Mar 31, 2018
Report on the Audit of the Standalone Ind AS Financial Statements
We have audited the accompanying standalone Ind AS financial statements of Dai-ichi Karkaria Limited (âthe Companyâ), which comprise the Balance Sheet as at 31 March 2018, and the Statement of Profit and Loss, the Statement of Changes in Equity and the Statement of Cash Flows for the year then ended, and a summary of the significant accounting policies and other explanatory information.
Managementâs Responsibility for the Standalone Ind AS Financial Statements
The Companyâs Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these standalone Ind AS financial statements that give a true and fair view of the 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 (Ind AS) 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 standalone 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 financial statements, management is responsible for assessing the Companyâs ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Auditorsâ Responsibility
Our responsibility is to express an opinion on these standalone 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 thereunder.
We conducted our audit of the standalone Ind AS financial statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone Ind AS financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditorâs judgment, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Companyâs preparation of the standalone Ind AS financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Companyâs Directors, as well as evaluating the overall presentation of the standalone Ind AS financial statements.
We are also responsible to 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 entityâs ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in the auditorâs report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify the opinion. Our conclusions are based on the audit evidence obtained up to the date of the auditorâs report. However, future events or conditions may cause an entity to cease to continue as a going concern.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India of the state of affairs of the Company as at 31 March 2018, its profit and other comprehensive income, changes in equity and its cash flows for the year ended on that date.
Other Matter
The comparative financial information of the Company for the year ended 31 March 2017 and the transition date opening balance sheet as at 1 April 2016 included in these standalone Ind AS financial statements, are based on the previously issued statutory standalone financial statements prepared in accordance with the Companies (Accounting Standards) Rules, 2006 audited by the predecessor auditor whose report for the year ended 31 March 2017 and 31 March 2016 dated 5 May 2017 and 14 May 2016 respectively expressed an unmodified opinion on those standalone 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
1. 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 Aâ, a statement on the matters specified in paragraphs 3 and 4 of the Order.
2. As required by Section 143(3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
(c) The Balance Sheet, the Statement of Profit and Loss, 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 standalone 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 2018 taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2018 from being appointed as a director in terms of Section 164(2) of the Act.
(f) With respect to the adequacy of the internal financial controls with respect to financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Bâ.
(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 its financial position in its standalone Ind AS financial statements - Refer Note 34 to the standalone Ind AS financial statements;
ii. The Company did not have any other long-term contracts including derivative contracts for which there were any material foreseeable losses;
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company; and
iv. The disclosures in the financial statements regarding holdings as well as dealings in specified bank notes during the period from 8 November 2016 to 30 December 2016 have not been made since they do not pertain to the financial year ended 31 March 2018. However amounts as appearing in the audited standalone Ind AS financial statements for the period ended 31 March 2017 have been disclosed.
Annexure A to the Independent Auditorsâ Report - 31 March 2018
(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 two 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 of land and building that are freehold, as disclosed in Note 4 to the standalone Ind AS financial statements, are held in the name of the Company. In respect of leasehold land, we have verified the lease deed duly registered with the appropriate authorities with the Company as lessee.
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. 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. 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 investments made, guarantees given and security provided, as applicable. The Company has not granted any loans.
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 records 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, Sales-tax, Goods and Service Tax (GST), Sales-tax, Service tax, Duty of Customs, Duty of Excise, Value added tax, Cess and other material statutory dues have been generally regularly deposited during the year by the Company with the appropriate authorities, though there are slight delay in few cases.
According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Employeesâ State Insurance, Income-tax, Goods and Service Tax (GST), 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 2018 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 and Value added tax which have not been deposited as on 31 March 2018 on account of disputes are given below:
Name of the statute |
Nature of the dues |
Amount of demand under dispute (Rs.) |
Amount paid under protest (Rs.) |
Amount under dispute not deposited (Rs.) |
Period to which the amount relates |
Forum where the dispute is pending |
Income-tax Act, 1961 |
Income-tax, interest and penalty |
3,587,442 |
- |
3,587,442 |
FY 2005-06 |
ITAT |
Income-tax Act, 1961 |
Income-tax, interest and penalty |
2,981,358 |
- |
2,981,358 |
FY 2005-06 |
High Court |
Income-tax Act, 1961 |
Income-tax, interest and penalty |
183,969 |
183,969 |
FY 2006-07 |
DCIT |
|
Income-tax Act, 1961 |
Income-tax, interest and penalty |
29,539,577 |
7,500,000 |
22,039,577 |
FY 2008-09 |
ITAT |
Income-tax Act, 1961 |
Income-tax, interest and penalty |
23,943,546 |
23,943,546 |
FY 2008-09 |
CIT (A) |
|
Income-tax Act, 1961 |
Income-tax, interest and penalty |
1,309,654 |
1,309,654 |
FY 2010-11 |
DCIT |
|
Income-tax Act, 1961 |
Income-tax, interest and penalty |
2,532,031 |
2,532,031 |
FY 2011-12 |
DCIT |
|
Income-tax Act, 1961 |
Income-tax, interest and penalty |
1,978,861 |
1,978,861 |
FY 2012-13 |
CIT (A) |
|
Maharashtra Value Added Tax Act, 2002 |
Value added tax |
1,494,908 |
400,000 |
1,094,908 |
FY 2008-09 |
DCST |
Central Sales Tax Act, 1956 |
Central sales tax |
6,238,165 |
90,000 |
6,148,165 |
FY 2008-09 |
DCST |
Central Sales Tax Act, 1956 |
Central sales tax |
325,000 |
- |
325,000 |
FY 2009-10 |
DCST |
Service tax under Finance Act |
Service tax |
4,864,155 |
4,864,155 |
FY 2008-09 to FY 2011-12 |
Addl. Commissioner Central Excise & Service Tax |
There are no dues of Duty of Customs, Duty of Excise and Cess which have not been deposited as on 31 March 2018 on account of disputes.
viii. In our opinion and 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 and government. The Company has not issued any debentures.
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 material fraud by the Company or on the Company by its officers or employees has been noticed or reported during the course of our audit.
xi. According to the information and explanations give to us and based on our examination of the records of the Company, the Company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act.
xii. In our opinion and according to the information and explanations given to us, the Company is not a Nidhi Company. Accordingly, 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. The details of such related party transactions have been disclosed in the standalone Ind AS financial statements as required under Accounting Standard (AS) 18, Related Party Disclosures specified under Section 133 of the Act, read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015.
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. In our opinion and 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 on standalone Ind AS financial statements- 31 March 2018
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (âthe Actâ)
We have audited the internal financial controls with reference to financial statements of Dai-ichi Karkaria Limited (âthe Companyâ) as of 31 March 2018 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 controls with reference to financial statements 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 companyâs policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.
Auditorsâ Responsibility
Our responsibility is to express an opinion on the Companyâs internal financial controls with reference to 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 (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 applicable to an audit of Internal Financial Controls and 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 with reference to financial statements 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 with reference to financial statements and their operating effectiveness. Our audit of internal financial controls with reference to financial statements included obtaining an understanding of internal financial controls with reference to financial statements, 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 auditorsâ judgement, 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 financial statements.
Meaning of Internal Financial Controls with reference to financial statements
A companyâs internal financial control with reference to 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 financial statements includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the companyâs assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls with reference to financial statements
Because of the inherent limitations of internal financial controls with reference to 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 financial statements to future periods are subject to the risk that the internal financial control with reference to 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 with reference to financial statements and such internal financial controls with reference to financial statements were operating effectively as at 31 March 2018, based on the internal control with reference to financial statements 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 B S R & Co. LLP
Chartered Accountants
Firmâs Registration No: 101248W/W-100022
Sadashiv Shetty
Mumbai Partner
3 May 2018 Membership No: 048648
Mar 31, 2017
INDEPENDENT AUDITORâS REPORT
TO
THE MEMBERS OF DAI-ICHI KARKARIA LIMITED
Report on the Standalone Financial Statements
We have audited the accompanying standalone financial statements of DAI-ICHI KARKARIA LIMITED (âthe Companyâ), which comprise the Balance Sheet as at 31 March, 2017, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.
