Mar 31, 2023
To the Members of Jindal Stainless Limited Basis for Opinion
Report on the Audit of the Standalone Financial Statements
1. We have audited the accompanying standalone financial statements of Jindal Stainless 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 then 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.
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 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.
4. Key audit matters 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 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 matters 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: Refer notes 23 and 38 of the accompanying standalone |
Our audit procedures in relation to the recognition of revenue included, but were not limited to the following: |
financial statements for the revenue recorded during the |
- Obtained an understanding of the Companyâs process of |
year ended 31 March 2023 and related accounting policy |
revenue recognition and evaluated the appropriateness |
adopted by the Company for revenue recognition. The Company recognises revenue from the sales of products |
of accounting policy adopted by the Company in accordance with Ind AS 115. |
when control over goods is transferred to customers and are |
- Evaluated the design and tested the operating |
accounted for net of returns and rebates. |
effectiveness of the internal controls put in place by the Company over recognition and measurement of revenue |
The Company has a large number of customers operating in |
in accordance with underlying customer contracts and |
various geographies and the sales contracts / arrangements with such customers have distinct varying commercial terms, |
accounting policies. |
including Incoterms that determine the timing of transfer |
- Performed test of details (including year end cut-off |
of control. Accordingly, significant efforts and judgment of |
testing) by selecting samples of revenue transactions |
the management is required in determining the timing of |
recorded during the year and samples from specific period |
transfer of control and measurement of revenue recognition |
before and after year end. For such samples selected, |
in accordance with Ind AS 115, Revenue from Contracts with |
verified the underlying documents, which included sales |
Customers (âInd AS 115â). |
invoices / contracts and dispatch / shipping documents to ensure revenue is booked with accurate amount and in |
Further, revenue is also a key performance indicator for the Company and there is risk of revenue being overstated due |
the correct period. |
to the pressure to achieve targets or earning expectations. |
- Performed analytical procedures including ratio analysis and period-on-period variance analysis, over revenue |
Owing to the multiplicity of the Companyâs products, |
recorded during the year to identify any unusual indicators |
volume of sales transactions, size of distribution network and varied terms of contracts with customers, in line with |
/ trends. |
the requirements of the Standards on Auditing, revenue is |
- Performed test of details over the outstanding trade |
determined to be an area involving significant risk requiring |
receivable balances which included obtaining direct |
significant auditor attention and is therefore considered to |
independent confirmations from customers, on a sample |
be a key audit matter in the current year audit. |
basis, for balances outstanding as at the year end. - Assessed the appropriateness and adequacy of the related disclosures in financial statements of the Company in accordance with the applicable accounting standards. |
Key audit matter |
How our audit addressed the key audit matter |
Business Combinations |
Our audit procedures in relation to Business Combination included, but were not limited to, the following: |
Refer note 33 of the accompanying standalone financial |
|
statements relating to a Composite Scheme of Arrangement |
- Obtained an understanding of the Scheme and the NCLT |
(âthe Schemeâ) amongst the Company, Jindal Stainless (Hisar) |
Order documents to understand the key terms anc |
Limited, JSL Lifestyle Limited, Jindal Lifestyle Limited, JSL Media Limited and Jindal Stainless Corporate Management |
conditions of the acquisition. |
Services Private Limited, pursuant to Sections 230 to 232 |
- Assessed the design and tested the operating |
and other relevant provisions of Companies Act, 2013 |
effectiveness of the Companyâs controls over the |
approved by the Honâble National Company Law Tribunal, |
accounting of business combination which includes |
Chandigarh Bench, vide order dated 02 February 2023 (âthe |
valuation of identified assets and liabilities acquired under |
NCLT Orderâ), with an appointed date of 01 April 2020. |
the business combination. |
The Scheme was accounted for as a business combination |
- Assessed appropriateness of the accounting policy |
in accordance with Ind AS 103 âBusiness Combinationsâ (âInd |
adopted by the Company in terms of the requirements of |
AS 103â) which requires recognition of identifiable assets and liabilities including identifiable intangibles, at fair value |
Ind AS 103. |
on the date of acquisition, with the excess of the acquisition |
- Evaluated the competence and objectivity of the |
price over such identified fair values recognised as goodwill. |
managementâs valuation expert engaged for the purchase |
The Company appointed an independent valuation expert to allocate the purchase consideration to the respective assets and liabilities acquired as per the fair values determined using various valuation models adopted by the expert, which |
price allocation and obtained an understanding of the approach adopted by the expert for this purpose. - Critically evaluated the reasonableness of key |
involved significant management estimates and judgements with respect to future business plans and projections, which involve high inherent estimation uncertainty. |
assumptions, estimates and judgements involved in the identification and valuation of acquired assets (including intangible assets) and liabilities, based on our knowledge of the Company and the industry. |
The management determined that the fair values of the net identifiable assets acquired was ? 3,226.72 crores as part |
- Involved auditorâs valuation experts to assess |
of the above fair valuation exercise and accordingly, the |
appropriateness of the valuation methodology and |
consideration paid in excess of the net identifiable assets |
valuation assumptions such as discount rate used by the |
acquired resulted in recognition of Goodwill of ? 89.95 crores. |
managementâs expert. |
We have considered the accounting and valuation of the said |
- Assessed the adequacy of the Companyâs disclosures |
business combination to be a matter of most significance to |
included in the financial statements in respect of the |
our current year audit given the complexity and judgement |
acquisition in accordance with the requirements of Ind |
involved, and the materiality of the business acquisition to the accompanying financial statements, and accordingly, this matter has been identified as a key audit matter. |
AS 103. |
The above matter is also considered fundamental to the understanding of the users of the accompanying financial statements on account of restatement of the comparative financial information as the accounting effect has been given from the acquisition date, being the Appointed Date approved under the Scheme. |
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 auditor''s 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.
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 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 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.
10. Our objectives are to obtain reasonable assurance about whether the 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 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 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 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 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; and
⢠Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the 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 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.
15. The comparative financial information of the Company presented in these financial statements for the year ended 31 March 2022 has been restated to give effect to the Composite Scheme of Arrangement (âSchemeâ) amongst the Company, Jindal Stainless (Hisar) Limited, JSL Lifestyle Limited, JSL Media Limited and Jindal Stainless Corporate Management Services Private Limited as further detailed in note 33. The financial information of Jindal Stainless (Hisar) Limited included as above, is based on audited financial statements for the year ended 31 March 2022, which has been jointly audited by one of the joint auditors, Lodha & Co, together with another auditor, who have jointly issued an unmodified opinion vide audit report dated May 05, 2022. Further, the financial information pertaining to JSL Lifestyle Limited, JSL Media Limited and Jindal Stainless Corporate Management Services Private Limited included as above, is based on the audited financial statements of such companies for the year ended 31 March 2022 which have been audited by their respective auditors, who have issued unmodified opinions vide their audit reports dated 27 March 2023, 27 April 2022 and 18 April 2022 respectively. The aforesaid audit reports of other auditors have been furnished to us by the management and relied upon by us for the purpose of our joint audit of the accompanying financial statements. Our opinion is not modified in respect of this matter.
16. 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.
17. 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 I, a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.
18. Further to our comments in Annexure I, 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 financial statements of the Company as on 31 March 2023 and the operating effectiveness of such controls, refer to our separate Report in Annexure II wherein 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 39 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 52 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 person(s) or entity(ies), 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 52 to the standalone financial statements, no funds have been received by the Company from any person(s) or entity(ies), 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 subclauses (a) and (b) above contain any material misstatement.
v. The interim dividend declared and paid by the Company during the year ended 31 March 2023 and until the date of this audit report is in compliance with section 123 of the Act. Further, as stated in note 14 to the accompanying standalone financial statements, the Board of Directors of the Company have proposed final dividend for the year ended 31 March 2023 which is subject to the approval of the members at the ensuing Annual General Meeting. The dividend declared is in accordance with section 123 of the Act to the extent it applies to declaration 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 April 1, 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.
Mar 31, 2022
Report on the Audit of the Standalone Financial Statements
1. We have audited the accompanying standalone financial statements of Jindal Stainless Limited (âthe Companyâ), which comprise the Balance Sheet as at 31 March 2022, 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 then ended, and 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 2022, and its profit (including other comprehensive income), its cash flows and the changes in equity for the year ended on that date.
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 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.
4. Key audit matters 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 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 matter to be communicated in our report.
Key audit matter |
How our audit addressed the key audit matter |
Revenue recognition: Refer note 23 and note 37 to the accompanying standalone financial statements for revenue recorded during the year ended 31 March 2022 and related accounting policy adopted by the Company for revenue recognition. The Company recognises revenue from the sales of products when control over goods is transferred to customers and are accounted for net of returns and rebates. The Company has a large number of customers operating in various geographies and the sales contracts / arrangements with such customers have distinct varying commercial terms, including Incoterms that determine the timing of transfer of control. Accordingly, significant efforts and judgment of the management is required in determining the timing of transfer of control and measurement of revenue recognition in accordance with Ind AS 115, Revenue from Contracts with Customers (âInd AS 115â). Further, revenue is also a key performance indicator for the Company and there is risk of revenue being overstated due to the pressure to achieve targets or earning expectations. Owing to the multiplicity of the Companyâs products, volume of sales transactions, size of distribution network and varied terms of contracts with customers, in line with the requirements of the Standards on Auditing, revenue is determined to be an area involving significant risk requiring significant auditor attention and is therefore considered to be a key audit matter in the current year audit. |
Our audit procedures in relation to the recognition of revenue included, but were not limited to, the following: - Obtained an understanding of the Companyâs process of revenue recognition and evaluated the appropriateness of accounting policy adopted by the Company in accordance with Ind AS 115. - Evaluated the design and tested the operating effectiveness of the internal controls put in place by the Company over recognition and measurement of revenue in accordance with underlying customer contracts and accounting policies; - Performed test of details (including year end cut-off testing) by selecting samples of revenue transactions recorded during the year and samples from specific period before and after year end. For such samples selected, verified the underlying documents, which included sales invoices / contracts and dispatch / shipping documents to ensure revenue is booked with accurate amount and in the correct period; - Performed analytical procedures including ratio analysis and period-on-period variance analysis, over revenue recorded during the year to identify any unusual indicators / trends; - Performed test of details over the outstanding trade receivable balances which included obtaining direct independent confirmations from customers, on a sample basis, for balances outstanding as at the year end; - Assessed the appropriateness and adequacy of the related disclosures in the standalone financial statements of the Company in accordance with the applicable accounting the applicable. |
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 do 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 system 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 Directors'' 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 I, 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 I, 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 2022 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 financial statements of the Company as on 31 March 2022 and the operating effectiveness of such controls, refer to our separate Report in Annexure II wherein 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 2022;
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 2022;
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 2022;
iv. (a) The management has represented that, to the best of its knowledge and belief, as disclosed in note 50 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 of the Ultimate Beneficiaries;
(b) The management has represented that, to the best of its knowledge and belief, as disclosed in note 50 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 2022.
Chartered Accountants
Firmâs Registration No.: 001076N/N500013
Partner
Membership No.: 058644
UDIN: 22058644AIGJFK2258
Place: Mumbai
Date: 02 May 2022
Mar 31, 2018
Report on the Standalone Financial Statements
1. We have audited the accompanying standalone financial statements of Jindal Stainless Limited (âthe Companyâ), which comprise the Balance Sheet as at 31 March 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 Standalone Financial Statements
2. The Companyâs Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these standalone financial statements that give a true and fair view of the 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 (Ind ASâ) 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 standalone 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 standalone 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 Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether these standalone financial statements are free from material misstatement.
6. An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditorâs judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial controls relevant to the Companyâs preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Companyâs Directors, as well as evaluating the overall presentation of the financial statements.
7. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on these standalone financial statements.
Opinion
8. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India including Ind AS specified under Section 133 of the Act, of the state of affairs (financial position) of the Company as at 31 March 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 31 March 2017 prepared in accordance with Ind AS included in these standalone financial statements have been audited by the predecessor auditor. The report of the predecessor auditor dated 12 May 2017 on the comparative financial information expressed an unmodified opinion on the financial information for the year ended 31 March 2017. Our opinion is not modified in respect of this matter.
Report on other Legal and Regulatory Requirements
10. As required by the Companies (Auditorâs Report) Order, 2016 (âthe Orderâ) issued by the Central Government of India in terms of Section 143(11) of the Act, we give in the Annexure I a statement on the matters specified in paragraphs 3 and 4 of the Order. 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 standalone financial statements dealt with by this report are in agreement with the books of accounts;
(d) in our opinion, the aforesaid standalone financial statements comply with Ind AS specified under Section 133 of the Act;
(e) on tthe 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 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 31 March 2018 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date and our report dated 25 April 2018 as per Annexure II expressed an unmodified opinion;
(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 27 to the standalone financial statements, has disclosed the impact of pending litigations on its financial position;
ii. the Company has made provision, as required under the applicable law or Ind AS, for material foreseeable losses, if any, on long-term contracts including derivative contracts;
iii. there has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company;
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 standalone financial statements. Hence, reporting under this clause is not applicable.
