Mar 31, 2023
Ester Industries Limited
Report on the Audit of the Standalone Financial
Statements
Opinion
1. We have audited the accompanying standalone financial statements of Ester Industries Limited (âthe Companyâ), which comprise the Balance Sheet as at 31 March 2023, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Cash Flow and the Statement of Changes in Equity for the year ended, and notes to the standalone financial statements, including a summary of the significant accounting policies and other explanatory information.
2. 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 Companies Act, 2013 (âthe Actâ) in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards (âInd ASâ) specified under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015 and other accounting principles generally accepted in India, of the state of affairs of the Company as at 31 March 2023,
and its profit (including other comprehensive income), its cash flows and the changes in equity for the year ended on that date.
Basis for Opinion
3. We conducted our audit in accordance with the Standards on Auditing specified under section 143(10) of the Act. our responsibilities under those standards are further described in the Auditorâs Responsibilities for the Audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (âICAIâ) together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matter
4. Key audit matter are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
5. We have determined the matter described below to be the key audit matters to be communicated in our report. |
|
Key audit matter |
How our audit addressed the key audit matter |
Revenue recognition - Sale of products Revenue of the Company majorly comprises of revenue from sale of polyester films and specialty polymers. The Company sells its products through various distribution channels involving a high volume of sale transactions. The Company recognised an amount of f107,747.88 lacs as revenue for the year ended 31 March 2023, as disclosed in Note 25 to the standalone financial statements. Refer Note 4.5.1 for the related accounting policy adopted by the management for recognition of revenue in accordance with the requirements of Ind AS 115, Revenue from Contracts with Customers (âInd AS 115â). Revenue recognition is a significant audit risk primarily as there is a risk that revenue is recognised on sale of goods before the control in the goods is transferred. Revenue is also a key performance indicator of the Company and accordingly, testing occurrence of revenue transactions is a key focus area for our audit. We determined this to be a key audit matter due to significant time and effort involved in testing revenue recorded during the year. |
Our audit procedures included, but were not limited, to the following: ⢠Obtained an understanding of the process of identification and recording of revenue transaction from sale of polyester films and specialty polymers; ⢠Evaluated the design, implementation and tested the operating effectiveness of key controls over revenue recognition including around quantity sold, pricing and accounting of revenue transactions; ⢠Performed substantive analytical procedures on revenue which included ratio analysis, product mix analysis, region wise analysis, etc.; ⢠On a sample basis, evaluated the terms and conditions of the contracts, including incoterms, with customers to ensure that the revenue recognition accounting policy adopted by the management is in accordance with Ind AS 115; ⢠On a sample basis, tested revenue transactions recorded during the year, and revenue transactions recorded in the period before and after year-end, with supporting documents such as invoices, agreements with customers, proof of deliveries; ⢠Performed other substantive audit procedures including obtaining debtor confirmations on a sample basis and reconciling revenue recorded during the year with statutory returns; ⢠Tested manual journal entries impacting revenue including credit notes, claims etc., which were material or irregular in nature with supporting documents and evaluated business rationale thereof; ⢠Evaluated disclosures made in the standalone financial statement for revenue recognition from sale of goods for appropriateness in accordance with the accounting standards. |
Information other than the Financial Statements and
Auditorâs Report thereon
6. The Companyâs Board of Directors are responsible for the other information. The other information comprises the information included in the Annual Report, but does not include the standalone financial statements and our auditorâs report thereon. The Annual Report is expected to be made available to us after the date of this auditorâs report.
Our opinion on the standalone financial statements does not cover the other information and we will not express any form of assurance conclusion thereon.
In connection with our audit of the standalone financial statements, our responsibility is to read the other information identified above when it becomes available and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.
When we read the Annual Report, if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance.
Responsibilities of Management and Those Charged with
Governance for the Standalone Financial Statements
7. The accompanying standalone financial statements have been approved by the Companyâs Board of Directors. The Companyâs Board of Directors are responsible for the matters stated in section 134(5) of the Act with respect to the preparation and presentation of these standalone financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, changes in equity and cash flows of the Company in accordance with the Ind AS specified under section 133 of the Act and other accounting principles generally accepted in India. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
8. In preparing the standalone financial statements, the Board of Directors are responsible for assessing the Companyâs ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using
the going concern basis of accounting unless the Board of Directors either intend to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
9. Those Board of Directors are also responsible for overseeing the Companyâs financial reporting process.
Auditorâs Responsibilities for the Audit of the Standalone
Financial Statements
10. Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditorâs report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Standards on Auditing will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.
11. As part of an audit in accordance with Standards on Auditing, specified under section 143(10) of the Act we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
⢠Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control;
⢠Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3) (i) of the Act we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to standalone financial statements in place and the operating effectiveness of such controls;
⢠Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management;
⢠Conclude on the appropriateness of Board of Directorsâ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Companyâs ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditorâs report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditorâs report. However, future events or conditions may cause the Company to cease to continue as a going concern;
⢠Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
12. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
13. We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
14. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditorâs report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
15. As required by section 197(16) of the Act based on our audit, we report that the Company has paid remuneration to its directors during the year in accordance with the provisions of and limits laid down under section 197 read with Schedule V to the Act.
16. As required by the Companies (Auditorâs Report) Order, 2020 (âthe Orderâ) issued by the Central Government of India in terms of section 143(11) of the Act we give in the Annexure A, a statement on the matters specified in paragraphs 3 and 4 of the order, to the extent applicable.
17. Further to our comments in Annexure A, as required by section 143(3) of the Act based on our audit, we report, to the extent applicable, that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit of the accompanying standalone financial statements;
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 standalone financial statements dealt with by this report are in agreement with the books of account;
d) In our opinion, the aforesaid standalone financial statements comply with Ind AS specified under section 133 of the Act;
e) on the basis of the written representations received from the directors and taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2023 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 reference to standalone financial statements of the Company as on 31 March 2023and the operating effectiveness of such controls, refer to our separate Report in Annexure B where in we have expressed an unmodified opinion; and
g) With respect to the other matters to be included in the Auditorâs Report in accordance with rule 11 of the Companies (Audit and Auditors) Rules, 2014 (as amended), in our opinion and to the best of our information and according to the explanations given to us:
i. The Company, as detailed in Note 38 to the standalone financial statements, has disclosed the impact of pending litigations on its financial position as at 31 March 2023;
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses as at 31 March 2023.;
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended 31 March 2023;
iv. a. The management has represented that, to the
best of its knowledge and belief, as disclosed in Note 46 (g) to the standalone financial statements, no funds have been advanced or loaned or invested (either from borrowed funds or securities premium or any other sources or kind of funds) by the Company to or in any persons or entities, including foreign entities (âthe intermediariesâ), with the understanding, whether recorded in writing or otherwise, that the intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (âthe Ultimate Beneficiariesâ) or provide any guarantee, security or the like on behalf the Ultimate Beneficiaries;
b. The management has represented that, to the best of its knowledge and belief, as disclosed in Note 46 (h) to the standalone financial
statements, no funds have been received by the Company from any persons or entities, including foreign entities (âthe Funding Partiesâ), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and
c. Based on such audit procedures performed as considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the management representations under sub-clauses (a) and (b) above contain any material misstatement.
v. The Company has not declared or paid any dividend during the year ended 31 March 2023.The final dividend paid by the Company during the year ended 31 March 2023 in respect of such dividend declared for the previous year is in accordance with section 123 of the Act to the extent it applies to payment of dividend.
vi. Proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 requires all companies which use accounting software for maintaining their books of account, to use such an accounting software which has a feature of audit trail, with effect from the financial year beginning on 01 April 2023 and accordingly, reporting under Rule 11(g) of Companies (Audit and Auditors) Rules, 2014 (as amended) is not applicable for the current financial year.
Chartered Accountants Firmâs Registration No.: 001076N/N500013
Partner
Membership No.: 507568 UDIN: 23507568BGYWBX5349
Place: Delhi Date: 26 May 2023
Mar 31, 2018
Report on the Financial Statements
1. We have audited the accompanying financial statements of Ester Industries Limited (âthe Company''), which comprise the Balance Sheet as at March 31, 2018, the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of the significant accounting policies and other explanatory information.
Managementâs Responsibility for the Financial Statements
2. The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Act'') with respect to the preparation of these financial statements that give a true and fair view of the state of affairs (financial position), profit or loss (financial performance including other comprehensive income), cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (âInd AS'') specified 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 financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditorâs Responsibility
3. Our responsibility is to express an opinion on these financial statements based on our audit.
4. We have taken into account the provisions of the Act, 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.
5. We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standardsrequire that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether these financial statements are freefrom material misstatement.
6. An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the 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 controls 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.
7. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on these financial statements.
Opinion
8. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India including Ind AS specified under Section 133 of the Act, of the state of affairs (financial position) of the Company as at March 31, 2018, and its profit (financial performance including other comprehensive income), its cash flows and the changes in equity for the year ended on that date.
Other Matter
9. The comparative financial information for the year ended March 31, 2017 and the transition date opening balance sheet as at April 1, 2016 prepared in accordance with Ind AS included in these financial statements, are based on the previously issued statutory financial statements for the year ended March 31, 2017 and March 31, 2016 respectively prepared in accordance with Accounting Standards prescribed under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 and the Companies (Accounting Standards) Amendment Rules, 2016 which were audited by the predecessor auditor S.R. Batliboi & Co LLP, whose reports dated June 2, 2017 and May 25, 2016 respectively expressed unmodified opinion on those financial statements and have been adjusted for the differences in the accounting principles adopted by the Company on transition to 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
10. As required by the Companies (Auditor''s Report) Order, 2016 (âthe Order'') issued by the Central Government of India in terms of Section 143(11) of the Act, we give in the Annexure I a statement on the matters specified in paragraphs 3 and 4 of the Order.
