Mar 31, 2019
Report on the Audit of the Ind AS Financial Statements Opinion
We have audited the accompanying Ind AS financial statements of Century Enka Limited (âthe Companyâ), which comprise the Balance Sheet as at 31 March 2019, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the Cash Flow Statement for the year then ended, and notes to the Ind AS financial statements, including a summary of the significant accounting policies and other explanatory information (herein after referred to as âInd AS financial statementsâ).
In our opinion and to the best of our information and according to the explanations given to us, the Ind AS financial statements give the information required by the Companies Act, 2013 (âthe Actâ) in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31 March 2019, its profit (including other comprehensive income), changes in equity and its cash flows for the year ended on that date.
Basis for Opinion
We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. Our responsibilities under those SAs are further described in the Auditorâs Responsibilities for the Audit of the Ind AS financial statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Emphasis of Matter
We draw your attention to note no 44 to the Ind AS financial statements regarding the Companyâs appeal pending before CESTAT, Mumbai against the excise duty demand aggregating Rs.22,927 Lakh plus interest thereon and penalty of Rs.22,927 Lakh. Based on expert legal advice and merits of the case, no provision has been considered necessary by the Company. The final determination of the cash outflow, if any, would depend upon the final decision of the appropriate authorities in the future. Our opinion is not modified in respect of the matter.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the Ind AS financial statements of the current year. These matters were addressed in the context of our audit of the Ind AS financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
Description of Key Audit Matters:
Key Audit Matters |
How the matter was addressed in our audit |
Impairment of Property, Plant and Equipment (PPE) - The Company has significant balances of PPE as on 31 March 2019 (refer note 3 to the financial statements). The Company has policy to review PPE to assess impairment in carrying value of PPE, if any. - Evaluation of impairment involves significant management judgements to estimate recoverable amount of PPE (refer note 2(A) Critical accounting judgements and key sources of estimation uncertainty). - Given the judgement required to estimate the recoverable amount of PPE, this is considered key audit matter |
Our procedures included: - Reviewing the PPE schedule and analyse the management''s assessment for impairment in the value of property, plant and equipment (due to changes in production, or underutilization, external information, obsolescence and damage) in accordance with Ind AS. - Assessing the reliability of management''s judgements used to estimate the recoverable amount of PPE - On sample basis, physically sighting the PPE to assess whether they are operating and in a good condition. - Discussing with management the future plans for the assets not in the operating condition. |
Inventory Valuation - The Company has significant balances of inventory as on 31 March 2019 (refer note 8 to the financial statements). - Inventories are valued at lower of cost or net realizable value (NRV). Cost is determined using weighted average cost method. - Valuation of inventories can be subjective due to inherent uncertainty due to volatility in prices of raw material and volatility in prices of finished goods due to changes in consumer demands - Determination of whether inventory will be realized for value less than cost requires management to exercise judgement and apply assumption - Because of size, inherent uncertainty in volatility in prices of raw material, assumption and complexities involved in inventory valuation, this is considered key audit matter |
Our procedures included: - Obtaining understanding of production process and testing of key controls over recognition and measurement of inventory - For sample locations, attending physical stock take procedures at the year end - For sample of inventory items, re-performed the weighted average cost calculation - Obtaining management''s calculation and relevant supporting for inventory valuation, validated mathematical accuracy of production costs and agreed the same with financial statements - Assessing reasonableness of assumption and judgements applied by management in inventory valuation including evaluating consistencies with managementâs prior period estimations - Assessing appropriateness of NRV estimated by management, on sample basis, by comparing NRV to recent market prices - Obtaining and re-performing the calculation of inventory write down based on ageing and NRV of inventory - Comparing historical trend of prices of raw material and finished goods to determine appropriateness of valuation of inventory |
Other Information
The Companyâs management and Board of Director are responsible for the other information. The Other information comprises the information included in the companyâs annual report, but does not include the financial statements and our auditorâs report thereon. The other information is expected to be made available to us after the date of this auditorâs report.
Our Opinion on the accompanying Ind AS financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the accompanying Ind AS financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with accompanying Ind AS financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.
When we read the other information included in the Companyâs annual report, if we concluded that there is a material misstatement therein, we are required to communicate the matter to those charged with governance.
Managementâs Responsibility for the Ind AS Financial Statements
The Companyâs management and Board of Directors are responsible for the matters stated in Section 134(5) of the Act with respect to the preparation of these Ind AS financial statements that give a true and fair view of the state of affairs, profit and other comprehensive income, changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (âInd ASâ) prescribed under Section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding 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 Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the Ind AS financial statements, management and Board of Director are responsible for assessing the Companyâs ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those Board of Directors are also responsible for overseeing the Companyâs financial reporting process.
Auditorâs Responsibility for the Audit of the Ind AS Financial Statements
Our objectives are to obtain reasonable assurance about whether the Ind AS financial statements as whole are free from material misstatement, whether due to fraud or error, and to issue an auditorâs report that includes our opinion. Reasonable assurance is a high level assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Ind AS Financial Statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
1. Identify and assess the risks of material misstatement of the Ind AS financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
2. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3) (i) of the Companies Act, 2013, we are also responsible for expressing our opinion on whether the company has adequate internal financial controls system in place and the operating effectiveness of such controls.
3. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
4. Conclude on the appropriateness of managementâs use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Companyâs ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditorâs report to the related disclosures in the Ind AS financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditorâs report. However, future events or conditions may cause the Company to cease to continue as a going concern.
5. Evaluate the overall presentation, structure and content of the Ind AS financial statements, including the disclosures, and whether the Ind AS financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the Ind AS financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditorâs report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. 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 the âAnnexure Aâ a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.
2. As required by Section 143(3) of the Act, we 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 (including other comprehensive income), the Statement of Changes in Equity and Cash Flow Statement and dealt with by this Report are in agreement with the books of account,
d) In our opinion, the aforesaid Ind AS financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act,
e) On the basis of the written representations received from the directors as on 31 March 2019 taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2019 from being appointed as a director in terms of Section 164(2) of the Act, and
f) With respect to the adequacy of the internal financial controls with reference to financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Bâ.
3. 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:
a) The Company has disclosed the impact of pending litigations as at 31 March 2019 on its financial position in its Ind AS financial statements - Refer Note 44 (a) to the Ind AS financial statements.
b) 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 Refer Note 45 to the Ind AS financial statements. The Company did not have any other long-term contracts for which there were any material foreseeable losses.
c) There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
d) The disclosure in the Ind AS financial statements regarding holdings and well as dealings in specified bank notes during the period from 8 November 2016 to 30 December 2016 have not been made in these financial statements since they do not pertain to the financial year ended 31 March 2019
4. With respect to the matter to be included in the Auditorsâ Report under Section 197(16) of the Act, in our opinion and according to the information and explanations given to us, the remuneration paid by the Company to its directors during the current year is in accordance with the provisions of Section 197 of the Act. The remuneration paid to any director is not in excess of the limit laid down under Section 197 of the Act. The Ministry of Corporate Affairs has not prescribed other details under Section 197(16) which are required to be commented upon by us.
Annexure A to the Independent Auditorâs Report - 31 March 2019 (Referred to in our report of even date)
i. (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
(b) The Company has a regular programme of physical verification of its fixed assets by which all fixed assets are verified in a phased manner over a period of three years. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, certain fixed assets were physically verified by the Management during the year. In our opinion, and according to the information and explanations given to us, no material discrepancies were noticed on such verification.
(c) In our opinion and 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.
ii. The inventory, except for goods-in-transit has been physically verified by the management at reasonable intervals during the year. In our opinion, the frequency of such verification is reasonable. For goods- in- transit, subsequent goods receipt have been verified. The discrepancies noticed on verification between the physical stocks and the book records were not material.
iii. In our opinion and according to the information and explanations given to us, 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 Act. Accordingly, paragraph 3(iii) of the Order is not applicable to the Company.
iv. The Company has not granted any loans or provided any guarantees or security to the parties covered under section 185 of the Act. In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Section 186 of the Act, with respect to the loans given, investments made, guarantees given and security provided.
v. In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public during the year in terms of the provisions of Sections 73 to 76 or any other relevant provisions of the Act and the rules framed there under. Accordingly, paragraph 3(v) of the Order is not applicable to the Company.
vi. We have broadly reviewed the books of account maintained by the Company as specified under Section 148(1) of the Act, for maintenance of cost records in respect of products manufactured by the Company, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. However, we have 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 on the basis of our examination of the records of the Company, amounts deducted/accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Employeesâ State Insurance, Income-tax, Goods and service tax , Duty of Customs, Cess and other material statutory dues have been regularly deposited during the year by the Company with the appropriate authorities.
According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Employeesâ State Insurance, Income-tax, Goods & Service Tax, Duty of Customs, Cess and other material statutory dues were in arrears as at 31 March 2019 for a period of more than six months from the date they became payable.
