Mar 31, 2015
1. We have audited the accompanying financial statements of MARMAGOA
STEEL LIMITED ("the Company"), which comprise the Balance Sheet asDat
31st March 2015, the Statement of Profit and Loss, and the Cash Flow
Statement for the year ended and a summary of significant accounting
policies and other explanatory information.
Management's Responsibility for the Financial Statements:
2. The management and Board of Directors of the Company are
responsible for the matters stated in Section 134(5) of the Companies
Act, 2013 ('the Act') with respect to the preparation of these
financial statements that give a true and fair view of the financial
position and financial performance of the Company in accordance with
the Accounting Principles generally accepted in India, including the
Accounting Standards specified underSection 133 of the Act, read with
rule 7 of the Companies (Accounts) Rules 2014. This responsibility
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; design,
implementation and maintenance of adequate internal financial controls,
that are 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.
Auditors' Responsibility:
3. Our responsibility is to express an opinion on these financial
statements based on our audit. We have taken into account the
provisions of the Act, the accounting and auditing standards and
matters which are required to be included in the audit report under the
provisions of the Act and the Rules made thereunder. We conducted our
audit in accordance with the Standards on Auditing specified under
Section 143(10) of the Act. Those standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
4. An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The procedures
selected depend on the 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 financialcontrol relevant to the Company's
preparation of the financial statements, that give a true and fair view,
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on
whether the Company has in place an adequate internal financial controls
system over financial reporting and the operating effectiveness of such
controls. An audit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of the accounting
estimates made by the Company's Management and Board of Directors, as
well as evaluating the overall presentation of the financial statements.
5. We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our audit opinion.
Opinion:
6. We have been informed by the company that the production activities
have been suspended since June 2013 for want of Working Capital Support
from the Banks, consequent upon the company's loans which have been
classified as NPA by both the Bank of Maharashtra and the Union Bank of
India. As a result, there is no generation of cash flows even to meet
the day to day expenses. However,pending finalization of
rehabilitation plan the accounts have been prepared on a going concern
basis.
Subject to this, in our opinion and to the best of our information and
according to the explanations given to us, the aforesaid financial
statements read together with the Notes thereon, 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:
i) In the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March 2015.
ii) In the case of the Statement of Profit & Loss, of the Losses for
the year ended 31st March 2015 and
iii) In the case of the Cash Flow Statement, of the Cash Flows during
the year ended that date in the functioning of the Company.
Report on other Legal and Regulatory requirements:
7. As required by the Companies (Auditor's Report) Order, 2015 ("the
Order") issued by the Central Government of India in terms of sub-
section (11) of Section 143 of the Act, we give below a statement on
the matters specified in paragraphs 3 and 4 of the Order.
i. (a) The Company has maintained proper records in electronic medium
showing full particulars including quantitative details and situation
of fixed assets.
(b) As represented to us in writing, the company has made a policy of
verifying physically, the fixed assets in a block of two years. During
the period, there has been no physical verification of the fixed
assets.
ii. (a) We have been informed thatin the absence of production, no
physicalverification has been done of inventory. Under these
circumstances, periodical physical verification was not considered
necessary.
(b) The procedures of physical verification of inventory followed by
the management are reasonable but not adequate in relation to the size
of the Company and the nature of its business, since the inventory was
not completely verified physically.
(c) In our opinion and according to the information and as per the
explanations given to us, the Company is maintaining proper records of
inventory. The actual stock of physical verification was done only
after the shutdown of manufacturing operation in May 2013. In the
absence of physical verification of items of inventory, the question of
dealing with the discrepancy in the book stock does not arise.
iii. (a) The company had granted during the year 2012-13 an interest
free loan to a company covered under Section 189 of the Companies Act.
No such loans were granted to any firm or other party covered under
Section 189 of the Companies Act. Balance at the end of the year was
Rs. 52.52 Lakhs.
(b) No interest has been charged to the borrower. We have been informed
that the said advance was made to the holding company of Marmagoa Steel
Limited, out of the interest free loan received from another company
with which there were no terms and conditions attached regarding
repayment of the principal.