11. Further to our comments in Annexure I, as required by Section 143(3) of the Act, we report that:
a) we have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;
b) in our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;
c) the financial statements dealt with by this report are in agreement with the books of account;
d) in our opinion, the aforesaid financial statements comply with Ind AS specified under Section 133 of the Act;
e) on the basis of the written representations received from the directors and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2018 from being appointed as a director in terms of Section 164(2) of the Act;
f) we have also audited the internal financial controls over financial reporting (IFCoFR) of the Company as on March 31, 2018 in conjunction with our audit of the financial statements of the Company for the year ended on that date and our report dated May 16, 2018 as per Annexure A expressed an unmodified opinion;
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, as detailed in Note 37 to the financial statements, has disclosed the impact of pending litigations on its financial position;
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 disclosure requirements relating to holdings as well as dealings in specified bank notes were applicable for the period from 8 November 2016 to 30 December 2016 which are not relevant to these financial statements. Hence, reporting under this clause is not applicable.
Annexure A to the Independent Auditorâs Report of even date to the Members of Ester Industries Limited on the financial statements for the year ended March 31, 2018
ANNEXURE A
Independent Auditorâs report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (âthe Actâ)
1. In conjunction with our audit of the financial statements of Ester-Industries Limited (âthe Companyâ) as at and for the year ended March 31, 2018 we have audited the internal financial controls over financial reporting (IFCoFR) of the company of as at that date.
Managementâs Responsibility for Internal Financial Controls
2. The Company''s Board of Directors 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 (âthe Guidance Note'') 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 the Company''s 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 Act.
Auditorsâ Responsibility
3. Our responsibility is to express an opinion on the Company''s IFCoFR based on our audit. We conducted our audit in accordance with the Standards on Auditing, issued by the ICAI and deemed to be prescribed under section 143(10) of the Act, to the extent applicable to an audit of IFCoFR, and the Guidance Note 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 IFCoFR were established and maintained and if such controls operated effectively in all material respects.
4. Our audit involves performing procedures to obtain audit evidence about the adequacy of the IFCoFR and their operating effectiveness. Our audit of IFCoFR included obtaining an understanding of IFCoFR, 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 judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
5. 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 IFCoFR.
Meaning of Internal Financial Controls over Financial Reporting
6. A company''s IFCoFR 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 IFCoFR 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 company''s assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial
Reporting
7. Because of the inherent limitations of IFCoFR, 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 IFCoFR to future periods are subject to the risk that IFCoFR may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
8. In our opinion, the Company has, in all material respects, adequate internal financial controls over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2018 based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note issued by the ICAI.
Annexure 1 to the Independent Auditorâs Report of even date to the members of Ester Industries Limited, on the financial statetments for the year ended March 31, 2018 Annexure I
Based on the audit procedures performed for the purpose of reporting a true and fair view on the financial statements of the Company and taking into consideration the information and explanations given to us and the books of account and other records examined by us in the normal course of audit, and to the best of our knowledge and belief, we report that:
(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 program of physical verification of its fixed assets under which fixed assets are verified in a phased manner over a period of 3 years, which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. In accordance with this program, certain fixed assets were verified during the year and no material discrepancies were noticed on such verification.
(c) The title deeds of all the immovable properties are held in the name of the Company.
(ii) In our opinion, the management has conducted a physical verification of inventory at reasonable intervals during the year, except for goods-in-transit. No material discrepancies were noticed on the aforesaid verification.
(iii) The Company has not granted any loan, secured or unsecured to companies, firms, Limited Liability Partnerships (LLPs) or other parties covered in the register maintained under Section 189 of the Act. Accordingly, the provisions of clauses 3(iii)(a), 3(iii)(b) and 3(iii)(c) of the Order are not applicable.
(iv) In our opinion, the Company has not entered into any transaction covered under Sections 185 and 186 of the Act. Accordingly, the provisions of clause 3(iv) of the Order are not applicable.
(v) In our opinion, the Company has not accepted any deposits within the meaning of Sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended). Accordingly, the provisions of clause 3(v) of the Order are not applicable.
(vi) We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under sub-section (1) of Section 148 of the Act in respect of Company''s products 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) The Company is regular in depositing undisputed statutory dues including provident fund, employees'' state insurance, income-tax, sales-tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues, as applicable, to the appropriate authorities. Further, no undisputed amounts payable in respect thereof were outstanding at the year-end for a period of more than six months from the date they become payable.
(b) The dues outstanding in respect of income-tax, sales-tax, service-tax, duty of customs, duty of excise and value added tax on account of any dispute, are as follows:
Statement of disputed dues
Name of the statute |
Nature of dues |
Rs. in lacs |
Period to which the amount relates |
Forum where dispute is pending |
Central Excise Act, 1944 |
Excise Duty |
8.06 |
March 1990 to May 1991 |
Commissioner (Appeal), Central Excise, Ghaziabad, UP |
Central Excise Act, 1944 |
Excise Duty |
17.46 |
June 1988 to March 1992 |
Joint Commissioner, Meerut, UP |
Central Excise Act, 1944 |
Excise Duty |
164.2 |
April 1990 to February 1992 |
Commissioner (Appeals), Central Excise, Ghaziabad, UP |
Central Excise Act, 1944 |
Excise Duty |
11.72 |
June 1987 to October 1988 |
Assistant Commissioner, Central Excise, Rampur, UP |
Central Excise Act, 1944 |
Excise Duty |
20.61 |
March 1991 to May 1991 |
Commissioner (Appeals), Cen tral Excise, Ghaziabad, UP |
Central Excise Act, 1944 |
Excise Duty |
17.23 |
April 1992 to November 1993 |
Commissioner, Central Excise, Meerut, UP |
Central Excise Act, 1944 |
Excise Duty |
1.59 |
August 1993 to March 1994 |
Commissioner (Appeal), Central Excise, Rampur, UP |
Central Excise Act, 1944 |
Excise Duty |
12.95 |
April 1991 to November 1992 |
Joint Commissioner, Meerut, UP |
Central Excise Act, 1944 |
Excise Duty |
1.58 |
July 1987 to December 1988 |
Commissioner, Central Excise, Meerut, UP |
Central Excise Act, 1944 |
Excise Duty |
4.32 |
April 1992 to July 1993 |
Assistant Commissioner, Central Excise, Rampur, UP |
Central Excise Act, 1944 |
Excise Duty |
34.44 |
January 2010 to January 2012 |
Commissioner (Appeals), Central Excise, Meerut, UP |
Central Excise Act, 1944 |
Excise Duty |
2.5 |
April 2009 to December 2009 |
Commissioner (Appeals), Central Excise, Rampur, UP |
Finance Act, 1994 |
Service Tax |
14.55 |
April 2015 to March 2016 |
Deputy Commissioner, Central Excise, Rampur, UP |
Finance Act, 1994 |
Service Tax |
123.05 |
April 2010 to March 2015 |
Commissioner (Appeals),Central Excise, Meerut, UP |
The Customs Act, 1962 |
Custom Duty |
2.58 |
January 1997 to March 1998 |
Additional Commissioner (Customs), Mumbai |
The Customs Act, 1962 |
Custom Duty |
4.48 |
January 1997 to March 1998 |
Additional Commissioner (Customs), Mumbai |
The Customs Act, 1962 |
Custom Duty |
7.59 |
January 1997 to March 1998 |
Additional Commissioner (Customs),Mumbai |
The Customs Act, 1962 |
Custom Duty |
43.05 |
April 1998 to March 1999 |
Commissioner of Customs, Mumbai |
The Customs Act, 1962 |
Custom Duty |
14.43 |
June 2016 |
Additional Commissioner (Customs), New Delhi |
The Customs Act, 1962 |
Custom Duty |
15.35 |
June 2016 |
Additional Commissioner of (Customs), New Delhi |
Income Tax Act, 1961 |
Income Tax |
18.00 |
Assessment year 1993-94 to Assessment year 1995-96 |
Income Tax Appellate Tribunal, New Delhi |
Income Tax Act, 1961 |
Income Tax |
3.41 |
Assessment year 1997-98 |
The Hon''ble Supreme Court of India |
Income Tax Act, 1961 |
Income Tax |
11.16 |
Assessment year 2005-06 |
Income Tax Appellate Tribunal, New Delhi |
Income Tax Act, 1961 |
Income Tax |
5.78 |
Assessment year 2004-05 |
The Hon''ble Supreme Court of India |
Income Tax Act, 1961 |
Income Tax |
14.09 |
Assessment year 2006-07 to Assessment year 2007-08 and Assessment year 2011-12 |
Income Tax Appellate Tribunal, New Delhi |
Income Tax Act, 1961 |
Income Tax |
4.05 |
Assessment year 2006-07 to Assessment year 2013-14 |
Commissioner of Income Tax (Appeals), New Delhi |
Income Tax Act, 1961 |
Income Tax |
33.68 |
Assessment year 2004-05 |
The Hon''ble Supreme Court of India |
Income Tax Act, 1961 |
Income Tax |
45.74 |
Assessment year 2014-15 |
Commissioner of Income Tax (Appeals), New Delhi |
(viii) The Company has not defaulted in repayment of loans or borrowings to any bank or financial institution during the year. The Company did not have any outstanding debentures and loan from government during the year.