Managementâs Responsibility for the Standalone Financial Statements
The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards 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 standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditorâs Responsibility
Our responsibility is to express an opinion on these standalone financial statements based on our audit.
In conducting our audit, we have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made hereunder.
We conducted our audit of the standalone financial statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the standalone financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the standalone financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the standalone financial statements.
We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements 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 31 March, 2017, and its profit and its cash flows for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by Section 143 (3) of the Act, based on our audit we report that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
c) The Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.
d) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards 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 Aâ. Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Company''s internal financial controls over financial reporting.
g) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements - Refer note 29.1 (i) (a) to the standalone financial statements;
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
iv. The Company has provided requisite disclosures in the standalone financial statements as regards its holding and dealings in Specified Bank Notes as defined in the Notification S.O. 3407(E) dated the 8 November, 2016 of the Ministry of Finance, during the period from 8 November 2016 to 30 December 2016. Based on audit procedures performed and the representations provided to us by the management we report that the disclosures are in accordance with the books of account maintained by the Company and as produced to us by the Management.
2. As required by the Companies (Auditor''s Report) Order, 2016 (âthe Orderâ) issued by the Central Government in terms of Section 143(11) of the Act, we give in âAnnexure Bâ a statement on the matters specified in paragraphs 3 and 4 of the Order.
(Referred to in paragraph 1 (f) under âReport on Other Legal and Regulatory Requirementsâ section of our report of even date)
Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (âthe Actâ)
We have audited the internal financial controls over financial reporting of Dai-ichi Karkaria Limited (âthe Companyâ) as of 31 March, 2017 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.
Managementâs Responsibility for Internal Financial Controls
The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.
Auditorâs Responsibility
Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the âGuidance Noteâ) issued by the Institute of Chartered Accountants of India and the Standards on Auditing prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained, is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.
Meaning of Internal Financial Controls Over Financial Reporting
A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls Over Financial Reporting
Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, to the best of our information and according to the explanations given to us, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 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 Institute of Chartered Accountants of India.
(Referred to in paragraph 2 under âReport on Other Legal and Regulatory Requirementsâ section of our report of even date)
(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
(b) Some of the fixed assets were physically verified during the year by the Management in accordance with a regular programme of verification which, in our opinion, provides for physical verification of all the fixed assets at reasonable intervals. According to the information and explanation given to us, no material discrepancies were noticed on such verification.
(c) With respect to immovable properties of land and buildings that are freehold, according to the information and explanations given to us and the records examined by us and based on the examination of the registered sale deed provided to us, we report that, the title deeds of such immovable properties are held in the name of the Company as at the balance sheet date. In respect of immovable properties of land that have been taken on lease and disclosed as fixed asset in the financial statements, the lease agreements are in the name of the Company, where the Company is the lessee in the agreement.
(ii) As explained to us, the inventories were physically verified during the year by the Management at reasonable intervals and no material discrepancies were noticed on physical verification.
(iii) The Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under section 189 of the Companies Act, 2013.
(iv) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Section 186 of the Companies Act, 2013 in respect of making investments and providing guarantees and securities, as applicable. The Company has not granted any loans.
(v) According to the information and explanations given to us, the Company has not accepted any deposit during the year in the terms of Sections 73 to 76 or any other relevant provisions of the Companies Act, 2013. There were no unclaimed deposits as at the year end.
(vi) The maintenance of cost records has been specified by the Central Government under section 148(1) of the Companies Act, 2013 for chemicals. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Records and Audit) Rules, 2014, as amended prescribed by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013, and are of the opinion that, prima facie, the prescribed cost records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.
(vii) According to the information and explanations given to us in respect of statutory dues:
a. The Company has generally been regular in depositing undisputed statutory dues, including Provident Fund, Employees'' State Insurance, Income-tax, Sales Tax, Service Tax, Customs Duty, Excise Duty, Value Added Tax, cess and other material statutory dues applicable to it to the appropriate authorities.
b. There were no undisputed amounts payable in respect of Provident Fund, Employees'' State Insurance, Income-tax, Sales Tax, Service Tax, Customs Duty, Excise Duty, Value Added Tax, cess and other material statutory dues in arrears as at 31 March, 2017 for a period of more than six months from the date they became payable.
c. Details of dues of Income-tax, Sales Tax, Service Tax and Value Added Tax which have not been deposited as on 31 March, 2017 on account of disputes are given below:
Name of the Statute |
Nature of dues |
Period to which the amount relates |
Forum where the dispute is pending |
Amount (Rs,) |
Income tax Act, 1961 |
Income Tax |
A.Y 2006-2007 |
ITAT |
35,87,442 |
Income tax Act, 1961 |
Income Tax |
A.Y 2006-2007 |
High Court |
29,81,358 |
Income tax Act, 1961 |
Income Tax |
A.Y. 2007-2008 |
DCIT |
1,83,969 |
Income tax Act, 1961 |
Income Tax |
A.Y. 2009-2010 |
ITAT |
*2,20,39,577 |
Income tax Act, 1961 |
Income Tax |
A.Y. 2009-2010 |
CIT(A) |
2,39,43,546 |
Income tax Act, 1961 |
Income Tax |
A.Y. 2011-2012 |
DCIT |
13,09,654 |
Income tax Act, 1961 |
Income Tax |
A.Y. 2012-2013 |
DCIT |
25,32,031 |
Income tax Act, 1961 |
Income Tax |
A.Y. 2013-2014 |
CIT(A) |
19,78,861 |
Maharashtra Value Added Tax Act, 2002 |
Value Added Tax |
F.Y. 2008-09 |
DCST |
#10,94,908 |
Central Sales Tax Act, 1956 |
Central Sales Tax |
F.Y. 2008-09 |
DCST |
@61,48,165 |
Central Sales Tax Act, 1956 |
Central Sales Tax |
F.Y. 2009-10 |
DCST |
3,25,000 |
Service Tax |
Service Tax |
F.Y. 2008-09 to F.Y. 2011-12 |
Addl. Commissioner Central Excise & Service Tax |
48,64,155 |
* Net of Rs, 75,00,000 paid under protest
# Net of Rs, 4,00,000 paid under protest @ Net of Rs, 90,000 paid under protest
There are no dues of Customs Duty, Excise Duty and Cess which have not been deposited as on 31 March, 2017 on account of disputes.
(viii) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of loans or borrowings to financial institutions, banks and government. The Company has not issued any debentures.
(ix) In our opinion and according to the information and explanations given to us, money raised by the way of term loans have been applied by the Company during the year for the purposes for which they were raised. The Company has not raised moneys by way of initial public offer or further public offer (including debt instruments).
(x) To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company and no material fraud on the Company by its officers or employees has been noticed or reported during the year.
(xi) In our opinion and according to the information and explanations given to us, the Company has paid / provided managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act, 2013.
(xii) The Company is not a Nidhi Company and hence reporting under clause (xii) of the CARO 2016 Order is not applicable.
(xiii) In our opinion and according to the information and explanations given to us the Company is in compliance with Section 177 and 188 of the Companies Act, 2013, where applicable, for all transactions with the related parties and the details of related party transactions have been disclosed in the financial statements etc. as required by the applicable accounting standards.
(xiv) During the year the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures and hence reporting under clause (xiv) of CARO 2016 is not applicable to the Company.