Annexure I to the Independent Auditorâs Report of even date to the members of Jindal Stainless Limited, on the standalone financial statements for the year ended 31 March 2018
Annexure 1
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) All fixed assets have not been physically verified by the management during the year, however, there is a regular program of verification once in three years, 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) The title deeds of all the immovable properties (which are included under the head âProperty, plant and equipmentâ) are held in the name of the Company.
ii) In our opinion, the management has conducted physical verification of inventory at reasonable intervals during the year, except for goods-in-transit and stocks lying with third parties. For stocks lying with third parties at the year-end, written confirmations have been obtained by the management. 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 complied with the provisions of section 186 in respect of investments and guarantees. Further, in our opinion, the Company has not entered into any transaction covered under Section 185 and Section 186 of the Act in respect of loans and security.
v) In our opinion, the Company has complied with the directives issued by the Reserve Bank of India, the provisions of Sections 73 to 76 and other relevant provisions of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended) as applicable, with regard to the deposits accepted. According to the information and explanations given to us, no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal, in this regard.
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 Companyâs 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) Undisputed statutory dues including provident fund, employeesâ state insurance, income-tax, sales-tax, service tax, duty of customs, duty of excise, value added tax, goods and services tax, cess and other material statutory dues, as applicable, have generally been regularly deposited to the appropriate authorities, though there has been a slight delay in a few cases. 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 became payable:
(b) The dues outstanding in respect of income-tax, sales tax, services-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 |
Amount (Rs. crores) |
Amount paid under protcst (Rs. crores) |
Period to which the amount relates |
Forum where dispute is pending |
The Central Sales Tax Act,1956 |
Central Sales tax |
33.06 |
8.26 |
2004-05 to 2007-08 |
The Honâble High Court, Odisha |
The Central Sales Tax Act, 1956 |
Central Sales Tax |
2.35 |
0.47 |
2013-14 and 2014-15 |
Commissioner of Commercial Taxes, Odisha |
The Odisha Value Added Tax Act, 2004 |
Value Added Tax |
22.92 |
2013-14 and 2014-15 |
The Honâble High Court, Odisha |
|
The Orissa Entry Tax Act, 1999 |
Entry Tax |
12.48 |
October 2010 to March 2013, 2015-16 and 2016-17 |
The Honâble High Court, Odisha |
|
The Orissa Entry Tax Act, 1999 |
Entry Tax |
56.18 |
1.08 |
October 2006 to September 2010 |
The Honâble High Court, Odisha |
The Orissa Entry Tax Act, 1999 |
Entry Tax |
34.16 |
2013-14 and 2014-15 |
The Honâble High Court, Odisha |
|
The Orissa Entry Tax Act,1999 |
Entry Tax |
0.10 |
0.10 |
April 2006 to September 2006 |
Additional Commissioner of Commercial Tax |
The Customs Tariff Act, 1975 |
Customs Duty |
7.97 |
0.60 |
2012-13 |
Commissioner Of Customs |
The Customs Act, 1962 |
Customs Duty |
1.70 |
0.13 |
2014-15 |
Commissioner Of Customs |
The Central Excise Act, 1944 |
Central Excise Duty |
0.71 |
0.18 |
January 2009 to April 2009 |
CESTAT |
The Central Excise Act, 1944 |
Central Excise Duty |
1.30 |
1.30 |
2006-07, 2007-08 and 2008-09 |
CESTAT |
The Central Excise Act, 1944 |
Central Excise Duty |
0.50 |
0.05 |
September 2006 to August 2011 |
CESTAT |
The Central Excise Act, 1944 |
Central Excise Duty |
0.30 |
- |
May 2008 to March 2009 |
CESTAT |
The Central Excise Act, 1944 |
Central Excise Duty |
0.94 |
- |
2011-12 to 2015-16 |
Commissioner of Central Excise |
Income-tax Act, 1961 |
Income tax |
2.17 |
Assessment Year (AY) 2003 04 |
Honâble High Court of Delhi |
|
Income-tax Act, 1961 |
Income tax |
3.01 |
- |
AY 2004-05 |
Honâble High Court of Delhi |
Income-tax Act, 1961 |
Income tax |
16.64 |
AY 2005-06 |
Honâble High Court of Delhi |
|
Income-tax Act, 1961 |
Income tax |
2.24 |
2.20 |
AY 2005-06 |
Commissioner of Income tax (Appeals) |
Income-tax Act, 1961 |
Income tax |
0.10 |
AY 2006 07 |
Additional Commissions of Income tax (Transfer pricing officer) |
|
Income-tax Act, 1961 |
Income tax |
9.06 |
- |
AY 2006 07 |
Honâble High Court of Delhi |
Income-tax Act, 1961 |
Income tax |
0.10 |
- |
AY 2006-07 |
Income tax Appellate Tribunal |
Income-tax Act, 1961 |
Income tax |
9.98 |
- |
AY 2007-08 |
Income tax Appellate Tribunal |
Income-tax Act, 1961 |
Income tax |
2.87 |
2.34 |
AY 2008 09 |
Income tax Appellate Tribunal |
Income-tax Act, 1961 |
Income tax |
0.30 |
- |
AY 2010-11 |
Income tax Appellate Tribunal |
Income-tax Act, 1961 |
Income tax |
0.21 |
AY 2010 11 |
Commissioner of Income tax (Appeals) |
|
Income-tax Act, 1961 |
Income tax |
1.80 |
AY 2011-12 |
Commissioner of Income tax (Appeals) |
viii) As at 31 March 2018, the Company has no continuing defaults in repayment of loans or borrowings to any financial institution or a bank or government or any dues to debenture-holders, though during the year there were certain defaults which have been made good by 31 March 2018.
ix) In our opinion, the Company has applied moneys raised by way of term loans for the purposes for which these were raised. The Company did not raise moneys by way of initial public offer or further public offer (including debt instruments) during the year.
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) Except as stated in note 42 to the financial statements with respect to three directors, managerial remuneration has been paid 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. The Company has taken necessary steps for securing refund of excess managerial remuneration, such as communicating with the persons to whom such amounts have been paid, etc. and the said amount is presented as âother financial assetsâ in the financial statements.
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 made preferential allotment of shares. In respect of the same, in our opinion, the Company has complied with the requirement of Section 42 of the Act and the Rules framed thereunder. Further, in our opinion, the amounts so raised have been used for the purposes for which the funds were raised. During the year, the Company did not make preferential allotment/ private placement of fully or partly convertible debentures.
xv) In our opinion, the Company has not entered into any non-cash 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.
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 standalone financial statements of Jindal Stainless Limited (âthe Companyâ) as at and for the year ended 31 March 2018, we have audited the internal financial controls over financial reporting (âIFCoFRâ) of the Company as at that date.
Managementâs Responsibility for internal Financial Controls
2. The Companyâs Board of Directors is responsible for establishing and maintaining internal financial controls based on 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 Noteâ) issued by the Institute of Chartered Accountants of India (the 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 Companyâs business, including adherence to the Companyâs policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.
Auditorâs Responsibility
3. Our responsibility is to express an opinion on the Companyâs 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 includes 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 auditorâs 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 Companyâs IFCoFR.
Meaning of Internal Financial Controls over Financial Reporting
6. A companyâs 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 companyâs IFCoFR include those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the companyâs assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
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 the 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 controls were operating effectively as at 31 March 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.
For Walker Chandiok & Co LLP
Chartered Accountants
Firmâs Registration No: 001076N/N500013
per Siddharth Talwar
Partner
Membership N0:512752
Place: New Delhi
Date: 25 April 2018
Mar 31, 2017
To the Members of JINDAL STAINLESS LIMITED REPORT ON THE STANDALONE IND AS FINANCIAL STATEMENTS
We have audited the accompanying standalone Ind AS financial statements of JINDAL STAINLESS LIMITED (âthe Companyâ), which comprise the Balance Sheet as at 31 stMarch, 2017, the Statement of Profit and Loss (including other comprehensive income), the Cash Flow Statement for the year then ended and the statement of changes in equity for the year then ended and a summary of the significant accounting policies and other explanatory information herein after referred to as âstandalone Ind AS financial statementsâ).
MANAGEMENT''S RESPONSIBILITY FOR THE STANDALONE IND AS FINANCIAL STATEMENTS
The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these standalone Ind AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) prescribed under Section 133 of the Act read with relevant rules issued there under. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
AUDITOR''S RESPONSIBILITY
Our responsibility is to express an opinion on these standalone Ind AS financial statements based on our audit.
We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.
We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone Ind AS financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the standalone Ind AS financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the standalone Ind AS financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.
OPINION
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India including the Ind AS, of the state of affairs (financial position) of the Company as at 31stMarch, 2017, and its profit financial performance including other comprehensive income)), its cash flows and the changes in equity for the year ended on that date.
EMPHASIS OF MATTERS:
We draw attention to the following matters:
(a) Pending necessary approvals for managerial remuneration [including payment made to one of the director pending central Government''s approval] and waiver application for excess remuneration paid earlier to one of the director rejected by the Central Government as stated in Note no. 49(C)(i)of the financial statements;
(b) Pending confirmations/reconciliation of balances of certain secured loans, loans & advances (including MAT credit), trade receivables, trade payables & other liabilities read with Note no. 32(A)(iii)(g) & 32(B) and 40(A) of the financial statements;
(c) Investments and loan & advances to certain subsidiary/other companies and Mat Credit entitlement, considered as good and fully realizable/ recoverable and no provision for diminution in value is considered necessary in the opinion of the management as stated in note no. 40(B) of the financial statements;
(d) Note no 35 of the financial statements wherein the company has made investment of Rs, 8.56 crore (As per Ind AS Rs, 8.47 Crore as on 31st March, 2017) (along with bank guarantee ofRs, 10.01 Crore) and Rs, 0.10 Crore in MJSJ Coal Limited and Jindal Synfuels Limited respectively. The company continues to treat the investment as good and recoverable in view of the pending decision challenging the Order and other circumstances mentioned therein;
(e) Net worth, post considering the fair value, became positive as stated in the Note no 34 of the financial statements.
Our opinion is not modified in respect of these matters.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
1. As required by the Companies (Auditor''s Report) Order, 2016(âthe Orderâ) issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us during the course of audit, we give in the Annexure ''A'' a statement on the matters specified in the paragraphs 3 and 4 of the Order.
2. As required by Section 143 (3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
(c) The Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, the Cash Flow Statement and Statement of Change in Equity dealt with by this Report are in agreement with the books of account.
(d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with relevant rule issued there under.
(e) On the basis of the written representations received from the directors as on 31st March, 2017 taken on record by the Board of Directors, none of the directors is disqualified as on 31 st March, 2017 from being appointed as a director in terms of Section 164 (2) of the Act.
(f) As required by section 143(3)(l) of the Companies Act, 2013, and based on the checking of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, our separate report with respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls is as per Annexure ''B''.
(g) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:
(i) The Company has disclosed the impact of pending litigations on its financial position in its standalone Ind AS financial statements -refer Note no. 28(A & E), 36&38to the standalone Ind AS financial statements.
(ii) The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long term contracts including derivatives contracts.
(iii) There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
(iv) The company had provided requisite disclosures in its Standalone Ind AS financial statements as to holdings as well as dealings in Specified Bank Notes during the period from 8th November, 2016 to 30th December, 2016 and these are in accordance with the books of accounts maintained by the company. Refer Note No. 57 to the standalone Ind AS financial statements.
Annexure âAâ referred to in paragraph 1 under the heading âReport on other legal and regulatory requirementsâ of our report of even date on the Standalone Ind AS Financial Statements of JINDAL STAINLESS LIMITED for the year ended 31st March 2017
1. (a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.
(b) The Company has a regular programme of Physical Verification of its Fixed assets by which fixed asset have been verified by the management according to the programme of periodical physical verification in a phased manner which in our opinion is reasonable having regard to the size of the Company and the nature of its fixed assets. The discrepancies noticed on such physical verification were not material. Asset wise recording of Fair Value is in process to be reconciled with fixes assets register.
(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties included in fixed assets are held in the name of the Company except as stated in footnote (@) of Note No. 2 of the standalone Ind AS financial statements.
2. The inventories of the Company (except stock lying with the third parties and in transit), part of stores and spares, have been physically verified by the management at reasonable intervals. In our opinion, the procedures of physical verification of inventory followed by the Management are reasonable in relation to the size of the Company and nature of its business. The discrepancies noticed on such physical verification of inventory as compared to book records were not material.
3. 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.
4. According to the information, explanations and representations provided by the management and based upon audit procedures performed, we are of the opinion that in respect of loans, investments, guarantees and security, the Company has complied with the provisions of the Section 185 and 186 of the Companies Act, 2013.