(ix) The Company did not raise moneys by way of initial public offer or further public offer (including debt instruments). In our opinion, the term loans were applied for the purpose for which the loans were obtained.
(x) No fraud by the Company or on the Company by its officers or employees has been noticed or reported during the period covered by our audit.
(xi) Managerial remuneration has been paid and provided by the Company in accordance with the requisite approvals mandated by the provisions of Section 197 of the Act read with Schedule V to the Act.
(xii) In our opinion, the Company is not a Nidhi Company. Accordingly, provisions of clause 3(xii) of the Order are not applicable.
(xiii) In our opinion all transactions with the related parties are in compliance with Sections 177 and 188 of Act, where applicable, and the requisite details have been disclosed in the financial statements etc., as required by the applicable Ind AS.
(xiv) During the year, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures.
(xv) In our opinion, the Company has not entered into any noncash transactions with the directors or persons connected with them covered under Section 192 of the Act.
(xvi) The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934.
For Walker Chandiok & Co LLP
Chartered Accountants
Firm''s Registration No.: 001076N/N500013
per Ashish Gupta
Partner
Membership No.: 504662
Place: New Delhi
Date: May 16, 2018
Mar 31, 2015
We have audited the accompanying standalone financial statements of
Ester Industries Limited ("the Company"), which comprises the Balance
Sheet as at March 31, 2015, the Statement of Profit and Loss and Cash
Flow Statement for the year then ended, and a summary of significant
accounting policies and other explanatory information
Managements responsibility for the financial statements
The Company's Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 ("the Act") with respect
to the preparation 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 accounting principles
generally accepted in India, including the Accounting Standards
specified under section 133 of the Act, read with Rule 7 of the
Companies (Accounts) Rules, 2014 This responsibility also includes
maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding of the assets of the Company and
for preventing and detecting frauds and other irregularities; selection
and application of appropriate accounting policies; making judgments
and estimates that are reasonable and prudent; and the design,
implementation and maintenance of adequate internal financial control
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 We conducted our
audit in accordance with the Standards on Auditing, issued by the
Institute of Chartered Accountants of India, as specified under Section
143(10) of the Act Those Standards require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free from material
misstatement
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements The procedures
selected depend on the auditor's judgment, including the assessment of
the risks of material misstatement of the financial statements, whether
due to fraud or error In making those risk assessments, the auditor
considers internal financial control relevant to the Company's
preparation of the financial statements that give a true and fair view
in order to design audit procedures that are appropriate in the
circumstances but not for the purpose of expressing an opinion on
whether the Company has in place an adequate internal financial controls
system over financial reporting and the effectiveness of such controls An
audit also includes evaluating the appropriateness of 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 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
March 31, 2015, its Profit, and its cash flows for the year ended on that
date
Report on other legal and regulatory requirements
1 As required by the Companies (Auditor's report) Order, 2015 ("the
Order") issued by the Central Government of India in terms of
sub-section (11) of section 143 of the Act, we give in the Annexure 1 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
purpose of our audit;
(b) In our opinion proper books of account as required by law have been
kept by the Company so far as it appears from our examination of those
books;
(c) The Balance Sheet, Statement of Profit and Loss, and Cash Flow
Statement dealt with by this Report are in agreement with the books of
account;
(d) In our opinion, the aforesaid standalone financial statements comply
with the Accounting Standards specified under section 133 of the Act,
read with Rule 7 of the Companies (Accounts) Rules, 2014;
(e) On the basis of written representations received from the directors
as on March 31, 2015, and taken on record by the Board of Directors,
none of the directors is disqualified as on March 31, 2015, from being
appointed as a director in terms of section 164 (2) of the Act;
(f) With respect to the other matters to be included in the Auditors
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:
i The Company has disclosed the impact of pending litigations on its
financial position in its financial statements  Refer Note 27 to the
financial statements;
ii The Company did not have any long-term contracts including
derivative contracts for which there were any material foreseeable
losses;
iii There has been no delay in transferring amounts, required to be
transferred, to the Investor Education and Protection Fund by the
Company
Annexure referred to in paragraph 1 of our report of even date under
section Report on other legal and regulatory requirements
Re: Ester Industries Limited ('the Company')
(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets
(b) All fixed assets have not been physically verified by the management
during the year but there is a regular programme of verification which,
in our opinion, is reasonable having regard to the size of the Company
and the nature of its assets No material discrepancies were noticed on
such verification
(ii) (a) The management has conducted physical verification of inventory
at reasonable intervals during the year
(b) The procedures of physical verification of inventory followed by the
management are reasonable and adequate in relation to the size of the
Company and the nature of its business
(c) The Company is maintaining proper records of inventory and no
material discrepancies were noticed on physical verification
(iii) (a) According to the information and explanations given to us,
the Company has not granted any loans, secured or unsecured to
companies, firms or other parties covered in the register maintained
under section 189 of the Companies Act, 2013 Accordingly, the
provisions of clause 3(iii) (a) and (b) of the Order are not applicable
to the Company and hence not commented upon
(iv) In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business, for the
purchase of inventory and fixed assets and for the sale of goods and
services During the course of our audit, we have not observed any major
weakness or continuing failure to correct any major weakness in the
internal control system of the company in respect of these areas
(v) The Company has not accepted any deposits from the public
(vi) We have broadly reviewed the books of account maintained by the
Company pursuant to the rules made by the Central Government for the
maintenance of cost records under section 148(1) of the Companies Act,
2013, related to the manufacture of polyester films and engineering
plastics, and are of the opinion that prima facie, the specifed
accounts and records have been made and maintained We have not,
however, made a detailed examination of the same
(vii) (a) The Company is regular in depositing with appropriate
authorities undisputed statutory dues including provident fund,
employees' state insurance, income-tax, sales- tax, wealth-tax, service
tax, customs duty, excise duty, value added tax, cess and other
material statutory dues applicable to it
(b) According to the information and explanations given to us, no
undisputed amounts payable in respect of provident fund, employees'
state insurance, income-tax, wealth-tax, service tax, sales-tax,
customs duty, excise duty, value added tax, cess and other material
statutory dues were outstanding, at the year end, for a period of more
than six months from the date they became payable
(c) According to the records of the Company, the dues outstanding of
income-tax, sales-tax, wealth-tax, service tax, customs duty, excise
duty, value added tax and cess on account of any dispute, are as
follows:
Name of the Nature of Dues Amount
Statute (Rs. in
lacs)
Central Excise Dispute on MODVAT credit taken on chips
used in yarn 30
04 Act, 1944 and on exempted clearance of chips Demand
raised for duty on removal of PET Chips
in custody
Central Excise Dispute on MODVAT credit taken on inputs
and Capital 173.86
Act, 1944 Goods used in chips which were cleared
at NIL duty
Central Excise Dispute on disallowance of MODVAT on TEG as 4.80
Act, 1944 documents were more than six months old
The Customs Demand for Custom Duty forgone on value
based 57.71
Act, 1962 advance license
Central Excise Demand on PET Chips waste cleared at nil
rate of duty 4.57
Act, 1944 MEG received under chapter X after
rescinding of Notification No 34/87 CE
Inadmissibility of MODVAT credit against
PBT Chips and Polyester films
Name of the
Statute Period to which Forum where dispute is
the amount relates pending
Central July 87 to June 93 Commissioner Central
Excise and Jan 95 Excise (Noida)
Act,1944
Central
Excise March 90 to Feb 92 Commissioner (Appeals),
Act,1944 and Oct 94 to Feb Central Excise Ghaziabad
95
Central
Excise March 92 Customs, Excise, Service
Act,1944
Tax Appellate Tribunal
(Delhi)
Central
Excise June 93 to April 95 Commissioner/Additional
Act,1962 Commissioner Customs
(DEEC) Mumbai
Centrl
Excise July 93 to May 94 Deputy Commissioner
and Feb to Aug Central Excise, Rampur
act,1944
2000
Name of the Nature of Dues Amount
Statute (Rs. in
lacs)
Central
Excise Demand raised on account
of differences in stocks
as 7.72
Act, 1944 per physical and book
records
Central
Excise Reversal of Cenvat credit
availed on HSD 206.92
Act, 1944
Central
Excise Demand on shortages on
inputs on department 3.09
Act, 1944 physical verification
The Customs Dispute on disallowance of
remission on MEG lost in 32.99
Act, 1962 Transit and utilization of
MODVAT credit
Finance Act, Demand for short payment of
Service Tax against bro- 13.54
1944 kerage and commission
Income Tax
Act, Dispute on Disallowance of
advertisement expenditure 1.16
1961 pursuant to Rule 6B of IT
Rules, 1962 by ITAT
Income Tax
Act, Dispute on Disallowances of
club expenditure on the 0.47
1961 contention that expenses not
incurred wholly and
exclusively for the business
needs
Income Tax
Act, Dispute on Disallowances of
50% of entertainment 5.10
1961 expenses on the contention of
non participation of
the employee for incurring
such expenditure
Income Tax
Act, Dispute on disallowances of
expenses relating to 14.68
1961 previous year
Income Tax
Act, Dispute on disallowances of
excess depreciation 16.94
1961 claimed by company,
commission paid to agent,
club expenses, provision for
doubtful debts and expenses
incurred on earning exempt
income by invoking section
14A of the Act
Income Tax
Act, Dispute on disallowances of
excess depreciation 18.08
1961 claimed by company, bonus
provision, expenses
incurred on earning exempt
income by invoking
section 14A of the Act