(xv) In our opinion and according to the information and explanations given to us, during the year the Company has not entered into any non-cash transactions with its directors or directors of subsidiary company or persons connected with them and hence provisions of section 192 of the Companies Act, 2013 are not applicable. Company does not have a holding or an associate company.
(xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.
For DELOITTE HASKINS & SELLS LLP
Chartered Accountants (Firm''s Registration No. 117366W/W-100018)
K. A. Katki
Partner
Place : Mumbai (Membership No. 038568)
Date : 5 May, 2017
Mar 31, 2016
Report on the Standalone Financial Statements
We have audited the accompanying standalone financial statements of DAI-ICHI KARKARIA LIMITED (âthe Companyâ), which comprise the Balance Sheet as at 31 March, 2016, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.
Management''s Responsibility for the Standalone Financial Statements
The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards prescribed under section 133 of the Act, as applicable.
This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these standalone financial statements based on our audit.
We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder and the Order under section 143 (11) of the Act.
We conducted our audit of the standalone financial statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements 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 31 March, 2016, and its profit and its cash flows for the year ended on that date.
Report on Other Legal and Regulatory Requirements
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) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
c) The Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.
d) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards prescribed under section 133 of the Act, as applicable.
e) On the basis of the written representations received from the directors as on 31 March, 2016 taken on record by the Board of Directors, none of the directors is disqualified as on 31 March, 2016 from being appointed as a director in terms of Section 164(2) of the Act.
f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Aâ. Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Company''s internal financial controls over financial reporting.
g) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer note 29.1 (i) (a) to the standalone financial statements;
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
2. As required by the Companies (Auditor''s Report) Order, 2016 (âthe Orderâ) issued by the Central Government in terms of Section 143(11) of the Act, we give in âAnnexure Bâ a statement on the matters specified in paragraphs 3 and 4 of the Order.
(Referred to in paragraph 2 under âReport on Other Legal and Regulatory Requirementsâ section of our report of even date)
(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
(b) Some of the fixed assets were physically verified during the year by the Management in accordance with a regular programme of verification which, in our opinion, provides for physical verification of all the fixed assets at reasonable intervals. According to the information and explanation given to us, no material discrepancies were noticed on such verification.
(c) With respect to immovable properties of land and buildings that are freehold, according to the information and explanations given to us and the records examined by us and based on the examination of the registered sale deed provided to us, we report that, the title deeds of such immovable properties are held in the name of the Company as at the balance sheet date. In respect of immovable properties of land that have been taken on lease and disclosed as fixed asset in the financial statements, the lease agreements are in the name of the Company, where the Company is the lessee in the agreement.
(ii) As explained to us, the inventories were physically verified during the year by the Management at reasonable intervals and no material discrepancies were noticed on physical verification.
(iii) The Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under section 189 of the Companies Act, 2013.
(iv) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Section 186 of the Companies Act, 2013 in respect of making investments and providing guarantees and securities, as applicable. The Company has not granted any loans.
(v) According to the information and explanations given to us, the Company has not accepted any deposit during the year. In respect of unclaimed deposits, the Company has complied with the provisions of Sections 73 to 76 or any other relevant provisions of the Companies Act, 2013.
(vi) The maintenance of cost records has been specified by the Central Government under section 148(1) of the Companies Act, 2013 for chemicals. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Records and Audit) Rules, 2014, as amended prescribed by the Central Government under subsection (1) of Section 148 of the Companies Act, 2013, and are of the opinion that, prima facie, the prescribed cost records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.
(vii) According to the information and explanations given to us in respect of statutory dues:
a. The Company has generally been regular in depositing undisputed statutory dues, including Provident Fund, Employees'' State Insurance, Income-tax, Sales Tax, Service Tax, Customs Duty, Excise Duty, Value Added Tax, cess and other material statutory dues applicable to it to the appropriate authorities.
b. There were no undisputed amounts payable in respect of Provident Fund, Employees'' State Insurance, Income-tax, Sales Tax, Service Tax, Customs Duty, Excise Duty, Value Added Tax, cess and other material statutory dues in arrears as at 31 March, 2016 for a period of more than six months from the date they became payable.
c. Details of dues of Income-tax, Sales Tax, Service Tax and Value Added Tax which have not been deposited as on 31 March, 2016 on account of disputes are given below:
Name of the Statute |
Nature of dues |
Period to which the amount relates |
Forum where the dispute is pending |
Amount Rs. |
Income tax Act, 1961 |
Income Tax |
A.Y. 2006-2007 |
ITAT |
65,68,800 |
Income tax Act, 1961 |
Income Tax |
A.Y. 2007-2008 |
DCIT |
9,72,275 |
Income tax Act, 1961 |
Income Tax |
A.Y. 2008-2009 |
DCIT |
25,99,294 |
Income tax Act, 1961 |
Income Tax |
A.Y. 2009-2010 |
ITAT |
2,49,84,136 |
Income tax Act, 1961 |
Income Tax |
A.Y. 2009-2010 |
CIT(A) |
2,39,43,546 |
Income tax Act, 1961 |
Income Tax |
A.Y. 2010-2011 |
CIT(A) |
26,74,861 |
Income tax Act, 1961 |
Income Tax |
A.Y. 2011-2012 |
CIT(A) |
18,83,760 |
Income tax Act, 1961 |
Income Tax |
A.Y. 2012-2013 |
CIT(A) |
31,19,907 |
Income tax Act, 1961 |
Income Tax |
A.Y. 2013-2014 |
CIT(A) |
19,78,861 |
Maharashtra Value Added Tax Act, 2002 |
Value Added Tax |
F.Y. 2008-09 |
DCST |
14,94,908 |
Central Sales Tax Act, 1956 |
Central Sales Tax |
F.Y. 2008-09 |
DCST |
62,38,165 |
Central Sales Tax Act, 1956 |
Central Sales Tax |
F.Y. 2010-11 |
Jt. CST (A) |
1,65,270 |
Service Tax |
Service Tax |
F.Y. 2008-09 to F.Y. 2011-12 |
Addl. Commissioner Central Excise & Service Tax |
60,44,592 |
There are no dues of Customs Duty, Excise Duty and Cess which have not been deposited as on 31 March, 2016 on account of disputes.
(viii) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of loans or borrowings to financial institutions, banks and government. The Company has not issued any debentures.
(ix) The Company has not raised moneys by way of initial public offer or further public offer (including debt instruments) or term loans and hence reporting under clause (ix) of the CARO 2016 Order is not applicable.
(x) To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company and no material fraud on the Company by its officers or employees has been noticed or reported during the year.
(xi) In our opinion and according to the information and explanations given to us, the Company has paid / provided managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act, 2013.
(xii) The Company is not a Nidhi Company and hence reporting under clause (xii) of the CARO 2016 Order is not applicable.
(xiii) In our opinion and according to the information and explanations given to us the Company is in compliance with Section 177 and 188 of the Companies Act, 2013, where applicable, for all transactions with the related parties and the details of related party transactions have been disclosed in the financial statements etc. as required by the applicable accounting standards.
(xiv) During the year the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures and hence reporting under clause (xiv) of CARO 2016 is not applicable to the Company.
(xv) In our opinion and according to the information and explanations given to us, during the year the Company has not entered into any non-cash transactions with its directors or directors of subsidiary company or persons connected with them and hence provisions of section 192 of the Companies Act, 2013 are not applicable. Company does not have a holding or an associate company.
(xvi) The Company is not required to be registered under section 45-I of the Reserve Bank of India Act, 1934.