(b) According to the information and explanations given to us and on the basis of our examination of the records of the Company, details of dues of Income-tax, Sales-tax, Service tax, Duty of Customs, Duty of Excise and Value added tax which have not been deposited as on 31 March 2019 on account of disputes are given below:
Name of the Statute |
Nature of the Dues |
Forum where dispute is pending A |
Period to which amount relates |
Amount* (Rs. in Lakh) |
Income tax Act, 1961 |
Income tax, interest and |
Calcutta High Court |
A.Y. 2004-2005 |
118 |
Penalty |
Income Tax Appellate Tribunal |
A.Y. 2008-2009 |
50 |
|
Central Excise Act, 1944 |
Excise Duty and Penalty |
Custom, Excise and Service Tax Appellate |
2000 to 2003 |
45154# |
Tribunal |
2007-08 to 2010-2011 & 2011-12 |
195 |
||
1999-2000 |
9 |
|||
Finance Act, 1994 |
Service Tax |
Custom, Excise and Service Tax Appellate |
2009-10 to 2013-14 |
141 |
Tribunal |
2015-16 to 2016-17 |
2 |
||
Gujarat Sales Tax Act, 1969 |
Sales Tax including interest & Penalty |
The Supreme Court of India |
2000-2001 |
599 |
A Exclude matters in respect of which favourable order has been received at various appellate authorities.
* net of amounts paid under protest.
# This does not include the interest claimed (not quantified) by the Central excise authorities
viii. According to the information and explanations given to us, and based on the records of the Company, the Company has not defaulted in the repayment of loans or borrowings to financial institutions, banks, government and dues to debenture holders.
ix. According to the information and explanations given to us, the term loans have been applied by the Company during the year for the purposes for which they were obtained. The Company did not raise money by way of initial public offer or further public offer (including debt instruments) during the year.
x. According to the information and explanations given to us, no 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, paragraph 3(xii) of the Order is not applicable to the Company.
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 Ind AS financial statements as required by the applicable accounting standards.
xiv. According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year. Accordingly, paragraph 3(xiv) of the Order is not applicable to the Company.
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 them. Accordingly, paragraph 3(xv) of the Order is not applicable to the Company.
xvi. According to the information and explanations given to us, the Company is not required to be registered under section 45 IA of the Reserve Bank of India Act, 1934. Accordingly, paragraph 3(xvi) of the Order is not applicable to the Company.
Annexure B to the Independent Auditorsâ Report of even date on the Ind AS financial statements of Century Enka Limited - 31 March 2019
We have audited the internal financial control over financial reporting of the Century Enka Limited (âthe Companyâ) as at 31 March 2019 in conjunction with our audit of the Ind AS financial statements of the Company for the year ended on that date. Managementâs Responsibility for Internal Financial Controls The Company''s management and Board of Directors are 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 Accountant of India (âICAIâ). 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 (âthe Actâ).
Auditorsâ Responsibility
Our responsibility is to express an opinion on the Companyâs internal financial controls with reference to Ind AS financial Statements based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (âthe Guidance Noteâ) and the Standards on Auditing, prescribed under section 143(10) of the Act, to the extent applicable to an audit of internal financial controls with reference to Ind AS financial statements. 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 with reference to Ind AS financial Statements were established and maintained and whether 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 with reference to Ind AS financial statements and their operating effectiveness. Our audit of internal financial controls with reference to Ind AS financial statements included obtaining an understanding of such internal financial controls, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditorâs judgment, including the assessment of the risks of material misstatement of the Ind AS 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 with reference to Ind AS financial statements.
Meaning of Internal Financial Controls with reference to Ind AS financial statements
A Companyâs internal financial control with reference to Ind AS financial statements is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of Ind AS financial statements for external purposes in accordance with generally accepted accounting principles. A Companyâs internal financial control with reference to Ind AS financial statements include those policies and procedures that:
(a) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;
(b) provide reasonable assurance that transactions are recorded as necessary to permit preparation of Ind AS 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
(c) 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 Ind AS financial statements.
Inherent Limitations of Internal Financial Controls with reference to Ind AS financial statements Because of the inherent limitations of internal financial with reference to Ind AS financial statements, 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 with reference to Ind AS financial statements to future periods are subject to the risk that the internal financial control with reference to Ind AS financial statements 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 31 March 2019, 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 ICAI
For Khimji Kunverji & Co LLP
(Formerly Khimji Kunverji & Co - 105146W)
Chartered Accountants
Gautam V. Shah
Mumbai Partner
21 May 2019 Membership No: 117348
Mar 31, 2017
INDEPENDENT AUDITORâS REPORT TO THE MEMBERS OF CENTURY ENKA LIMITED
Report on the Ind AS Financial Statements
We have audited the accompanying Ind AS financial statements of Century Enka Limited (âthe Companyâ), which comprise the Balance Sheet as at 31 March 2017, 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 (herein after referred to as âInd AS financial statementsâ).
Managementâs Responsibility for 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 Ind AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) prescribed under Section 133 of the Act read with relevant rules issued there under.
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; the selection and application of appropriate accounting policies; making judgments and the estimates that are reasonable and prudent; and the 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 Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditorsâ Responsibility
Our responsibility is to express an opinion on these Ind AS 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 of the 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 Ind AS financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the Ind AS financial statements. The procedures selected depend on the auditorâs judgment, including the assessment of the risks of material misstatement of the Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Companyâs preparation of the Ind AS financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Companyâs Directors, as well as evaluating the overall presentation of the Ind AS financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Ind AS financial statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India including the Ind AS, of the financial position of the Company as at 31 March 2017, and its financial performance including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.
Emphasis of Matter
We draw your attention to Note 46 to the financial statements regarding the Companyâs appeal pending before CESTAT, Mumbai against the excise duty demand aggregating Rs. 22,927 lakh plus interest thereon and penalty of Rs. 22,927 lakh. Based on expert legal advice and merits of the case, no provision has been considered necessary by the company. The final determination of the cash outflow, if any, would depend upon the final decision of the appropriate authorities in the future. Our opinion is not modified in respect of this matter.
Other Matter
The comparative financial information of the Company for the year ended 31 March 2016 and the transition date opening Balance Sheet as at 1 April 2015 included in these Ind AS financial statements, are based on the previously issued statutory financial statements prepared in accordance with the Companies (Accounting Standards) Rules, 2006 audited by Price Waterhouse, Chartered Accountants (predecessor auditor) for the year ended 31 March 2016 and for the year ended 31 March 2015, whose reports dated 4 May 2016 and 5 May 2015, respectively, expressed an unmodified opinion on those financial statements, as adjusted for the differences in the accounting principles adopted by the Company on transition to the Ind AS, which have been audited by us. Our opinion is not modified in respect of this matter.
Report on Other Legal and Regulatory Requirements
As required by the Companies (Auditorâs Report) Order, 2016 (âthe Orderâ), issued by the Central Government of India in terms of Section 143(11) of the Act, we give in the âAnnexure A,â a statement on the matters specified in paragraphs 3 and 4 of the Order.
1. 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) I n 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, the Cash Flow Statement and the Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.
(d) In our opinion, the aforesaid Ind AS financial statements comply with the Indian Accounting Standards prescribed under Section 133 of the Act.
(e) On the basis of the written representations received from the directors as on 31 March 2017 taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 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 âAnnexure Bâ; and
(g) With respect to the other matters to be included in the Auditorsâ Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on the financial position in its Ind AS financial statements - Refer Note 46 to the Ind AS financial statements;
ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on derivative contracts. The Company has long-term contracts for which there were no material foreseeable losses - Refer Note 47(b) to the Ind AS financial statements;
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company; and
iv. The Company has provided requisite disclosures in the Ind AS financial statements as to holdings as well as dealings in Specified Bank Notes during the period from 8 November 2016 to 30 December 2016. Based on audit procedures and relying on the management representation, we report that the disclosures are in accordance with books of account maintained by the Company and as produced to us by the Management-Refer Note 50 to the Ind AS financial statements.
i. (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
(b) The Company has a regular programme of physical verification of its fixed assets by which all fixed assets are verified in a phased manner over a period of three years. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, certain fixed assets were physically verified by the Management during the year. In our opinion, and according to the information and explanations given to us, no material discrepancies were noticed on such verification.
(c) In our opinion and 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.
ii. The inventory has been physically verified by the management at reasonable intervals during the year. In our opinion, the frequency of such verification is reasonable. No material discrepancies noticed on verification between the physical stocks and the book records.
iii. I n our opinion and according to the information and explanations given to us, 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 Act. Accordingly, paragraph 3(iii) of the Order is not applicable to the Company.
iv. The Company has not granted any loans or provided any guarantees or security to the parties covered under Section 185 of the Act. In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Sections 186 of the Act, with respect to the loans given, investments made, guarantees given and security provided.
v. I n our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public during the year in terms of the provisions of Sections 73 to 76 or any other relevant provisions of the Act and the rules framed there under. Accordingly, paragraph 3(v) of the Order is not applicable to the Company.
vi. We have broadly reviewed the books of account maintained by the Company as specified under Section 148(1) of the Act, for maintenance of cost records in respect of products manufactured by the Company, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. However, we have 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 on the basis of our examination of the records of the Company, amounts deducted/accrued in the books of account inrespect of 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 material statutory dues have been regularly deposited during the year by the Company with the appropriate authorities.
