matters, which is presently unascertainable, no provision has been made in respect of these dues.
b) Note No. 14.1(c) to the Financial Statements regarding non current debtors which include dues of Rs.312.56 Lakhs from Govt. parties after completion of the projects which are considered good for recovery.
c) Note No. 16 to the Financial Statements regarding non moving inventory of work in progress amounting to Rs.2593.67 Lakhs on account of orders which have been cancelled/ put on hold. The Company contends that this stock will either be liquidated or diverted to other projects without any loss arising there from.
Our report is not qualified in respect of the above matters. Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2016 (''the Order'') issued by the Central Government of India - Ministry of Corporate Affairs, in terms of sub-section (11) of section 143 of the Act, we give in the Annexure A, a statement on the matters specified in paragraphs 3 and 4 of the said Order.
2. As required by Section 143 (3) of the Act, we report that:
(a) we have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the 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 and proper returns adequate for the purpose of our audit have been received from divisions at Zambia and Ethiopia not visited by us. In case of Ethiopia, overseas Auditors'' Report has been forwarded to us and appropriately dealt with. In case of division at Zambia, as there are no significant operations on account of closure of site, the returns received from the branch are unaudited.
(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 and with the returns from the divisions at Zambia and Ethiopia;
(d) In our opinion, the aforesaid 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 March 31, 2017 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2017 from being appointed as a director in terms of Section 164 (2) of the Act.,
(f) with respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in "Annexure B"; and
(g) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note 34 to the financial statements;
ii. the Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts;
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund (IEPF) by the Company except in case of unclaimed redemption amount of preference shares amounting to Rs.1.44 Lakhs which is remaining to be transferred as at the end of the year. (Please refer Note No. 37 to the financial statements).
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 8th November 2016 to 30th December 2016. Based on audit procedures and relying on the management representation we report that the disclosures are in accordance with books of accounts maintained by the Company and as produced to us by the management - Refer note No.36.
(Referred to in paragraph 1 under the heading "Report on Other Legal and Regulatory Requirements" of our Report of even date on the financial statements for the year ended March 31, 2017 of Walchandnagar Industries Limited)
(i) (a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.
(b) The Company has a programme for physical verification of the fixed assets, which in our opinion is reasonable having regard to the nature of the business. Accordingly, the fixed assets have been physically verified by the Management at the end of the year and no material discrepancies were noticed on such verification.
(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company except in respect of land survey Nos. 317/1B, 303 A/2 and 337 are not available.
(ii) The Management has conducted physical verification of the inventory at reasonable intervals other than material lying with sub-contractors, which have been confirmed by majority of them.
(iii) The Company has not granted any secured or unsecured loans to companies, firms or other parties covered in the Register maintained under section 189 of the Companies Act, 2013. Therefore, clause 3 (iii) of the said Order is not applicable.
(iv) In our opinion and according to the information and explanations given to us, the company doesn''t have any loans, investments, guarantee or security to which the provisions of section 185 and 186 of the Companies Act 2013 apply.
(v) The Company has not accepted any deposits during the year to which the provisions of section 73 to 76 of the Companies Act, 2013 and Companies (Acceptance of deposits) Rules, 2014 apply. According to the information and explanation given to us no order has been received from Company Law Board, National Company Law Tribunal or Reserve Bank of India or any court or tribunal by the Company.
(vi) We have broadly reviewed the cost records maintained by the Company specified by the Central Government under section 148(1) of the Companies Act, 2013 and are of the opinion that, prima facie, the prescribed cost records have been maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.
(vii) (a) According to the information and explanations given to us and the records of the Company examined by us, the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Employees'' State Insurance, Income Tax, Sales Tax, Service Tax, Custom Duty, Excise Duty, Value Added Tax, Cess and other material statutory dues to the extent applicable to it.
According to the information and explanations given to us, there are no undisputed outstanding dues in respect of the above items in arrears as at March 31, 2017 for a period of more than six months from the date they became payable.
(b) According to the information and explanations given to us, the disputed statutory dues on accounts of Income Tax, Sales Tax, Service Tax, Customs Duty, Excise Duty, Value Added Tax, Municipal Tax and Cess that have not been deposited on account of matters pending before appropriate authority are as follows:
Name of the Statute |
Nature of Dues |
Amount (Rs. in Lakhs) |
Period to which the amount relates |
Forum where dispute is pending |
Central Excise Act, 1944 |
Denial of exemption availed under notification No. 6/2002, for supply of biomass based boilers. |
266.19 (Net of CENVAT reversal and payment) |
March, 2000 to March, 2004 |
CESTAT, Mumbai |
Central Excise Act, 1944 |
Excise duty demand on bought out items supplied for centrifugals, which have already suffered duty at manufacturers end. |
82.73 (Net of CENVAT reversal and payments) |
June, 1983 to April, 2005 |
Supreme Court |
Maharashtra Land Revenue Code |
NA Tax (Rs. 20 Lakhs paid under protest) |
86.61 |
1982 to 2003 |
Tahasildar, Indapur |
NA Tax |
16.18 |
1982 to 2003 |
Tahasildar, Indapur |
|
NA Tax |
58.58 |
1994 to 2003 |
Tahasildar, Indapur |
|
Pune Municipal Corporation |
Municipal Taxes -Determination of Annual Rateable Value |
89.32 |
2008-09 to 2016-17 |
Court of Small Causes , Pune |
Name of the Statute |
Nature of Dues |
Amount (Rs. in Lakhs) |
Period to which the amount relates |
Forum where dispute is pending |
Central Sales Tax Act, 1956 |
The exemption from tax for transit sale under section 6(2) (b) is denied. Rs.30 Lakhs paid under protest. |
159.83 |
2005-06 |
Sales Tax (Appellate Tribunal), Mumbai |
Service Tax |
Demand on value addition of bought out items. Rs.28.76 Lakhs paid under protest. |
362.65 |
2006-10 |
CESTAT, Kolkata |
Employees Provident Fund |
EPF - Demand from EPF authorities |
50.68 |
2006-07 |
Mumbai High Court |
Central Excise Act, 1944 |
Excise Duty on bought out components supplied for Centrifugals |
2.47 |
Sept-09 to Jan-11 |
CESTAT, Mumbai |
(viii) There are no loans or borrowings payable to government or debenture holders. The Company has delayed in repayment of following dues to the banks and financial institutions during the year.