Name of the Period to which Forum where dispute is
the amount relates pending
Central
Excise November 1992 Commissioner Meerut II
Act,1944
Central
Excise
Act,1944 March 1994 to High Court, Delhi
February 1997
and March 1997 to
March 1998
Central
Excise
Act,1944 July 2010 Assistant Commissioner,
Rampur
The Customs
Act,1962 June 87 to Oct 88, Assistant Commissioner,
March 91 to May 91 Rampur
and 1993
Financial
Act,1944 F Y 2011-12 Additional Commissioner,
Meerut
Income Tax
Act,1961 A Y 1993-94 to Income Tax - Assessing
1997-98 Officer
Income Tax
Act,1961 A Y 1993-94 to Income Tax - Assessing
1994-95 Officer & Commissioner
of Income Tax (Appeals)
Delhi
Income tax
Act,1961 A Y 1993-94 to Income Tax - Assessing
1997-98 Officer
Income Tax
Act,1961 A Y 1993-94 to Income Tax - Assessing
1997-98 Officer
Income Tax
Act,1961 AY: 2004-05 to Income Tax Appellate
2005-06 Tribunal, Delhi
Income Tax
Act,1961 A Y 2006-07 to A Y Commissioner of Income
2011-12 Tax (Appeals) Delhi &
Income Tax Appellate
Tribunal, Delhi
(d) According to the information and explanations given to us, the
amount required to be transferred to investor education and protection
fund in accordance with the relevant provisions of the Companies Act,
1956 (1 of 1956) and rules made thereunder has been transferred to such
fund within time
(viii) The Company has no accumulated losses at the end of the financial
year and it has not incurred cash losses in the current and immediately
preceding financial year
(ix) Based on our audit procedures and as per the information and
explanations given by the management, we are of the opinion that the
Company has not defaulted in repayment of dues to a financial
institution and bank The Company does not have any dues outstanding to
debenture holders
(x) According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from bank
or financial institutions
(xi) Based on the information and explanations given to us by the
management, term loans were applied for the purpose for which the loans
were obtained
(xii) Based upon the audit procedures performed for the purpose of
reporting the true and fair view of the financial statements and as per
the information and explanations given by the management, we report
that no fraud on or by the Company has been noticed or reported during
the year
S.R. Batliboi & Co. LLP
Chartered Accountants
ICAI Firm Registration
Number: 301003E
per Raman Sobti
Place of Signature: New Delhi Partner
Date : May 25, 2015 Membership Number: 89218
Mar 31, 2014
We have audited the accompanying financial statements of Ester
Industries Limited ("the Company"), which comprise the Balance Sheet as
at March 31, 2014, and the Statement of Profit and Loss and Cash Flow
Statement for the year then ended, and a summary of significant
accounting policies and other explanatory information.
2) Management''s responsibility for the financial statements
Management is responsible for the preparation of these financial
statements that give a true and fair view of the financial position,
financial performance and cash flows of the Company in accordance with
accounting principles generally accepted in India, including the
Accounting Standards notif ed under the Companies Act, 1956, read with
General Circular 8/2014 dated April 4, 2014 issued by the Ministry of
Corporate Affairs. 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.
3) Auditor''s responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The procedures
selected depend on the auditor''s judgment, including the assessment of
the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the Company''s preparation and
fair presentation of the financial statements in order to design audit
procedures that are appropriate in the circumstances but not for the
purpose of expressing an opinion on the effectiveness of the entity''s
internal control. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of
the accounting estimates made by management, as well as evaluating the
overall presentation of the financial statements. We believe that the
audit evidence we have obtained is suf cient and appropriate to provide
a basis for our audit opinion.
4) Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the financial statements give the information
required by the Companies Act, 1956 ("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 af airs of the Company as at March
31, 2014;
(b) in the case of the Statement of Profit and Loss, of the Profit for
the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows forthe
year ended on that date.
5) Report on other legal and regulatory requirements
As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order") issued by the Central Government of India in terms of
sub-section (4A) of section 227 of the Act, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
As required by section 227(3) of the Act, we report that:
(a) We have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purpose of our
audit;
(b) In our opinion proper books of account as required by law have been
kept by the Company so far as appears from our examination of those
books and proper returns adequate for the purposes of our audit have
been received from branches not visited by us;
(c) The Balance Sheet, Statement of Profit and Loss, and Cash Flow
Statement dealt with by this Report are in agreement with the books of
account and with there turns received from branches not visited by us;
(d) In our opinion, the Balance Sheet, the Statement of Profit and
Loss, and the Cash Flow Statement comply with the Accounting Standards
notif ed under the Companies Act, 1956, read with General Circular
8/2014 dated 4 April 2014 issued by the Ministry of Corporate Af airs;
(e) On the basis of written representations received from the directors
as on March 31, 2014, and taken on record by the Board of Directors,
none of the directors is disqualified as on March 31, 2014, from being
appointed as a director in terms of clause (g) of sub-section (1) of
section 274 of the Companies Act, 1956.
Other Matter
We did not audit total assets of Rs. 53.21 lacs as at March 31, 2014,
total revenues of Rs. 32.96 lacs and net cash outflows amounting to Rs.
9.81 lacs for the year then ended, included in the accompanying f
nancial statements in respect of erstwhile Sriyam Impex Private Limited
which got amalgamated with the Company pursuant to the order of High
Court of Uttarakhand vide its order dated March 25, 2014. The financial
statements and other financial information of erstwhile Sriyam Impex
Private Limited have been audited by other auditors and whose report
has been furnished to us. Our opinion, in so far as it relates to the
af airs of erstwhile Sriyam Impex Private Limited is based solely on
the report of other auditors. Our opinion is not qualified in respect
of this matter.
Annexure referred to in paragraph 5 of our report of even date under
section ''Report on other legal and regulatory requirements''
Re: Ester Industries Limited (''the Company'')
(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) All fixed assets have not been physically verif ed by the
management during the year but there is a regular programme of verif
cation which, in our opinion, is reasonable having regard to the size
of the Company and the nature of its assets. No material discrepancies
were noticed on such Verification.
(c) There was no disposal of a substantial part of fixed assets during
the year.
(ii) (a) The management has conducted physical Verification of
inventory at reasonable intervals during the year.
(b) The procedures of physical Verification of inventory followed by
the management are reasonable and adequate in relation to the size of
the Company and the nature of its business.
(c) The Company is maintaining proper records of inventory and no
material discrepancies were noticed on physical Verification.
(iii) (a) According to the information and explanations given to us,
the Company has not granted any loans, secured or unsecured to
companies, firms or other parties covered in the register maintained
under section 301 of the Companies Act, 1956. Accordingly, the
provisions of clause 4(iii) (a) to (d) of the Order are not applicable
to the Company and hence not commented upon.
(b) According to information and explanations given to us, the Company
has not taken any loans, secured or unsecured, from companies, firms or
other parties covered in the register maintained under section 301 of
the Companies Act, 1956. Accordingly, the provisions of clause 4(iii)
(e) to (g) of the Order are not applicable to the Company and hence not
commented upon.
(iv) In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business, for the
purchase of inventory and fixed assets and for the sale of goods. The
activities of the Company do not involve the sale of services. During
the course of our audit, we have not observed any major weakness or
continuing failure to correct any major weakness in the internal
control system of the company in respect of these areas.
(v) (a) According to the information and explanations provided by the
management, we are of the opinion that the particulars of contracts or
arrangements referred to in section 301 of the Companies Act, 1956 that
need to be entered into the register maintained under section 301 have
been so entered.
(b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of such contracts or
arrangements and exceeding the value of Rupees five lakhs have been
entered into during the financial year at prices which are reasonable
having regard to the prevailing market prices at the relevant time.
(vi) The Company has not accepted any deposits from the public.
(vii) In our opinion, the Company has an internal audit system
commensurate with the size of the Company and nature of its business.
(viii) We have broadly reviewed the books of account maintained by the
Company pursuant to the rules made by the Central Government for the
maintenance of cost records under section 209 (1) (d) of the Companies
Act, 1956, related to the manufacture of polyester films and
engineering plastics, and are of the opinion that prima facie, the
prescribed accounts and records have been made and maintained. We have
not, however, made a detailed examination of the same.
(ix) (a) The Company is regular in depositing with appropriate
authorities undisputed statutory dues including provident fund,
investor education and protection fund, employees'' state insurance,
income-tax, sales-tax, wealth-tax, service tax, customs duty, excise
duty, cess and other material statutory dues applicable to it.
(b) According to the information and explanations given to us, no
undisputed amounts payable in respect of provident fund, investor
education and protection fund, employees'' state insurance, income-tax,
wealth- tax, service tax, sales-tax, customs duty, excise duty cess and
other material statutory dues were outstanding, at the year end, for a
period of more than six months from the date they became payable.
(c) According to the records of the Company, the dues outstanding of
income-tax, sales-tax, wealth-tax, service tax, customs duty, excise
duty and cess on account of any dispute, are as follows:
Name of the Nature of Dues Amount
Statute (Rs. in lacs)
Central Excise Dispute on MODVAT credit taken
on chips 30.04
Act, 1944 used in yarn and on exempted clearance
of chips. Demand raised for duty on
removal of PET Chips in custody
Central Excise Dispute on MODVAT credit taken on 173.86
Act, 1944 inputs and Capital Goods used in
chips which were cleared at NIL duty.