According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Employeesâ State Insurance, Income-tax, Sales-tax, Service tax, Duty of Customs, Duty of Excise, Value added tax, Cess and other material statutory dues were in arrears as at 31 March 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 and on the basis of our examination of the records of the Company, details of dues of Income-tax, Sales-tax, Service tax, Duty of Customs, Duty of Excise and Value added tax which have not been deposited as on 31 March 2017 on account of disputes are given below:
viii. According to the information and explanations given to us, and based on the records of the Company, the Company has not defaulted in the repayment of loans or borrowings to financial institutions, banks, government and dues to debenture holders.
Name of the Statute |
Nature of the Dues |
Forum where dispute is pending |
Period to which amount relates |
Amount* (? In Lakh) |
Income Tax Act, 1961 |
Income Tax, Interest and Penalty |
Calcutta high Court |
A.Y. 2004-2005 |
118 |
Income Tax Appellate Tribunal |
A.Y. 2008-2009 |
50 |
||
The Central Excise Act, 1944 |
Excise duty and Penalty |
Custom, Excise and Service Tax Appellate Tribunal |
2000 to 2003 |
45,154# |
Excise Duty |
Custom, Excise and Service Tax Appellate Tribunal |
1995 -1996 |
66 |
|
Excise duty and Penalty |
Custom, Excise and Service Tax Appellate Tribunal |
2007-2008 to 2010 -2011 & 2011-12 |
196 |
|
Excise duty and Penalty |
Commissioner of Central Excise (A) |
2011 to 2015 |
36 |
|
Finance Act, 1994 |
Service Tax |
Custom, Excise and Service Tax Appellate Tribunal |
2009-2010 to 2013-2014 |
141 |
Gujarat Sales Tax Act, 1969 |
Sales Tax including interest & Penalty |
The Supreme Court of India |
2000 -2001 |
672 |
Sales Tax |
Joint Commissioner of Sales-Tax (A) |
2007-2008 |
13 |
* net of amounts paid under protest.
# This does not include the interest claimed (not quantified) by the Central excise authorities.
ix. According to the information and explanations given to us, the term loans have been applied by the Company during the year for the purposes for which they were obtained. The Company did not raise money by way of initial public offer or further public offer (including debt instruments) during the year.
x. According to the information and explanations given to us, no 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 given to us and based on our examination of the records of the Company, the Company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act.
xii. In our opinion and according to the information and explanations given to us, the Company is not a nidhi company. Accordingly, paragraph 3(xii) of the Order is not applicable to the Company.
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 Ind AS financial statements as required by the applicable accounting standards.
xiv. According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year. Accordingly, paragraph 3(xiv) of the Order is not applicable to the Company.
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 them. Accordingly, paragraph 3(xv) of the Order is not applicable to the Company.
xvi. According to the information and explanations given to us, the Company is not required to be registered under section 45 IA of the Reserve Bank of India Act, 1934. Accordingly, paragraph 3(xvi) of the Order is not applicable to the Company.
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Act
We have audited the internal financial controls over financial reporting of Century Enka Limited (âthe Companyâ) as at 31 March 2017 in conjunction with our audit of the 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 (âICAIâ). 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 Act.
Auditorsâ Responsibility
Our responsibility is to express an opinion on the Companyâs internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the âGuidance Noteâ) and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Act, to the extent applicable to an audit of internal financial controls, both issued by the ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditorâs judgment, including the assessment of the risks of material misstatement of the Ind AS 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:
(a) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;
(b) 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
(c) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Companyâs assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls Over Financial Reporting
Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31 March 2017, 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 ICAI.
For Khimji Kunverji & Co.
Chartered Accountants
Firmâs Registration No: 105146W
Gautam V. Shah
Mumbai Partner
10 May 2017 Membership No: 117348
Mar 31, 2015
Report on the Financial Statements
1. We have audited the accompanying financial statements of Century
Enka Limited ("the Company"), which comprise the Balance Sheet as at
March 31,2015, 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.
ManagementÂs Responsibility for the Financial Statements
2. The CompanyÂs Board of Directors is responsible for the matters
stated in Section 134(5) of the Companies Act, 2013 ("the Act") with
respect to the preparation of these financial statements to 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
3. Our responsibility is to express an opinion on these financial
statements based on our audit.
4. We have taken into account the provisions of the Act and the Rules
made thereunder including the accounting standards and matters which
are required to be included in the audit report.
5. We conducted our audit in accordance with the Standards on Auditing
specified under Section 143(10) of the Act and other applicable
authoritative pronouncements issued by the Institute of Chartered
Accountants of India. Those Standards and pronouncements require that
we comply with ethical requirements and plan and perform the audit to
obtain reasonable assurance about whether the financial statements are
free from material misstatement.
6. 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, 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 CompanyÂs Directors, as well
as evaluating the overall presentation of the financial statements.
7. 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
8. 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, 2015, and its profit and its cash flows for the year ended
on that date.
Emphasis of Matter
9. We draw your attention to Note 31(b) to the financial statements
regarding the CompanyÂs appeal pending before CESTAT, Mumbai against
the excise duty demand aggregating Rs. 22,927 Lacs plus interest
thereon and penalty of Rs. 22,927 Lacs. Based on expert legal advice
and merits of the case, no provision has been considered necessary by
the Company. The final determination and cash outflow, if any, would
depend upon the final decision of the appropriate authorities in the
future. Our opinion is not qualified in respect of this matter.
Report on Other Legal and Regulatory Requirements
10. As required by Âthe Companies (AuditorÂs Report) Order,
2015Â, issued by the Central Government of India in terms of sub-
section (11) of Section 143 of the Act (hereinafter referred to as the
"Order"), 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 paragraphs 3 and 4 of the Order.
11. 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 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, 2015 taken on record by the Board of
Directors, none of the directors is disqualified as on March 31, 2015
from being appointed as a director in terms of Section 164(2) of the
Act.
(f) With respect to the other matters to be included in 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 knowledge and belief
and according to the information and explanations given to us:
i. The Company has disclosed the impact, if any, of pending
litigations as at March 31,2015 on its financial position in its
financial statements - Refer Note 31(a), 31(b) and 40 ;
ii. The Company has long-term contracts including derivative contracts
as at March 31, 2015 for which there were no material foreseeable
losses;
iii. There were no amounts which were required to be transferred to the
Investor Education and Protection Fund by the Company during the year
ended March 31, 2015.
Annexure to Independent AuditorÂs Report
Referred to in paragraph 10 of the Independent AuditorÂs Report of
even date to the members of Century Enka Limited on the financial
statements as of and for the year ended March 31, 2015 :
i.(a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation, of fixed
assets.
(b) The fixed assets are physically verified by the Management
according to a phased programme designed to cover all the items over a
period of 3 years which, in our opinion, is reasonable having regard to
the size of the Company and the nature of its assets. Pursuant to the
programme, a portion of the fixed assets has been physically verified
by the Management during the year and no material discrepancies have
been noticed on such verification.
ii. (a) The inventory excluding stocks with third parties has been
physically verified by the Management during the year. In respect of
inventory lying with third parties, these have substantially been
confirmed by them. In our opinion, the frequency of verification is
reasonable.
(b) In our opinion, 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) On the basis of our examination of the inventory records, in our
opinion, the Company is maintaining proper records of inventory. The
discrepancies noticed on physical verification of inventory as compared
to book records were not material.
iii. The Company has not granted any loans, secured or unsecured, to
companies, firms or other parties covered in the register maintained
under Section 189 of the Act. Therefore, the provisions of Clause
3(iii), (iii)(a) and (iii)(b) of the said Order are not applicable to
the Company.
iv. In our opinion, and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchase of inventory and fixed assets and for the sale of goods.
Further, on the basis of our examination of the books and records of
the Company, and according to the information and explanations given to
us, we have neither come across, nor have been informed of, any
continuing failure to correct major weaknesses in the aforesaid
internal control system.
v. The Company has not accepted any deposits from the public within
the meaning of Sections 73, 74, 75 and 76 of the Act and the rules
framed there under to the extent notified.
vi. We have broadly reviewed the books of account maintained by the
Company in respect of products where, pursuant to the rules made by the
Central Government of India, the maintenance of cost records has been
specified under sub-section (1) of Section 148 of the Act, and are of
the opinion that, prima facie, the prescribed accounts and records have
been made and maintained. We have not, however, made a detailed
examination of the 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, in our opinion, the
Company is regular in depositing the undisputed statutory dues,
including provident fund, employees state insurance, income tax,
sales tax, wealth tax, service tax, duty of customs, duty of excise,
value added tax and other material statutory dues, as applicable, with
the appropriate authorities.