5. In our opinion and according to the information and explanations given to us, the Company has complied with the directive issued by the Reserve Bank of India and the provisions of Section 73 to76 of the Act or any other relevant provisions of the Act and the rules framed there under (to the extent applicable) with regard to deposit accepted from the public. We have been informed that no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or other Tribunal in this regard.
6. 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 Act in respect of the company''s products to which the said rules are made applicable and are of the opinion that prima facie, the prescribed records have been made and maintained. We have, however, not made a detailed examination of the said records with a view to determine whether they are accurate or complete.
7. (a) According to the records of the Company, 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 with the appropriate authorities to the extent applicable and there are no undisputed statutory dues payable for a period of more than six months from the date they become payable as at 31st March, 2017.
(b) According to the records and information & explanations given to us, there are no dues in respect of service tax that have not been deposited with the appropriate authorities to the extent applicable on account of any dispute and the dues in respect of income tax, duty of customs, duty of excise and value added tax that have not been deposited with the appropriate authorities on account of any dispute and the forum where the dispute is pending are given below: -
Name of The Statuts |
Nature of Dues |
Amount (Rs, in Crore) |
Period (Financial Year) |
Forum where dispute is pending |
31.35 |
2005-11 |
CESTAT, East Zonal Bench Kolkata. |
||
Central Excise Act |
Excise Duty |
0.30 |
April 06- March 12 |
Commissioner Appeal, Bhubaneswar |
0.03 |
2011-12 & 2012-13 |
Commissioner Appeal Jajpur division |
||
Central Excise Act |
Custom Duty |
7.97 |
2012-13 |
Commissioner of Central Excise, Customs and Service Tax, Bhubaneswar -1 |
24.79 |
2005-06 to 2007-08 |
High Court Odisha, Cuttack |
||
The Central Sales Tax, 1956 |
Sales Tax |
1.88 |
2013-14 2014-15 |
Additional Commissioner of Commercial Tax, Cuttak |
0.02 |
2011-12 |
Joint Commissioner of Commercial Tax, Jajpur Range, Jajpur Road |
Name of The Statuts |
Nature of Dues |
Amount |
Period |
Forum where dispute is |
(Rs, in Crore) |
(Financial Year) |
pending |
||
2.47 |
2005-06 2006-07 2010-11 |
Commissioner of Income Tax (Appeals), Delhi |
||
Income tax Act |
Income Tax |
5.18 |
2002-03 2003-04 2004-05 |
High Court, New Delhi |
28.28 |
2005-06 2006-07 & 2007-08 |
ITAT, New Delhi |
||
69.59 |
2006-07 to 2016-17 |
Hon''ble Supreme, Court |
||
Entry Tax Act,1999 |
Entry Tax |
130.93 |
2006-11 2013-14 2014-15 |
High Court Odisha, Cuttack |
Odisha Value Added |
Value Added Tax |
22.93 |
2013-14 & 2014-15 |
High Court Odisha, Cuttack |
Above does not include show cause notices and are after incorporating effect of the Scheme (Refer Note27A).
8. In our opinion, on the basis of audit procedures and according to the information and explanations given to us, the company has defaulted in repayment of dues (including interest, installments letter of credits payments) to banks and financial institutions at various days during the year (read with note no. 33).The maximum amount of default on a particular date was Rs, 856.97 Crore (including default of Rs, 7.82 Crore w.r.t. outstanding debentures) and maximum delay (no. of days) noticed was 88 days (maximum delay of 84 days w.r.t. outstanding debentures). As on March 31, 2017, the overdue financial obligations to banks/ financial institutions/debenture holders was Rs, 266.68 Crore with maximum delay of 60 days, the lender wise details of which is as follows:
Allahabad Bank Rs, 3.43 Crore; Axis Bank Rs,4.67 Crore; Bank of Baroda Rs, 127.61 Crore; Bank of Maharashtra Rs, 0.28 Crore; Canara Bank Rs, 0.38 Crore; Central Bank of India Rs, 3.65 Crore; Corporation Bank Rs, 0.84 Crore; Federal Bank Rs, 0.99 Crore; General Insurance Corporation of India Rs, 0.28 Crore; HDFC Bank Rs, 0.78 Crore; IDBI Bank Rs, 5.10 Crore; Indian Bank Rs, 0.67 Crore; Jammu & Kashmir Bank Rs, 1.49 Crore; Karnataka BankRs, 0.81 Crore; Life Insurance Corporation of India Rs, 5.49 Crore; New India Assurance CompanyRs, 0.28 Crore; Oriental Bank of Commerce Rs, 3.19 Crore; Punjab National BankRs, 1.23 Crore; Standard Chartered BankRs, 22.63 Crore; State Bank of Bikaner & Jaipur Rs, 1.14 Crore; State Bank of HyderabadRs, 4.18 Crore; State Bank of IndiaRs, 0.10 Crore; State Bank of MysoreRs, 3.38 Crore; State Bank of Patiala Rs, 65.17 Crore; State BankofTravancore Rs, 1.47 Crore; Syndicate BankRs, 1.46 Crore; UCO BankRs, 1.67 Crore; United India Insurance Company Rs, 0.28 Crore; Union Bank of India Rs, 1.29 Crore; United Bank of India Rs, 2.75 Crore.
9. On the basis of information and explanations given to us, term loan were applied for the purpose for which the loans were obtained. No money have been raised during the year by way of initial public offer or further public offer.
10. Based on the audit procedure performed and on the basis of information and explanations provided by the management, no fraud by the Company and no material fraud on the Company by its officers or employees has been noticed or reported during the course of the audit.
11. According to the information and explanations given to us and based on our examination of the records of the Company, managerial remuneration has been paid/provided [pending Central Government''s approval] in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act, read with note no. 49(C)(1).
12. In our opinion and according to the information and explanations given to us, the Company is not a Nidhi Company. Accordingly, paragraph 3(xii) of the Order is not applicable.
13. According to the information and explanations and records made available by the management of the Company and audit procedure performed, for transactions with the related parties during the year, the Company has complied with the provisions of Section 177 and 188 of the Act, where applicable [Read with note no. 27Band 47].As explained and as per records, details of related party transactions have been disclosed in the standalone Ind AS financial statements as per the applicable Accounting Standards.
14. According to the information and explanations given to us, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year, read with note no. 12; except allotment of compulsorily convertible warrants as stated in note no.12A(vi) in respect of which requirement of section 42 of the Act have been complied with and the amount raised have been used for the purpose for which the funds were raised.
15. On the basis of records made available to us and according to information and explanations given to us, the Company has not entered into noncash transactions with the directors or persons connected with him.
16. The Company is not required to be registered under section 45-IAof the Reserve Bank of India Act1934.
ANNEXURE ''B'' TO THE INDEPENDENT AUDITOR''S REPORT OF EVEN DATE ON THE STANDALONE IND AS FINANCIAL STATEMENTS OF JINDAL STAINLESS LIMITED
Report on the Internal Financial Controls over Financial Reporting under Clause (I) of Sub-section 3 of Section 143 of the Companies Act, 2013 (âthe Actâ)
We have audited the internal financial controls over financial reporting of JINDAL STAINLESS LIMITED(âthe Companyâ) as of March 31, 2017 in conjunction with our audit of the standalone Ind AS financial statements of the Company for the year ended on that date.
MANAGEMENT''S RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS
The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (ICAI). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to Company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.
AUDITOR''S RESPONSIBILITY
Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the âGuidance Noteâ) and the Standards on Auditing, issued by the Institute of Chartered Accountants of India (ICAI) and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.
MEANING OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING
A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.
INHERENT LIMITATIONS OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING
Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
OPINION
In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2017, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
For LODHA & CO. For S.S. KOTHARI MEHTA & CO.
Chartered Accountants Chartered Accountants
FRN: 301051E FRN: 000756N
N.K. LODHA SUNIL WAHAL
Partner Partner
Membership No. 85155 Membership No. 87294
Place: New Delhi Dated: 12th May 2017
Mar 31, 2016
TO THE MEMBERS OF JINDAL STAINLESS LIMITED Report on the Standalone Financial Statements
We have audited the accompanying REVISED standalone financial statements of JINDAL STAINLESS LIMITED (âthe Companyâ), which comprise the REVISED Balance Sheet as at 31st March, 2016, the REVISED Statement of Profit and Loss, the REVISED Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information in which impact of the Scheme (as stated in Note No. 27) have been incorporated.
Managementâs Responsibility for the Standalone Financial Statements
The Companyâs Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these REVISED standalone financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditorâs Responsibility
Our responsibility is to express an opinion on these REVISED standalone financial statements based on our audit.
We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.
We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone financial statements. The procedures selected depend on the auditorâs judgment, including the assessment of the risks of material misstatement of the standalone financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Companyâs preparation of the standalone financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Companyâs Directors, as well as evaluating the overall presentation of the standalone 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 REVISED standalone financial statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid REVISED 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 31st March, 2016, and its loss and its cash flows for the year ended on that date.
Emphasis of Matters:
We draw attention to the following matters:
a) Net worth of the company has been eroded as stated in note no. 34 of the REVISED financial statements. The company continues to prepare its accounts on a going concern basis for the reasons as stated in the said note;
b) Pending necessary approvals for managerial remuneration as stated in Note no. 49(C)(i) of the REVISED financial statements;
c) Pending confirmations/reconciliation of balances of certain secured loans (read with Note No. 27), loans & advances, trade receivables, trade payables & other liabilities read with Note no. 32(A)(iii)(g) & 32(B) and 40(A) of the REVISED financial statements;
d) Investments and loan & advances to certain subsidiary/other companies and Mat Credit entitlement, considered as good and fully realizable/ recoverable and no provision for diminution in value is considered necessary in the opinion of the management as stated in note no. 40(B) of the REVISED financial statements;
e) Note no. 35 of the REVISED financial statements wherein the company has made investment of Rs, 8.56 crore (along with bank guarantee of Rs, 10.01 Crore) and Rs, 0.10 Crore in MJSJ Coal Limited and Jindal Synfuels Limited respectively. The company continues to treat the investment as good and recoverable in view of the pending decision challenging the Order and other circumstances mentioned therein;
f) Note no. 27 (5) of the REVISED financial statements regarding Mining Rights and effect of mining operations recorded in the financial statement of the Company for the reasons and as stated in said note no.
Our opinion is not modified in respect of these matters.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditorâs Report) Order, 2016(âthe Orderâ) issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us during the course of audit, we give in the Annexure âAâ a statement on the matters specified in the paragraphs 3 and 4 of the Order.
2. As required by Section 143 (3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
(c) The REVISED Balance Sheet, the REVISED Statement of Profit and Loss, and the REVISED Cash Flow Statement dealt with by this Report are in agreement with the books of account.
(d) In our opinion, the aforesaid REVISED standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
(e) On the basis of the written representations received from the directors as on 31st March, 2016 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2016 from being appointed as a director in terms of Section 164 (2) of the Act.
(f) As required by section 143(3)(i) of the Companies Act, 2013, and based on the checking of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, our separate report with respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls is as per Annexure âBâ.
(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, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements - refer Note no. 28(A & D), 36 & 38 to the REVISED standalone financial statements.
ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long term contracts including derivatives contracts.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
Annexure âAâ referred to in paragraph 1 under the heading âReport on other legal and regulatory requirementsâ of our report of even date on the
REVISED Standalone Financial Statements of JINDAL STAINLESS LIMITED for the year ended 31st March 2016
1. (a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.
(b) The Company has a regular programme of Physical Verification of its Fixed assets by which fixed asset have been verified by the management according to the programe of periodical physical verification in a phased manner which in our opinion is reasonable having regard to the size of the Company and the nature of its fixed assets. The discrepancies noticed on such physical verification were not material.
(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company except as stated in footnote (@) of Note No. 11 of the standalone financial statements.
2. The inventories of the Company (except stock lying with the third parties and in transit), part of stores and spares, have been physically verified by the management at reasonable intervals. In our opinion, the procedures of physical verification of inventory followed by the Management are reasonable in relation to the size of the Company and nature of its business. The discrepancies noticed on such physical verification of inventory as compared to book records were not material.
3. 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.
4. According to the information, explanations and representations provided by the management and based upon audit procedures performed, we are of the opinion that in respect of loans, investments, guarantees and security, the Company has complied with the provisions of the Section 185 and 186 of the Companies Act, 2013.
5. In our opinion and according to the information and explanations given to us, the Company has complied with the directive issued by the Reserve Bank of India and the provisions of Section 73 to 76 of the Act or any other relevant provisions of the Act and the rules framed there under (to the extent applicable) with regard to deposit accepted from the public. We have been informed that no order has been passed by the Company Law Board {however, on the application of the Company for extension of time (refer note no. 4(d)} or National Company Law Tribunal or Reserve Bank of India or any Court or other Tribunal in this regard.
6. 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 Act in respect of the companyâs products to which the said rules are made applicable and are of the opinion that prima facie, the prescribed records have been made and maintained. We have, however, not made a detailed examination of the said records with a view to determine whether they are accurate or complete.