(Rs. In Lakhs)
Lenders name |
Period of default days |
Amount |
Installment due on |
Actual payment date |
Bank Of India |
77 |
175.00 |
31/03/2016 |
16/06/2016 |
Bank Of India |
84 |
175.00 |
30/06/2016 |
22/09/2016 |
Bank Of India |
62 |
175.00 |
30/09/2016 |
01/12/2016 |
Bank Of India |
40 |
175.00 |
31/12/2016 |
09/02/2017 |
State Bank of India |
03 |
200.00 |
31/03/2017 |
03/04/2017 |
(ix) The company has not raised money by way of Initial Public Offer or further public offer (including debt instruments) during the year. In respect of term loans taken by the Company, in our opinion and according to the information and explanations given to us, the same have been applied for the purposes for which they were raised.
(x) According to the information and explanations given to us, no material fraud by the Company or on the Company by its officers or employees has been noticed or reported during the course of our audit.
(xi) According to the information and explanations give to us and based on our examination of the records of the Company, the Company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Act.
(xii) In our opinion and according to the information and explanations given to us, the Company is not a nidhi company. Accordingly, clause (xii) of the Order is not applicable.
(xiii) According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with sections 177 and 188 of the Act where applicable and details of such transactions have been disclosed in the financial statements as required by the applicable accounting standards.
(xiv) According to the information and explanations give to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.
(xv) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into non-cash transactions with directors or persons connected with him. Accordingly, clause (xv) of the Order is not applicable.
(xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act 1934.
FOR, K. S. Aiyar & Co.,
Chartered Accountants
Firm''s Registration No.: 100186W
Satish K. Kelkar
Place: Mumbai Partner
Date: May 26, 2017. Membership No.: 38934
Sep 30, 2014
We have audited the accompanying financial statements of Walchandnagar
Industries Limited ("the Company"), which comprise the Balance Sheet as
at September 30, 2014, the Statement of Profit and Loss and the 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") which continue to applicable
in respect of Section 133 of the Companies Act, 2013 in terms of
General Circular 15/2013 dated September 13, 2013 of the Ministry of
Corporate Affairs and in accordance with the accounting principles
generally accepted in India. This responsibility includes the design,
implementation and maintenance of internal control relevant to the
preparation and fair presentation of the financial statements that are
free from material misstatement, whether due to fraud or error.
Auditor''s responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and the disclosures in the financial statements. The
procedures selected depend on the auditor''s judgement, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud and error. In making those risk
assessments, the auditor considers internal control relevant to the
Company''s preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Company''s internal control. An audit also includes
evaluating the appropriateness of accounting policies used and the
reasonableness of the accounting estimates made by the management, as
well as evaluating the overall presentation of the financial
statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion. opinion
In our opinion and to the best of our information and according to the
explanations given to us, the financial statements give the information
required by the Act in the manner so required and give a true and fair
view in conformity with the accounting principles generally accepted in
India:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at September 30, 2014;
(b) in the case of the Statement of Profit 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 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"), as amended, issued by the Central Government of India in terms
of sub-section (4A) of section 227 of the Act, we give in the Annexure
a statement on the matters specified in paragraphs 4 and 5 of the
Order.
2. As required by section 227(3) of the Act, we report that:
(a) we have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purpose of our
audit;
(b) in our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books and proper returns adequate for the purpose of our audit
have been received from divisions at Zambia and Ethiopia not visited by
us. The divisions'' overseas Auditors'' Reports have been forwarded to us
and appropriately dealt with;
(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 and with the audited returns from the divisions at Zambia and
Ethiopia;
(d) in our opinion, the Balance Sheet, Statement of Profit and Loss,
and Cash Flow Statement comply with the Accounting Standards referred
to in sub-section (3C) of section 211 of the Companies Act, 1956 read
with the General Circular 15/2013 dated September 13, 2013 of the
Ministry of Corporate Affairs in respect of Section 133 of the
Companies Act, 2013; and
(e) on the basis of written representations received from the directors
as on September 30, 2014, and taken on record by the Board of
Directors, none of the directors is disqualified as on September 30,
2014, from being appointed as a director in terms of clause (g) of
sub-section (1) of section 274 of the Companies Act, 1956.
(Referred to in paragraph 1 under the heading "Report on Other Legal
and Regulatory Requirements" of our Report of even date on the
financial statements for the year ended September 30, 2014 of
Walchandnagar Industries Limited)
(i) In respect of its fixed assets :
(a) The Company has maintained proper records showing full particulars
including quantitative details and situation of fixed assets.
(b) The Company has a programme for physical verification of the fixed
assets, which in our opinion is reasonable having regard to the nature
of the business. Accordingly, the fixed assets have been physically
verified by the Management at the end of the year and no material
discrepancies were noticed on such verification.