For DELOITTE HASKINS & SELLS LLP
Chartered Accountants
(Firm''s Registration No. 117366W/W-100018)
K. A. Katki
Partner
(Membership No. 038568)
Place : Mumbai
Date : 14 May, 2016
Mar 31, 2014
We have audited the accompanying financial statements of Dai-ichi
Karkaria Limited ("the Company"), which comprise the Balance Sheet as
at 31st March, 2014, the Statement of Profit and Loss and the Cash Flow
Statement for the year then ended, and a summary of the significant
accounting policies and other explanatory information.
Management''s responsibility for the financial statements
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 notified under the Companies
Act, 1956 ("the Act") (which continue to be applicable in respect of
Section 133 of the Companies Act, 2013 in terms of General Circular
15/2013 dated 13th September, 2013 of the Ministry of Corporate
Affairs) and in accordance with the accounting principles generally
accepted in India. This responsibility includes the design,
implementation and maintenance of internal control relevant to the
preparation and presentation of the financial statements that give a
true and fair view and are free from material misstatement, whether due
to fraud or error.
Auditors'' Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and the disclosures in the financial statements. The
procedures selected depend on the auditor''s judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the
Company''s preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Company''s internal control. An audit also includes
evaluating the appropriateness of the accounting policies used and the
reasonableness of the accounting estimates made by the Management, as
well as evaluating the overall presentation of the financial
statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the 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:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March, 2014;
(b) in the case of the Statement of Profit and Loss, of the profit of
the Company for the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows of the
Company for the year ended on that date
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order") issued by the Central
Government in terms of Section 227(4A) of the Act, we give in the
Annexure a statement on the matters
specified in paragraphs 4 and 5 of the Order.
2. As required by Section 227(3) of the Act, we report that:
(a) We have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the 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 Balance Sheet, the Statement of Profit and
Loss, and the Cash Flow Statement comply with the Accounting Standards
notified under the Act (which continue to be applicable in respect of
Section 133 of the Companies Act, 2013 in terms of General Circular
15/2013 dated 13th September, 2013 of the Ministry of Corporate
Affairs).
(e) On the basis of the written representations received from the
directors as on 31st March, 2014 taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March, 2014
from being appointed as a director in terms of Section 274(1)(g) of the
Act.
(Referred to in paragraph 1 under ''Report on Other Legal and Regulatory
Requirements'' section of our report of even date)
In our opinion and according to the information and explanation given
to us, the nature of the Company''s business/activities, during the year
are such that clauses (x), (xii), (xiii), (xiv), (xv), (xviii), (xix),
(xx) of the Order are not applicable to the Company. In respect of the
other clauses, we report as under:
(i) In respect of its fixed assets:
(a) The Company has maintained proper records showing full particulars,
including quantitative details and situation of fixed assets which are
in the process of being updated in respect of one location.
(b) The company has a program of physical verification of its fixed
assets, once in two years on a unit-wise basis, which in our opinion is
reasonable. The unit fixed assets due for verification were not
physically verified during the year by the management.
(c) In our opinion and according to the information and explanations
given to us, a substantial part of the fixed assets has not been
disposed off by the Company during the year.
(ii) In respect of its inventories:
(a) As explained to us, inventories were physically verified during the
year by the Management at reasonable intervals.
(b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management were reasonable and adequate in relation to
the size of the Company and the nature of its business.
(c) In our opinion and according to the information and explanations
given to us, the Company has maintained proper records of its
inventories and no material discrepancies were noticed on physical
verification.
(iii) I n respect of loans, secured or unsecured, granted or taken by
the Company to or from companies, firms or other parties covered in the
register maintained under section 301 of the Companies Act 1956
according to the information and explanations given to us: Loans granted
(a) The Company has not granted any loans during the year to parties
covered under Section 301 of the Companies Act, 1956. At the year-end,
there are no outstanding balances of such loans. The maximum amount
involved during the year was Rs. 7,000,000 to one party.
(b) The rate of interest and other terms and conditions of such loans
were, in our opinion, prima facie not prejudicial to the interest of
the Company.
(c) The receipts of principal amounts and interest have been regular/as
per stipulations.
(d) There were no overdue amounts exceeding Rs. 1 lakh remaining
outstanding as at the year-end. Loans taken
(e) The Company has not taken any loans during the year from parties
covered under Section 301 of Companies Act, 1956.
(iv) In our opinion and according to the information and explanations
given to us, there are adequate internal control systems commensurate
with the size of the Company and the nature of its business with regard
to purchases of inventory and fixed assets and for the sale of goods
and services and during the course of our audit, we have not observed
any major weakness in such internal control system.
(v) In respect of contracts or arrangements entered in the Register
maintained in pursuance of Section 301 of the Companies Act 1956, to
the best of our knowledge and belief and according to the information
and explanations given to us:
(a) The particulars of contracts or arrangements referred to Section
301 that needed to be entered into the Register, maintained under the
said section have been so entered.
(b) Where each of such transactions is in excess of Rs 5 lakhs in
respect of any party, the transactions have been made at prices which
are prima facie reasonable having regard to the prevailing market
prices at the relevant time, other than certain purchases which are of
a special nature for which comparable quotations are not available and
in respect of which we are, therefore, unable to comment.
(vi) In our opinion and according to the information and explanations
given to us, the Company has complied with the provisions of Sections
58A and 58AA or any other relevant provisions of the Companies Act,
1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard
to the deposits accepted from the public. According to the information
and explanations given to us, no order has been passed by the Company
Law Board or the National Company Law Tribunal or the Reserve Bank of
India or any Court or any other Tribunal.
(vii) I n our opinion, the internal audit functions carried out during
the year by a firm of Chartered Accountants appointed by the Management
have been commensurate with the size of the Company and the nature of
its business.
(viii) We have broadly reviewed the cost records maintained by the
Company pursuant to the Companies (Cost Accounting Records) Rules, 2011
prescribed by the Central Government under Section 209(1)(d) of the
Companies Act, 1956 and are of the opinion that prima facie the
prescribed cost records have been maintained and are being made up. We
have, however, not made a detailed examination of the cost records with
a view to determine whether they are accurate or complete.
(ix) According to the information and explanations given to us in
respect of statutory dues:
(a) The Company has generally been regular in depositing undisputed
dues, including Provident Fund, Investor Education and Protection Fund,
Employees'' State Insurance, Income-Tax, Sales-Tax, Wealth Tax, Service
Tax, Custom Duty, Excise Duty, Cess and any other material statutory
dues with the appropriate authorities.
(b) There were no undisputed amounts payable in respect of 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 in arrears as
at 31st March, 2014 for a period of more than six months from the date
they became payable.
(c) Details of dues of Income-tax, Sales Tax, Wealth Tax, Service Tax,
Custom Duty, Excise Duty and Cess which have not been deposited as on
31st March, 2014, on account of disputes are given below :
Name of the Statute Nature of dues Period to which
the amount relates
Income tax Act, 1961 Income Tax A.Y. 2006-2007
Income tax Act, 1961 Income Tax A.Y. 2007-2008
Income tax Act, 1961 Income Tax A.Y. 2008-2009
Income tax Act, 1961 Income Tax A.Y. 2009-2010
Income tax Act, 1961 Income Tax A.Y. 2010-2011
Income tax Act, 1961 Income Tax A.Y. 2011-2012
Maharashtra Value Value Added Tax F.Y. 2008-09
Added Tax Act, 2002
Central Sales Tax Act, Central SalesTax F.Y. 2008-09
1956
Service Tax Service Tax 2008-09 to 2011-12
Name of the Statute Forum where the Amount
dispute is pending (in Rs )
Income tax Act, 1961 CIT(A) 35.87 lakhs
Income tax Act, 1961 ITAT 2.48 lakhs
Income tax Act, 1961 ITAT 0.58 lakhs
Income tax Act, 1961 CIT(A) 220.40 lakhs
Income tax Act, 1961 CIT(A) 26.75 lakhs
Income tax Act, 1961 CIT(A) 18.84 lakhs
Maharashtra Value CIT(A) 14.05 lakhs
Added Tax Act, 2002
Central Sales Tax Act CIT(A) 58.38 lakhs
1956
Service Tax Comissioner of 108.89 lakhs
Central Excise
& Customs
(x) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in the repayment of dues to
banks. There are no dues to financial institutions or debenture
holders.