7. (a) According to the records of the Company, the Company is regular in depositing undisputed statutory dues including provident fund, employeesâ
state insurance, income tax, sales-tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues with the appropriate authorities to the extent applicable and there are no undisputed statutory dues payable for a period of more than six months from the date they become payable as at 31 st March, 2016.
(b) According to the records and information & explanations given to us, there are no dues in respect of service tax that have not been deposited with the appropriate authorities to the extent applicable on account of any dispute and the dues in respect of income tax, duty of customs, duty of excise and value added tax that have not been deposited with the appropriate authorities on account of any dispute and the forum where the dispute is pending are given below: -
Name of The Statute |
Nature of Dues |
Amount (Rs, in Lacs) |
Period (Financial Year) |
Forum where dispute is pending |
Central Excise Act |
Excise Duty |
3,134.85 |
2005-11 |
CESTAT, East Zonal Bench Kolkata. |
31.84 |
April 06 - March 12 |
Commissioner Appeal, Bhubaneswar |
||
Customs Act |
Custom Duty |
797.05 |
2012-13 |
Commissioner of Central Excise, Customs and Service Tax, Bhubaneswar -1 |
The Central Sales Tax, 1956 |
Sales Tax |
2,479.44 |
2005-06 to 2007-08 |
High Court Orissa, Cuttack |
Income tax Act |
Income Tax |
247.14 |
2005-06 2006-07 2010-11 |
Commissioner of Income Tax (Appeals), Delhi |
517.52 |
2002-03 2003-04 |
High Court, New Delhi |
||
2,828.17 |
2004-05 2005-06 2006-07 & 2007-08 |
ITAT, New Delhi |
||
Entry Tax Act, 1999 |
Entry Tax |
9,745.96 |
2006-07 to 2015-16 |
Hâble Supreme Court |
8,210.54 |
2006-11 |
High Court Orissa, Cuttack |
Above does not include show cause notices and are after incorporating effect of the Scheme (Refer Note no. 27)
8. In our opinion, on the basis of audit procedures and according to the information and explanations given to us, the company has defaulted in repayment of dues (including interest, installment & letter of credits payments) to banks and financial institutions at various days during the year (read with note no. 33). The maximum amount of default on a particular date was Rs, 82,274.50 Lacs (including default ofRs, 508.51 Lacs w.r.t. outstanding debentures) and maximum delay (no. of days) noticed was 86 days (maximum delay of 59 days w.r.t. outstanding debentures). As on March 31, 2016, the overdue financial obligations to banks/ financial institutions/debenture holders was Rs, 55,359.54 Lacs with maximum delay of 61 days, the lender wise details of which is as follows:
Allahabad Bank Rs, 633.40 Lacs; Axis Bank Rs, 3,084.24 Lacs; Bank of Baroda Rs, 150.37 Lacs; Bank of Maharashtra Rs, 28.78 Lacs; Canara Bank Rs, 5,910.31 Lacs; Central Bank of India Rs, 646.10 Lacs; Corporation Bank Rs, 108.18 Lacs; Federal Bank Rs, 108.48 Lacs; General Insurance Corporation of India Rs, 28.65 Lacs; HDFC Bank Rs, 120.84 Lacs; ICICI Bank Rs, 5,599.94 Lacs; IDBI Bank Rs, 1,000.82 Lacs; Indian Bank Rs, 150.88 Lacs; Jammu & Kashmir Bank Rs, 255.85 Lacs; Karnataka Bank Rs, 68.84 Lacs; Life Insurance Corporation of India Rs, 577.75 Lacs; New India Assurance Company Rs, 28.57 Lacs; Oriental Bank Of Commerce Rs, 583.73 Lacs; Punjab National Bank Rs, 15,923.17 Lacs; State Bank of Bikaner & JaipurRs, 285.32 Lacs; State Bank of Hyderabad Rs, 695.50 Lacs; State Bank of India Rs,16,570.03 Lacs; State Bank of Mysore Rs, 241.49 Lacs; State Bank of Patiala Rs, 852.08 Lacs; State Bank of Travancore Rs, 340.14 Lacs; Syndicate Bank Rs, 224.68 Lacs; UCO Bank Rs, 295.38 Lacs; United India Insurance Company Rs, 28.54 Lacs; Union Bank of India Rs, 321.85 Lacs; United Bank of India Rs, 495.64 Lacs.
9. On the basis of information and explanations given to us, term loan were applied for the purpose for which the loans were obtained. No moneys have been raised during the year by way of initial public offer or further public offer.
10. Based on the audit procedure performed and on the basis of information and explanations provided by the management, no fraud by the Company and no material fraud on the Company by its officers or employees has been noticed or reported during the course of the audit.
11. According to the information and explanations given to us and based on our examination of the records of the Company, managerial remuneration has been paid/ provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act, read with note no. 49(C)(i).
12. In our opinion and according to the information and explanations given to us, the Company is not a nidhi company. Accordingly, paragraph 3(xii) of the Order is not applicable.
13. According to the information and explanations and records made available by the management of the Company and audit procedure performed, for transactions with the related parties during the year, the Company has complied with the provisions of Section 177 and 188 of the Act, where applicable [Read with note no. 27(6&7) and 47]. As explained and as per records, details of related party transactions have been disclosed in the standalone financial statements as per the applicable Accounting Standards.
14. According to the information and explanations given to us, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year, read with note no. 2(b)(ii). Accordingly, we are not offering comment with respect to compliance of requirement of Section 42 of the Act and utilization of the money.
15. On the basis of records made available to us and according to information and explanations given to us, the Company has not entered into non-cash transactions with the directors or persons connected with him.
16. The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act 1934.
ANNEXURE âBâ TO THE INDEPENDENT AUDITORâS REPORT OF EVEN DATE ON THE REVISED STANDALONE FINANCIAL STATEMENTS OF JINDAL STAINLESS LIMITED
Report on the Internal Financial Controls over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (âthe Actâ)
We have audited the internal financial controls over financial reporting of JINDAL STAINLESS LIMITED (âthe Companyâ) as of March 31, 2016 in conjunction with our audit of the REVISED standalone financial statements of the Company for the year ended on that date.
Managementâs Responsibility for Internal Financial Controls
The Companyâs management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (ICAI). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to Companyâs policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.
Auditorâs Responsibility
Our responsibility is to express an opinion on the Companyâs internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the âGuidance Noteâ) and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditorâs judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Companyâs internal financial controls system over financial reporting.
Meaning of Internal Financial Controls Over Financial Reporting
A companyâs internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A companyâs internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the companyâs assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls Over Financial Reporting
Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2016, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
For LODHA & CO. For S.S. KOTHARI MEHTA & CO.
Chartered Accountants Chartered Accountants
FRN: 301051E FRN: 000756N
N.K. LODHA SUNIL WAHAL
Partner Partner
Membership No. 85155 Membership No. 87294
Place : New Delhi
Dated : 23rd November, 2016
Mar 31, 2014
We have audited the accompanying financial statements of Jindal
Stainless Limited ("the Company"), which comprise the Balance Sheet as
at 31st March, 2014, the Statement of Profit and Loss and Cash Flow
statement for the year then ended, and a summary of the significant
accounting policies and other explanatory information.
Management''s responsibility for the financial statements
Management is responsible for the preparation of these financial
statements that give a true and the fair view of the financial
position, financial performance and cash flows of the company in
accordance with the accounting principles generally accepted in India,
including Accounting Standards referred to in sub section (3C) of
section 211 of the Companies Act, 1956 ("the Act") read with the
General Circular 15/ 2013 dated 13th September 2013 of the Ministry of
Corporate Affairs in respect of section 133 of the Companies Act, 2013.
This responsibility includes the design, implementation and maintenance
of internal control relevant to the preparation and presentation of the
financial statements that give a true and fair view and free from
material misstatement, whether due to fraud or error.
Auditor''s responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by The Institute of Chartered
Accountants of India. Those standards require that we comply with the
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 Company''s
internal control. An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of the accounting
estimates made by the management, as well as evaluating the overall
presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the financial statements give the information
required by the Act in the manner so required and give a true and fair
view in conformity with the accounting principles generally accepted in
India:
a. In case of the Balance Sheet, of the state of the affairs of the
company as at 31st March, 2014,
b. In case of the statement of Profit and Loss, of the loss for the
year ended on that date, and
c. In case of the Cash Flow Statement, of the cash flows for the year
ended on that date.
Emphasis of Matter
Attention is drawn to the following:
(a) Note no. 53(C)(i) regarding pending necessary approvals for
managerial remuneration as explained in the said note.
(b) Note no. 32(A)(iv)e read with Note no. 40(B) and 40(A) regarding
pending confirmations of balances of certain secured loans, loans &
advances, creditors & receivables as stated in the said note.
(c) Note no. 40(C) regarding certain investments and loan & advances as
good and fully realizable/ recoverable related to certain subsidiary
companies, for the reason stated in said note, and no provision for
diminution in value is necessary in the opinion of the management.
Our opinion is not qualified in respect of above matters.
Report on other legal and regulatory requirements
(i) 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 matters specified in paragraphs 4 and 5 of the order.
(ii) As required by section 227(3) of the Act, we report that:
a. We have obtained all the information and explanations which, to the
best of our knowledge and belief, were necessary for the purpose of our
audit;
b. In our opinion, proper books of account, as required by law, have
been kept by the Company so far as appears from our examination of
those books and proper returns adequate for the purpose of our audit
have been received from the branches not visited by us;
c. The report on the accounts of the branches audited under section
228 by other auditors have been forwarded to us as required by clause
(c) of sub-section 228 and have been dealt with in preparing our report
in the manner considered necessary by us;
d. The Balance Sheet, Statement of Profit & Loss and Cash Flow
Statement referred to in this report are in agreement with the books of
account and with the audited returns received from the branches;
e. In our opinion, the Balance Sheet, the Statement of Profit & Loss
and the Cash Flow Statement referred to in this report comply with the
Accounting Standards referred to in sub-section (3C) of section 211 of
the Act read with the General Circular 15/2013 dated 13th September
2013 of the Ministry of Corporate Affairs in respect of section 133 of
the Companies Act, 2013;
f . On the basis of the written representations received from the
Directors and taken on record by the Board of Directors, we report that
none of the directors of the Company is disqualified as on 31st March
2014 from being appointed as a Director of the Company in terms of
clause (g) of sub-section (1) of section 274 of the Act.
ANNEXURE TO INDEPENDENT AUDITORS'' REPORT Referred to in paragraph 1
under the heading "Report on other legal and regulatory requirements"
of our report of even date
1. (a) The company has maintained proper records in respect of its
fixed assets showing full particulars, including quantitative details
and situation of fixed assets.
(b) We have been informed that certain fixed assets of the company have
been physically verified by the management according to a phased
programme of periodic verification which, in our opinion, is reasonable
having regard to the size of the company and nature of fixed assets. As
informed, no material discrepancies between book records and physical
inventory have been noticed in respect of the fixed assets physically
verified during the year.
(c) As per records and information and explanation given to us, no
substantial part of fixed assets has been disposed off during the year.
2. (a) As informed, the inventory of the company (except stocks lying
with third parties, in transit), part of the stores and spares, have
been physically verified by the management either at the end of the
year or after the year end, and in respect of stores and spares, there
is perpetual inventory system and a substantial portion of the stocks
have been verified during the year (Read with Note no. 49). In our
opinion, the frequency of verification is reasonable.
(b) According to the information and explanations given to us, the
procedures of physical verification of inventory followed by the
management are reasonable and adequate in relation to the size of the
company and the nature of its business.
(c) In our opinion and according to the information and explanations
given to us, the company is maintaining proper records of inventory; in
respect of process stock, the records are updated as and when physical
verification has been carried out. The discrepancies noticed on such
physical verification of inventory as compared to book records were not
material.
3. (a) As informed to us, the company has not given any loan, secured
or unsecured to companies, firms, or other parties covered in the
register maintained under section 301 of the Act. Accordingly, the
provisions of clause 4(iii) (b) to (d) of The Order are not applicable.
(e) As informed to us, 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 Act. Accordingly, the
provisions of clause 4 (iii) (f) & (g) of The Order are not applicable.
4. In our opinion and according to the information and explanations
given to us, having regard to the explanations that certain items
purchased/sold are of special nature for which, as explained, suitable
alternatives sources, do not exist for obtaining comparative
quotations, taking into consideration the quality, usage and such other
factors, there are adequate internal control systems commensurate with
the size of the company and nature of its business with regard to
purchase of inventory, fixed assets and for the sale of goods and
services. Further, on the basis of examination of the books and records
of the company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given, we have neither come across nor have we been
informed of any instance of major weaknesses in aforesaid internal
control systems.
5. (a) To the best of our knowledge and belief and according to the
information and explanations given to us, we are of the opinion that
the particulars of contracts or arrangements that need to be entered in
the register maintained under section 301 of the Act have been so
entered.