(c) The fixed assets disposed off during the year were not substantial.
According to the information and explanations given to us, we are of
the opinion that the disposal of the Fixed Assets has not affected the
going concern status of the Company.
(ii) In respect of its inventories :
(a) The Management has conducted physical verification of the inventory
at reasonable intervals other than material lying with sub-contractors,
which have been confirmed by majority of them.
(b) The procedures of physical verification of inventories followed by
the Management are reasonable and adequate in relation to the size of
the Company and the nature of its business.
(c) The Company has maintained proper records of inventory and no
material discrepancies were noticed on physical verification as
compared to the book records.
(iii) The Company has not granted/ taken any secured or unsecured loans
to/ from companies, firms or other parties covered in the Register
maintained under section 301 of the Companies Act, 1956. Therefore,
sub-clauses (b), (c),
(d) , (e), (f) and (g) of clause (iii) of the said Order are not
applicable.
(iv) In our opinion and according to the information and explanations
given to us, there are adequate internal control systems commensurate
with the size of the Company and the nature of its business with regard
to the purchase of inventories and fixed assets and with regard to the
sale of goods and services. During the course of our audit, we have
not observed any continuing failure to correct major weaknesses in
internal controls.
(v) (a) According to the information and explanations given to us, we
are of the opinion that the transactions that need to be entered into
the register maintained under section 301 of the Companies Act, 1956
have been so entered.
(b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of contracts or
arrangements entered in the registers maintained under section 301 of
the Companies Act, 1956 and exceeding the value of Rs. 5 Lakhs in respect
of any party during the year have been made at price which are
reasonable having regard to prevailing market prices at the relevant
time.
(vi) In our opinion and according to the information and explanations
given to us, the Company has complied with the provisions of section
58A and 58AA and any other relevant provisions of the Companies Act,
1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard
to the deposits accepted from the public. As informed to us, no order
has been passed by the Company Law Board, National Company Law Tribunal
or Reserve Bank of India or any other court or any other tribunal.
(vii) In our opinion, Company has an internal audit system commensurate
with size and nature of its business.
(viii) We have broadly reviewed the cost records maintained by the
Company pursuant to the Companies (Cost Accounting Records) Rules, 2011
prescribed by the Central Government under section 209(1) (d) of the
Companies Act, 1956 and are of the opinion that, prima facie, the
prescribed cost records have been maintained. We have, however, not
made a detailed examination of the cost records with a view to
determine whether they are accurate or complete.
(ix) (a) According to the information and explanations given to us and
the records of the Company examined by us, the Company is generally
regular in depositing with appropriate authorities 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 and Cess and other material statutory
dues applicable to it.
According to the information and explanations given to us, there are no
undisputed outstanding dues in respect of the above items in arrears as
at September 30, 2014 for a period of more than six months from the
date they became payable.
(b) According to the information and explanations given to us, the
disputed statutory dues on accounts
of Sales Tax, Income Tax, Customs Duty, Wealth Tax, Service Tax, Excise
Duty, Municipal Tax and Cess that have not been deposited on account of
matters pending before appropriate authority are as follows:
Name of the Nature of Amount Period to
Statute Dues (Rsin Lakhs) which the
amount
relates
Central Denial of 266.19 March,
Excise Act, exemption (Net of 2000 to
1944 availed under CENVAT March,
notification reversal 2004
No. 6/2002, and
for supply payment)
of biomass
sbased boilers.
Central Excise duty 82.73 June, 1983
Excise Act, demand (Net of to April,
1944 on bought CENVAT 2005
out items reversal
supplied for and
centrifugals, payments)
which have
already suffered
duty at
manufacturers
end.
Maharashtra NA Tax (20 86.61 1982 to
Land Lakhs paid 2003
Revenue under protest)
Code
NA Tax 16.18 1982 to
2003
NA Tax 58.58 1994 to
2003
Pune Municipal 325.07 2008-09 to
Municipal Taxes - 2011-12
Corporation Determination
of Annual
Rateable Value
Central Sales The 159.83 2005-06
Tax Act, exemption
1956 from tax
for transit
sale under
section 6(2)
(b)is denied.
30 Lakhs paid
under protest).
Service Tax Demand on 362.65 2006-10
value addition
of bought out
items.
28.76 Lakhs
paid under
protest).
Employees EPF - Demand 50.68 2006-07
Provident from EPF
Fund authorities
Central Excise Duty 2.47 Sept-09 to
Excise Act, on bought out Jan-11
1944 components
supplied for
Centrifugals
Name of the Statue Forum where dispute is pending
Central Excise Act,1944 CESTAT, Mumbai
Central Excise Act,1944 Supreme Court
Maharashtra Land Revenue Code Collector of Pune
SDO, Baramati
SDO, Baramati
Pune Municipal Corporation Court of Small Causes , Pune
Central Sales Tax Act,1956 Joint Commissioner of Sales
Tax (Appeal), Pune
Service Tax Employees Provident
Fund CESTAT, Kolkata
Employees Provident Fund Mumbai High Court
Central Excise Act,1944 CESTAT, Mumbai
(x) The Company does not have any accumulated losses as at the end of
the financial year.The Company has incurred cash losses in the
financial year covered by our audit and in the immediately preceding
financial year.
(xi) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in the repayment of dues to
the financial institutions or banks or debenture holders during the
year.
(xii) The Company has not granted any loans and advances on the basis
of security by way of pledge of shares, debentures and other
securities.