(xi) In our opinion and 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
(xii) In our opinion and according to the information and explanations
given to us, and on an overall examination of the Balance Sheet of the
Company, we report that funds raised on short-term basis have, prima
facie, not been used during the year for long-term investment.
(xiii) To the best of our knowledge and belief and according to the
information and explanations given to us, no fraud by the Company and
no significant fraud on the Company has been noticed or reported during
the year.
For DELOITTE HASKINS & SELLS LLP
Chartered Accountants
Firms'' Registration No. 117366W/W-100018
Shyamak R Tata
Partner
Membership No. 38320
Place : Mumbai
Date : 2nd May, 2014
Mar 31, 2013
Report on the Financial Statements
We have audited the accompanying financial statements of Dai-ichi
Karkaria Limited ("the CompanyÂ), which comprise the Balance Sheet as
at 31st March, 2013, the Statement of Profit and Loss and the Cash Flow
Statement for the year then ended, and a summary of the significant
accounting policies and other explanatory information.
Management''s Responsibility for the Financial Statements
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 Section 211(3C)
of the Companies Act, 1956 ("the ActÂ) and in accordance with the
accounting principles generally accepted in India. This responsibility
includes the design, implementation and maintenance of internal control
relevant to the preparation and presentation of the financial
statements that give a true and fair view and are free from material
misstatement, whether due to fraud or error.
Auditors'' Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and the disclosures in the financial statements. The
procedures selected depend on the auditor''s judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the
Company''s preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Company''s internal control. An audit also includes
evaluating the appropriateness of the accounting policies used and the
reasonableness of the accounting estimates made by the Management, as
well as evaluating the overall presentation of the financial
statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the 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:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March, 2013;
(b) in the case of the Statement of Profit and Loss, of the profit of
the Company for the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 ("the
OrderÂ) issued by the Central Government in terms of Section 227(4A) of
the Act, we give in the Annexure a statement on the matters specified
in paragraphs 4 and 5 of the Order.
2. As required by Section 227(3) of the Act, we report that:
(a) We have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the 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 Balance Sheet, the Statement of Profit and
Loss, and the Cash Flow Statement comply with the Accounting Standards
referred to in Section 211 (3C) of the Act.
(e) On the basis of the written representations received from the
directors as on 31st March, 2013 taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March, 2013
from being appointed as a director in terms of Section 274(1)(g) of the
Act.
ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT
(Referred to in paragraph 1 under ''Report on Other Legal and Regulatory
Requirements'' section of our report of even date)
In our opinion and according to the information and explanation given
to us, the nature of the Company''s business/activities, during the year
are such that clauses (x), (xii), (xiii), (xiv), (xv),(xviii), (xix),
(xx) of the Order are not applicable to the Company. In respect of the
other clauses, we report as under:
(i) In respect of its fixed assets:
(a) The Company has maintained proper records showing full particulars,
including quantitative details and situation of fixed assets which are
in the process of being updated in respect of one location.
(b) The Company has a revised program of physical verification of its
fixed assets once in two years on a unit-wise basis, which in our
opinion is reasonable. During the year, some of the assets (plant and
machinery and laboratory equipment) of the unit due for verification
were physically verified by the management and the discrepancies
noticed on such verification, with the book records were not material.
(c) In our opinion and according to the information and explanations
given to us, a substantial part of the fixed assets has not been
disposed off by the Company during the year.
(ii) In respect of its inventories:
(a) As explained to us, inventories were physically verified during the
year by the Management at reasonable intervals.
(b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management were reasonable and adequate in relation to
the size of the Company and the nature of its business.
(c) In our opinion and according to the information and explanations
given to us, the Company has maintained proper records of its
inventories and no material discrepancies were noticed on physical
verification.
(iii) In respect of loans, secured or unsecured, granted or taken by
the Company to or from companies, firms or other parties covered in the
register maintained under Section 301 of the Companies Act, 1956
according to the information and explanations given to us:
Loans granted
(a) The Company has granted loans aggregating Rs. 2,00,00,000 to one
party during the year. At the year-end, the outstanding balances of
such loans aggregated Rs. 70,00,000 (number of parties  One) and the
maximum amount involved during the year was Rs. 3,00,00,000 (number of
parties  One)
(b) The rate of interest and other terms and conditions of such loans
were, in our opinion, prima facie not prejudicial to the interest of
the Company.
(c) The receipts of principal amounts and interest have been regular/as
per stipulations.
(d) There were no overdue amounts exceeding Rs. 1 lakh remaining
outstanding as at the year-end. Loans taken
(e) The Company has not taken any loans during the year from parties
covered under Section 301 of Companies Act, 1956
(iv) In our opinion and according to the information and explanations
given to us, there are adequate internal control systems commensurate
with the size of the Company and the nature of its business with regard
to purchases of inventory and fixed assets and for the sale of goods
and services and during the course of our audit, we have not observed
any major weakness in such internal control system.
(v) In respect of contracts or arrangements entered in the Register
maintained in pursuance of Section 301 of the Companies Act, 1956 to
the best of our knowledge and belief and according to the information
and explanations given to us:
(a) The particulars of contracts or arrangements referred to Section
301 that needed to be entered into the Register, maintained under the
said section have been so entered.
(b) Where each of such transactions is in excess of Rs. 5 lakhs in
respect of any party, the transactions have been made at prices which
are prima facie reasonable having regard to the prevailing market
prices at the relevant time, other than certain purchases which are of
a special nature for which comparable quotations are not available and
in respect of which we are, therefore, unable to comment.
(vi) In our opinion and according to the information and explanations
given to us, the Company has complied with the provisions of Sections
58A and 58AA or any other relevant provisions of the Companies Act,
1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard
to the deposits accepted from the public. According to the information
and explanations given to us, no order has been passed by the Company
Law Board or the National Company Law Tribunal or the Reserve Bank of
India or any Court or any other Tribunal.
(vii) In our opinion, the internal audit functions carried out during
the year by a firm of Chartered Accountants appointed by the Management
have been commensurate with the size of the Company and the nature of
its business.
(viii) We have broadly reviewed the cost records maintained by the
Company pursuant to the Companies (Cost Accounting Records) Rules, 2011
prescribed by the Central Government under Section 209(1)(d) of the
Companies Act, 1956 and are of the opinion that prima facie the
prescribed cost records have been maintained and are being made up. We
have, however, not made a detailed examination of the cost records with
a view to determine whether they are accurate or complete.
(ix) According to the information and explanations given to us in
respect of statutory dues:
(a) The Company has generally been regular in depositing undisputed
dues, including Provident Fund, Investor Education and Protection Fund,
Employees'' State Insurance, Income-Tax, Sales-Tax, Wealth Tax, Service
Tax, Custom Duty, Excise Duty, Cess and any other material statutory
dues with the appropriate authorities.
(b) There were no undisputed amounts payable in respect of 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 in arrears as
at 31st March, 2013 for a period of more than six months from the date
they became payable.
(c) Details of dues of Income-tax, Sales Tax, Wealth Tax, Service Tax,
Custom Duty, Excise Duty and Cess which have not been deposited as on
31st March, 2013, on account of disputes are given below:
Name of the
Statute Nature of
dues Period to
which Forum
where Amount
the
amount the
dispute
is (in Rs.)
relates pending
Income tax Act, 1961 Income Tax 2006-2007 CIT(A) 35.87 lakhs
Income tax Act, 1961 Income Tax 2007-2008 ITAT 87.04 lakhs
Income tax Act, 1961 Income Tax 2008-2009 ITAT 1.36 lakhs
Income tax Act, 1961 Income Tax 2009-2010 CIT(A) 177.87 lakhs
(x) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in the repayment of dues to
banks. There are no dues to financial institutions or debenture
holders.