(b) In our opinion and having regard to our comments in paragraphs 4
above, and according to the information and explanations given to us,
transactions made in pursuance of contracts or arrangements entered
into the register maintained under section 301 of the Act and exceeding
the value of rupees five lacs in respect of each party during the year
have been made at prices which are reasonable having regard to
prevailing market prices at the relevant time where such market prices
are available.
6. In our opinion and according to the information and explanations
given to us, the company has complied with the directives issued by the
Reserve Bank of India and the provisions of Section 58A, 58AA or any
other relevant provisions of the Act and the Rules framed there under
with regard to deposits accepted from public. We have been informed
that no order has been passed by Company Law Board or National Company
Law Tribunal or Reserve Bank of India or any Court or any other
Tribunal in this regard.
7. In our opinion, the company has an internal audit system
commensurate with the size of the company and nature of its business.
8. We have broadly reviewed the books of accounts 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 Act in
respect of the Company''s products and are of the opinion that, prima
facie, the prescribed records have been made and maintained. We are,
however, not required to make a detailed examination of such books and
records.
9. (a) In our opinion and according to the information and
explanations given to us, 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 during the year with appropriate authorities. No
undisputed amount payable inrespect of the aforesaid statutory dues
were outstanding as at 31.03.2014 for a period of more than six months
from the date they became payable.
(b) In our opinion and according to the information and explanations
given to us, there are no dues in respect of Wealth Tax and Cess that
have not been deposited with appropriate authorities on account of
disputes and the dues in respect of Income Tax, Excise duty, Service
Tax, Sales Tax and Custom Duty that have not been deposited with
appropriate authorities on account of dispute and the forum where the
dispute is pending are as given below:
Name of the statue Nature of the Dues Amount
(Rs. In lacs)
Central Excise Act,1944 Excise Duty 1.69
658.08
27.19
7.57
2,960.81
46.99
57.14
7.63
0.02
6.12
290.84
0.12
3,256.20
31.84
437.86
5.21
1.02
4.74
11.90
0.39
18.52
145.81
Custom Act, 1962 Custom Duty 60.00
10.00
Finance Act,1994 Service Tax 522.83
53.83
9.79
15.29
Name of the statue Period to which Forum where dispute is
pending
the amount relates
Central Excise Act,
1944 April 1995-June 95 High Court, New Delhi
Jan 1999- Dec 2004 High Court of Punjab &
Haryana.
Jan 05-June 05 CESTAT, Delhi.
2000-01 CESTAT, Delhi.
July 05- Dec 07 CESTAT, Delhi.
July 05- Dec 07 CESTAT, Delhi.
Sep 94- March 96 Commissioner of Central
Excise, Rohtak.
1994-95 Addl. Commissioner of
Central Excise, Rohtak.
Jan 10- June 10 CESTAT, Delhi
July 95- Sep 95 Joint Commissioner of
Central Excise, Rohtak
2006-07 CESTAT, Delhi
July 12 to Feb 13 Dy., Commissioner, Hisar
May 08 - March 11 Commissioner Appeal,
Bhubaneswar
May 08 - March 11 Commissioner Appeal,
Bhubaneswar
Aug-08 to Dec-10 CESTAT, Delhi
Jul-09 Revision Authority
(Jt Secy)
April-07 to Oct-2007 High Court, Punjab &
Haryana
May-07 to Oct-2007 High Court, Punjab & Haryana
Jan- 95 to June- 96 Joint Commissioner, Rohtak
June, 96 to July 96 Commissioner (Appeal),
Delhi-III,
Gurgaon
Jul-09, Aug-09 Dy Comm, Hisar
July 2011 - Sept
2011 Commissioner (Appeal),
Delhi-III,
Gurgaon
Custom Act, 1962 2008-09 CESTAT, Delhi
2013-14 CESTAT, Delhi
Finance Act,1994 Dec 03- March-06 CESTAT, Delhi
2005-06 to 2008-09 CESTAT, Delhi
2005-06 to 2010-11 CESTAT, Delhi
Oct.08 to Dec.08 CESTAT, Delhi
Name of the statue Nature of the Dues Amount
(Rs. In lacs)
Central Sales Tax Sales Tax 3.00
Act,1956
2,479.44
Income Tax Act, 1961 Income Tax 254.05
517.52
3,429.34
Entry Tax Act, 1999 Entry Tax 4,600.91
8,210.13
Name of the statue Period to which Forum where dispute is
pending
the amount relates
Central Sales Tax
Act,1956 1993-94 High Court of Punjab & Haryana
2005-06 to 2007-08 H''ble High Court Orissa,
Cuttack
Income Tax Act, 1961 2004-05, 2009-10 CIT (A) -VIII, New Delhi
2002-03 & 2003-04 High Court, New Delhi
2004-05, 2005-06, ITAT, Delhi
2007-08
Entry Tax Act, 1999 2006-07 To 2012-13 H''ble Supreme Court
2006-11 H''ble High Court Orissa,
Cuttack
Above does not include show cause notice.
10. The company has accumulated losses at the end of the financial
year and also its net worth has been eroded more than 50%. Further
company has incurred cash losses during the year and also incurred cash
losses in the immediately preceding financial year.
11. In our opinion and according to information and explanations given
to us, the company had defaulted in repayment of dues (including
interest, installment & letter of credits payments) to banks at various
days during the year. There is no default in repayment of dues to
financial institutions/ debenture holders during the year. The maximum
amount of default on a particular date was Rs. 30,677.75 lacs and maximum
delay (no. of days) noticed for a particular bank was 85 days (refer
foot note to Note no. 10 & Note no. 33 for continue default and read
with Note no. 32).
12. In our opinion and according to the information and explanations
given to us, no loans and advances have been granted by the company on
the basis of pledge of shares, debentures and other securities.
13. The Company is not a chit fund or a nidhi / mutual benefit fund /
society. Therefore, the provisions of Clause 4 (xiii) of The Order are
not applicable to the Company.
14. In our opinion, and according to the information and explanations
given to us, the company is not dealing or trading in shares,
securities, debentures and other investments. Therefore, the provisions
of Clause 4 (xiv) of The Order are not applicable to the Company.
15. In our opinion and according to the information and explanations
given to us, the Company has not given any guarantee for loans taken by
others from banks or financial institutions. (Read with Note no. 27(C))
16. In our opinion and on the basis of information and explanations
given to us, the term loans raised during the year by the Company were
applied at the close of the financial year for the purposes for which
the loans were obtained where such end use has been stipulated by the
lender.
17. On the basis of information and explanations given to us, to the
extent ofRs. 61,991.13 lacs fund raised on short-term basis have been
used for long-term investments (read with Note no. 32).
18. 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. (This is to read with Note no. 34)
19. On the basis of the records made available to us, the Company has
created necessary security and charge in respect of debentures
outstanding at the year end.
20. The company has not raised any money through public issue during
the year.
21. During the course of our examination of the books and records of
the company carried out in accordance with the generally accepted
auditing practices in India, we have neither come across any instance
of material fraud on or by the company, noticed or reported during the
year, nor have we been informed of such case by the management.
For LODHA & CO. For S.S. KOTHARI MEHTA & CO.
Chartered Accountants Chartered Accountants
FRN 301051E FRN 000756N
(N.K. LODHA) (ARUN K. TULSIAN)
Partner
Membership No. 85155
Place: New Delhi Partner
Date : 29th May, 2014 Membership No. 89907
Mar 31, 2013
Report on the financial statements
We have audited the accompanying financial statements of Jindal
Stainless Limited ("the Company"), which comprise the Balance Sheet
as at 31st March 2013, the statement of Profit and Loss and Cash Flow
statement for the year then ended, and a summary of the significant
accounting policies and other explanatory information.
Management''s responsibility for the financial statements
Management is responsible for the preparation of these financial
statements that give a true and the fair view of the financial
position, financial performance and cash flows of the company in
accordance with the accounting principles generally accepted in India,
including Accounting Standards referred to in sub section (3C) of
section 211 of the Companies Act, 1956 ("the Act"). This
responsibility includes the design, implementation and maintenance of
internal control relevant to the preparation and presentation of the
financial statements that give a true and fair view and free from
material misstatement, whether due to fraud or error.
Auditor''s responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by Institute of Chartered
Accountant of India. Those standards require that we comply with the
ethical requirements and plan and perform the audit to obtain the
reasonable assurance about whether the financial statements are free
from material misstatements.
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.
An audit also includes evaluating the appropriateness of accounting
policies used and the reasonableness of the accounting estimates made
by the management, as well as evaluating the overall presentation of
the financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the financial statements give the information
required by the Act in the manner so required and give a true and fair
view in conformity with the accounting principles generally accepted in
India:
a. In the case of Balance Sheet, of the state of the affairs of the
company as at 31st March 2013;
b. In the case of 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.
Emphasis of Matter
Attention is drawn to the following:
(a) Note no. 51(C)(i) regarding pending necessary approvals for
managerial remuneration as explained in the said note;
(b) Note no. 33(A)(v)e read with note no. 39(B) regarding pending
confirmations of balances of certain secured loans as stated in the
said note; and
(c) Note no. 39(C) regarding certain investments and loans & advances
considered as good and fully realizable/ recoverable related to certain
subsidiary companies, for the reason stated in said note, and no
provision for diminution in value is necessary in the opinion of the
management.
Our opinion is not qualified in respect of these matters.
Report on other legal and the regulatory requirements:
(i) As required by the Companies (Auditors'' 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 the paragraphs 4 and 5
of the order.
(ii) As required by section 227(3) of the Act, we report that:
a. We have obtained all the information and explanations which, to the
best of our knowledge and belief, were necessary for the purpose of our
audit;
b. In our opinion, proper books of account, as required by law, have
been kept by the Company so far as appears from our examination of
those books and proper returns adequate for the purpose of our audit
have been received from the branches not visited by us;
c. The reports on the accounts of the branches audited by other
Auditors have been forwarded to us and have been appropriately dealt
with by us in preparing our report;
d. The Balance Sheet, Statement of Profit & Loss and Cash Flow
Statement referred to in this report are in agreement with the books of
account and with the audited accounts from the branches;
e. In our opinion, the Balance Sheet, the Statement of Profit & Loss
and Cash Flow Statement referred to in this report comply with the
Accounting Standards referred to in sub-section (3C) of section 211 of
Companies Act, 1956; and
f. On the basis of written representations received from the Directors
and taken on record by the Board of Directors, we report that none of
the directors of the Company is disqualified as on 31st March 2013 from
being appointed as a Director of the Company in terms of clause (g) of
sub-section (1) of section 274 of the Companies Act, 1956.
Referred to in paragraph 1 under the heading "Report on other legal
and the regulatory requirements" of our report of even date
1. (a) The company has maintained proper records in respect of its
fixed assets showing full particulars, including quantitative details
and situation of fixed assets.
(b) We have been informed that certain fixed assets of the company have
been physically verified by the management according to a phased
programme of periodic verification which, in our opinion, is reasonable
having regard to the size of the company and nature of fixed assets. As
informed, no material discrepancies between book records and physical
inventory have been noticed in respect of the fixed assets physically
verified during the year.
(c) As per records and information and explanations given to us, no
substantial part of fixed assets has been disposed off during the year.
2. (a) As informed, the inventory of the company at all its locations,
except stocks lying with third parties, in transit and part of the
stores and spares, have been physically verified by the management
either at the end of the year or after the year end, and in respect of
stores and spares, there is perpetual inventory system and a
substantial portion of the stocks have been verified during the year.
In our opinion, the frequency of verification is reasonable.
(b) According to the information and explanations given to us, the
procedures of physical verification of inventory followed by the
management are reasonable and adequate in relation to the size of the
company and the nature of its business.
(c) In our opinion and according to the information and explanations
given to us, the company is maintaining proper records of inventory; in
respect of process stock, the records are updated as and when physical
verification is carried out. The discrepancies noticed on such physical
verification of inventory as compared to book records were not
material.
3. (a) As informed to us, the company has not given any loan, secured
or unsecured, to companies, firms, or other parties covered in the
register maintained under section 301 of the Act. Accordingly, the
provisions of clause 4(iii) (b) to (d) of The Order are not applicable.
(b) As informed to us, 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 Act. Accordingly, the
provisions of clause 4 (iii) (f) & (g) of the Order are not applicable.
4. In our opinion and according to the information and explanations
given to us, having regard to the explanations that certain items
purchased/sold are of special nature for which, as explained, suitable
alternatives sources do not exist for obtaining comparative quotations,
taking into consideration the quality, usage and such other factors,
there are adequate internal control systems commensurate with the size
of the company and nature of its business with regard to purchase of
inventory, fixed assets and for the sale of goods and services.
Further, on the basis of examination of the books and records of the
company, carried out in accordance with the generally accepted auditing
practices in India, and according to the information and explanations
given, we have neither come across nor have we been informed of any
instance of major weaknesses in aforesaid internal control systems.