Central Excise Dispute on disallowance of
MODVAT on 4.80
Act, 1944 TEG as documents were more than six
months old.
The Customs Demand for Custom Duty forgone on 57.71
Act, 1962 value based advance license.
Central Excise Demand on PET Chips waste cleared 4.57
Act, 1944 at nil rate of duty. MEG received under
chapter X after rescinding of
Notification No. 34/87 CE.
Inadmissibility of MODVAT credit
against PBT Chips and Polyester films.
Central Excise Demand raised on account of
differences 7.72
Act, 1944 in stocks as per physical and book
records.
Central Excise Reversal officenvat credit availed
on HSD. 206.92
Act, 1944
Central Excise Demand on shortages on inputs on 3.09
Act, 1944 department physical Verification.
The Customs Dispute on disallowance of remission 32.99
Act, 1962 on MEG lost in Transit and
utilization of MODVAT credit
Finance Act, Demand for short payment of
Service Tax 13.54
1944 against brokerage and commission
Income Tax Act, Dispute on Disallowance of
advertisement 1.68
1961 expenditure pursuant to Rule 6B of IT
Rules, 1962 by ITAT
Income Tax Act, Dispute on Disallowances of club 1.80
1961 expenditure on the contention that
expenses not incurred wholly and
exclusively for the business needs.
Name of the Statue Period to which the Forum where
amount relates dispute is pending
Central Excise
Act, 1944 July 87 to June 93 Commissioner
and Jan 95 Central Excise (Noida)
Central Excise
Act, 1944 March 90 to Feb 92 Commissioner
and Oct 94 to Feb 95 (Appeals), Central
Excise Ghaziabad
Central Excise
Act, 1944 March 92 Customs, Excise,
Service Tax Appellate
Tribunal (Delhi)
The Customs
Act, 1962 June 93 to April 95 Commissioner/
Additional
Commissioner
Customs (DEEC)
Mumbai
Central Excise
Act, 1944 July 93 to May 94 Deputy
and Feb to Aug 2000 Commissioner
Central Excise,
Rampur
Central Excise
Act, 1944 November 1992 Commissioner
Meerut II
Central Excise
Act, 1944 March 1994 to High Court, Delhi
February 1997
and March 1997 to
March 1998
The Customs
Act, 1962 July 2010 Assistant
Commissioner,
Rampur
Finance Act,
1944 June 87 to Oct 88, Assistant
March 91 to May 91 Commissioner,
and 1993 Rampur
Income Tax Act,
1961 F.Y. 2011-12 Additional
Commissioner,
Meerut
Income Tax Act,
1961 A.Y. 1990-91, 1993- Income Tax -
94 to 1997-98 Assessing officer
A.Y. 1990-91, 1993- Income Tax -
94 to 1994-95 Assessing officer 1&
Income Tax Act,
1961 & A.Y.2005-06 Commissioner of
Income Tax (Appeals)
Delhi
Name of the Nature of Dues Amount
Statute (Rs. in lacs)
Income Tax Act, Dispute on Disallowances of 50% 5.10
1961 of entertainment expenses on the
contention of non participation of the
employee for incurring such expenditure.
Income Tax Act, Dispute on disallowances of expenses 14.68
1961 relating to previous year.
Income Tax Act, Dispute on disallowances of excess 16.94
1961 depreciation claimed by company,
commission paid to agent, club
expenses, provision for doubtful
debts and expenses incurred on
earning exempt income by invoking
section 14A of the Act
Income Tax Act, Dispute on disallowances of excess 17.93
1961 depreciation claimed by company,
bonus provision, expenses incurred
on earning exempt income by invoking
section 14A of the Act
Name of the Statue Period to which the Forum where
amount relates dispute is pending
Income Tax Act,
1961 A.Y. 1993-94 to Income Tax -
1997-98 Assessing officer
Income Tax Act,
1961 A.Y. 1993-94 to Income Tax -
1997-98 Assessing officer
Income Tax Act,
1961 A.Y. 2004-05 to Income Tax Appellate
2005-06 Tribunal, Delhi
Income Tax Act,
1961 A.Y. 2006-07 to A.Y. Commissioner of
2011-12 Income Tax (Appeals)
Delhi & Income Tax
Appellate Tribunal,
Delhi
(x) The Company has no accumulated losses at the end of the financial
year and it has not incurred cash losses in the current and immediately
preceding financial year.
(xi) Based on our audit procedures and as per the information and
explanations given by the management, we are of the opinion that the
Company has not defaulted in repayment of dues to a financial
institution and bank. The Company does not have any dues outstanding to
debenture holders.
(xii) According to the information and explanations given to us and
based on the documents and records produced before us, the Company has
not granted loans and advances on the basis of security by way of
pledge of shares, debentures and other securities.
(xiii) In our opinion, the Company is not a chit fund or a nidhi /
mutual benefit fund / society. Therefore, the provisions of clause 4
(xiii) of the Companies (Auditor''s Report) Order, 2003 (as amended) are
not applicable to the Company.
(xiv) In respect of dealing/trading in shares, securities, debentures
and other investments, in our opinion and according to the information
and explanations given to us, proper records have been maintained of
the transactions and contracts and timely entries have been made
therein. The shares, securities, debentures and other investments have
been held by the Company, in its own name.
(xv) According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from bank
or financial institutions.
(xvi) Based on the information and explanations given to us by the
management, term loans were applied for the purpose for which the loans
were obtained.
(xvii) According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we report
that no funds raised on short-term basis have been used for long-term
investment.
(xviii) The Company has not made any preferential allotment of shares
to parties or companies covered in the register maintained under
section 301 of the Companies Act, 1956.
(xix) The Company did not have any outstanding debentures during the
year.
(xx) The Company has not raised any money through a public issue during
the period.
(xxi) Based upon the audit procedures performed for the purpose of
reporting the true and fair view of the financial statements and as per
the information and explanations given by the management, we report
that no fraud on or by the Company has been noticed or reported during
the year.
For S.R. Batliboi & Associates LLP
Chartered Accountants
ICAI Firm Registration Number: 101049W
per Raman Sobti
Place : New Delhi Partner
Date : May 21, 2014 Membership Number: 89218
Mar 31, 2013
Report on the Financial Statements
We have audited the accompanying fnancial statements of Ester
Industries Limited ("the Company"), which comprise the Balance Sheet as
at March 31, 2013, and the Statement of Proft and Loss and Cash Flow
Statement for the year then ended, and a summary of signifcant
accounting policies and other explanatory information.
Management''s Responsibility for the Financial Statements
Management is responsible for the preparation of these fnancial
statements that give a true and fair view of the fnancial position,
fnancial performance and cash fows of the Company in accordance with
accounting principles generally accepted in India, including the
Accounting Standards referred to in sub- section (3C) of section 211 of
the Companies Act, 1956 ("the Act"). This responsibility includes the
design, implementation and maintenance of internal control relevant to
the preparation and presentation of the fnancial statements that give a
true and fair view and are free from material misstatement, whether due
to fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these fnancial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the fnancial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the fnancial statements. The procedures
selected depend on the auditor''s judgment, including the assessment of
the risks of material misstatement of the fnancial statements, whether
due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the Company''s preparation and
fair presentation of the fnancial statements in order to design audit
procedures that are appropriate in the circumstances. An audit also
includes evaluating the appropriateness of accounting policies used and
the reasonableness of the accounting estimates made by management, as
well as evaluating the overall presentation of the fnancial statements.
We believe that the audit evidence we have obtained is sufcient and
appropriate to provide a basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the fnancial statements give the information
required by the Act in the manner so required and 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 afairs of the
Company as at March 31, 2013;
(b) in the case of the Statement of Proft and Loss, of the loss for the
year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash fows for the
year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order") issued by the Central Government of India in terms of
sub-section (4A) of section 227 of the Act, we give in the Annexure a
statement on the matters specifed in paragraphs 4 and 5 of the Order.
2. As required by section 227(3) of the Act, we report that:
(a) We have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purpose of our
audit;
(b) In our opinion proper books of account as required by law have been
kept by the Company so far as appears from our examination of those
books;
(c) The Balance Sheet, Statement of Proft and Loss, and Cash Flow
Statement dealt with by this Report are in agreement with the books of
account;
(d) In our opinion, the Balance Sheet, Statement of Proft and Loss, and
Cash Flow Statement comply with the Accounting Standards referred to in
subsection (3C) of section 211 of the Companies Act, 1956;
(e) On the basis of written representations received from the directors
as on March 31, 2013, and taken on record by the Board of Directors,
none of the directors is disqualifed as on March 31, 2013, from being
appointed as a director in terms of clause (g) of sub-section (1) of
section 274 of the Companies Act, 1956.
Re: Ester Industries Limited (''the Company'')
(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fxed
assets.
(b) All fxed assets have not been physically verifed by the management
during the year but there is a regular program of verifcation which, in
our opinion, is reasonable having regard to the size of the Company and
the nature of its assets. No material discrepancies were noticed on
such verifcation.
(c) There was no disposal of a substantial part of fxed assets during
the year.
(ii) (a) The management has conducted physical verifcation of inventory
at reasonable intervals during the year.