(b) According to the information and explanations given to us and the
records of the Company examined by us, there are no dues of wealth-tax
and cess which have not been deposited on account of any dispute. The
particulars of dues of income tax, sales tax, service tax, duty of
customs and duty of excise as at March 31, 2015 which have not been
deposited on account of a dispute, are as follows:
Name of Nature of Amount Amount Period Forum where
the dues (Rs. in paid to which dispute
statute lacs) under the amount is pending
protest relates
(Rs. in
lacs)
The Income 118 - AY 2004-05 Calcutta High
Income -tax
-tax Court 50 - AY 2008-09 Income-tax
Act, Appellate
1961 Tribunal
The Excise 20 - 2000-01 Customs, Excise
Central Duty, and Service Tax
Excise including 2001-02 Appellate
Act, penalty Tribunal
1944 as and 66 66 January
applicable 1995 to
September
1995
195 - 2007-08 to Commissioner of
2010-11 Customs &
Central Excise
The Excise 22,927 700 April 2000 Customs, Excise
Central Duty to and Service Tax
Excise (Refer March 2003 Appellate
Act, Note 1 Tribunal
1944 below)
Penalty 22,927 -
Finance Penalty on 8 - January Customs,
Act, Service 2005 to Excise and
1994 tax dues November Service Tax
2012 Appellate
Tribunal
Service 185 44 May 2009
tax to
January
2014
The Customs 170 68 1994-95, Customs, Excise
Customs Duty 2001-02 Service Tax
Act, and and
1962 2006-07 Appellate
Tribunal
The Sales-tax 672 73 2000-01 The Supreme
Gujarat including Court of
Sales- interest India
tax and
Act, penalty
1969
The Sales-tax 19 - 2007-08 Joint
Gujarat Commissioner of
Value Sales- Tax Act,
Added (Appeals)
tax
2006
The Value 32 8 2008-09 Commissioner of
Maharashtra Added Sales-tax
Value Tax
Added
Tax Act
Note 1 - This does not include the interest claimed by the Central
excise authorities.
c) There are no amounts required to be transferred by the Company to
the Investor Education and Protection Fund in accordance with the
provisions of the Companies Act, 1956 and the rules made thereunder.
viii. The Company has no accumulated losses as at the end of the
financial year and it has not incurred any cash losses in the financial
year ended on that date or in the immediately preceding financial year.
ix. According to the records of the Company examined by us and the
information and explanation given to us, the Company has not defaulted
in repayment of dues to any financial institution or bank or debenture
holders as at the balance sheet date.
x. In our opinion, and 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 during the year.
Accordingly, the provisions of Clause 3(x) of the Order are not
applicable to the Company.
xi. In our opinion, and according to the information and explanations
given to us, the term loans have been applied for the purposes for
which they were obtained.
xii. During the course of our examination of the books and records of
the Company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
material fraud on or by the Company, noticed or reported during the
year, nor have we been informed of any such case by the Management.
For Price Waterhouse
Firm Registration Number: 301112E
Chartered Accountants
Mumbai
May 05, 2015 Jeetendra Mirchandani
Partner
Membership Number 48125
Mar 31, 2014
1. We have audited the accompanying financial statements of Century
Enka Limited (the "Company"), which comprise the Balance Sheet as at
March 31, 2014, and the Statement of profit and Loss and Cash Flow
Statement for the year then ended, and a summary of significant
accounting policies and other explanatory information, which we have
signed under reference to this report.
Management''s Responsibility for the Financial Statements
2. The Company''s 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 notifed under the Companies
Act, 1956 of India (the "Act") 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. 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
3. 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 and other applicable authoritative
pronouncements 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.
4. An audit involves performing procedures to obtain audit evidence,
about the amounts and 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 auditors consider 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.
5. We believe that the audit evidence we have obtained is suffcient
and appropriate to provide a basis for our audit opinion.
Opinion
6. In our opinion, and to the best of our information and according to
the explanations given to us, the accompanying financial statements give
the information required by the Act in the manner so required and give
a true and fair view in conformity with the accounting principles
generally accepted in India:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2014;
(b) in the case of the Statement of profit and Loss, of the profit for
the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Emphasis of Matter
7. We draw your attention to Note 31(b) to the financial statements
regarding the Company''s appeal pending before CESTAT, Mumbai against
the excise duty demand aggregating Rs. 22,927 lacs plus interest thereon
and penalty of Rs. 22,927 lacs. Based on expert legal advice and merits
of the case, no provision has been considered necessary by the Company.
The final determination and cash outflow, if any, would depend upon the
final decision of the appropriate authorities in the future. Our opinion
is not qualifed in respect of this matter.
Report on Other Legal and Regulatory Requirements
8. As required by ''the Companies (Auditor''s Report) Order, 2003'', as
amended by ''the Companies (Auditor''s Report) (Amendment) Order, 2004'',
issued by the Central Government of India in terms of sub-section (4A)
of section 227 of the Act (hereinafter referred to as the "Order"), 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 paragraphs 4 and 5 of the Order.
9. 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 dealt with by this report comply with the
Accounting Standards notifed under 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;
(e) On the basis of written representations received from the directors
as on March 31, 2014, and taken on record by the Board of Directors,
none of the directors is disqualifed as on March 31, 2014, from being
appointed as a director in terms of clause (g) of sub-section (1) of
section 274 of the Act.
ANNEXURE TO INDEPENDENT AUDITORS'' REPORT Referred to in paragraph 8 of
the Independent Auditors'' Report of even date to the members of Century
Enka Limited on the financial statements as of and for the year ended
March 31, 2014
i. (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation, of fixed
assets.
(b) The fixed assets of the Company have been physically verifed by the
Management during the year and no material discrepancies have been
noticed on such verifcation. In our opinion, the frequency of
verifcation is reasonable.
(c) In our opinion, and according to the information and explanations
given to us, a substantial part of fixed assets has not been disposed
off by the Company during the year.
ii. (a) The inventory excluding stocks with third parties has been
physically verifed by the Management during the year. In respect of
inventory lying with third parties, these have substantially been
confirmed by them. In our opinion, the frequency of verifcation is
reasonable.
(b) In our opinion, the procedures of physical verifcation 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) On the basis of our examination of the inventory records, in our
opinion, the Company is maintaining proper records of inventory. The
discrepancies noticed on physical verifcation of inventory as compared
to book records were not material.
iii. The Company has not granted/taken any loans, secured or unsecured,
to/from companies, firms or other parties covered in the register
maintained under Section 301 of the Act. Therefore, the provisions of
Clause 4(iii) (b), (c), (d), (f) and (g) of the said Order are not
applicable to the Company.
iv. In our opinion, and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchase of inventory and fixed assets and for the sale of goods.
Further, on the basis of our examination of the books and records of
the Company, and according to the information and explanations given to
us, we have neither come across, nor have been informed of, any
continuing failure to correct major weaknesses in the aforesaid
internal control system.
v (a) According to the information and explanations given to us, we are
of the opinion that the particulars of all contracts or arrangements
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 such contracts or
arrangements and exceeding the value of Rupees Five Lakhs in respect of
any party during the year have been made at prices which are reasonable
having regard to the prevailing market prices at the relevant time.
vi. In our opinion, and according to the information and explanations
given to us, the Company has complied with the provisions of Sections
58A and 58AA or any other relevant provisions of the Act and the
''Companies (Acceptance of Deposits) Rules, 1975'' with regard to the
deposits accepted from the public. According to the information and
explanations given to us, no order has been passed by the Company Law
Board or National Company Law Tribunal or Reserve Bank of India or any
Court or any other Tribunal on the Company in respect of the aforesaid
deposits.
vii. In our opinion, the Company has an internal audit system
commensurate with its size and the nature of its business.
viii. We have broadly reviewed the books of account maintained by the
Company in respect of products where, pursuant to the rules made by the
Central Government of India, the maintenance of cost records has been
prescribed under clause (d) of sub-section (1) of Section 209 of the
Act, and are of the opinion that, prima facie, the prescribed accounts
and records have been made and maintained. We have not, however, made a
detailed examination of the 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, in our opinion, the Company
is regular in depositing the 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 and other material statutory dues, as
applicable, with the appropriate authorities.
(b) According to the information and explanations given to us and the
records of the Company examined by us, there are no dues of wealth-tax
which have not been deposited on account of any dispute. The
particulars of dues of income tax, sales tax, service tax, customs duty
and excise duty as at March 31, 2014 which have not been deposited on
account of a dispute, are as follows:
Name of the statute Nature of dues Amount Amount paid under
protest (Rs. lacs)
(Rs. lacs)
The Income-tax Act, Income-tax,
including 108 -
1961 interest and
penalty, 118
as applicable 454 454
The Central Excise Excise Duty, 20 -
Act, 1944 including
interest and 66 66
penalty as
applicable
248 -
Name of the Statue Period to which the Forum where the dispute is
amount relates pending
The Income-tax Act,
1961 AY 2002-03 Calcutta High Court
AY 2004-05
AY 2008-09 Income-tax Appellate
Tribunal
The Central Excise
Act, 1944 2000-01 and 2001-02 Customs, Excise and
1993-94 Service Tax Appellate
Tribunal
2007-08 to 2010-11 Commissioner of Customs
and Central Excise
Name of the statute Nature of dues Amount Amount paid under
protest (Rs. lacs)
(Rs. lacs)
The Central Excise Excise Duty (See 22,927 -
Act, 1944 Note 1 below)
Penalty 22,927 -
Finance Act, 1994 Penalty on Service- 7 -
tax dues
The Customs Act, Customs Duty 199 68
1962 including interest and
penalty, as applicable
The Gujarat Sales- Sales-tax including 361 -
tax Act, 1969 interest and penalty, 74 -
as applicable 207 78
The Gujarat Value Sales-tax 24 -
Added Tax Act, 2006
The Maharashtra Value Added Tax 32 -
Value Added Tax Act 14 -
Name of the Statue Period to which the Forum where the dispute is
amount relates pending
The Central Excise
Act, 1944 April 2000 to March Customs, Excise and
2003 Service Tax Appellate
Tribunal
Finance Act, 1994 January 2008 to Commissioner of Customs
November 2012 and Central Excise
(Appeals)
The Customs Act,
1962 1994-95, 2001-02 Customs, Excise, and
and 2006-07 Service Tax Appellate
Tribunal
The Gujarat Sales-
tax Act, 1969 2000-01 The Supreme Court of India
2000-01 Joint Commissioner of
2000-01 Commercial Tax
The Gujarat Value
Added Tax Act, 2006 2007-08 Commissioner of
Commercial Taxes
The Maharashtra
Value Added Tax Act 2008-09 Commissioner of Sales-tax
2012-13
Note 1 - This does not include interest claimed by the Central
excise authorities.
x. The Company has no accumulated losses as at the end of the financial
year and it has not incurred any cash losses in the financial year ended
on that date or in the immediately preceding financial year.
xi. According to the records of the Company examined by us and the
information and explanation given to us, the Company has not defaulted
in repayment of dues to any financial institution or bank or debenture
holders as at the balance sheet date.