(xiii) In our opinion and according to the information and explanations
given to us, the Company is not a chit fund or a nidhi/ mutual benefit
fund/ society. Therefore, the provisions of clause 4(xiii) of the
Companies (Auditor''s Report) Order, 2003 are not applicable to the
Company.
(xiv) In our opinion and according to the information and explanations
given to us, the Company is not dealing in or trading in shares,
securities, debentures and other investments. Accordingly the
provisions of clause 4(xiv) of the Companies (Auditor''s Report) Order,
2003 are not applicable to the Company.
(xv) According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from
banks or financial institutions.
(xvi) In our opinion and according to the information and explanations
given to us, the term loans taken by the Company have been applied for
the purposes for which they were raised.
(xvii) According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we are of
the opinion that funds raised on short- term basis have not been used
for long-term investment.
(xviii) According to the information and explanations given to us,
during the period covered by our audit report, the Company has not made
any preferential allotment of shares to the parties and companies
covered under the register maintained under section 301 of the
Companies Act, 1956.
(xix) According to the information and explanations given to us, during
the period covered by our audit report, the Company has not issued any
debentures.
(xx) According to the information and explanations given to us, during
the period covered by our audit report, the Company has not raised any
money by public issue.
(xxi) According to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
For K. s. Aiyar & Co.,
Chartered Accountants
Firm''s Registration No.: 100186W
satish K. Kelkar
Place: Mumbai Partner
Date: November 29, 2014 Membership No.: 38934
Sep 30, 2013
Report on the Financial Statements
We have audited the accompanying financial statements of Walchandnagar
Industries Limited ("the Company"), which comprise the Balance Sheet as
at September 30, 2013, the Statement of Profit and Loss and the 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") and in accordance with the
accounting principles generally accepted in India. This responsibility
includes the design, implementation and maintenance of internal control
relevant to the preparation and fair presentation of the financial
statements that are free from material misstatement, whether due to
fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The procedures
selected depend on the auditor''s judgment, including the assessment of
the risks of material misstatement of the financial statements, whether
due to fraud and error. In making those risk assessments, the auditor
considers internal control relevant to the Company''s preparation and
fair presentation of the financial statements in order to design audit
procedures that are appropriate in the circumstances. An audit also
includes evaluating the appropriateness of accounting policies used and
the reasonableness of the accounting estimates made by the management,
as well as evaluating the overall presentation of the financial
statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the financial statements give the information
required by the Act in the manner so required and give a true and fair
view in conformity with the accounting principles generally accepted in
India:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at September 30, 2013;
(b) in the case of the Statement of Profit 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 flows for the
year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order") issued by the Central Government of India in terms of
sub-section (4A) of section 227 of the Act, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
2. As required by section 227(3) of the Act, we report that:
(a) we have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purpose of our
audit;
(b) in our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books and proper returns adequate for the purpose of our audit
have been received from divisions at Zambia and Ethiopia not visited by
us. The divisions'' overseas Auditors'' Reports have been forwarded to us
and appropriately dealt with;
(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 and with the audited returns from the divisions at Zambia and
Ethiopia;
(d) i n 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 September 30, 2013, and taken on record by the Board of
Directors, none of the directors is disqualified as on September 30,
2013, from being appointed as a director in terms of clause (g) of sub-
section (1) of section 274 of the Companies Act, 1956.
annexure to the auditors'' report
(Referred to in paragraph 1 under the heading "Report on Other Legal
and Regulatory Requirements" of our Report of even date on the
financial statements for the year ended September 30, 2013 of
Walchandnagar Industries Limited)
(i) In respect of its fixed assets:
(a) The Company has maintained proper records showing full particulars
including quantitative details and situation of fixed assets.
(b) The Company has a programme for physical verification of the fixed
assets, which in our opinion is reasonable having regard to the nature
of the business. Accordingly, the fixed assets have been physically
verified by the Management at the end of the year and no material
discrepancies were noticed on such verification.
(c) The fixed assets disposed of during the year were not substantial.
According to the information and explanations given to us, we are of
the opinion that the disposal of the Fixed Assets has not affected the
going concern status of the Company.
(ii) In respect of its inventories:
(a) The Management has conducted physical verification of the inventory
at reasonable intervals other than material lying with sub-contractors,
which have been confirmed by majority of them.
(b) The procedures of physical verification of inventories followed by
the Management are reasonable and adequate in relation to the size of
the Company and the nature of its business.
(c) The Company has maintained proper records of inventory and no
material discrepancies were noticed on physical verification as
compared to the book records.
(iii) The Company has not granted/taken any secured or unsecured loans
to/ from companies, firms or other parties covered in the Register
maintained under section 301 of the Companies Act, 1956. Therefore,
sub-clauses (b), (c), (d), (e), (f) and (g) of clause (iii) of the said
Order are not applicable.
(iv) In our opinion and according to the information and explanations
given to us, there are adequate internal control systems commensurate
with the size of the Company and the nature of its business with regard
to the purchase of inventory and fixed assets and for sale of goods and
services. During the course of our audit, we have not observed any
continuing failure to correct major weaknesses in internal controls.
(v) (a) According to the information and explanations given to us, we
are of the opinion that the transactions that need to be entered into
the register maintained under section 301 of the Companies Act, 1956
have been so entered.
(b) I n our opinion and according to the information and explanations
given to us, the transactions made in pursuance of contracts or
arrangements entered in the registers maintained under section 301 of
the Companies Act, 1956 and exceeding the value of Rs. Five lakhs in
respect of any party during the year have been made at price which are
reasonable having regard to prevailing market prices at the relevant
time.