5. (a) To the best of our knowledge and according to the information
and explanations given to us, we are of the opinion that the
particulars of contracts or arrangements that need to be entered in the
register maintained under section 301 of the Act, have been so entered.
(b) In our opinion and having regard to our comments in paragraph 4
above, and according to the information and explanations given to us,
transactions made in pursuance of contracts or arrangements entered
into the register maintained under section 301 of the Act, and
exceeding the value of rupees five lacs in respect of each party during
the year have been made at prices which are reasonable having regard to
prevailing market prices at the relevant time where such market prices
are available.
6. In our opinion and according to the information and explanations
given to us, the company has complied with the directives issued by the
Reserve Bank of India and the provisions of Section 58A, 58AA or any
other relevant provisions of the Act, and the Rules framed there under
with regard to deposits accepted from public. We have been informed
that no order has been passed by Company Law Board or National Company
Law Tribunal or Reserve Bank of India or any Court or any other
Tribunal in this regard.
7. In our opinion, the company has an internal audit system
commensurate with the size of the company and nature of its business.
8. We have broadly reviewed the books of accounts 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 Act, in
respect of the Company''s products and are of the opinion that, prima
facie, the prescribed records have been made and maintained. We are,
however, not required to make a detailed examination of such books and
records.
9. (a) In our opinion and according to the information and
explanations given to us, 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 during the year with appropriate authorities. No
undisputed amount payable in respect of the aforesaid statutory dues
were outstanding as at last day of the financial year for a period of
more than six months from the date they became payable.
(b) In our opinion and according to the information and explanations
given to us, there are no dues in respect of Wealth Tax that have not
been deposited with appropriate authorities on account of disputes and
the dues in respect of Income Tax, Excise duty, Service Tax, Sales Tax
and Custom Duty that have not been deposited with appropriate
authorities on account of dispute and the forum where the dispute is
pending are as given below:
10. The company has no accumulated losses at the end of the financial
year and it has incurred cash loss during the year and did not incur
cash loss in the immediately preceding financial year.
11. In our opinion, on the basis of audit procedures and according to
the information and explanations given to us, the Company has not
defaulted in repayment of dues to financial institution/banks/
debenture holders, except default in payment of principal & interest of
Rs. 13,570 lacs (USD 25 Million) & Rs. 1,495 lacs for a maximum period
of 163 days and 41 days respectively. However as on balance sheet date
there was no default and this is to be read with note no. 33(B).
12. In our opinion and according to information and explanations given
to us, no loans and advances have been granted by the company on the
basis of pledge of shares, debentures and other securities.
13. The Company is not a chit fund or a nidhi / mutual benefit fund /
society. Therefore, the provisions of Clause 4 (xiii) of the Order are
not applicable to the Company.
14. In our opinion, and according to the information and explanations
given to us, the company is not dealing or trading in shares,
securities, debentures and other investments. Therefore, the provisions
of Clause 4 (xiv) of the Order are not applicable to the Company.
15. In our opinion and according to the information and explanations
given to us, the Company has not given any guarantee for loans taken by
others from banks or financial institutions. (Read with Note no. 27(C))
16. In our opinion and on the basis of information and explanations
given to us, the term loans raised during the year by the Company were
applied at the close of the financial year for the purposes for which
the loans were obtained where such end use has been stipulated by the
lender.
17. On the basis of information and explanations given to us, and on
the basis of an overall examination of the balance sheet of the
Company, no funds raised on short-term basis have been used for
long-term investment. (read with note no. 33)
18. The Company has not made any preferential allotment of shares to
parties or companies covered in the register maintained under section
301 of the Act. (read with note no. 47)
19. On the basis of the records made available to us, the Company has
created necessary security and charge in respect of debentures
outstanding at the year end.
20. The company has not raised any money through public issue during
the year.
21. During the course of our examination of the books and records of
the company carried out in accordance with the generally accepted
auditing practices in India, we have neither come across any instance
of material fraud on or by the company, noticed or reported during the
year, nor have we been informed of such case by the management.
For LODHA & CO. For S.S. KOTHARI MEHTA & CO.
Chartered Accountants Chartered Accountants
FRN: 301051E FRN: 000756N
(N.K. LODHA) (ARUN K. TULSIAN)
Place : New Delhi Partner Partner
Date :
27th May, 2013 M. No. 85155 M. No. 89907
Mar 31, 2012
We have audited the attached Balance Sheet of Jindal Stainless Limited
(Formerly JSL Stainless Limited), as at 31st March, 2012 and the
Statement of Profit & Loss and also the Cash Flow Statement of the
Company 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.
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.
1) As required by the Companies (Auditor's Report) Order, 2003 (as
amended) (herein after called The Order) issued by the Central
Government of India in terms of Section 227 (4A) of the Companies Act,
1956, and on the basis of such checks of the books and records of the
company as we considered appropriate, we enclose in the Annexure a
statement on the matters specified in the paragraphs 4 and 5 of the
said Order.
2) Further to our comments in the Annexure referred to in Paragraph 1
above, we report that:
a) We have obtained all the information and explanations which, to the
best of our knowledge and belief, were necessary for the purposes of
our audit;
b) In our opinion, proper books of account, as required by law, have
been kept by the Company so far as appears from our examination of
those books and proper returns adequate for the purpose of our audit
have been received from the branches not visited by us;
c) The reports on the accounts of the branch audited by other Auditors
have been forwarded to us and have been appropriately dealt with by us
in preparing our report;
d) The Balance Sheet, Statement of Profit & Loss and Cash Flow
Statement referred to in this report are in agreement with the books of
account and with the audited accounts from the branch;
e) In our opinion, the Balance Sheet, Statement of Profit & Loss and
Cash Flow Statement referred to in this report comply with the
Accounting Standards referred to in sub section (3C) of Section 211 of
the Companies Act, 1956;
f) On the basis of written representations received from the Directors
and taken on record by the Board of Directors, we report that none of
the directors of the Company is disqualified as on 31st March, 2012
from being appointed as a Director of the Company in terms of clause
(g) of sub section (1) of section 274 of the Companies Act, 1956;
g) Without qualifying attention is drawn to;
(i) Note no. 33(vi) read with note no. 40(B) regarding pending
confirmations of balances of certain secured loans as stated in the
said note.
(ii) Note no. 40(C) read with note no. 12 regarding investment and loan
& advances to certain subsidiary companies, for the reason stated in
said note, no provision for diminution in value is necessary in the
opinion of management.
h) In our opinion and to the best of our information and according to
the explanations given to us, the said accounts read together with
Significant Accounting Policies and other Notes thereon, give the
information required by the Companies Act, 1956 in the manner so
required and give a true and fair view in conformity with the
accounting principles generally accepted in India:
(i) In the case of Balance Sheet, of the state of affairs of the
Company as at 31st March, 2012; (ii) In the case of Statement of Profit
& Loss, of the loss of the Company for the year ended on that date; and
(iii) In the case of Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
Annexure to the Auditors' Report (Referred to in Paragraph 1 of our
report of even date to the Members of Jindal Stainless Ltd. (Formerly
JSL Stainless Ltd.) on the Financial Statements for the year ended 31st
March, 2012)
1. (a) The company has maintained proper records in respect of its
fixed assets showing full particulars, including quantitative details
and situation of fixed assets.
(b) We have been informed that certain fixed assets of the company have
been physically verified by the management according to a phased
programme of periodic verification which, in our opinion, is reasonable
having regard to the size of the company and nature of fixed assets. As
informed, no material discrepancies between book records and physical
inventory have been noticed in respect of the fixed assets physically
verified during the year.
(c) As per records and information and explanation given to us, no
substantial part of fixed assets has been disposed off during the year.
2. (a) As informed, the inventory of the company at all its locations,
except stocks lying with third parties, in transit and part of the
stores and spares, have been physically verified by the management
either at the end of the year or after the year end, and in respect of
stores and spares, there is perpetual inventory system and a
substantial portion of the stocks have been verified during the year.
In our opinion, the frequency of verification is reasonable.
(b) According to the information and explanations given to us, the
procedures of physical verification of inventory followed by the
management are reasonable and adequate in relation to the size of the
company and the nature of its business.
(c) In our opinion and according to the information and explanations
given to us, the company is maintaining proper records of inventory; in
respect of process stock, the records are updated as and when physical
verification has been carried out. The discrepancies noticed on such
physical verification of inventory as compared to book records were not
material.
3. (a) As informed to us, the company has not given 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, the provisions of clause 4(iii) (b) to (d) of The Order
are not applicable.
(e) As informed to us, 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, the provisions of clause 4 (iii) (f) & (g) of The Order
are not applicable.
4. In our opinion and according to the information and explanations
given to us, having regard to the explanations that certain items
purchased/sold are of special nature for which, as explained, suitable
alternatives sources, do not exist for obtaining comparative
quotations, taking into consideration the quality, usage and such other
factors, there are adequate internal control systems commensurate with
the size of the company and nature of its business with regard to
purchase of inventory, fixed assets and for the sale of goods and
services. Further, on the basis of examination of the books and records
of the company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given, we have neither come across nor have we been
informed of any instance of major weaknesses in aforesaid internal
control systems.
5. (a) To the best of our knowledge and belief and according to the
information and explanations given to us, we are of the opinion that
the particulars of contracts or arrangements that need to be entered in
the register maintained under section 301 of the Companies Act, 1956
have been so entered.
(b) In our opinion and having regard to our comments in paragraphs 4
above, and according to the information and explanations given to us,
transactions made in pursuance of contracts or arrangements entered
into the register maintained under section 301 of the Companies Act,
1956 and exceeding the value of rupees five lacs in respect of each
party during the year have been made at prices which are reasonable
having regard to prevailing market prices at the relevant time where
such market prices are available.
6. In our opinion and according to the information and explanations
given to us, the company has complied with the directives issued by the
Reserve Bank of India and the provisions of Section 58A, 58AA or any
other relevant provisions of the Companies Act, 1956 and the Rules
framed there under with regard to deposits accepted from public. We
have been informed that no order has been passed by Company Law Board
or National Company Law Tribunal or Reserve Bank of India or any Court
or any other Tribunal in this regard.
7. In our opinion, the company has an internal audit system
commensurate with the size of the company and nature of its business.
8. We have broadly reviewed the books of accounts 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 in respect of the company's products and are of the opinion
that, prime facie, the prescribed records have been made and
maintained. We are, however, not required to make a detailed
examination of such books and records.
9. (a) In our opinion and according to the information and
explanations given to us, 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 during the year with appropriate authorities. No
undisputed amount payable in respect of the aforesaid statutory dues
were outstanding as at last day of the financial year for a period of
more than six months from the date they became payable.
(b) In our opinion and according to the information and explanations
given to us, there are no dues in respect of Wealth Tax that have not
been deposited with appropriate authorities on account of disputes and
the dues in respect of Income Tax, Excise duty, Service Tax, Sales Tax,
Custom Duty and Cess that have not been deposited with appropriate
authorities on account of dispute and the forum where the dispute is
pending are as given below:
Name of Nature of Amount Period to which
the statue the Dues ( Rs. in Lacs) the amount relates
Central Excise 1.69 April 1995-June 95
Excise Act Duty
658.09 Jan 1999-Dec 04
27.19 Jan 05-June 05
7.57 2000-01
2.960.81 July 05-Dec 07
47.96 July 05-Dec 07
253.64 Aug 09-June 09
57.14 Sep 94-March 96
7.63 1994-95
0.39 1996-97
23.74 July & August-09
4.04 April 09-Nov 10
0.02 Jan10-Jun10
18.02 July 95-Sep 95
5.76 April 07-October 07
3.723.82 2005-11
The Custom Custom 10.00 2008-09
Act, 1962 Duty
60.00 2008-09
Finance Act Service Tax 522.83 Dec 03-March 06
7.64 2008-09 & 2009-10
53.83 2005-06 to 2008-09
The Central Sales Tax 3.00 1993-94
Sales Tax
Act 1956
2,479.44 2005-06 to 2007-08
Name of the Statue Forum where dispute is pending
Central
Excise Act High Court, New Delhi
High Court of Punjab & Haryana.
CESTAT, Delhi.
CESTAT, Delhi.
CESTAT, Delhi.
CESTAT, Delhi.
CESTAT, Delhi.
Commissioner of Central Excise, Rohtak.
Addl. Commissioner of Central Excise,
Rohtak.
Commissioner (Appeals), Gurgaon
Revision Authority, Delhi
Commissioner (Appeals), Gurgaon
Commissioner (Appeals), Gurgaon
Joint Commissioner of Central Excise,
Rohtak
Joint Secretary Excise, Rohtak
Commissioner, Central Excise,
Bhubneswar-1, Odisha.
The Custom
Act, 1962 High Court, New Delhi
CESTAT, Delhi.
Finance Act CESTAT, Delhi.
CESTAT, Delhi.
CESTAT, Delhi.
The Central
Sales Tax
Act 1956 High Court of Punjab & Haryana.
High Court Odisha, Cuttack.