(xi) In our opinion and 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.
(xii) In our opinion and according to the information and explanations
given to us, and on an overall examination of the Balance Sheet of the
Company, we report that funds raised on short-term basis have, prima
facie, not been used during the year for long-term investment.
(xiii) To the best of our knowledge and belief and according to the
information and explanations given to us, no fraud by the Company and
no material fraud on the Company has been noticed or reported during
the year.
For Deloitte Haskins & Sells.
Chartered Accountants
Registration No. 117366W
Shyamak R Tata
Partner
Membership No. 38320
Place : Mumbai
Date : 28May, 2013
Mar 31, 2012
1. We have audited the attached balance sheet of Dai-ichi Karkaria
Limited ("the Company") as at March 31, 2012, the Statement of Profit
and Loss and also the Cash Flow Statement for the year ended on that
date, annexed thereto. These financial statements are the
responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audit.
2. We conducted our audit in accordance with auditing standards
generally accepted in India. Those Standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by Management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the Companies (Auditor's Report) Order, 2003
issued by the Central Government of India in terms of sub-section (4A)
of Section 227 of the Companies Act, 1956, we enclose in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the said
order.
4. Further to our comments in the Annexure referred to in paragraph 3
above, we report as follows:
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, the Statement of Profit and Loss and Cash Flow
Statement dealt with by this report are in agreement with the books of
account;
d. in our opinion, the Balance Sheet, the Statement of Profit and Loss
and Cash Flow Statement dealt with by this report are in compliance
with the Accounting Standards referred to in Section 211(3C) of the
Companies Act, 1956;
e. in our opinion and to the best of our information and according to
the explanations given to us, they said give the information required by
the Companies Act, 1956, in the manner so required and give a true and
fair view in conformity with the accounting principles generally
accepted in India:
(i) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March 2012;
(ii) in the case of the Statement of Profit and Loss, of the profit of
the Company for the year ended on that date and
(iii) in the case of Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
i. On the basis of written representations received from the directors
as on 31st March 2012, and taken on record by the Board of Directors,
we report that none of the directors is disqualified as on March 31,
2012 from being appointed as a director in terms of Section 274(l)(g)
of the Companies Act, 1956.
ANNEXURE TO THE AUDITORS REPORT
(Referred to in paragraph 3 of our report of even date)
(i) In our opinion and according to the information and explanation
given to us, the nature of Company's business/activities, during the
year are such that clauses (xii), (xiii), (xiv), (xviii), (xix), (xx)
of Companies (Auditors' Report) Order, 2003 are not applicable to the
Company. In respect of the other clauses, we report as under:
(ii) In respect of its fixed assets:
(a) The Company has maintained proper records showing full particulars,
including quantitative details, and situation of fixed assets which are
in the process of being updated in respect of one location.
(b) The Company has a revised program of physical verification of its
fixed assets once in two years on a unit-wise basis, which in our
opinion is reasonable. During the year, some of the assets (plant and
machinery and laboratory equipment) of the unit due for verification
were physically verified by the management and the discrepancies
noticed on such verification, with the book records were not material.
(c) In our opinion and according to the information and explanations
given to us, a substantial part of the fixed assets has not been
disposed off by the Company during the year.
(ii) In respect of its inventories:
(a) As explained to us, inventories were physically verified during the
year by the Management at reasonable intervals.
(b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management were reasonable and adequate in relation to
the size of the Company and the nature of its business.
(c) In our opinion and according to the information and explanations
given to us, the Company has maintained proper records of its
inventories and the discrepancies noticed on physical verification were
not material and have been adjusted in the books of account.
(iv) In respect of loans, secured or unsecured, granted or taken by the
Company to or from companies, firms or other parties covered in the
register maintained under section 301 of the Companies Act 1956
according to the information and explanations given to us:
Loans granted
(a) The Company has granted loans aggregating Rs 30,000,000 (number of
parties - One) during the year. At the end year-end, the outstanding
balances of such loans aggregated Rs 10,000,000 and the maximum amount
involved during the year was Rs 40,252,603 (number of parties - One).
(b) The rate of interest and other terms and conditions of such loans
were, in our opinion, prima facie not prejudicial to the interest of
the Company.
(c) The receipts of principal amounts and interest have been regular/as
per stipulations.
(d) There were no overdue amounts of Rs 1 lakh remaining outstanding as
at the year-end.
Loans taken
(e) The Company has not taken any loans during the year from parties
covered under section 301 of Companies Act, 1956.
(v) In our opinion and according to the information and explanations
given to us, there are adequate internal control systems commensurate
with the size of the Company and the nature of its business with regard
to purchases of inventory and fixed assets and for the sale of goods
and services. During the course of our audit, we have not observed any
major weakness in such internal control system.
(vi) In respect of contracts or arrangements entered in the Register
maintained in pursuance of Section 301 of the Companies Act 1956, to
the best of our knowledge and belief and according to the information
and explanations given to us:
(a) The particulars of contracts or arrangements referred to Section
301 that needed to be entered into the Register, maintained under the
said section have been so entered.
(b) Where each of such transactions is in excess of Rs 5 lakhs in
respect of any party, the transactions have been made at prices which
are prima facie reasonable having regard to the prevailing market
prices at the relevant time.
(vii) In our opinion and according to the information and explanations
given to us, the Company has complied with the provisions of Sections
58A and 58AA or any other relevant provisions of the Companies Act,
1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard
to the deposits accepted from the public. According to the information
and explanations given to us, no order has been passed by the Company
Law Board or the National Company Law Tribunal or the Reserve Bank of
India or any Court or any other Tribunal.
(viii) In our opinion, the internal audit functions carried out during
the year by a firm of Chartered Accountants appointed by the Management
have been commensurate with the size of the Company and the nature of
its business.
(ix) We have broadly reviewed the cost records maintained by the
Company pursuant to the Companies (Cost Accounting Records) Rules, 2011
prescribed by the Central Government under Section 209(1)(d) of the
Companies Act, 1956 and are of the opinion that prima facie the
prescribed cost records have been maintained and are being made up. We
have, however, not made a detailed examination of the cost records with
a view to determine whether they are accurate or complete.
(x) According to the information and explanations given to us in
respect of statutory dues:
(a) The Company has generally been regular in depositing undisputed
dues, including Provident Fund, Investor Education and Protection Fund,
Employees' State Insurance, Income-Tax, Sales-Tax, Wealth Tax,
Service Tax, Custom Duty, Excise Duty, Cess and any other material
statutory dues with the appropriate authorities.
(b) There were no undisputed amounts payable in respect of Income-tax,
Wealth Tax, Custom Duty, Excise Duty, Cess and other material statutory
dues in arrears as at 31st March, 2012 for a period of more than six
months from the date they became payable.
(c) Details of dues of Income-tax, Sales Tax, Wealth Tax, Service Tax,
Custom Duty, Excise Duty and Cess which have not been deposited as on
31st March, 2012, on account of disputes are given below:
Name of the Nature of Period to which the Forum
where the Amount
Statute dues amount relates dispute is
pending (in Rs.)