(vi) In our opinion and according to the information and explanations
given to us, the Company has complied with the provisions of section
58A and 58AA and any other relevant provisions of the Companies Act,
1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard
to the deposits accepted from the public. As informed to us, no order
has been passed by the Company Law Board, National Company Law Tribunal
or Reserve Bank of India or any other court or any other tribunal.
(vii) In our opinion, Company has an internal audit system commensurate
with size and nature of its business.
(viii) We have broadly reviewed the cost records maintained by the
Company pursuant to the Companies (Cost Accounting Records) Rules, 2011
prescribed by the Central Government under section 209(1)(d) of the
Companies Act, 1956 and are of the opinion that, prima facie, the
prescribed cost records have been maintained. We have, however, not
made a detailed examination of the cost records with a view to
determine whether they are accurate or complete.
(ix) (a) According to the information and explanations given to us and
the records of the Company examined by us, the Company is generally
regular in depositing with appropriate authorities 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 and Cess and other material statutory
dues applicable to it. There are no undisputed outstanding dues in
respect of the above items which are more than six months as at the
balance sheet date.
(b) According to the information and explanations given to us, the
disputed statutory dues on accounts of Sales Tax, Income Tax, Customs
Duty, Wealth Tax, Service Tax, Excise Duty, Municipal Tax and Cess that
have not been deposited on account of matters pending before
appropriate authority are as follows:
Name Nature Amount Period to Forum
of the of Dues (Rs. in which the where
Statute Lakhs) amount dispute is
relates pending
Central Denial of 266.19 March, CESTAT,
Excise Act, exemption (Net of 2000 to Mumbai
1944 availed under CENVAT March,
notification reversal 2004
No. 6/2002, and
for supply of payment)
biomass based
boilers.
Central Excise duty 82.45 June, 1983 Supreme
Excise Act, demand on (Net of to Court
1944 bought out CENVAT April, 2005
items supplied reversal
for centrifugals, and
which have payments)
already
suffered duty at
manufacturers
end.
Maharashtra NA Tax (Rs. 20 86.61 1982 to Collector
Land lakhs paid 2003 of Pune
Revenue under protest)
Code
NA Tax 16.18 1982 to SDO,
2003 Baramati
NA Tax 58.58 1994 to SDO,
2003 Baramati
Pune Municipal 325.07 2008-09 Court of
Municipal Taxes - to 2011-12 Small
Corporation Determination Causes,
of Annual Pune
Rateable Value
Central
Sales The exemption 159.83 2005-06 Joint
Tax Act,
1956 from tax for Commissioner
transit sale of Sales Tax
under section (Appeal),
6(2)(b) is Pune
denied. (Rs.
30 lakhs paid
under protest).
Andhra VAT - Addition 475.53 Oct. 2009 to Appellate
Pradesh of adhoc Sept. 2010 Dy.
Value Added amount in Sales Commissioner
Tax Act (CT),
Secunderabad
Service Tax Demand on 362.65 2006-10 CESTAT,
value addition Kolkata
of bought out
items. (Rs.
28.76 lakhs
paid under
protest).
Employees EPF - Demand 50.68 2006-07 Mumbai
Provident from EPF High Court
Fund authorities
(x) The Company does not have any accumulated losses as at the end of
the financial year. The Company has incurred cash losses only in the
financial year covered by our audit but has not incurred any cash loss
in the immediately preceding financial year.
(xi) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in the repayment of dues to
the financial institutions or banks or debenture holders during the
year.
(xii) The Company has not granted any loans and advances on the basis
of security by way of pledge of shares, debentures and other
securities.
(xiii) In our opinion and according to the information and explanations
given to us, the Company is not a chit fund or a nidhi/mutual benefit
fund/society. Therefore, the provisions of clause 4(xiii) of the
Companies (Auditor''s Report) Order, 2003 are not applicable to the
Company.
(xiv) In our opinion and according to the information and explanations
given to us, the Company is not dealing in or trading in shares,
securities, debentures and other investments. Accordingly the
provisions of clause 4(xiv) of the Companies (Auditor''s Report) Order,
2003 are not applicable to the Company.
(xv) According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from
banks or financial institutions.
(xvi) The term loans have been applied for the purposes for which they
were raised.
(xvii) According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we report
that no funds raised on short-term basis have been used for long-term
investment.
(xviii) According to the information and explanations given to us
during the period covered by our audit report, the Company has not made
any preferential allotment of shares to the parties and companies
covered under the register maintained under section 301 of the
Companies Act, 1956.
(xix) According to the information and explanations given to us during
the period covered by our audit report, the Company has not issued any
debentures.
(xx) According to the information and explanations given to us during
the period covered by our audit report, the Company has not raised any
money by public issue.
(xxi) According to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
For K. S. Aiyar & Co.
Chartered Accountants
Firm''s Registration No. 100186W
By the hand of
Satish K. Kelkar
Place : Mumbai Partner
Date : November 27, 2013 Membership No. 38934
Sep 30, 2010
We have audited the attached Balance Sheet of Walchandnagar Industries
Limited, as at 30th September, 2010 and also the Profit and Loss
Account and the Cash Flow Statement for the year ended on that date
annexed thereto, in which are incorporated the returns of the division
at Zambia audited by overseas local auditors and relied on by us.
1. These financial statements are the responsibility of the Companys
management. Our responsibility is to express an opinion on these
financial statements based on our audit.