(c) Since no specific terms were attached regarding repayment of the
principal, the question of overdue loans does not arise.
iv. In our opinion and according to the information and as per the
explanations given to us, there is an adequate internal control system
in the company commensurate with its size and the nature of its
business for the purchase of inventory and fixed assets and for the
sale of goods. There were no services rendered by the company. During
the course of our audit, we did not come across any continuing failure
to correct any major weaknesses in the internal control system
prevailing in the Company.
v. In our opinion and according to the information and as per the
explanations given to us, the Company has neither accepted deposits
from the public during the year under consideration nor has the Company
Law Board or National Company Law Tribunal or Reserve Bank of India or
any court or any other Tribunal have passed any orders against the
Company for any contravention under Sections 73 & 74 or any other
provisions of the Companies Act.
vi. The Central Government has prescribed maintenance of cost records
under Section 209(1)(d) of the Companies Act, 1956, for the products of
the Company. We have broadly reviewed the books of account maintained by
the Company pursuant to the order made under the said Section and are of
the opinion that prima-facie; the Company has maintained the prescribed
accounts and records.
vii(a) In our opinion and according to the information and as per the
explanations given to us, during the year, the Company was not regular
in depositing undisputed statutory dues including Provident Fund,
Employees' State Insurance, VAT, Income Tax and Service Tax. However,
in the payment of Customs duty, Excise duty, cess and Wealth tax the
company was regular in depositing undisputed dues with the appropriate
authorities. As on 31st March 2015, a sum of Rs. 840.57 lakhs of tax
was outstanding for a period of more than six months from the date they
became payable comprising of the following -
(b) Statutory Dues Rs. In Forum where
Lakhs Dispute
pending
EPF - Employers PF
Contribution (MSL) 11.37 commissioner
ESI - Employers
Contribution (MSL) 4.30
PF Contribution PF
(Contractors) 1.57 commissioner
Service Tax 30.75
Income Tax - TDS 63.60
Entry Tax 5.97
Central Sales Tax 430.61
VAT of various states 292.40
Total 840.57
(c ) There has not been an occasion in case of the Company during the
year under report to transfer any sums to the Investor Education and
Protection Fund. The question of delay in transferring such sums does
not arise.
viii. The company has accumulated losses at the end of the year which
are more than 50% of its net worth. The Company has incurred cash losses
during the current financial year and during the immediately preceding
financial year.
ix. In our opinion and according to the information and as per the
explanations given to us, the Company has defaulted in the repayment of
dues to their Bankers viz., Bank of Maharashtra, Margao Branch and
Union Bank of India, Panjim Branch who have invoked the provisions of
SARFAESI Act, 2002 and also assigned the respective debts in favour of
Asset Reconstruction Companies; Pridhvi Asset Reconstruction and
Securitisation Company Ltd., Hyderabad and Asset Reconstruction Company
(India) Ltd. respectively. We have been informed that negotiations are
in progress with both the ARCs for arriving at a negotiated settlement
of dues.
x. In our opinion and to the best of our information and as per the
explanations given to us and as per the records of the Company, the
Company has not given any guarantee for loans taken by others from
Banks or Financial Institutions.
xi. In our opinion and to the best of our information and as per the
records of the Company, no Term Loans were borrowed during the period
under consideration for any specific purpose.
xii. During the course of our audit, we have neither come across any
frauds on or by the Company nor has the same been reported to us by the
management.
8. As required by section 143(3) of the Act, we further report that:
a) we have sought and obtained all the information and explanations
which to the best of our knowledge and belief were necessary for the
purpose of our audit;
b) in our opinion proper books of account as required by law have been
kept by the Company so far as appears from our examination of those
books;
c) the Balance Sheet, Statement of Profit and Loss and Cash Flow
statement dealt with by this Report are in agreement with the books of
account;
d) in our opinion, the aforesaid financial statements comply with the
applicable Accounting Standards specified under Section 133 of the Act,
read with Rule 7 of the Companies (Accounts) Rules 2014
e) on the basis of written representations received from the directors
as on March 31,2015, and taken on record by the Board of Directors, none
of the directors is disqualified as on March 31,2015, from being
appointed as a director in terms of Section 164(2) of the Act
f) In our opinion and to the best of our information and according to
the explanations given to us, we report as under with respect to other
matters to be included in the Auditor's Report in accordance with Rule
11 of the Companies (Audit and Auditors) Rules, 2014:
i. The pending litigations which would impact the financial position
of the Company is given at Note 32 of the Notes to financial statements
ii. The Company did not have any long-term contracts including
derivative contracts; as such the question of commenting on any
material foreseeable losses thereon does not arise
iii. There has not been an occasion in case of the Company during the
year under report to transfer any sums to the Investor Education and
Protection Fund. The question of delay in transferring such sums does
not arise.
For N.D.HEGDE & ASSOCIATES,
Chartered Accountants
(ICAI Firm Reg.No.103616W)
NAGESH D. HEGDE
Membership No.: 041345
Place: Curtorim
Date:17.07.2015
Mar 31, 2014
1. We have audited the accompanying financial statements of
"MARMAGOA STEEL LIMITED"'' ("the Company"), which comprise the
Balance Sheet as at 31st March 2014, the Statement of Profit & Loss,
and the Cash Flow Statement for the year then ended and a summary of
the significant accounting policies and other explanatory information.