Income tax
Act, 1961 Income Tax 2000-2001 ITAT 88.49 lakhs
Income tax
Act, 1961 Income Tax 2006-2007 CIT(A) 35.87 lakhs
Income tax
Act, 1961 Income Tax 2007-2008 ITAT 87.04 lakhs
Income tax
Act, 1961 Income Tax 2008-2009 ITAT 1.36 lakhs
Income tax
Act, 1961 Income Tax 2009-2010 CIT(A) 177.87 lakhs
(xi) The Company does not have any accumulated losses as at 31st March,
2012. The Company has not incurred any cash losses during the financial
year covered by our audit and the immediately preceding financial year.
(xii) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in the repayment of dues to
financial institutions and banks.
(xiii) In our opinion and according to the information and explanations
given to us, the terms and conditions of the guarantees given by the
Company for loans taken by others from banks and financial
institutions, are not prima facie prejudicial to the interests of the
Company.
(xiv) According to the information and explanations given to us, and on
an overall examination of the balance sheet of the Company, funds
raised on short term basis have, prima facie, not been used during the
year for long term investment.
(xv) To the best of our knowledge and belief and according to the
information and explanations given to us, no fraud on or by the Company
has been noticed or reported during the year.
For Deloitte Haskins & Sells.
Chartered Accountants
Registration No. 117366W
Shyamak R. Tata
Partner
Membership No. 38320
Place : Mumbai
Date : 11th May, 2012
Mar 31, 2011
1. We have audited the attached Balance Sheet of Dai-ichi Karkaria
Limited ("the Company") as at March 31, 2011, the Profit and Loss
Account and also the Cash Flow Statement for the year ended on that
date, annexed thereto. These financial statements are the
responsibility of the Companys management. Our responsibility is to
express an opinion on these financial statements based on our audit.
2. We conducted our audit in accordance with auditing standards
generally accepted in India. Those Standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by Management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the Companies (Auditors Report) Order, 2003 (CARO)
issued by the Central Government of India in terms of sub-section (4A)
of Section 227 of the Companies Act, 1956, we enclose in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the said
order.
4. Further to our comments in the Annexure referred to in paragraph 3
above, we report as follows:
a. we have obtained all the information and explanations which, to the
best of our knowledge and belief, were necessary for the purposes of
our audit;
b. in our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books;
c. the Balance Sheet, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account;
d. in our opinion, the Balance Sheet, Profit and Loss Account and Cash
Flow Statement dealt with by this report are in compliance with the
Accounting Standards referred to in Section 211(3C) of the Companies
Act, 1956;
e. in our opinion and to the best of our information and according to
the explanations given to us, the said give the information required by
the Companies Act, 1956, in the manner so required and give a true and
fair view in conformity with the accounting principles generally
accepted in India:
(i) in 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 of the
Company for the year ended on that date and
(iii) in the case of Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
5. On the basis of written representations received from the directors
as on March 31, 2011, and taken on record by the Board of Directors, we
report that none of the directors is disqualified as on March 31, 2011
from being appointed as a director in terms of Section 274(l)(g) of the
Companies Act, 1956.
ANNEXURE TO THE AUDITORS REPORT
(Referred to in paragraph 3 of our report of even date)
(i) In our opinion and according to the information and explanation
given to us, the nature of Companys business/activities, during the
year are such that clauses (viii), (xii), (xiii), (xiv), (xvi),
(xviii), (xix), (xx) of Companies (Auditors Report) Order, 2003 are
not applicable to the Company. In respect of the other clauses, we
report as under:
(ii) In respect of its fixed assets:
(a) The Company has maintained proper records showing full particulars,
including quantitative details and situation of fixed assets which are
in the process of being updated in respect of one location.
(b) The Company has a revised program of physical verification of its
fixed assets once in two years on a unit-wise basis, which in our
opinion is reasonable. During the year, some of assets of the unit due
for verification (plant and machinery and laboratory equipments) were
physically verified by the management and the discrepancies noticed on
such verification, with the book records were not material.
(c) In our opinion and according to the information and explanations
given to us, a substantial part of the fixed assets has not been
disposed off by the Company during the year.
(iii) In respect of its inventories:
(a) As explained to us, inventories were physically verified during the
year by the Management at reasonable intervals.
(b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management were reasonable and adequate in relation to
the size of the Company and the nature of its business.
(c) In our opinion and according to the information and explanations
given to us, the Company has maintained proper records of its
inventories and the discrepancies noticed on physical verification were
not material and have been adjusted in the books of account.
(iv) In respect of loans, secured or unsecured, granted or taken by the
Company to or from companies, firms or other parties covered in the
register maintained under Section 301 of the Companies Act 1956
according to the information and explanations given to us: Loans
granted
(a) The Company has granted loans aggregating Rs. 30,000,000 (number of
parties - One) during the year. At the end year-end, the outstanding
balances of such loans aggregated Rs. 10,000,000 and the maximum amount
involved during the year was Rs. 30,608,288 (number of parties - One).
(b) The rate of interest and other terms and conditions of such loans
were, in our opinion, prima facie not prejudicial to the interest of
the Company.
(c) The receipts of principal amounts and interest have been regular/as
per stipulations.
(d) There were no overdue amounts of Rs. 1 lakh remaining outstanding
as at the year-end. Loans taken
(e) The Company has not taken any loans during the year from parties
covered under Section 301 of Companies Act, 1956
(v) In our opinion and according to the information and explanations
given to us, there are adequate internal control systems commensurate
with the size of the Company and the nature of its business with regard
to purchases of inventory and fixed assets and for the sale of goods
and services. During the course of our audit, we have not observed any
major weakness in such internal control system.
(vi) In respect of contracts or arrangements entered in the Register
maintained in pursuance of Section 301 of the Companies Act 1956, to
the best of our knowledge and belief and according to the information
and explanations given to us:
(a) The particulars of contracts or arrangements referred to Section
301 that needed to be entered into the Register, maintained under the
said section have been so entered.
(b) Where each of such transactions is in excess of Rs. 5 lakhs in
respect of any party, the transactions have been made at prices which
are prima facie reasonable having regard to the prevailing market
prices at the relevant time.
(vii) In our opinion and according to the information and explanations
given to us, the Company has complied with the provisions of Sections
58A and 58AA or any other relevant provisions of the Companies Act,
1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard
to the deposits accepted from the public. According to the information
and explanations given to us, no order has been passed by the Company
Law Board or the National Company Law Tribunal or the Reserve Bank of
India or any Court or any other Tribunal.
(viii) In our opinion, the internal audit functions carried out during
the year by a firm of Chartered Accountants appointed by the Management
have been commensurate with the size of the Company and the nature of
its business.
(ix) According to the information and explanations given to us in
respect of statutory dues:
(a) The Company has generally been regular in depositing undisputed
dues, including Provident Fund, Investor Education and Protection Fund,
Employees State Insurance, Income-Tax, Sales-Tax, Wealth Tax, Service
Tax, Custom Duty, Excise Duty, Cess and any other material statutory
dues with the appropriate authorities.
(b) There were no undisputed amounts payable in respect of Income-tax,
Wealth Tax, Custom Duty, Excise Duty, Cess and other material statutory
dues in arrears as at March 31, 2011 for a period of more than six
months from the date they became payable.
(c) Details of dues of Income-tax, Sales Tax, Wealth Tax, Service Tax,
Custom Duty, Excise Duty and Cess which have not been deposited as on
March 31, 2011, on account of disputes are given below:
Name of the Nature of Period to Forum where the Amount
Statute dues which the dispute is (in Rs.)
amount pending
relates
Income tax Act,
1961 Income Tax 2006-2007 CIT (A) 28.78 lakhs
Income tax Act,
1961 Income Tax 1999-2000 CIT(A) 88.49 lakhs
Income tax Act,
1961 Income Tax 2007-2008 CIT (A) 90.01 lakhs
(x) The Company does not have any accumulated losses as at March 31,
2011. The Company has not incurred any cash losses during the financial
year covered by our audit anf the immediately preceding financial year.