(b) The procedures of physical verifcation of inventory followed by the
management are reasonable and adequate in relation to the size of the
Company and the nature of its business.
(c) The Company is maintaining proper records of inventory and no
material discrepancies were noticed on physical verifcation.
(iii) (a) According to the information and explanations given to us,
the Company has not granted any loans, secured or unsecured to
companies, frms or other parties covered in the register maintained
under section 301 of the Companies Act, 1956. Accordingly, the
provisions of clause 4(iii)(a) to (d) of the Order are not applicable
to the Company and hence not commented upon.
(b) According to information and explanations given to us, the Company
has not taken any loans, secured or unsecured, from companies, frms or
other parties covered in the register maintained under section 301 of
the Companies Act, 1956. Accordingly, the provisions of clause
4(iii)(e) to (g) of the Order are not applicable to the Company and
hence not commented upon.
(iv) In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business, for the
purchase of inventory and fxed assets and for the sale of goods. There
is no sale of service; hence provisions of this clause, to the extent
of sale of services are not applicable to the Company. During the
course of our audit, we have not observed any major weakness or
continuing failure to correct any major weakness in the internal
control system of the company in respect of these areas.
(v) (a) According to the information and explanations provided by the
management, we are of the opinion that the particulars of contracts or
arrangements referred to in section 301 of the Companies Act, 1956 that
need to be entered into the register maintained under section 301 have
been so entered.
(b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of such contracts or
arrangements and exceeding the value of Rupees fve lakhs have been
entered into during the fnancial year at prices which are reasonable
having regard to the prevailing market prices at the relevant time.
(vi) The Company has not accepted any deposits from the public.
(vii) In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
(viii) We have broadly reviewed the books of account maintained by the
Company pursuant to the rules made by the Central Government for the
maintenance of cost records under section 209(1)(d) of the Companies
Act, 1956, related to the manufacture of polyester flms and engineering
plastics and are of the opinion that prima facie, the prescribed
accounts and records have been made and maintained. We have not,
however, made a detailed examination of the same.
(ix) (a) Undisputed statutory dues including provident fund, investor
education and protection fund, employees'' state insurance, income-tax,
sales-tax, wealth-tax, service tax, custom duty, excise duty, cess and
other material statutory dues have generally been regularly deposited
with the appropriate authorities.
(b) According to the information and explanations given to us, no
undisputed amounts payable in respect of provident fund, investor
education and protection fund, employees'' state insurance, income-tax,
wealth- tax, service tax, sales-tax, customs duty, excise duty, cess
and material other undisputed statutory dues were outstanding, at the
year end, for a period of more than six months from the date they
became payable.
(c) According to the records of the Company, the dues outstanding of
income-tax, sales-tax, wealth-tax, service tax, custom duty, excise
duty and cess on account of any dispute, are as follows:
Name of the Nature of Dues Amount
Statute (Rs. in lacs)
Central Excise Dispute on MODVAT credit taken on chips 30.04
Act, 1944 used in yarn and on exempted clearance
of chips. Demand raised for duty on
removal of PET Chips in custody.
Central Excise Dispute on MODVAT credit taken on 173.86
Act, 1944 inputs and Capital Goods used in chips
which were cleared at NIL duty.
Central Excise Dispute on disallowance of MODVAT on 4.80
Act, 1944 TEG as documents were more than six
months old.
The Customs Demand for Custom Duty forgone on 57.71
Act, 1962 value based advance license.
Central Excise Demand on PET Chips waste cleared 4.57
Act, 1944 at nil rate of duty. MEG received under
chapter X after rescinding of
Notifcation No. 34/87 CE.
Inadmissibility of MODVAT credit
against PBT Chips and Polyester flms.
Central Excise Demand raised on account of diferences 7.72
Act, 1944 in stocks as per physical and book
records.
Name of the Period to which the Forum where
Statute amount relates dispute is pending
Central Excise
Act,1944 July 87 to June 93 Commissioner
and Jan 95 Central Excise (Noida)
Central Excise
Act,1944 March 90 to Feb 92 Commissioner
and Oct 94 to Feb 95 (Appeals), Central
Excise Ghaziabad
Central Excise
Act,1944 March 92 Customs, Excise,
Service Tax Appellate
Tribunal (Delhi)
The Customs
Act,1962 June 93 to April 95 Commissioner/ Additional
Commissioner Customs
(DEEC) Mumbai
Central Excise
Act,1944 July 93 to May 94 Deputy
and Feb to Aug 2000 Commissioner
Central Excise,
Rampur
Central Excise
Act,1944 November 1992 Commissioner
Meerut II
Name of the Nature of Dues Amount
Statute (Rs. in lacs)
The Customs Dispute on disallowance of remission 32.99
Act, 1962 on MEG lost in Transit and utilization
of MODVAT credit.
Central Excise Demand on shortages on inputs on 3.09
Act, 1944 department physical verifcation.
Income Tax Act, Dispute on Disallowance of advertisement 1.68
1961 expenditure pursuant to Rule 6B of IT
Rules, 1962 by ITAT.
Income Tax Act, Dispute on Disallowances of club 1.80
1961 expenditure on the contention that
expenses not incurred wholly and
exclusively for the business needs.
Income Tax Act, Dispute on Disallowances of 50% 5.10
1961 of entertainment expenses on the
contention of non participation of
the employee for incurring such
expenditure.
Income Tax Act, Dispute on disallowances of expenses 14.68
1961 relating to previous year.
Income Tax Act, Disallowance of 80HHC beneft in MAT 16.94
1961 computation.
Income Tax Act, Dispute on disallowances of excess 11.66
1961 depreciation claimed by company, bonus
provision, expenses incurred on
earning exempt income by invoking
section 14A of the Act.
Name of the Period to which the Forum where
Statute amount relates dispute is pending
The Customs
Act,1962 June 87 to Oct 88, Assistant
March 91 to May 91 Commissioner,
and 1993 Rampur
Central Excise
Act,1944 July 2010 Assistant
Commissioner, Rampur
Income Tax
Act,1961 A.Y. 1990-91, 1993- Income Tax Appellate
94 to 1997-98 Tribunal, Delhi
Income Tax
Act,1961 A.Y. 1990-91, 1993- Income Tax Appellate
94 to 1994-95 & Tribunal, Delhi &
A.Y.2005-06 Commissioner of
Income Tax (Appeals)
Delhi
Income Tax
Act,1961 A.Y. 1993-94 to Income Tax Appellate
1997-98 Tribunal, Delhi
Income Tax
Act,1961 A.Y. 1993-94 to Income Tax Appellate
1997-98 Tribunal, Delhi
Income Tax
Act,1961 A.Y. 2004-05 to Income Tax Appellate
2005-06 Tribunal, Delhi
Income Tax
Act,1961 A.Y. 2006-07 to A.Y. Commissioner
2009-10
Appeals
(x) The Company has no accumulated losses at the end of the fnancial
year and it has not incurred cash losses in the current and immediately
preceding fnancial year.
(xi) Based on our audit procedures and as per the information and
explanations given by the management, we are of the opinion that the
Company has not defaulted in repayment of dues to a fnancial
institution and banks. The Company has no outstanding debentures during
the current year.
(xii) According to the information and explanations given to us and
based on the documents and records produced to us, the Company has not
granted loans and advances on the basis of security by way of pledge of
shares, debentures and other securities.
(xiii) In our opinion, the Company is not a chit fund or a nidhi /
mutual beneft fund / society. Therefore, the provisions of clause
4(xiii) of the Companies (Auditor''s Report) Order, 2003 (as amended)
are not applicable to the Company.
(xiv) In respect of dealing/trading in shares, securities, debentures
and other investments, in our opinion and according to the information
and explanations given to us, proper records have been maintained of
the transactions and contracts and timely entries have been made
therein. The shares, securities, debentures and other investments have
been held by the Company in its own name.
(xv) According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from bank
or fnancial institutions.
(xvi) Based on information and explanations given to us by the
management, term loans were applied for the purpose for which the loans
were obtained.
(xvii) According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we report
that no funds raised on short-term basis have been used for long-term
investment.
(xviii) The Company has not made any preferential allotment of shares
to parties or companies covered in the register maintained under
section 301 of the Companies Act, 1956.
(xix) The Company did not have any outstanding debentures during the
year.
(xx) The Company has not raised any money through a public issue during
the year.
(xxi) Based upon the audit procedures performed for the purpose of
reporting the true and fair view of the fnancial statements and as per
the information and explanations given by the management, we report
that no fraud on or by the Company has been noticed or reported during
the year.
For S.R. BATLIBOI & CO. LLP
Chartered Accountants
Firm registration number: 301003E
per Manoj Gupta
Place : New Delhi Partner
Date : May 24, 2013 Membership Number: 83906
Mar 31, 2012
1. We have audited the attached Balance Sheet of Ester Industries
Limited ('the Company') as at March 31, 2012 and also the Statement of
profit and loss and 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 (as
amended) 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 above, we
report that:
i. We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purposes of our
audit;
ii. In our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books;
iii. The balance sheet, statement of profit and loss and cash flow
statement dealt with by this report are in agreement with the books of
account;
iv. In our opinion, the balance sheet, statement of profit and loss
and cash flow statement dealt with by this report comply with the
accounting standards referred to in sub-section (3C) of section 211 of
the Companies Act, 1956.
v. On the basis of the written representations received from the
directors, as on March 31, 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 clause
(g) of sub-section (1) of section 274 of the Companies Act, 1956.
vi. In our opinion and to the best of our information and according to
the explanations given to us, the said accounts give the information
required by the Companies Act, 1956, in the manner so required and give
a true and fair view in conformity with the accounting principles
generally accepted in India;
a) in the case of the balance sheet, of the state of affairs of the
Company as at March 31, 2012;
b) in the case of the statement of profit and loss, of the loss for the
year ended on that date; and
c) in the case of cash flow statement, of the cash flows for the year
ended on that date.