Name of Nature of Amount Period to which
the statue the Dues ( Rs. in Lacs) the amount relates
Orissa Value Sales Tax 179.53 2005-06,2006-07
Added Tax &2007-08
Act 2004
Income Tax Income Tax 5,988.49 2004-05, 2005-06
Act 2006-07
517.52 2002-03 & 2003-04
549.65 2007-08
Entry Tax Entry Tax 5,440.45 2006-07 to 2011-12
Act, 1999
8,210.13 2010-11
Name of the Statue Forum where dispute is pending
Orissa Value
Added Tax
Act 2004 Add. Commissioner of Sales tax, Cuttack
Income Tax
Act Commissioner of Income Tax(Appeals),
Delhi
High Court, New Delhi
Dispute Resolution Panel
Entry Tax
Act, 1999 H'ble Supreme Court
High Court Odisha, Cuttack.
10. The company has no accumulated losses at the end of the financial
year and it has not incurred cash loss during the year and also in the
immediately preceding financial year.
11. In our opinion, on the basis of audit procedures and according to
the information and explanations given to us, the company has not
defaulted in repayment of dues to financial institutions/banks/
debenture holders, in view of the debt restructuring approved under CDR
mechanism as stated in note no 33 and read together with note no. 4(f).
12. In our opinion and according to information and explanations given
to us, no loans and advances have been granted by the company on the
basis of pledge of shares, debentures and other securities.
13. The company is not a chit fund or a nidhi / mutual benefit fund /
society. Therefore, the provisions of Clause 4 (xiii) of The Order are
not applicable to the company.
14. In our opinion and according to the information and explanations
given to us, the company is not dealing or trading in shares,
securities, debentures and other investments. Therefore, the provisions
of Clause 4 (xiv) of The Order are not applicable to the company.
15. In our opinion and according to the information and explanations
given to us, the company has not given any guarantee for loans taken by
others from banks or financial institutions. (Read with Note no. 27(c).
16. In our opinion and on the basis of information and explanations
given to us, the term loans raised during the year by the company were
applied at the close of the financial year for the purposes for which
the loans were obtained where such end use has been stipulated by the
lender.
17. On the basis of information and explanations given to us, and on
the basis of an overall examination of the balance sheet of the
company, no funds raised on short-term basis have been used for
long-term investments.
18. 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.
19. On the basis of the records made available to us, the company has
created necessary security and charge in respect of debentures
outstanding at the year end.
20. The company has not raised any money through pubic issue during
the year.
21. During the course of our examination of the books and records of
the company carried out in accordance with the generally accepted
auditing practices in India, we have neither come across any instance
of material fraud on or by the company, noticed or reported during the
year nor we have been informed of such case by the management.
For Lodha & Co. For S.S. Kothari Mehta & Co.
Chartered Accountants Chartered Accountants
FRN: 301051E FRN: 000756N
(N.K. Lodha) (Arun K. Tulsian)
Place: New Delhi Partner Partner
Date : 29th May, 2012 M. No. 85155 M. No. 89907
Mar 31, 2011
We have audited the attached Balance Sheet of JSL Stainless Limited, as
at 31st March 2011 and the Profit & Loss Account and also the Cash Flow
Statement of the Company 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.
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.
1) As required by the Companies (Auditor's Report) Order, 2003 (as
amended) (herein after called The Order) issued by the Central
Government of India in terms of Section 227 (4A) of the Companies Act,
1956, and on the basis of such checks of the books and records of the
company as we considered appropriate, we enclose in the Annexure a
statement on the matters specified in the paragraphs 4 and 5 of the
said Order.
2) Further to our comments in the Annexure referred to in Paragraph 1
above, we report that:
a) We have obtained all the information and explanations which, to the
best of our knowledge and belief, were necessary for the purposes of
our audit;
b) In our opinion, proper books of account, as required by law, have
been kept by the Company so far as appears from our examination of
those books and proper returns adequate for the purpose of our audit
have been received from the branches not visited by us;
c) The reports on the accounts of the branch audited by other Auditors
have been forwarded to us and have been appropriately dealt with by us
in preparing our report;
d) The Balance Sheet, Profit & Loss Account and Cash Flow Statement
referred to in this report are in agreement with the books of account
and with the audited accounts from the branch;
e) In our opinion, the Balance Sheet, Profit & Loss Account and Cash
Flow Statement referred to in this report comply with the Accounting
Standards referred to in sub section (3C) of Section 211 of the
Companies Act, 1956;
f) On the basis of written representations received from the Directors
and taken on record by the Board of Directors, we report that none of
the directors of the Company is disqualified as on 31st March, 2011
from being appointed as a Director of the company in terms of clause
(g) of sub section (1) of section 274 of the Companies Act, 1956;
g) Without qualifying attention is drawn to;
(i) Note no. 28 (C) (i) (a) of schedule 20 regarding pending necessary
approvals for managerial remuneration as explained in the said note.
(ii) Note no. 7 (b) of schedule 20 regarding pending confirmations of
balances of certain secured loans as stated in the said note.
(iii) Note no. 13 (c ) of schedule 20 regarding investment and loan &
advances to certain subsidiary companies, for the reason stated in said
note, no provision for diminution in value is necessary in the opinion
of management.
h) In our opinion and to the best of our information and according to
the explanations given to us, the said accounts read together with
Significant Accounting Policies and Notes thereon, give the information
required by the Companies Act, 1956 in the manner so required and give
a true and fair view in conformity with the accounting principles
generally accepted in India:
(i) In the case of Balance Sheet, of the state of affairs of the
Company as at 31st March, 2011;
(ii) In the case of Profit & Loss Account, of the profit of the Company
for the year ended on that date; and
(iii) In the case of Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
ANNEXURE TO AUDITORS' REPORT
(Referred to in Paragraph 1 of our report of even date to the Members
of JSL Stainless Limited on the Financial Statements for the year ended
31st March, 2011)
1. (a) The company has maintained proper records in respect of its
fixed assets showing full particulars, including quantitative details
and situation of fixed assets.
(b) We have been informed that certain fixed assets of the company have
been physically verified by the management according to a phased
programme of periodic verification which, in our opinion, is reasonable
having regard to the size of the company and nature of fixed assets. As
informed, no material discrepancies between book records and physical
inventory have been noticed in respect of the fixed assets physically
verified during the year.
(c) As per records and information and explanations given to us, no
substantial part of fixed assets has been disposed off during the year.
2. (a) As informed, the inventory of the company at all its locations,
except stocks lying with third parties, in transit and part of the
stores and spares, have been physically verified by the management
either at the end of the year or after the year end, and in respect of
stores and spares, there is perpetual inventory system and a
substantial portion of the stocks have been verified during the year.
In our opinion, the frequency of verification is reasonable.
(b) According to the information and explanations given to us, the
procedures of physical verification of inventory followed by the
management are reasonable and adequate in relation to the size of the
company and the nature of its business.
(c) In our opinion and according to the information and explanations
given to us, the company is maintaining proper records of inventory; in
respect of process stock, the records are updated as and when physical
verification has been carried out. The discrepancies noticed on such
physical verification of inventory as compared to book records were not
material.
3. (a) As informed to us, the company has not given 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, the provisions of clause 4 (iii) (b) to (d) of The Order
are not applicable.
(e) As informed to us, 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, the provisions of clause 4 (iii) (f) & (g) of The Order
are not applicable.
4. In our opinion and according to the information and explanations
given to us, having regard to the explanations that certain items
purchased/sold are of special nature for which, as explained, suitable
alternatives sources, do not exist for obtaining comparative
quotations, taking into consideration the quality, usage and such other
factors, there are adequate internal control systems commensurate with
the size of the company and nature of its business with regard to
purchase of inventory, fixed assets and for the sale of goods and
services. Further, on the basis of examination of the books and records
of the company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given, we have neither come across nor have we been
informed of any instance of major weaknesses in aforesaid internal
control systems.
5. (a) To the best of our knowledge and belief and according to the
information and explanations given to us, we are of the opinion that
the particulars of contracts or arrangements that need to be entered in
the register maintained under section 301 of the Companies Act, 1956
have been so entered.
(b) In our opinion and having regard to our comments in paragraphs 4
above, and according to the information and explanations given to us,
transactions made in pursuance of contracts or arrangements entered
into the register maintained under section 301 of the Companies Act,
1956 and exceeding the value of rupees five lacs in respect of each
party during the year have been made at prices which are reasonable
having regard to prevailing market prices at the relevant time where
such market prices are available.
6. In our opinion and according to the information and explanations
given to us, the company has complied with the directives issued by the
Reserve Bank of India and the provisions of Section 58A, 58AA or any
other relevant provisions of the Companies Act, 1956 and the Rules
framed there under with regard to deposits accepted from public. We
have been informed that no order has been passed by Company Law Board
or National Company Law Tribunal or Reserve Bank of India or any Court
or any other Tribunal in this regard.
7. In our opinion, the company has an internal audit system
commensurate with the size of the company and nature of its business.
8. We have broadly reviewed the books of accounts 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 in respect of the Company's products and are of the opinion
that, prime facie, the prescribed records have been made and
maintained. We are, however, not required to make a detailed
examination of such books and records.
9. (a) In our opinion and according to the information and
explanations given to us, 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 during the year with appropriate authorities. No
undisputed amount payable in respect of the aforesaid statutory dues
were outstanding as at last day of the financial year for a period of
more than six months from the date they became payable.
(b) In our opinion and according to the information and explanations
given to us, there are no dues in respect of Wealth Tax that have not
been deposited with appropriate authorities on account of disputes and
the dues in respect of Income Tax, Excise duty, Service Tax, Sales Tax,
Custom Duty and Cess that have not been deposited with appropriate
authorities on account of dispute and the forum where the dispute is
pending are as given below:
Name of Nature of Amount Period to which
the Forum where dispute
is pending
the
statute the Dues (Rs. in
Lacs) amount relates
Central Excise 1.69 1995-96 Hon'ble High Court,
New Delhi
Excise Act Duty
658.08 1999-04 Hon'ble High Court
of Punjab & Haryana.
27.19 2004-06 CESTAT, Delhi.
7.57 2000-01 CESTAT, Delhi.
113.07 2005-08 CESTAT, Delhi.
180.10 2008-10 CESTAT, Delhi.
57.14 1994-96 Commissioner of
Central Excise,Rohtak
7.63 1994-95 Add. Commissioner of
Central Excise,Rohtak
0.39 1996-97 Commissioner
(Appeals), Gurgaon
0.98 2008-09 Commissioner
(Appeals), Gurgaon
23.73 2009-10 Commissioner
(Appeals), Gurgaon
18.02 1995-97 Joint Commissioner
of Central Excise,
Rohtak
6.53 2005-07 CESTAT, Bangalore
3,309.88 2005-10 Commissioner of
Central Excise,
Bhubaneshwar
70.50 2009-11 Commissioner of
Central Excise,
Bhubaneshwar
The Custom Custom 10.00 2008-09 Hon'ble High Court,
Delhi
Act, 1962 Duty
60.00 2008-09 CESTAT, Delhi
Finance Act Service Tax 745.67 2003-06 CESTAT, Delhi
7.64 2008-10 CESTAT, Delhi
Sales Tax
Act Sales Tax 3.00 1993-94 Hon'ble High Court
of Punjab & Haryana
65.06 2002-05 Commissioner of
Sales Tax Odisha,
Cuttack
O VAT 179.57 2005-06, Stay petition before
Additional
Commissioner
2006-07 & of Sales Tax and
Writ Petition before
High
2007-08 Court, Cuttack
Entry Tax Entry Tax 22.71 2004-05 Commissioner of
Sales Tax Odisha,
Cuttack
Act, 1999
351.65 2007-08 Hon'ble Supreme Court
79.56 2008-09 Hon'ble Supreme Court
15.76 2009-10 Hon'ble Supreme Court
4,129.01 2010-11 Hon'ble Supreme Court
Income Tax Income Tax 6,103.86 2004-05, Commissioner of
Income Tax
(Appeals), Delhi
Act 2005-06,
2006-07 &
2008-09
517.52 2002-03 & Hon'ble High Court,
Delhi
2003-04
10. The company has no accumulated losses at the end of the financial
year and it has not incurred cash loss during the year and also in the
immediately preceding financial year.
11. In our opinion, on the basis of audit procedures and according to
the information and explanations given to us, the Company has not
defaulted in repayment of dues to financial institution/banks/
debenture holders, in view of the debt restructuring approved under CDR
mechanism as stated in note no.7 of schedule 20 and read together with
notes no. 1 and 2 of schedule 4.
12. In our opinion and according to information and explanations given
to us, no loans and advances have been granted by the company on the
basis of pledge of shares, debentures and other securities.
13. The Company is not a chit fund or a nidhi / mutual benefit fund /
society. Therefore, the provisions of Clause 4 (xiii) of The Order are
not applicable to the Company.