(xi) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in the repayment of dues to
financial institutions and banks.
(xii) In our opinion and according to the information and explanations
given to us, the terms and conditions of the guarantees given by the
Company for loans taken by others from banks and financial
institutions, are not prima facie prejudicial to the interests of the
Company.
(xiii) According to the information and explanations given to us, and
on an overall examination of the balance sheet of the Company, funds
raised on short term basis have, prima facie, not been used during the
year for long term investment.
(xiv) To the best of our knowledge and belief and according to the
information and explanations given to us, no fraud on or by the Company
has been noticed or reported during the year.
For Deloitte Haskins & Sells.
Chartered Accountants
Registration No. 117366W
Shyamak R. Tata
Partner
Membership No. 38320
Place : Mumbai
Date : May 4, 2011
Mar 31, 2010
1. We have audited the attached balance sheet of Dai-ichi Karkaria
Limited ("the Company") as at March 31, 2010, the Profit and Loss
Account and also the Cash Flow Statement for the year ended on that
date, annexed thereto. These financial statements are
the.responsibility of the Companys management. Our responsibility is
to express an opinion on these financial statements based on our audit.
2. We conducted our audit in accordance with auditing standards
generally accepted in India. Those Standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by Management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the Companies (Auditors Report) Order, 2003 (CARO)
issued by the Central Government of India in terms of sub-section (4A)
of Section 227 of the Companies Act, 1956, we enclose in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the said
order.
4. Further to our comments in the Annexure referred to in paragraph 3
above, we report as follows:
a. we have obtained all the information and explanations which, to the
best of our knowledge and belief, were necessary for the purposes of
our audit;
b. in our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books;
c. the Balance Sheet, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account;
d. in our opinion, the Balance Sheet, Profit and Loss Account and Cash
Flow Statement dealt with by this report are in compliance with the
Accounting Standards referred to in Section 211(3C) of the Companies
Act, 1956;
e. in our opinion and to the best of our information and according to
the explanations given to us, the said give the information required by
the Companies Act, 1956, in the manner so required and give a true and
fair view in conformity with the accounting principles generally
accepted in India:
(i) in 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 Profit and Loss Account, of the profit of the
Company for the year ended on that date and
(iii) in the case of Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
5. On the basis of written representations received from the directors
as on March 31, 2010, and taken on record by the Board of Directors, we
report that none of the directors is disqualified as on March 31, 2010
from being appointed as a director in terms of Section 274(1) (g) of
the Companies Act, 1956.
ANNEXURE TO THE AUDITORS REPORT (Referred to in paragraph 3 of our
report of even date)
In our opinion and according to the information and explanation given
to us, the nature of Companys business/ activities, during the year
are such that clauses (viii), (xii), (xiii), (xiv), (xviii), (xix),
(xx) of Companies (Auditors Report) Order, 2003 are not applicable to
the Company. In respect of the other clauses, we report as under:
(i) In respect of its fixed assets:
(a) The Company has maintained proper records showing full particulars,
including quantitative details and situation of fixed assets which are
in the process of being updated in respect of one location.
(b) Although the Company has a revised program of physical verification
of its fixed assets to once in two years on a unit-wise basis, which in
our opinion is reasonable, the unit fixed assets due for verification
were not physically verified during the year by the management.
(c) In our opinion and according to the information and explanations
given to us, a substantial part of the fixed assets has not been
disposed off by the Company during the year.
(ii) In respect of its inventories:
(a) As explained to us, inventories were physically verified during the
year by the Management at reasonable intervals.
(b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management were reasonable and adequate in relation to
the size of the Company and the nature of its business.
(c) In our opinion and according to the information and explanations
given to us, the Company has maintained proper records of its
inventories and the discrepancies noticed on physical verification were
not material and have been adjusted in the books of account.
(iii) In respect of loans, secured or unsecured, granted or taken by
the Company to or from companies, firms or other parties covered in the
register maintained under Section 301 of the Companies Act 1956, we
have to state:
Loans granted
(a) The Company has not granted any loans, secured or unsecured, during
the year to companies, firms or other parties covered in the register
maintained under Section 301 of the Act. In respect of such loans
granted in earlier years to one party, these have been repaid during
the year and there is no balance outstanding as at the year end. The
maximum amount involved during the year was Rs. 1,448,299/-.
(b) The rate of interest and other terms and conditions of such loans
were, in our opinion, prima facie not prejudicial to the interest of
the Company.
(c) Since the payment of the principal and interest are on demand, the
(question of regularity in the repayment of principal and payment of
interest does not arise.
Loans taken
(d) The Company has not taken any loans during the year from parties
covered under Section 301 of Companies Act, 1956.
(iv) In our opinion and according to the information and explanations
given to us, there are adequate internal control systems commensurate
with the size of the Company and the nature of its business with regard
to purchases of inventory and fixed assets and for the sale of goods
and services. During the course of our audit, we have not observed any
major weakness in such internal control system.
(v) In respect of contracts or arrangements entered in the Register
maintained in pursuance of Section 301 of the Companies Act 1956, to
the best of our knowledge and belief and according to the information
and explanations given to us:
(a) The particulars of contracts or arrangements referred to Section
301 that needed to be entered into the Register, maintained under the
said Section have been so entered.
(b) Where each of such transactions is in excess of Rs. 5 lakhs in
respect of any party, the transactions have been made at prices which
are prima facie 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 theprovisions of Sections
58A and 58AA or any other relevant provisions of the Companies Act,
1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard
to the deposits accepted from the public. According to the information
and explanations given to us, no order has been passed by the Company
Law Board or the National Company Law Tribunal or the Reserve Bank of
India or any Court or any other Tribunal.
(vii) In our opinion, the internal audit functions carried out during
the year by a firm of Chartered Accountants appointed by the Management
have been commensurate with the size of the Company and the nature of
its business.
(viii) According to the information and explanations given to us in
respect of statutory dues:
(a) The Company has generally been regular in depositing undisputed
dues, including Provident Fund, Investor Education and Protection Fund,
Employees State Insurance, Income-Tax, Sales-Tax, Wealth Tax, Service
Tax, Custom Duty, Excise Duty, Cess and any other material statutory
dues with the appropriate authorities. Based on our audit procedures
there are no arrears of statutory dues which has remained outstanding
as at March 31, 2010 for a period of more than six months from the date
they became payable.
(b) Details of dues of Income-tax, Sales Tax, Wealth Tax, Service Tax,
Custom Duty, Excise Duty and Cess which have not been deposited as on
March 31, 2010, on account of disputes are given below:
Statute Nature of Period to which Forum where the Amount
dues the dues relate to dispute is pending (in
Rupees)
Income
tax Act Income Tax 2006-07 CIT (A) 28.78lakhs
(ix) The Company does not have any accumulated losses as at March 31,
2010. The Company has not incurred any cash losses during the financial
year covered by our audit and the immediately preceding financial year.
(x) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in the repayment of dues to
financial institutions and banks.
(xi) In our opinion and according to the information and explanations
given to us, the terms and conditions of the guarantees given by the
Company for loans taken by others from banks and financial
institutions, are not prima facie prejudicial to the interests of the
Company.
(xii) The term loans raised during the year were applied for the
purpose for which they were raised.
(xiii) According to the information and explanations given to us, and
on an overall examination of the balance sheet of the Company, funds
raised on short term basis have, prima facie, not been used during the
year for long term investment.
(xiv) To the best of our knowledge and belief and according to the
information and explanations given to us, no fraud on or by the Company
has been noticed or reported during the year.
For Deloitte Haskins & Sells.
Chartered Accountants
Registration No. 117366W
Shyamak R. Tata
Partner
Membership No. 38320
Place : Mumbai
Date : May 10, 2010