2. We conducted our audit in accordance with the Auditing Standards
generally accepted in India. Those Standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the Companies (Auditors Report) Order, 2003, as
amended by the Companies (Auditors Report) (Amendment) Order, 2004,
issued by the Central Government of India in terms of sub-section (4A)
of Section 227 of the Companies Act, 1956, we enclose in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the said
Order.
4. Further to our comments in the Annexure referred to in paragraph 3
above, we report that:
(i) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purposes of our
audit;
(ii) In our opinion, proper books of account as required by law, have
been kept by the Company so far as appears from our examination of
those books and proper returns adequate for the purposes of our audit
have been received from the division at Zambia not visited by us. The
divisions overseas Auditors Report has been forwarded to us and
appropriately dealt with;
(iii) The balance sheet, profit and loss account and cash flow
statement dealt with by this report are in agreement with the books of
account and with the audited returns from the division at Zambia;
(iv) In our opinion, the balance sheet, profit and loss account and
cash flow statement dealt with by this report comply with the
Accounting Standards referred to in sub-section (3C) of Section 211 of
the Companies Act, 1956;
(v) On the basis of written representations received from the
Directors, as on 30th September, 2010 and taken on record by the Board
of Directors, we report that none of the Directors of the Company are
disqualified as on 30th September, 2010, from being appointed as a
Director, in terms of Clause (g) of sub-section (1) of Section 274 of
the Companies Act, 1956;
(vi) No provision has been made for the liability, if any, in respect
of a Bank Guarantee invoked and encashed by a customer during the year
amounting to Rs. 700 Lakhs shown under "Loans and Advances", and in
respect of Rs. 744 Lakhs owed by the said customer appearing under
"Sundry Debtors". The Company has disputed the customers claim for
bank guarantee invocation and has initiated the arbitration proceedings
as detailed in Note No. D-3(iii), Schedule "O" of "Notes to Accounts".
Since the matter is under arbitration, we are unable to opine on the
likelihood of the liability devolving on the Company and the consequent
effect on its Profits and the Reserves and Surplus.
Subject to (vi) above, in our opinion and to the best of our
information and according to the explanations given to us, the said
accounts give the information required by the Companies Act, 1956, in
the manner so required and give a true and fair view in conformity with
the accounting principles generally accepted in India:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at 30th September, 2010;
(b) in the case of the Profit and Loss account, of the Profit for the
year ended on that date; and
(c) in the case of the Cash Flow statement, of the cash flows for the
year ended on that date.
ANNEXURE TO THE AUDITORS REPORT Referred to in paragraph 3 of our
report of even date,
(i) (a) The Company has maintained proper records showing full
particulars including quantitative details and situation of the Fixed
Assets.
(b) The Company has a programme for physical verification of the Fixed
Assets, which in our opinion is reasonable having regards to the nature
of the business. Accordingly, the Fixed Assets have been physically
verified by the management at the end of the year and no material
discrepancies were noticed on such verification.
(c) The Fixed Assets disposed off during the year were not substantial.
According to the information and explanation given to us; we are of the
opinion that the disposal of the Fixed Assets has not affected the
going concern status of the Company.
(ii) (a) The Management has conducted physical verification of the
inventory at reasonable intervals other than material lying with
sub-contractors, which have been substantially confirmed by them.
(b) The procedures of physical verification of inventories followed by
the management are reasonable and adequate in relation to the size of
the Company and the nature of its business.
(c) The Company has maintained proper records of inventory and no
material discrepancies were noticed on physical verification as
compared to the book records.
(iii) (a) The Company has not granted/taken any secured or unsecured
loans to/from Companies, Firms or other parties covered in the Register
maintained under Section 301 of the Companies Act, 1956. Therefore,
sub-clauses (b), (c), (d), (e), (f) and (g) of (iii) of the said Order
are not applicable.
(iv) In our opinion and according to the information and explanations
given to us, there are adequate internal control systems commensurate
with the size of the Company and the nature of its business with regard
to purchases of inventory, fixed assets and with regard to sale of
goods and services. During the course of our audit, we have not
observed any continuing failure to correct major weakness in internal
controls.
(v) (a) According to the information and explanations given to us, we
are of the opinion that the transactions that need to be entered into
the register maintained under Section 301 of the Companies Act, 1956
have been so entered.
(b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of contracts or
arrangements entered in the registers maintained under Section 301 of
the Companies Act, 1956 and exceeding the value of Rs. 5 Lakhs in
respect of any party during the year have been made at price which are
reasonable having regard to prevailing market prices at the relevant
time.
(vi) In our opinion and according to the information and explanations
given to us, the Company has complied with the provisions of Sections
58A and 58AA or any other relevant provisions of the Companies Act,
1956 and the Companies (Acceptance of Deposits) Rules , 1975 with
regard to the deposits accepted from the public. As informed to us, no
order has been passed by the Company Law Board, National Company Law
Tribunal or Reserve Bank of India or any other court or any other
tribunal.
(vii) In our opinion, Company has an internal audit system commensurate
with size and nature of its business.
(viii) According to the information and explanations given to us, the
Central Government has not prescribed the maintenance of cost records
under Section 209( I) (d) of the Companies Act, 1956.
(ix) (a) The Company is generally regular in depositing with
appropriate authorities 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 and Cess and other statutory dues applicable to it.
According to the information and explanations given to us, no
undisputed amount payable in respect of Income-Tax, Wealth Tax, Service
Tax, Sales-Tax, Custom Duty, Excise Duty and Cess were in arrears as at
30th September, 2010 for the period of more than six months from the
date they became payable.