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.
Therefore, the provisions of Clause 4(xii) of the Order are not
applicable to the Company
xiii. As the provisions of any special statute applicable to chit fund/
nidhi/ mutual benefit fund/ societies are not applicable to the Company,
the provisions of Clause 4(xiii) of the Order are not applicable to the
Company.
xiv. In our opinion, the Company is not dealing in or trading in
shares, securities, debentures and other investments. Accordingly, the
provisions of Clause 4(xiv) of the Order are not applicable to the
Company.
xv. In our opinion, and according to the information and explanations
given to us, the Company has not given any guarantee for loans taken by
others from banks or financial institutions during the year.
Accordingly, the provisions of Clause 4(xv) of the Order are not
applicable to the Company
xvi. In our opinion, and according to the information and explanations
given to us, the term loans have been applied for the purposes for
which they were obtained.
xvii. According to the information and explanations given to us and on
an overall examination of the balance sheet of the company, we report
that no funds raised on short-term basis have been used for long-term
investment.
xviii. The Company has not made any preferential allotment of shares to
parties and companies covered in the register maintained under Section
301 of the Act during the year. Accordingly, the provisions of Clause
4(xviii) of the Order are not applicable to the Company.
xix. The Company has not issued any debentures during the year and does
not have any debentures outstanding as at the beginning of the year and
at the year end. Accordingly, the provisions of Clause 4(xix) of the
Order are not applicable to the Company
xx. The Company has not raised any money by public issues during the
year. Accordingly, the provisions of Clause 4(xx) of the Order are not
applicable to the Company.
xxi. During the course of our examination of the books and records of
the Company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
material fraud on or by the Company, noticed or reported during the
year, nor have we been informed of any such case by the Management.
For Price Waterhouse
Firm Registration Number: 301112E
Chartered Accountants
Jeetendra Mirchandani
Mumbai Partner
May 5, 2014 Membership Number 48125
Mar 31, 2013
1. We have audited the accompanying financial statements of Century
Enka Limited (the "Company"), which comprise the Balance Sheet as
at March 31, 2013, and the Statement of Profit and Loss and Cash Flow
Statement for the year then ended, and a summary of significant
accounting policies and other explanatory information, which we have
signed under reference to this report.
Management''s Responsibility for the Financial Statements
2. The Company''s 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'' of India (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
3. 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.
4. An audit involves performing procedures to obtain audit evidence,
about the amounts and 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 auditors consider internal control relevant to the
Company''s preparation and fair presentation of the financial
statements in order to design audit procedures that are appropriate in
the circumstances. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of
the accounting estimates made by Management, as well as evaluating the
overall presentation of the financial statements.
5. We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our audit opinion.
Opinion
6. In our opinion, and to the best of our information and according to
the explanations given to us, the accompanying financial statements
give the information required by the Act in the manner so required and
give a true and fair view in conformity with the accounting principles
generally accepted in India:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2013;
(b) in the case of the Statement of Profit and Loss, of the profit for
the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Report on Other Legal and Regulatory Requirements
7. As required by ''the Companies (Auditor''s Report) Order,
2003'', as amended by ''the Companies (Auditor''s Report)
(Amendment) Order, 2004'', issued by the Central Government of India
in terms of sub-section (4A) of section 227 of the Act (hereinafter
referred to as the "Order"), 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 paragraphs 4 and 5
of the Order.
8. 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 dealt with by this report comply with the
Accounting Standards referred to in sub-section (3C) of section 211 of
the Act;
(e) On the basis of written representations received from the directors
as on March 31, 2013, and taken on record by the Board of Directors,
none of the directors is disqualified as on march 31, 2013, from being
appointed as a director in terms of clause (g) of sub- section (1) of
section 274 of the Act.
ANNEXURE TO INDEPENDENT AUDITORS'' REPORT
Referred to in paragraph 7 of the Independent Auditors'' Report of
even date to the members of Century Enka Limited on the financial
statements for the year ended March 31, 2013
1. a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation, of fixed
assets.
b) The fixed assets of the Company have been physically verified by the
Management during the year and no material discrepancies have been
noticed on such verification. In our opinion, the frequency of
verification is reasonable.
c) In our opinion, and according to the information and explanations
given to us, a substantial part of fixed assets has not been disposed
of by the Company during the year.
2. a) The inventory has been physically verified by the Management
during the year. In our opinion, the frequency of verification is
reasonable.
b) In our opinion, 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) On the basis of our examination of the inventory records, in our
opinion, the Company is maintaining proper records of inventory. The
discrepancies noticed on physical verification of inventory as compared
to book records were not material.
3. The Company has not granted/taken any loans, secured or unsecured,
to companies, firms or other parties covered in the register maintained
under Section 301 of the Act. Therefore, the provisions of Clause
4(iii) (b), (c), (d), (f) and (g) of the said Order are not applicable
to the Company.
4. In our opinion, and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchase of inventory and fixed assets and for the sale of goods.
Further, on the basis of our examination of the books and records of
the Company, and according to the information and explanations given to
us, we have neither come across, nor have been informed of, any
continuing failure to correct major weaknesses in the aforesaid
internal control system.
5. a) According to the information and explanations given to us, we
are of the opinion that the particulars of all contracts or
arrangements 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 such contracts or
arrangements and exceeding the value of Rupees Five Lakhs in respect of
any party during the year have been made at prices which are reasonable
having regard to the prevailing market prices at the relevant time.
6. 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 Act and the
''Companies (Acceptance of Deposits) Rules, 1975'' with regard to the
deposits accepted from the public. According to the information and
explanations given to us, no order has been passed by the Company Law
Board or National Company Law Tribunal or Reserve Bank of India or any
Court or any other Tribunal on the Company in respect of the aforesaid
deposits.
7. In our opinion, the Company has an internal audit system
commensurate with its size and the nature of its business.
8. We have broadly reviewed the books of account maintained by the
Company in respect of products where, pursuant to the rules made by the
Central Government of India, the maintenance of cost records has been
prescribed under clause (d) of sub-section (1) of Section 209 of the
Act, and are of the opinion that, prima facie, the prescribed accounts
and records have been made and maintained. We have not, however, made
a detailed examination of the records with a view to determine whether
they are accurate or complete.
9. a) According to the information and explanations given to us and
the records of the Company examined by us, in our opinion, the Company
is regular in depositing the 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 and other material statutory dues, as
applicable, with the appropriate authorities.
b) According to the information and explanations given to us and the
records of the Company examined by us, there are no dues of wealth-tax
and service-tax which have not been deposited on account of any
dispute. The particulars of dues of income tax, sales tax, customs duty
and excise duty as at March 31, 2013 which have not been deposited on
account of a dispute, are as follows:
Name of the statute Nature of dues Amount Amount paid
(Rs. /
lacs) under protest
(Rs. / lacs)
The Income-tax Act, Income-tax, including 21 -
1961 interest
63 -
108 -
118 -
454 454
Name of the Statute Period to which Forum where the dispute is
the amount relates pending
The Income-tax Act, 1961 AY 1985-86
AY 1987-88 Calcutta High Court
AY 2002-03
AY 2004-05
AY 2008-09 Income-tax Appellate
Tribunal
Name of the statute Nature of dues Amount Amount paid
(Rs. /
lacs) under protest
(Rs. / lacs)
The Central Excise Excise Duty, including 20 -
Act, 1944 interest and penalty
as applicable 66 66
248 -
The Customs Act, Customs Duty 182 68
1962 including interest and
penalty, as applicable
The Gujarat Sales-tax Sales-tax including 361 -
Act, 1969 interest and penalty, 74 -
as applicable 207 78
The Gujarat Value Sales-tax 24 -
Added Tax Act, 2006
The Maharashtra Value Added Tax 14 -
Value Added Tax Act
Name of the Statute Period to which Forum where the dispute is
the amount relates pending
The Central Excise Act,
1944 2000-01 and
2001-02 Customs, Excise and
Service
1993-94 Tax Appellate Tribunal
2007-08 to Commissioner of Customs
2010-11 and Central Excise
The Customs Act, 1962 1994-95 Customs, Excise, and
Service
2001-02 and
2006-07 Tax Appellate Tribunal
The Gujarat Sales-tax
Act, 1969 2000-01 The Supreme Court of India
2000-01 Joint Commissioner of
2000-01 Commercial Tax
The Gujarat Value Added
Tax Act, 2006 2007-08 Commissioner of Commercial
Taxes
The Maharashtra Value
Added Tax Act 2012-13 Commissioner of Sales-tax
10. The Company has no accumulated losses as at the end of the
financial year and it has not incurred any cash losses in the financial
year ended on that date or in the immediately preceding financial year.