Re: Ester Industries Limited
(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) All fixed assets have not been physically verified by the
management during the year but there is a regular program of
verification which, in our opinion, is reasonable having regard to the
size of the Company and the nature of its assets. No material
discrepancies were noticed on such verification.
(c) There was no substantial disposal of fixed assets during the year.
(ii) (a) The management has conducted physical verification of
inventory at reasonable intervals during the year.
(b) The procedures of physical verification of inventory followed by
the management are reasonable and adequate in relation to the size of
the Company and the nature of its business.
(c) The Company is maintaining proper records of inventory and no
material discrepancies were noticed on physical verification.
(iii) (a) According to the information and explanations given to us,
the Company has not granted any loans, secured or unsecured to
companies, firms or other parties covered in the register maintained
under section 301 of the Companies Act, 1956. Accordingly, the
provisions of clause 4(iii)(a) to (d) of the Order are not applicable
to the Company and hence not commented upon.
(b) According to information and explanations given to us, the Company
has not taken any loans, secured or unsecured, from companies, firms or
other parties covered in the register maintained under section 301 of
the Companies Act, 1956. Accordingly, the provisions of clause
4(iii)(e) to (g) of the Order are not applicable to the Company and
hence not commented upon.
(iv) In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business, for the
purchase of inventory and fixed assets and for the sale of goods. There
is no sale of service; hence provisions of this clause, to the extent
of sale of services are not applicable to the Company. During the
course of our audit, we have not observed any major weakness or
continuing failure to correct any major weakness in the internal
control system of the company in respect of these areas.
(v) (a) According to the information and explanations provided by the
management, we are of the opinion that the particulars of contracts or
arrangements referred to in section 301 of the Companies Act, 1956 that
need to be entered into the register maintained under section 301 have
been so entered.
(b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of such contracts or
arrangements and exceeding the value of Rupees five lakhs have been
entered into during the financial year at prices which are reasonable
having regard to the prevailing market prices at the relevant time.
(vi) The Company has not accepted any deposits from the public.
(vii) In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
(viii) We have broadly reviewed the books of account maintained by the
Company pursuant to the rules made by the Central Government for the
maintenance of cost records under section 209(1 )(d) of the Companies
Act, 1956, related to the manufacture of polyester films and
engineering plastics and are of the opinion that prima facie, the
prescribed accounts and records have been made and maintained.
(ix) (a) Undisputed statutory dues including provident fund, investor
education and protection fund, employees' state insurance, income-tax,
sales-tax, wealth-tax, service tax, custom duty, excise duty, cess and
other material statutory dues have generally been regularly deposited
with the appropriate authorities.
(b) According to the information and explanations given to us, no
undisputed amounts payable in respect of provident fund, investor
education and protection fund, employees' state insurance, income-tax,
wealth-tax, service tax, sales-tax, customs duty, excise duty, cess and
material other undisputed statutory dues were outstanding, at the year
end, for a period of more than six months from the date they became
payable.
(c) According to the records of the Company, the dues outstanding of
income-tax, sales-tax, wealth-tax, service tax, custom duty, excise
duty and cess on account of any dispute, are as follows:
Name of the Nature of Dues Amount
Statute (Rs. in
lacs)
Central Excise Dispute on MODVAT credit taken on chips 30.04
Act, 1944 used in yarn and on exempted clearance of
chips. Demand raised for duty on removal
of PET Chips in custody
Central Excise Dispute on MODVAT credit taken on inputs 173.86
Act, 1944 and Capital Goods used in chips which
were cleared at NIL duty.
Central Excise Dispute on disallowance of MODVAT on TEG 4.80
Act, 1944 as documents were more than six months old.
The Customs Demand for Custom Duty forgone on value 57.71
Act, 1962 based advance license.
Central Excise Demand on PET Chips waste cleared at nil 4.57
Act, 1944 rate of duty. MEG received under chapter
X after rescinding of Notification
No. 34/87 CE. Inadmissibility of MODVAT
credit against PBT Chips and Polyester
films.
Name of the Statute Period to which the Forum where dispute
amount relates is pending
Central Excise Act,1944 July 87 to June 93 and Commissioner Central
Jan 95 Excise (Noida)
Central Excise Act,1944 March 90 to Feb 92 Commissioner
and Oct 94 to Feb 95 (Appeals), Central
Excise Ghaziabad
Central Excise Act,1944 March 92 Customs, Excise,
Service Tax Appellate
Tribunal (Delhi)
The Customs Act,1962 June 93 to April 95 Commissioner/
Additional
Commissioner Customs
(DEEC) Mumbai
Central Excise Act,1944 July 93 to May 94 and Deputy Commissioner
Feb to Aug 2000 Central Excise, Rampur
Name of the Nature of Dues Amount
Statute (Rs. in
lacs)
Central Excise Demand raised on account of differences in 7.72
Act, 1944 stocks as per physical and book records.
The Customs Dispute on disallowance of remission on MEG 32.99
Act, 1962 lost in Transit and utilization of MODVAT
credit
Central Excise Demand on shortages on inputs on 3.09
Act, 1944 department physical verificatioin.
Income Tax Act, Penalty imposed on difference of loss 1.84
1961 assessed by Income Tax Department and tax
return filed by the Company.
Income Tax Act, Dispute on Disallowance of advertisement 1.68
1961 expenditure pursuant to Rule 6B of IT Rules,
1962 by ITAT
Income Tax Act, Dispute on Disallowances of club expenditure 1.80
1961 on the contention that expenses not incurred
wholly and exclusively for the business needs.
Income Tax Act, Dispute on Disallowances of 50% of 5.10
1961 entertainment expenses on the contention
of non participation of the employee for
incurring such expenditure
Income Tax Act, Dispute on disallowances of expenses relating 14.68
1961 to previous year.
Income Tax Act, Disallowance of 80HHC benefit in MAT 16.94
1961 computation
Income Tax Act, Dispute on disallowances of excess 37.47
1961 depreciation claimed by company, bonus
provision, expenses incurred on earning
exempt income by invoking section 14A of
the Act
Name of the Statute Period to which the Forum where dispute
amount relates is pending
Central Excise Act,1944 November 1992 Commissioner Meerut II
The Customs Act,1962 June 87 to Oct 88, Assistant
March 91 to May 91 Commissioner,
and 1993 Rampur
Central Excise Act,1944 July 2010 Assistant Commissioner,
Rampur
Income Tax Act,1961 1988-89 High Court, Delhi
Income Tax Act,1961 A.Y. 1990-91, 1993- Income Tax Appellate
94 to 1997-98 Tribunal, Delhi
Income Tax Act,1961 A.Y. 1990-91, 1993- Income Tax Appellate
94 to 1 994-95 & Tribunal, Delhi &
A.Y.2005-06 Commissioner of
Income Tax (Appeals)
Delhi
Income Tax Act,1961 A.Y. 1993-94 to 1997- Income Tax Appellate
98 Tribunal, Delhi
Income Tax Act,1961 A.Y. 1993-94 to 1997- Income Tax Appellate
98 Tribunal, Delhi
Income Tax Act,1961 AY: 2004-05 to 2005- Income Tax Appellate
06 Tribunal, Delhi
Income Tax Act,1961 A.Y. 2006-07 to A.Y. Commissioner
2009-10 Appeals
(x) The Company has no accumulated losses at the end of the financial
year and it has not incurred cash losses in the current and immediately
preceding financial year.
(xi) Based on our audit procedures and as per the information and
explanations given by the management, we are of the opinion that the
Company has not defaulted in repayment of dues to a financial
institution and banks. The Company has no outstanding debentures during
the current year.
(xii) According to the information and explanations given to us and
based on the documents and records produced to us, the Company has not
granted loans and advances on the basis of security by way of pledge of
shares, debentures and other securities.
(xiii) In our opinion, the Company is not a chit fund or a nidhi /
mutual benefit fund / society. Therefore, the provisions of clause
4(xiii) of the Companies (Auditor's Report) Order, 2003 (as amended)
are not applicable to the Company.
(xiv) In respect of dealing/trading in shares, securities, debentures
and other investments, in our opinion and according to the information
and explanations given to us, proper records have been maintained of
the transactions and contracts and timely entries have been made
therein. The shares, securities, debentures and other investments have
been held by the Company in its own name.
(xv) According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from bank
or financial institutions.
(xvi) Based on information and explanations given to us by the
management, term loans were applied for the purpose for which the loans
were obtained.
(xvii) According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we report
that no funds raised on short-term basis have been used for long- term
investment.
(xviii) The Company has not made any preferential allotment of shares
to parties or companies covered in the register maintained under
section 301 of the Companies Act, 1956.
(xix) The Company did not have any outstanding debentures during the
year.
(xx) The Company has not raised any money through a public issue during
the year.
(xxi) Based upon the audit procedures performed for the purpose of
reporting the true and fair view of the financial statements and as per
the information and explanations given by the management, we report
that no fraud on or by the Company has been noticed or reported during
the year.
For S. R. BATLIBOI & CO.