(b) According to the information and explanations given to us, the
disputed statutory dues on account of Sales Tax, Income-Tax, Customs
Duty, Wealth Tax, Service Tax, Excise Duty and Cess that have not been
deposited on account of matters pending before appropriate authority
are as follows:
Name of Nature of Dues Amount Period to Forum
the (Rs. in Lakhs) which the where
Statute amount dispute is
relates pending
Central Denial of 266.19 (Net March, CESTAT,
Excise Act, exemption availed of CENVAT 2000 to Mumbai
1944 under notification reversal March,
No. 6/2002, for and 2004
supply of biomass payment)
based boilers
Central Excise duty demand 79.98 (Net June, CESTAT,
Excise Act, on bought out of CENVAT 1983 to Mumbai
1944 items supplied reversal April,
for centrifugals, and 2005
which has already payments)
suffered duty at
manufacturers end
Maharashtra N.A. Tax 66.61 1982 to Collector,
Land 2003 Pune
Revenue
Code
(x) The Company does not have any accumulated losses at the end of the
financial year and has not incurred any cash losses in the current year
and immediately preceding financial year.
(xi) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in the repayment of dues to
the financial institutions or banks or debenture holders during the
year.
(xii) The Company has not granted any loans and advances on the basis
of security by way of pledge of shares, debentures and other
securities.
(xiii) In our opinion and according to the information and explanations
given to us, the Company is not a chit fund or a nidhi/mutual benefit
fund/society. Therefore, the provisions of clause 4(xiii) of the
Companies (Auditors Report) Order, 2003 are not applicable to the
Company.
(xiv) In our opinion and according to the information and explanations
given to us, the Company is not dealing in or trading in shares,
securities, debentures and other investments. Accordingly the
provisions of clause 4(xiv) of the Companies (Auditors Report) Order,
2003 are not applicable to the Company.
(xv) According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from bank
or financial institutions.
(xvi) The term loans have been applied for the purpose for which they
were raised.
(xvii) According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we report
that the no funds raised on short-term basis have been used for
long-term investment.
(xviii) According to the information and explanations given to us
during the period covered by our audit report, the Company has not made
any preferential allotment of shares to the parties and companies
covered under the register maintained u/s. 301 of the Companies Act,
1956.
(xix) According to the information and explanations given to us during
the period covered by our audit report, the Company has not issued any
debentures.
xx) According to the information and explanations given to us during
the period covered by our audit report, the Company has not raised any
money by public Issue.
(xxi) According to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
For K. S. Aiyar & Co.
Chartered Accountants
FRN 100186W
Satish K. Kelkar
Place : Mumbai Partner
Date : 22nd November, 2010 Membership No. 38934
Sep 30, 2009
We have audited the attached Balance Sheet of Walchandnagar Industries
Limited, as at 30th September, 2009 and also the Profit and Loss
Account and the Cash Flow Statement for the year ended on that date
annexed thereto, in which are incorporated the returns of the division
at Zambia audited by overseas local auditors and relied on by us.
1. These financial statements are the responsibility of the Companys
management. Our responsibility is to express an opinion on these
financial statements based on our audit.
2. We conducted our audit in accordance with the Auditing Standards
generally accepted in India.Those Standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the Companies (Auditors Report) Order, 2003, as
amended by the Companies (Auditors Report) (Amendment) Order, 2004,
issued by the Central Government of India in terms of sub-section (4A)
of Section 227 of the Companies Act, 1956, we enclose in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the said
Order.
4. Further to our comments in the Annexure referred to in paragraph 3
above, we report that:
(i) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purposes of our
audit;
(ii) In our opinion, proper books of account as required by law, have
been kept by the Company so far as appears from our examination of
those books and proper returns adequate for the purposes of our audit
have been received from the division at Zambia not visited by us. The
divisions overseas Auditors Report has been forwarded to us and
appropriately dealt with;
(iii) The balance sheet, profit and loss account and cash flow
statement dealt with by this report are in agreement with the books of
account and with the audited returns from the division at Zambia;
(iv) In our opinion, the balance sheet, profit and loss account and
cash flow statement dealt with by this report comply with the
Accounting Standards referred to in sub-section (3C) of Section 211 of
the Companies Act, 1956;
(v) On the basis of written representations received from the
Directors, as on 30th September, 2009 and taken on record by the Board
of Directors, we report that none of the Directors of the Company are
disqualified as on 30th September, 2009, from being appointed as a
Director, in terms of Clause (g) of sub-section (1) of Section 274 of
the Companies Act, 1956;
(vi) As stated in our earlier years audit report, no provision has
been made for the liability, if any, in respect of the Bank Guarantee
invoked by the parties in earlier years, as explained in the Note No.
D-4 (iii) (a) and lb) of the Schedule 0 Since the matter is
sub-judice we are unable to opine on the likelihood of these
liabilities devolving on the Company and the consequent effect on
Profit and the Reserves and Surplus.
Subject to (vi) above, in our opinion and to the best of our
information and according to the explanations given to us, the said
accounts give the information required by the Companies Act, 1956, in
the manner so required and give a true and fair view in conformity with
the accounting principles generally accepted in India:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at 30th September, 2009;
(b) in the case of the Profit and Loss account, of the Profit for the
year ended on that date and
(c) in the case of the Cash Flow statement, of the cash flows for the
year ended on that date.
ANNEXURE TO THE AUDITORS REPORT
Referred to in paragraph 3 of our report of even date,
(i) (a) The Company has maintained proper records showing full
particulars including quantitative details and situation of the Fixed
Assets.
(b) The Company has a programme for physical verification of the Fixed
Assets, which in our opinion is reasonable having regards to the nature
of the business. Accordingly, the Fixed Assets have been physically
verified by the management at the end of the year and no material
discrepancies were noticed on such verification.