11. According to the records of the Company examined by us and the
information and explanation given to us, the Company has not defaulted
in repayment of dues to any financial institution or bank or debenture
holders as at the balance sheet date.
12. The Company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
Therefore, the provisions of Clause 4(xii) of the Order are not
applicable to the Company.
13. As the provisions of any special statute applicable to chit fund/
nidhi/ mutual benefit fund/ societies are not applicable to the
Company, the provisions of Clause 4(xiii) of the Order are not
applicable to the Company.
14. In our opinion, the Company is not dealing in or trading in
shares, securities, debentures and other investments. Accordingly, the
provisions of Clause 4(xiv) of the Order are not applicable to the
Company.
15. In our opinion, and 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 during the year.
Accordingly, the provisions of Clause 4(xv) of the Order are not
applicable to the Company.
16. In our opinion, and according to the information and explanations
given to us, the term loans have been applied for the purposes for
which they were obtained.
17. According to the information and explanations given to us and on
an overall examination of the balance sheet of the company, we report
that the no funds raised on short-term basis have been used for
long-term investment.
18. The Company has not made any preferential allotment of shares to
parties and companies covered in the register maintained under Section
301 of the Act during the year. Accordingly, the provisions of Clause
4(xviii) of the Order are not applicable to the Company.
19. The Company has not issued any debentures during the year and does
not have any debentures outstanding as at the beginning of the year and
at the year end. Accordingly, the provisions of Clause 4(xix) of the
Order are not applicable to the Company.
20. The Company has not raised any money by public issues during the
year. Accordingly, the provisions of Clause 4(xx) of the Order are not
applicable to the Company.
21. During the course of our examination of the books and records of
the Company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
material fraud on or by the Company, noticed or reported during the
year, nor have we been informed of any such case by the Management.
For Price Waterhouse
Firm Registration Number: 301112E
Chartered Accountants
Jeetendra Mirchandani
Place : Miami, USA Partner
Date : May 15, 2013 Membership Number 48125
Mar 31, 2012
1. We have audited the attached Balance Sheet of Century Enka Limited
(the "Company") as at March 31, 2012, and the related Statement of
Profit and Loss and Cash Flow Statement for the year ended on that date
annexed thereto, which we have signed under reference to this report.
These financial statements are the responsibility of the Company's
Management. Our responsibility is to express an opinion on these
financial statements based on our audit.
2. We conducted 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 (Auditor's Report) Order, 2003, as
amended by the Companies (Auditor's Report) (Amendment) Order, 2004
(together the Order), issued by the Central Government of India in
terms of sub-section (4A) of Section 227 of The Companies Act, 1956 of
India (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 paragraphs 4 and 5 of the Order.
4. Further to our comments in the Annexure referred to in paragraph 3
above, we report that:
(a) We have obtained all the information and explanations which, to the
best of our knowledge and belief, were necessary for the purposes of
our audit;
(b) In our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books;
(c) The Balance Sheet, 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 dealt with by this report comply with the
accounting standards referred to in sub-section (3C) of Section 211 of
the Act;
(e) On the basis of written representations received from the
directors, as on March 31, 2012 and taken on record by the Board of
Directors, none of the directors is disqualified as on March 31,2012
from being appointed as a director in terms of clause (g) of
sub-section (1) of Section 274 of the Act;
(f) In our opinion and to the best of our information and according to
the explanations given to us, the said financial statements together
with the notes thereon and attached thereto give, in the prescribed
manner, the information required by the Act, 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, 2012;
(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.
ANNEXURE TO AUDITORS' REPORT
Referred to in paragraph 3 of the Auditors' Report of even date to
the members of Century Enka Limited on the financial statements as of
and for the year ended March 31, 2012
1. (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation, of fixed
assets.
(b) The fixed assets of the Company have been physically verified by
the Management during the year and no material discrepancies between
the book records and the physical inventory have been noticed. In our
opinion, the frequency of verification is reasonable.
(c) In our opinion, and according to the information and explanations
given to us, a substantial part of fixed assets has not been disposed
off by the Company during the year.
2. (a) The inventory (excluding stocks with third parties) has been
physically verified by the Management during the year. In respect of
inventory lying with third parties, these have substantially been
confirmed by them. In our opinion, the frequency of verification is
reasonable.
(b) In our opinion, 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) On the basis of our examination of the inventory records, in our
opinion, the Company is maintaining proper records of inventory. The
discrepancies noticed on physical verification of inventory as compared
to book records were not material.
3. (a) The Company has not granted any loans, secured or unsecured,
to companies, firms or other parties covered in the register maintained
under Section 301 of the Act.
(b) The Company has not taken any loans, secured or unsecured, from
companies, firms or other parties covered in the register maintained
under Section 301 of the Act.
4. In our opinion, and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchase of inventory and fixed assets and for the sale of goods.
Further, on the basis of our examination of the books and records of
the Company, and according to the information and explanations given to
us, no major weakness have been noticed or reported.
5. (a) In our opinion, and according to the information and
explanations given to us, the particulars of contracts or arrangements
referred to in Section 301 of the Act have been entered in the register
required to be maintained under that section.
(b) In our opinion, and according to the information and explanations
given to us, the transactions made in pursuance of such contracts or
arrangements and exceeding the value of Rupees Five Lakhs in respect of
any party during the year have been made at prices which are reasonable
having regard to the prevailing market prices at the relevant time.
6. 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 Act and the
'Companies (Acceptance of Deposits) Rules, 1975' with regard to the
deposits accepted from the public. According to the information and
explanations given to us, no order has been passed by the Company Law
Board or National Company Law Tribunal or Reserve Bank of India or any
Court or any other Tribunal on the Company in respect of the aforesaid
deposits.
7. In our opinion, the Company has an internal audit system
commensurate with its size and the nature of its business.
8. We have broadly reviewed the books of account maintained by the
Company in respect of products where, pursuant to the rules made by the
Central Government of India, the maintenance of cost records has been
prescribed under clause (d) of sub-section (1) of Section 209 of the
Act, and are of the opinion that, prima facie, the prescribed accounts
and records have been made and maintained. We have not, however, made a
detailed examination of the records with a view to determine whether
they are accurate or complete.
9. (a) According to the information and explanations given to us and
the records of the Company examined by us, in our opinion, the Company
is regular in depositing the 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 and other material statutory dues, as
applicable, with the appropriate authorities.
(b) According to the information and explanations given to us and the
records of the Company examined by us, there are no dues of wealth tax
and service tax which have not been deposited on account of any
dispute. The particulars of dues of income tax, excise duty, customs
duty and sales tax as at March 31, 2012 which have not been deposited
on account of a dispute, are as follows:
Name of the Nature of dues Amount Period to which the amount
statute
(Rs. Lacs) relates
The Income
Tax Act,
1961 Income Tax dues,
including
interest 226
Assessment Year 2002-03
and penalty,
as applicable and 2004-05
Income Tax dues,
including interest 365 Assessment Year 2008-09
and penalty
The Central
Excise Act, Excise Duty 86* 1993-94,2000-01 and
1944 2001-02
The Customs
Act, 1962 Customs Duty
including
interest 182* 1994-95,2001 -02 and
and penalty,
as applicable 2006-07
The Gujarat
Sales Tax
Act, Sales tax
including
interest and 361 2000-01
1969 penalty, as
applicable
Purchase Tax 74 2000-01
Additional Tax 207* 2000-01
The Gujarat
Value Added Sales Tax 24 2007-08
Tax Act,
2006
Name of the Period to which the Forum where the
statute amount relates dispute is pending
The income Tax
Act,1961 Assessment year 2002-03 Calcutta High Court
and 2004-05
Assessment year 2008-09 Income Tax Appellate
Tribunal
The central Excise
Act,1944 1993-94,2000-01 and
2001-02 Customs, Excise, and
Service Tax Appellate
Tribunal
The customs
Act,1962 1994-95,2001-02 and
2006-07 Customs, Excise, and
Service Tax Appellate
Tribunal
The Gujarat Sales
Tax Act,1969 2000-01 The Supreme Court of
India
2000-01 Joint Commissioner of
Commercial Tax
2000-01 Joint Commissioner of
Commercial Tax
The Gujarat Value
Added Tax Act,1969 2007-08 Commissioner of
Commercial Taxes
* Includes Rs. 212 Lacs paid under protest considered as recoverable by
the Company.