14. In our opinion, and according to the information and explanations
given to us, the company is not dealing or trading in shares,
securities, debentures and other investments. Therefore, the provisions
of Clause 4 (xiv) of The Order are not applicable to the Company.
15. In our opinion and according to the information and explanations
given to us, the Company has not given any guarantee for loans taken by
others from banks or financial institutions. (Read with Note no. 20 of
schedule 20)
16. In our opinion and on the basis of information and explanations
given to us, the term loans raised during the year by the Company were
applied for the purposes for which the loans were obtained where such
end use has been stipulated by the lender, however pending utilization
during the course of the year the loan fund has been temporarily
deployed in mutual funds/bonds/deposited with banks.
17. On the basis of information and explanations given to us, and on
the basis of an overall examination of the balance sheet of the
Company, no funds raised on short-term basis have been used for
long-term investments.
18. 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.
19. On the basis of the records made available to us, the Company has
created necessary security and charge in respect of debentures
outstanding at the year end.
20. The company has not raised any money through pubic issue during
the year.
21. During the course of our examination of the books and records of
the company carried out in accordance with the generally accepted
auditing practices in India, we have neither come across any instance
of material fraud on or by the company, noticed or reported during the
year nor we have been informed of such case by the management.
For Lodha & Co. For S.S. Kothari Mehta & Co.
Chartered Accountants Chartered Accountants
FRN: 301051E FRN: 000756N
(N.K. Lodha) (Arun K. Tulsian)
Place:New Delhi Partner Partner
Date :27th May, 2011 M. No. 85155 M. No. 89907
Mar 31, 2010
We have audited the attached Balance Sheet of JSL Limited, as at 31st
March, 2010 and the Profit & Loss Account and also the Cash Flow
Statement of the Company for the year ended on that date, annexed
thereto. These financial statements are the responsibility of the
Companys management. Our responsibility is to express an opinion on
these financial statements based on our audit
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.
1) As required by the Companies (Auditors Report) Order, 2003 (as
amended) ^erein after called The Order) issued by the Central
Government of India in terms of Section 227 (4A) of the Companies Act
1956, and on the basis of such checks of the books and records of the
company as we considered appropriate, we enclose in the Annexure a
statement on the matters specified in the paragraphs 4 and 5 of the
said Order.
2) Further to our comments in the Annexure referred to in Paragraph 1
above, we report that:
a) We have obtained all the information and explanations which, to the
best of our knowledge and belief, were necessary for the purposes of
our audit;
b) In our opinion, proper books of account, as required by law, have
been kept by the Company so far as appears from our examination of
those books and proper returns adequate for the purpose of our audit
have been received from the branches not visited by us;
c) The reports on the accounts of the branch audited by other Auditors
have been forwarded to us and have been appropriately dealt with by us
in preparing our report;
d) The Balance Sheet, Profit & Loss Account and Cash Flow Statement
referred to in this report are in agreement with the books of account
and with the audited accounts from the branch;
e) In our opinion, the Balance Sheet, Profit & Loss Account and Cash
Flow Statement referred to in this report comply with the Accounting
Standards referred to in sub section (3C) of Section 211 of the
Companies Act, 1956;
f) On the basis of written representations received from the Directors
and taken on record by the Board of Directors, we report that none of
the directors of the Company is disqualified as on 31st March, 2010
from being appointed as a Director of the company in terms of clause
(g) of sub section (1) of section 274 of the Companies Act, 1956;
g) Without qualifying attention is drawn to;
(,) Note no. 24 (C) î of schedule 20 regarding pending necessary
approvals for managerial remuneration as explained in
thesaidnote. (u) Note no. 10 of schedule 20 regarding impact of
interest on FCCB and EPS as stated in the said note.
(ill) Note no. 7 (11) of schedule 20 regarding pending confirmations of
balances of certain secured loans as stated in the saidnote.
(iv) Note no. 2 (B) of schedule 20 regarding pending export obligation
against raw material consumed imported under advance license as stated
in the said note
h) In our opinion and to the best of our information and according to
the explanations given to us, the said accounts read together with
Significant Accounting Policies and Notes thereon, give the information
required by the Companies Act, 1956 in the manner so required and give
a true and fair view in conformity with the accounting principles
generally accepted in India:
(,) In the case of Balance Sheet, of the state of affairs of the
Company as at 31st March, 2010;
(u) In the case of Profit & Loss Account, of the profit of the Company
for the year ended on that date; and
(ill) In the case of Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
ANNEXURE TO AUDITORS REPORT
Referred to in Paragraph 1 of our report of even date to the Members of
JSL LIMITED on the Financial Statements for the year ended 31st March,
2010.
1. (a) The company has maintained proper records in respect of its
fixed assets showing full particulars, including quantitative
details and situation of fixed assets
(b) We have been informed that certain fixed assets of the company have
been physically verified by the management according to a phased
programme of periodic verification which, in oJ opinion, is reasonable
having regard to the size of the company and nature of ffxed assets. As
informed, no material discrepancies between book record! and physical
inventory have been noticed in respect of the fixed assets physically
verified during the year.
(c) As per records and information and explanations given to us, no
substantial part of fixed assets has been disposed off during the year.
2. (a) As informed, the inventory of the company at all its locations,
except stocks lying with third parties, in transit and part of
the stores and spares, have been physically verified by the management
either at the end of the year or after the year end, and in respect of
stores and spares, there is perpetual inventory system and a
substantial portion of the stocks have been verified during the year.
In our opinion, the frequency of verification is reasonable.
(b) According to the information and explanations given to us, the
procedures of physical verification of inventory followed by the
management are reasonable and adequate in relation to the size of the
company and the nature of its business.
(c) In our opinion and according to the information and explanations
given to us, the company is maintaining proper record of inventory; in
respect of process stock, the records are updated as and when physical
verification has been carried out. The discrepancies noticed on such
physical verification of inventory as compared to book records were not
material.
3. (a) As informed to us, the company has not given 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, the provisions of clause 4(iii) (b) to (d) of The
Order are not applicable.
(b) As informed to us, 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, the provisions of clause 4 (ill) (f) & (g) of The Order
are not applicable.
4. In our opinion and according to the information and explanations
given to us, having regard to the explanations that certain items
purchased/sold are of special nature for which, as explained, suitable
alternatives sources, do not exist for obtaining comparative
quotations, taking into consideration the quality, usage and such other
factors, there are adequate internal control systems commensurate with
the size of the company and nature of its business with regard to
purchase of inventory, fixed assets and for the sale of goods and
services. Further, on the basis of examination of the books and records
of the company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given, we have neither come across nor have we been
informed of any instance of major weaknesses in aforesaid internal
control systems.
5. (a) To the best of our knowledge and belief and according to the
information and explanations given to us, we are of the
opinion that the particulars of contracts or arrangements that need to
be entered in the register maintained under section 301 of the
Companies Act, 1956 have been so entered.
(b) In our opinion and having regard to our comments in paragraphs 4
above, and according to the information and explanations given to us,
transactions made in pursuance of contracts or arrangements entered
into the register maintained under section 301 of the Companies Act,
1956 and exceeding the value of rupees five lacs in respect of each
party during the year have been made at prices which are reasonable
having regard to prevailing market prices at the relevant time where
such market prices are available.
6. In our opinion and according to the information and explanations
given to us, the company has complied with the directives issued by the
Reserve Bank of India and the provisions of section 58A, 58AA or any
other relevant provisions of the Companies Act, 1956 and the Rules
framed there under with regard to deposits accepted from public. We
have been informed that no order has been passed by Company Law Board
or National Company Law Tribunal or Reserve Bank of India or any Court
or any other Tribunal in this regard.
7. In our opinion, the company has an internal audit system
commensurate with the size of the company and nature of its business.
8. We have broadly reviewed the books of accounts 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 in respect of the Companys products and are of the opinion
that, prime facie, the prescribed records have been made and maintained
We are, however, not required to make a detailed examination of such
books and records.
9. (a) In our opinion and according to the information and
explanations given to us, 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 during the year with appropriate authorities. No
undisputed amount payable in respect of the aforesaid statutory dues
were outstanding as at last day of the financial year for a period of
more than six months from the date they became payable.
(b) In our opinion and according to the information and explanations
given to us, there are no dues in respect of Wealth Tax and Custom Duty
that have not been deposited with appropriate authorities on account of
disputes and the dues in respect of Income Tax, Excise duty, Service
Tax, Sales Tax and Cess that have not been deposited with appropriate
authorities on account of dispute and the forum where the dispute is
pending are as given below:
Name of the statute Nature Amount Period to which Forum where dispute
of the (Rs. inthe amount is pending.
Dues LAcs) relates
Central Excise Act Excise Duty 1.69 1995.96 High Court, New Delhi.
21.69 1994-95 Reference application
allowed by CESTAT, Delhi
for further appeal in
High Court, Delhi.
658.08 1999-2004 High Court of Punjab &
Haryana
27.19 2004-06 CESTAT, Delhi.
113.07 2005-08 CESTAT, Delhi.
7.57 2000-01 CESTAT, Delhi.
57.14 1994-96 Commissioner of Central
Excise, Rohtak.
7.63 1994-95 Addl. Commissioner of
Central Excise, Rohtak
5.99 2007-08 &
2008-09 Commissioner (Appeals),
Gurgaon
0.39 1996-97 Commissioner (Appeals),
Gurgaon
18.02 1995-97 Joint Commissioner of
Central Excise, Rohtak
6,48 2005-07 CESTAT, Banglore
14.38 2004-08 Assistant Commissioner,
Vtzag
3,309.88 2005-10 Commissioner of Central
Excise, Bhuvanshver
Finance Act Service Tax 745.67 2003-06 CESTAT, Delhi
1.99 2007-08 &
2008-09 Commissioner (Appeals),
Delhi
9.89 2008-09 Commissioner (Appeals),
Gurgaon
Sales Tax Act Sales Tax 3.00 1993-94 High Court of Punjab &
Haryana
65.06 2002-03,
2003-04 Commissioner of Sales
Tax Onssa, Cuttack.
& 2004-05
OVAT 179.57 2005-06,
2006-07 Stay petition before
Additional Commissioner
& 2007-08 of Sales Tax and Writ
Petition before High
Court, Cuttack
ORISED Act, 2004 Cess 320.49 2005-07 Hble Supreme Court
Entry Tax Act, 1999 Entry Tax 22.71 2004-05 Commissioner of Sales Tax
Onssa, Cuttack.
10.37 2005-06 Commissioner of
Commercial Tax Central
Zone Cuttack
351.65 2007-08 Hble Supreme Court
Income Tax Act Income Tax 2,851.73 2004-05 &
2005-06 Commissioner of Income
Tax (Appeals), Delhi.
534.99 2002-03 &
2003-04 High Court, New Delhi
10. The company has no accumulated losses at the end of the financial
year and it has not incurred cash loss during the year. However cash
loss was incurred m the immediately preceding financial year.
11. In our opinion, on the basis of audit procedures and according to
the information and explanations given to us, the Company has not
defaulted in repayment of dues to financial institution/banks/
debenture holders, in view of the debt restructuring approved under CDR
mechanism as stated in note no. 7 of schedule 20 except
redemption/conversion of Foreign Currency Convertible Bonds.
12. In our opinion and according to the information and explanations
given to us, no loans and advances have been granted by the companion
the basis of pledge of shares, debentures and other securities.
13. The Company is not a chit fund or a mdhi / mutual benefit fund /
society. Therefore, the provisions of clause 4 (xiu) of The Order are
not applicable to the Company.
14. In our opinion, and according to the information and explanations
given to us, the company is not dealing or trading in shares,
securities, debentures and other investments. Therefore, the provisions
of clause 4 (xiv) of The Order are not applicable to the Company.
15. In our opinion and according to the information and explanations
given to us, the Company has not given any guarantee for loans taken by
others from banks or financial institutions. (Read with Note no. 18 of
schedule 20).
16. In our opinion and on the basis of information and explanations
given to us, the term loans raised during the year by the Company were
applied for the purposes for which the loans were obtained where such
end use has been stipulated by the lender, however pending utilization
during the course of the year the loan fund has been temporarily
deployed in mutual funds/bonds/deposited with banks.
17. On the basis of information and explanations given to us, and on
the basis of an overall examination of the balance sheet of the
Company, no funds raised on short-term basis have been used for
long-term investments.
18. 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.
19. On the basis of the records made available to us, the Company has
created necessary security and charge in respect of debentures
outstanding at the year end.
20. The company has not raised any money through pubic issue during
the year.
21. During the course of our examination of the books and records of
the company carried out in accordance with the generally accepted
auditing practices in India, we have neither come across any instance
of material fraud on or by the company! noticed or reported during the
year nor we have been informed of such case by the management.
For LODHA & CO. For S.S. KOTHARI MEHTA & CO.
Chartered Accountants Chartered Accountants
FRN:301051E FRN : 000756N
(N.K. LODHA) (ARUN K. TULSIAN)
Place: New Delhi Partner Partner
Date : 31st May, 2010MNo. 85155 M. No. 89907