(c) The Fixed Assets disposed off during the year were not substantial.
According to the information and explanation given to us; we are of the
opinion that the disposal of the Fixed Assets has not affected the
going concern status of the Company.
(ii) (a) The Management has conducted physical verification of the
inventory at reasonable intervals other than material lying with
sub-contractors, which have been substantially confirmed by them.
(b) The procedures of physical verification of inventories followed by
the management are reasonable and adequate in relation to the size of
the Company and the nature of its business.
(c) The Company has maintained proper records of inventory and no
material discrepancies were noticed on physical verification as
compared to the book records.
(iii) (a) The Company has not granted/taken any secured or unsecured
loans to/from Companies, Firms or other parties covered in the Register
maintained under Section 301 of the Companies Act, 1956. Therefore,
sub-clauses (b), (c), (d), (e), (f) and (g) of (iii) of the said Order
are not applicable.
(iv) In our opinion and according to the information and explanations
given to us, there are adequate internal control systems commensurate
with the size of the Company and the nature of its business with regard
to purchases of inventory, fixed assets and with regard to " sale of
goods and services. During the course of our audit, we have not
observed any continuing failure to correct major weakness in internal
controls.
(v) (a) According to the information and explanations given to us, we
are of the opinion that the transactions that need to be entered into
the register maintained under Section 301 of the Companies Act, 1956
have been so entered. (b) In our opinion and according to the
information and explanations given to us, the transactions made in
pursuance of contracts or arrangements entered in the registers
maintained under Section 301 of the Companies Act, 1956 and exceeding
the value of Rs. Five Lakhs m tespett of any party duimg the yeaT have
been made at price which are reasonable having regard to prevailing
market prices at the relevant time.
However, with regard to the Management Service Contract with a party,
as service is of specialized nature it is not possible to ascertain the
market price for the same.
(vi) In our opinion and according to the information and explanations
given to us, the Company has complie with the provisions of Sections
58A and 58AA or any other relevant provisions of the Companies Act,
1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard
to the deposits accepted from the public. As informed to us, no order
has been passed by the Compan Law Board, National Company Law Tribunal
or Reserve Bank of India or any other court or any other tribunal.
(vii) In our opinion. Company has an internal audit system commensurate
with size and nature of its business.
(viii) According to the information and explanations given to us, the
Central Government has not prescribed the maintenance of cost records
under Section 209( I) (d) of the Companies Act, 1956.
(ix) (a) The Company is generally regular in depositing with
appropriate authorities 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 and Cess and other statutory dues applicable to it.
According to the information and explanations given to us, no
undisputed amount payable in respect of Income-Tax, Wealth Tax, Service
Tax, Sales-Tax, Custom Duty, Excise Duty and Cess were in arrears as at
30th September, 2009 for the period of more than six months from the
date they became payable.
(b) According to the information and explanations given to us, the
disputed statutory dues on account of Sales Tax, Income-Tax, Customs
Duty, Wealth Tax, Service Tax, Excise Duty and Cess that have not been
deposited on account of matters pending before appropriate authority
are as follows:
Name of Nature of Dues Amount Period to Forum
the (Rs. in which the where
Statute Lakhs) amount dispute is
relates pending
Central Denial of 266.19 (Net March, CESTAT,
Excise Act, exemption availed ofCENVAT 2000 to Mumbai
1944 under notification reversal March,
No. 6/2002, for and 2004
supply of biomass payment)
based boilers
Central Excise duty demand 61.36 (Net June, CESTAT,
Excise Act, on bought out ofCENVAT 1983 to Mumbai
1944 items supplied reversal April,
for centrifugals, and 2005
which has already payments)
suffered duty at
manufacturers end.
Maharashtra N.A. Tax 66.61 1982 to Tehsildar,
Land 2003 Indapur
Revenue
Code
(x) The Company does not have any accumulated losses at the end of the
financial year and has not incurred any cash losses in the current year
and immediately preceding financial year.
(xi) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in the repayment of dues to
the financial institutions or banks or debenture holders during the
year.
(xii) The Company has not granted any loans and advances on the basis
of security by way of pledge of shares, debentures and other
securities.
(xiii) In our opinion and according to the information and explanations
given to us, the Company is not a chit fund or a nidhi/mutual benefit
fund/society. Therefore, the provisions of clause 4(xiii) of the
Companies (Auditors Report) Order, 2003 are not applicable to the
Company.
(xiv) In our opinion and according to the information and explanations
given to us, the Company is not dealing in or trading in shares,
securities, debentures and other investments. Accordingly the
provisions of clause 4 (xiv) of the Companies (Auditors Report) Order,
2003 are not applicable to the Company.
(xv) According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from bank
or financial institutions.
(xvi) The term loans have been applied for the purpose for which they
were raised.
(xvii) According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we report
that the no funds raised on short-term basis have been used for
long-term investment.
(xviii) According to the information and explanations given to us
during the period covered by our audit report, the Company has not made
any preferential allotment of shares to the parties and companies
covered under the register maintained u/s. 301 of the Companies Act,
1956.
(xix) According to the information and explanations given to us during
the period covered by our audit report, the Company has not issued any
debentures.
xx) According to the information and explanations given to us during
the period covered by our audit report, the Company has not raised any
money by public Issue.
(xxi) According to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
For K. S. Aiyar & Co.
Chartered Accountants
Satish K. Kelkar
Place: Mumbai Partner
Date: 25th November, 2009 Membership No. 38934