Firm Registration No. 301003E
Chartered Accountants
per Manoj Gupta
Date : 4th May 2012 Partner
Place : Gurgaon Membership No.: 83906
Mar 31, 2010
1. We have audited the attached Balance Sheet of Ester Industries
Limited (Ãthe CompanyÃ) as at March 31, 2010 and also the Profit and
Loss Account and the Cash Flow Statement for the year ended on that
date annexed thereto. These financial statements are the responsibility
of the CompanyÃs 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 (AuditorÃs Report) Order, 2003 (as
amended) 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 above, we
report that:
i. We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purposes of our
audit;
ii. In our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books;
iii. The balance sheet, profit and loss account and cash flow statement
dealt with by this report are in agreement with the books of account;
iv. In our opinion, the balance sheet, profit and loss account and cash
flow statement dealt with by this report comply with the accounting
standards referred to in sub-section (3C) of section 211 of the
Companies Act, 1956.
v. On the basis of the 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 clause
(g) of sub-section (1) of section 274 of the Companies Act, 1956.
vi. In our opinion and to the best of our information and according to
the explanations given to us, the said accounts give the information
required by the Companies Act, 1956, in the manner so required and give
a true and fair view in conformity with the accounting principles
generally accepted in India;
a) in the case of the balance sheet, of the state of affairs of the
Company as at March 31, 2010;
b) in the case of the profit and loss account, of the profit for the
year ended on that date; and
c) in the case of cash flow statement, of the cash flows for the year
ended on that date.
ANNEXURE REFERRED TO IN PARAGRAPH 3 OF OUR REPORT OF EVEN DATE RE:
ESTER INDUSTRIES LIMITED
(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) All fixed assets have not been physically verified by the
management during the year but there is a regular program of
verification which, in our opinion, is reasonable having regard to the
size of the Company and the nature of its assets. In accordance of the
said program, part of the fixed assets has been physically verified
during the year. As informed, no material discrepancies were noticed on
such verification.
(c) There was no substantial disposal of fixed assets during the year.
(ii) (a) The management has conducted physical verification of
inventory at reasonable intervals during the year.
(b) The procedures of physical verification of inventory followed by
the management are reasonable and adequate in relation to the size of
the Company and the nature of its business.
(c) The Company is maintaining proper records of inventory and no
material discrepancies were noticed on physical verification.
(iii) (a) As informed, the Company has not granted any loan, secured or
unsecured to companies, firms or other parties covered in the register
maintained under section 301 of the Companies Act, 1956. Accordingly,
paragraphs 4 (iii) (b), (c) and (d) of the Companies (AuditorÃs Report)
Order, 2003 (as amended) (herein referred to as the Order), are not
applicable.
(b) As informed, the Company has not taken any loan, secured or
unsecured from companies, firms or other parties covered in the
register maintained under Section 301 of the Companies Act, 1956.
Accordingly, paragraphs 4 (iii) (f) and (g) of the Order, are not
applicable.
(iv) In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business, for the
purchase of inventory and fixed assets and for the sale of goods. There
is no sale of service; hence provisions of this clause, to the extent
of sale of services are not applicable to the Company. During the
course of our audit, no major weakness has been noticed in the internal
control system in respect of these areas. During the course of our
audit, we have not observed any continuing failure to correct major
weakness in internal control system of the company.
(v) (a) According to the information and explanations provided by the
management, we are of the opinion that the particulars of contracts or
arrangements referred to in section 301 of the Act that need to be
entered into the register maintained under section 301 have been so
entered.
(b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of such contracts or
arrangements exceeding value of Rupees five lakhs have been entered
into during the financial year at prices which are reasonable having
regard to the prevailing market prices at the relevant time.
(vi) The Company has not accepted any deposits from the public.
(vii) In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business. (viii) We have
broadly reviewed the books of account maintained by the Company
pursuant to the rules made by the Central Government for the
maintenance of cost records under Section 209(1)(d) of the Companies
Act, 1956, and are of the opinion that prima facie, the prescribed
accounts and records have been made and maintained. (ix) (a)
Undisputed statutory dues including provident fund, investor education
and protection fund, employeesà state insurance, income-tax, sales-tax,
wealth-tax, service tax, custom duty, excise duty and other material
statutory dues have generally been regularly deposited with the
appropriate authorities. Further, since the Central Government has
till date not prescribed the amount of cess payable under section 441 A
of the Companies Act,1956, we are not in a position to comment upon the
regularity or otherwise of the company in depositing the same.
(b) According to the information and explanations given to us, no
undisputed amounts payable in respect of provident fund, investor
education and protection fund, employeesà state insurance, income-tax,
wealth-tax, service tax, sales-tax, customs duty, excise duty and other
undisputed statutory dues were outstanding, at the year end, for a
period of more than six months from the date they became payable.
(c) According to the records of the Company, the dues outstanding of
income-tax, sales-tax, wealth-tax, service tax, custom duty, excise
duty and cess on account of any dispute, are as follows:
Name of the Nature of Dues
Statute
Central Excise Dispute on MODVAT credit taken on chips used in
Act, 1944 yarn and on exempted clearance of chips. Demand
raised for duty on removal of PET Chips in custody
Central Excise Dispute on MODVAT credit taken on inputs and
Act, 1944 Capital Goods used in chips which were cleared at
NIL duty.
Central Excise Dispute on disallowance of MODVAT on TEG as
Act, 1944 documents were more than six months old.
The Customs Demand for Custom Duty forgone on value based
Act, 1962 advance license.
Central Excise Demand on PET Chips waste cleared at nil rate of
Act, 1944 duty. MEG received under chapter X after rescinding
of Notification No. 34/87 CE. Inadmissibility of
MODVAT credit against PBT Chips and Polyester films.
Central Excise Demand raised on account of differences in stocks
Act, 1944 as per physical and book records.
The Customs Dispute on disallowance of remission on MEG lost in
Act, 1962 Transit and utilization of MODVAT credit
Penalty imposed on difference of loss assessed by
Income Tax Income Tax Department and tax return filed by the
Act, 1961
Company.
Income Tax Disallowance of 80HHC benefit in MAT computation
Act, 1961
Name of the Amount Period to which the Forum where dispute
Statute (Rs. in
Lacs) amount relates is pending
Central Excise 35.50 July 87 to June 93 and Commissioner Central
Act, 1944 Jan 95 Excise (Noida)
Central Excise 173.86 March 90 to Feb 92 and Commissioner
(Appeals),
Act, 1944 Oct 94 to Feb 95 Central Excise
Ghaziabad
Central Excise 4.80 March 92 Customs, Excise,
Service
Act, 1944 Tax Appellate
Tribunal (Delhi)
The Customs 57.72 June 93 to April 95 Commissioner /
Additional
Act, 1962 Commissioner Customs
(DEEC) Mumbai
Central Excise 10.6 July 93 to May 94 and Deputy Commissioner
Act, 1944 Feb to Aug 2000 Central Excise,
Rampur
Central Excise 7.72 November 1992 Commissioner Meerut
Act, 1944 II
The Customs 32.99 June 87 to Oct 88,March Assistant
Commissioner,
Act, 1962 91 to May 91 and 1993 Rampur
Income Tax 1.84 1988-89 High Court, Delhi
Act, 1961
Income Tax 63.68 AY: 2003-04 to 2004-05 Commissioner Appeals
Act, 1961
(x) The Company has no accumulated losses at the end of the financial
year and it has not incurred cash losses in the current and immediately
preceding financial year.
(xi) Based on our audit procedures and as per the information and
explanations given by the management, we are of the opinion that the
Company has not defaulted in repayment of dues to a financial
institution, bank or debenture holders.
(xii) According to the information and explanations given to us and
based on the documents and records produced to us, the Company has not
granted loans and advances on the basis of security by way of pledge of
shares, debentures and other securities.
(xiii) In our opinion, the Company is not a chit fund or a nidhi /
mutual benefit fund / society. Therefore, the provisions of clause
4(xiii) of the Companies (AuditorÃs Report) Order, 2003 (as amended)
are not applicable to the Company.
(xiv) In respect of dealing/trading in shares, securities, debentures
and other investments, in our opinion and according to the information
and explanations given to us, proper records have been maintained of
the transactions and contracts and timely entries have been made
therein. The shares, securities, debentures and other investments have
been held by the Company in its own name.
(xv) According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from bank
or financial institutions.
(xvi) Based on information and explanations given to us by the
management, term loans were applied for the purpose for which the loans
were obtained.
(xvii) According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we report
that no funds raised on short-term basis have been used for long-term
investment.
(xviii) The Company has made preferential allotment of shares to
parties or companies covered in the register maintained under Section
301 of the Companies Act, 1956. In our opinion the price at which
shares have been issued is not prejudicial to the interest of the
Company.
(xix) The Company had issued unsecured fully and compulsorily
convertible debentures during the year which were issued for a short
period and were converted into equity shares on December 24, 2009 on
which no security or charge is required to be created on such
debentures.
(xx) The Company has not raised any money through a public issue during
the year.
(xxi) Based upon the audit procedures performed for the purpose of
reporting the true and fair view of the financial statements and as per
the information and explanations given by the management, we report
that no fraud on or by the Company has been noticed or reported during
the course of our audit.
For S. R. Batliboi & Co.
Firm registration No. 301003E
Chartered Accountants
per Manoj Gupta
Partner
Membership No.: 83906
Place - Gurgaon
Date - May 18, 2010