10. The Company has no accumulated losses.
11. According to the records of the Company examined by us and the
information and explanation given to us, the Company has not defaulted
in repayment of dues to any financial institution or bank or debenture
holders as at the balance sheet date.
12. The Company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
13. The provisions of any special statute applicable to chit
fund/nidhi/mutual benefit fund/societies are not applicable to the
Company.
14. In our opinion, the Company is not a dealer or trader in shares,
securities, debentures and other investments.
15. In our opinion, and 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 during the year.
16. In our opinion, and according to the information and explanations
given to us, the term loans have been applied, on an overall basis, for
the purposes for which they were obtained.
17. On the basis of an overall examination of the balance sheet of the
Company, in our opinion, and according to the information and
explanations given to us, there are no funds raised on a short-term
basis which have been used for long-term investment.
18. The Company has not made any preferential allotment of shares to
parties and companies covered in the register maintained under Section
301 of the Act during the year.
19. The Company has not issued any debentures during the year; and
does not have any debentures outstanding as at the year end.
20. The Company has not raised any money by public issues during the
year.
21. During the course of our examination of the books and records of
the Company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
fraud on or by the Company, noticed or reported during the year, nor
have we been informed of any such case by the Management.
For Price Waterhouse
Firm Registration Number: 301112E
Chartered Accountants
Jeetendra Mirchandanl
Place: Mumbai Partner
Date : May 02, 2012 Membership Number 48125
Mar 31, 2011
1. We have audited the attached Balance Sheet of Century Enka Limited
(the "Company") as at March 31, 2011, and the related Profit and Loss
Account and Cash Flow Statement for the year ended on that date annexed
thereto, which we have signed under reference to this report. These
financial statements are the responsibility of the Companys
Management. Our responsibility is to express an opinion on these
financial statements based on our audit.
2. We 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
(together the ÃOrderÃ), issued by the Central Government of India in
terms of sub-section (4A) of Section 227 of ÃThe Companies Act, 1956
of India (the ÃAct) 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 paragraphs 4 and 5 of the Order.
4. Further to our comments in the Annexure referred to in paragraph 3
above, we report that:
(a) We have obtained all the information and explanations which, to the
best of our knowledge and belief, were
necessary for the purposes of our audit;
(b) In our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books;
(c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account;
(d) In our opinion, the Balance Sheet, Profit and Loss Account and Cash
Flow Statement dealt with by this report comply with the accounting
standards referred to in sub-section (3C) of Section 211 of the Act;
(e) On the basis of written representations received from the
directors, as on March 31, 2011 and taken on record by the Board of
Directors, none of the directors is disqualified as on March 31, 2011
from being appointed as a director in terms of clause (g) of
sub-section (1) of Section 274 of the Act;
(f) In our opinion and to the best of our information and according to
the explanations given to us, the said financial statements together
with the notes thereon and attached thereto give, in the prescribed
manner, the information required by the Act, 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, 2011;
(ii) in the case of the Profit and Loss Account, of the profit for the
year ended on that date; and
(iii) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
ANNEXURE TO AUDITORS REPORT
[Referred to in paragraph 3 of the Auditors Report of even date to the
members of Century Enka Limited on the financial statements for the
year ended March 31, 2011]
1. (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation, of fixed
assets.
(b) The fixed assets of the Company have been physically verified by
the Management during the year and no
material discrepancies between the book records and the physical
inventory have been noticed. In our opinion, the frequency of
verification is reasonable.
(c) In our opinion and according to the information and explanations
given to us, a substantial part of fixed assets has not been disposed
of by the Company during the year.
2. (a) The inventory (excluding stocks with third parties) has been
physically verified by the Management during the year. In respect of
inventory lying with third parties, these have substantially been
confirmed by them. In our opinion, the frequency of verification is
reasonable.
(b) In our opinion, 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) On the basis of our examination of the inventory records, in our
opinion, the Company is maintaining proper records of inventory. The
discrepancies noticed on physical verification of inventory as compared
to book records were not material.
3. (a) The Company has not granted any loans, secured or
unsecured, to companies, firms or other parties covered in the register
maintained under Section 301 of the Act.
(b) The Company has not taken any loans, secured or unsecured, from
companies, firms or other parties covered in the register maintained
under Section 301 of the Act.
4. In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchase of inventory, fixed assets and for the sale of goods and
services. Further, on the basis of our examination of the books and
records of the Company, and according to the information and
explanations given to us, we have neither come across nor have been
informed of any continuing failure to correct major weaknesses in the
aforesaid internal control system.
5. (a) In our opinion and according to the information and explanations
given to us, the particulars of contracts or arrangements referred to
in Section 301 of the Act have been entered in the register required to
be maintained under that section.
(b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of such contracts or
arrangements and exceeding the value of Rupees Five Lakhs in respect of
any party during the year have been made at prices which are reasonable
having regard to the prevailing market prices at the relevant time.
6. In our opinion and according to the information and explanations
given to us, the Company has complied with the directives issued by
Reserve Bank of India and the provisions of Sections 58A and 58AA or
any other relevant provisions of the Act and the Companies (Acceptance
of Deposits) Rules, 1975 with regard to the deposits accepted from the
public. According to the information and explanations given to us, no
Order has been passed by the Company Law Board or National Company Law
Tribunal or Reserve Bank of India or any Court or any other Tribunal on
the Company in respect of the aforesaid deposits.
7. In our opinion, the Company has an internal audit system
commensurate with its size and nature of its business.
8. We have broadly reviewed the books of account maintained by the
Company in respect of products where, pursuant to the Rules made by the
Central Government of India, the maintenance of cost records has been
prescribed under clause (d) of sub-section (1) of Section 209 of the
Act, and are of the opinion that prima facie, the prescribed accounts
and records have been made and maintained. We have not, however, made a
detailed examination of the records with a view to determine whether
they are accurate or complete.
9. (a) According to the information and explanations given to us and
the records of the Company examined by us, in our opinion, the Company
is regular in depositing the 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 material statutory dues as
applicable with the appropriate authorities.
(b) According to the information and explanations given to us and the
records of the Company examined by us, the particulars of dues of
income-tax, sales-tax, wealth- tax, service-tax, customs duty, excise
duty and cess as at March 31, 2011 which have not been deposited on
account of a dispute, are as follows:
Name of the statute Nature of dues Amount
(Rs. Lacs)
The Income Tax Act, 1961 Computation of
profits under
Section 143(3) 454
The Customs Act, 1962 Refund of customs
duty 68
Reclassification of
imported assets 22
The Sales Tax Act Additional Tax 133
Purchase Tax 74
Demand raised on
completion of
Assessment 19
The Central Excise Computation of
Act, 1944 cost of production 20
Property Tax Liability for
Open Land 70
Name of the statute Period to which Forum where the
the amount dispute is
relates pending
The Customs Act, 1962 2007-08 Commissioner of
Income Tax (Appeals)
The Customs Act, 1962 2001-02 Customs, Excise, and
Service Tax
Appellate Tribunal
2006-07 Customs, Excise, and
Service Tax Appellate
Tribunal
The Sales Tax Act 2000-01 Joint Commissioner
of Commercial Tax
2000-01 Joint Commissioner
of Commercial Tax
2006-07 Joint Commissioner
of Commercial Tax
The Central Excise 2000-01 and Customs, Excise, and
Act,1944 2001-02 Service Tax Appellate
Tribunal
Property Tax 2006-07 till Court of Senior
2010-11 Division Pune
10. The Company has no accumulated losses as at March 31, 2011 and it
has not incurred any cash losses in the financial year ended on that
date or in the immediately preceding financial year.
11. According to the records of the Company examined by us and the
information and explanation given to us, the Company has not defaulted
in repayment of dues to any financial institution or bank or debenture
holders as at the balance sheet date.
12. The Company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
13. The provisions of any special statute applicable to chit fund /
nidhi / mutual benefit fund/ societies are not applicable to the
Company.
14. In our opinion, the Company is not a dealer or trader in shares,
securities, debentures and other investments.
15. In our opinion and 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 during the year.
16. In our opinion, and according to the information and explanations
given to us, on an overall basis, the term loans have been applied for
the purposes for which they were obtained.
17. On the basis of an overall examination of the balance sheet of the
Company, in our opinion and according to the information and
explanations given to us, there are no funds raised on a short-term
basis which have been used for long-term investment.
18. During the year, the Company has allotted equity
shares on preferential basis to a company covered in the register
maintained under Section 301 of the Act consequent upon conversion of
warrants. The price at which these equity shares have been issued has
been determined as per the Securities and Exchange Board of India
(Issue of Capital and Disclosure Requirements) Regulations, 2009, which
in our opinion, is not prejudicial to the interest of the company.
19. During the course of our examination of the books and records of
the Company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
fraud on or by the Company, noticed or reported during the year, nor
have we been informed of such case by the Management.
20. The other clauses, Clause (xix) on creation of charge for
debentures issued and outstanding at the year end and clause (xx) on
end use of money raised by public issues of paragraph 4 of the
Companies (Auditors Report) Order 2003, as amended by the Companies
(Auditors Report) (Amendment) Order, 2004, are not applicable in the
case of the Company for the year, since in our opinion there is no
matter which arises to be reported in the aforesaid Order.
For Price Waterhouse
Firm Registration Number: 301112E
Chartered Accountants
Jeetendra Mirchandani
Partner
Membership Number F 48125
Place: Mumbai
Date : May 02, 2011
Mar 31, 2010
1. We have audited the attached Balance Sheet of Century Enka Limited
(the ÃCompanyÃ) as at March 31, 2010, and the related Profi t and Loss
Account and Cash Flow Statement for the year ended on that date annexed
thereto, which we have signed under reference to this report. These fi
nancial statements are the responsibility of the CompanyÃs Management.
Our responsibility is to express an opinion on these fi nancial
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 fi
nancial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the fi nancial statements. An audit also includes
assessing the accounting principles used and signifi cant estimates
made by Management, as well as evaluating the overall fi nancial
statement presentation. We believe that our audit provides a reasonable
basis for our opinion.
3. As required by the Companies (AuditorÃs Report) Order, 2003, as
amended by the Companies (AuditorÃs Report) (Amendment) Order, 2004
(together the ÃOrderÃ), issued by the Central Government of India in
terms of sub-section (4A) of Section 227 of ÃThe Companies Act, 1956Ã
of India (the ÃActÃ) 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 specifi ed in paragraphs 4 and 5 of the Order.
4. Further to our comments in the Annexure referred to in paragraph 3
above, we report that:
(a) We have obtained all the information and explanations which, to the
best of our knowledge and belief, were necessary for the purposes of
our audit;
(b) In our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books;
(c) The Balance Sheet, Profi t and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account;
(d) In our opinion, the Balance Sheet, Profi t 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 Act;
(e) On the basis of written representations received from the
directors, as on March 31, 2010 and taken on record by the Board of
Directors, none of the directors is disqualifi ed as on March 31, 2010
from being appointed as a director in terms of clause (g) of
sub-section (1) of Section 274 of the Act;
(f) In our opinion and to the best of our information and according to
the explanations given to us, the said fi nancial statements together
with the notes thereon and attached thereto give, in the prescribed
manner, the information required by the Act, 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, 2010;
(ii) in the case of the Profi t and Loss Account, of the profi t for
the year ended on that date; and
(iii) in the case of the Cash Flow Statement, of the cash fl ows for
the year ended on that date.
ANNEXURE TO AUDITORSÃ REPORT
[Referred to in paragraph 3 of the Auditorsà Report of even date to the
members of Century Enka Limited on the fi nancial statements for the
year ended March 31, 2010]
1. (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation of fi xed
assets.
(b) The fi xed assets of the Company have been physically verifi ed by
the Management during the year and no material discrepancies between
the book records and the physical inventory have been noticed. In our
opinion, the frequency of verifi cation is reasonable.
(c) In our opinion and according to the information and explanations
given to us, a substantial part of fi xed assets has not been disposed
of by the Company during the year.
2. (a) The inventory (excluding stocks with third parties) has been
physically verifi ed by the Management during the year. In respect of
inventory lying with third parties, these have substantially been confi
rmed by them. In our opinion, the frequency of verifi cation is
reasonable.
(b) In our opinion, the procedures of physical verifi cation 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) On the basis of our examination of the inventory records, in our
opinion, the Company is maintaining proper records of inventory. The
discrepancies noticed on physical verifi cation of inventory as
compared to book records were not material.
3. (a) The Company has not granted any loans, secured or unsecured, to
companies, fi rms or other parties covered in the register maintained
under Section 301 of the Act.
(b) The Company has not taken any loans, secured or unsecured, from
companies, fi rms or other parties covered in the register maintained
under Section 301 of the Act.
4. In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchase of inventory, fi xed assets and for the sale of goods and
services. Further, on the basis of our examination of the books and
records of the Company, and according to the information and
explanations given to us, we have neither come across nor have been
informed of any continuing failure to correct major weaknesses in the
aforesaid internal control system.
5. (a) In our opinion and according to the information and
explanations given to us, the particulars of contracts or arrangements
referred to in Section 301 of the Act have been entered in the register
required to be maintained under that section.
(b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of such contracts or
arrangements and exceeding the value of Rupees Five Lakhs in respect of
any party during the year have been made at prices which are reasonable
having regard to the prevailing market prices at the relevant time.
6. In our opinion and according to the information and explanations
given to us, the Company has complied with the directives issued by
Reserve Bank of India and the provisions of Sections 58A and 58AA or
any other relevant provisions of the Act and the Companies (Acceptance
of Deposits) Rules, 1975 with regard to the deposits accepted from the
public. According to the information and explanations given to us, no
Order has been passed by the Company Law Board or National Company Law
Tribunal or Reserve Bank of India or any Court or any other Tribunal on
the Company in respect of the aforesaid deposits.
7. In our opinion, the Company has an internal audit system
commensurate with its size and nature of its business.
8. We have broadly reviewed the books of account maintained by the
Company in respect of products where, pursuant to the Rules made by the
Central Government of India, the maintenance of cost records has been
prescribed under clause (d) of sub-section (1) of Section 209 of the
Act, and are of the opinion that prima facie, the prescribed accounts
and records have been made and maintained. We have not, however, made a
detailed examination of the records with a view to determine whether
they are accurate or complete.
9. (a) According to the information and explanations given to us and
the records of the Company examined by us, in our opinion, the Company
is regular in depositing the undisputed statutory dues including
provident fund, investor education and protection fund, employeesÃ
state insurance, income-tax, sales-tax, wealth tax, service tax,
customs duty, excise duty, cess and other material statutory dues as
applicable with the appropriate authorities.
(b) According to the information and explanations given to us and the
records of the Company examined by us, the particulars of dues of
income-tax, sales-tax, customs duty and excise duty as at March 31,
2010 which have not been deposited on account of a dispute, are as
follows:
Name of the
statute Nature of dues Amount
(Rs.
Crores)
The Income
Tax Act, 1961 Computation of profi ts under
Section 251 and 0.56
143(3)
The CustomÃs
Act, 1962 Refund of customs duty 0.68
Reclassification of
imported assets 0.22
The Sales Tax
Act Additional Tax 1.33
Purchase Tax 0.74
The Central
Excise Act, Computation of cost of production 0.20
1944
Name of the Statue Period to Forum where the
dispute is pending
which the
amount relates
The Income Tax Act, 1961 2003-04 Income Tax Appellate Tribunal
The CustomÃs Act, 1962 2001-02 Customs, Excise, and Service
Tax Appellate Tribunal
2006-07 Customs, Excise, and Service
Tax Appellate Tribunal
The Sales Tax Act 2000-01 Joint Commissioner of
Commercial Tax
2000-01 Joint Commissioner of
Commercial Tax
The Central Excise Act,
1944 2000-01 and Customs, Excise, and Service
Tax Appellate Tribunal
2001-02
10. The Company has no accumulated losses as at March 31, 2010 and it
has not incurred any cash losses in the fi nancial year ended on that
date or in the immediately preceding fi nancial year.
11. According to the records of the Company examined by us and the
information and explanation given to us, the Company has not defaulted
in repayment of dues to any fi nancial institution or bank or debenture
holders as at the balance sheet date.
12. The Company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
13. The provisions of any special statute applicable to chit fund /
nidhi / mutual benefi t fund/ societies are not applicable to the
Company.
14. In our opinion, the Company has maintained proper records of
transactions and contracts relating to dealing or trading in shares,
securities, debentures and other investments during the year and timely
entries have been made therein. Further, such securities have been held
by the Company in its own name or are in the process of transfer in its
name, except to the extent of the exemption granted under Section 49 of
the Act.
15. In our opinion and according to the information and explanations
given to us, the Company has not given any guarantee for loans taken by
others from banks or fi nancial institutions during the year.
16. In our opinion, and according to the information and explanations
given to us, on an overall basis, the term loans have been applied for
the purposes for which they were obtained.
17. On the basis of an overall examination of the balance sheet of the
Company, in our opinion and according to the information and
explanations given to us, there are no funds raised on a short- term
basis which have been used for long-term investment.
18. During the year, the Company has allotted equity shares on
preferential basis to a company covered in the register maintained
under Section 301 of the Act consequent upon conversion of warrants.
The price at which these equity shares have been issued has been
determined as per the Securities and Exchange Board of India (Issue of
Capital and Disclosure Requirements) Regulations, 2009, which in our
opinion, is not prejudicial to the interest of the Company.
19. During the course of our examination of the books and records of
the Company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
fraud on or by the Company, noticed or reported during the year, nor
have we been informed of such case by the Management.
20. The other clauses, Clause (xix) on creation of charge for
debentures issued and outstanding at the year end and clause (xx) on
end use of money raised by public issues of paragraph 4 of the
Companies (AuditorÃs Report) Order 2003, as amended by the Companies
(AuditorÃs Report) (Amendment) Order, 2004,are not applicable in the
case of the Company for the year, since in our opinion there is no
matter which arises to be reported in the aforesaid Order.
For Price Waterhouse
Firm Registration Number: 301112 E
Chartered Accountants
Jeetendra Mirchandani
Place : Mumbai Partner
Date : May 03, 2010 Membership No. F 48125
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