Management''s Responsibility for the Financial Statements:
2. The Company''s Management is responsible for the preparation of
these financial statements that give a true and fair view of the
financial position and financial performance of the Company in
accordance with the Accounting Standards referred to in Section 133 of
the Companies Act, 2013("the Act") and in accordance with the
accounting principles generally accepted in India. This responsibility
includes the design, implementation and maintenance of internal
control relevant to the preparation and presentation of the financial
statements that give a true and fair view and are free from material
misstatement, whether due to fraud or error.
Auditors'' Responsibility:
3. Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing, issued by the Institute of Chartered
Accountants of India. Those standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
4. An audit involves performing procedures to obtain audit evidence
about the amounts and the disclosures in the financial statements. The
procedures selected depend on the auditor''s judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers the 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 controls. An audit also
includes evaluating the appropriateness of the accounting policies
used and the reasonableness of the accounting estimates made by the
Management, as well as evaluating the overall presentation of the
financial statements.
5. We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our audit opinion.
Opinion:
6. We have been informed by the company that the production activities
have been suspended since June 2013 for want of Working Capital
Support from the Banks, consequent upon the company''s loans which have
been classified as NPA by both the Bank of Maharashtra and the Union
Bank of India. As a result, there is no generation of cash flows even
to meet the day to day expenses. However, pending finalization of
rehabilitation plan the accounts have been prepared on a going concern
basis Subject to this, in our opinion and to the best of our
information and according to the explanations given to us, the
aforesaid financial statements read together with the Notes thereon,
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:
i) In the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March 2014.
ii) In the case of the Statement of Profit & Loss, of the Losses for
the year ended 31st March 2014 and
iii) In the case of the Cash Flow Statement, of the Cash Flows during
the year ended that date in the functioning of the Company.
Report on other Legal and Regulatory requirements:
7. As required by Section 143(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 of account.
c) The Balance Sheet, the Statement of Profit & Loss, and the Cash
Flow Statement dealt with by this report are in agreement with the
books of account maintained by the Company.
d) In our opinion, the Balance Sheet, the Statement of Profit & Loss
and the Cash Flow Statement dealt with by this report comply with the
Accounting Standards referred to in Section 133 of The Companies Act,
2013 to the extent applicable to the Company as stated in para (1) of
the Notes on the Financial Statements.
e) On the basis of the written representations received from four of
the Directors, the said Directors are not disqualified as on 31st
March 2014 from being appointed as Directors in terms of Section 164
(2) of the Act.
8) As required by the Companies (Auditors'' Report) Order 2003, issued
by the Ministry of Finance (Department of Company Affairs) in terms of
Section 143 (11) of the Companies Act 2013, we report on the matters
specified in paragraphs 4 & 5 of the said Order to the extent
applicable:
i. (a) The Company has maintained proper records in electronic medium
showing full particulars including quantitative details and situation
of fixed assets.
(b) As represented to us in writing, the company has made a policy of
verifying physically, the fixed assets in a block of two years. During
the period, there has been no physical verification of the fixed
assets.
(c) No substantial part of the fixed assets of the company was sold
during the year.
ii. (a) We have been informed that Physical Verification of only
Billets has been made during the year. Thereafter, in the absence of
production, no verification has been done of inventory. Under these
circumstances, periodical physical verification was not considered
necessary.
(b) The procedures of physical verification of inventory followed by
the management are reasonable but not adequate in relation to the size
of the Company and the nature of its business, since the inventory was
not completely verified physically other than Billets.
(c) In our opinion and according to the information and as per the
explanations given to us, the Company is maintaining proper records of
inventory. The discrepancies noticed on verification between the
physical stocks and the book records as far as Billets were concerned,
have been properly dealt with in the books of account of the company.
We have been informed that the stock of Billets as on 30th September
2013 as per the Books was 599.141 MT whereas on physical verification
the actual stock of Billets was 80 MT bringing the difference to
519.141 MT. It has been represented to us that from the beginning of
production of Billets, the same was accounted on the basis of
theoretical calculation and the dispatches of Billets for Rolling/Sale
was accounted on actual weighment basis at the weighbridge. The actual
stock of physical verification was done only after the shutdown of
manufacturing operation in May 2013. In the absence of physical
verification of other items of inventory, the question of dealing with
the discrepancy in the book stock does not arise.
iii. (a) The company had granted during the immediately preceding year
an interest free loan to a company covered under Section 189 of the
Companies Act. No such loans were granted to any firm or other party
covered under Section 189 of the Companies Act. Balance at the end of
the year was Rs. 52.52 Lakhs.
(b) No interest has been charged to the borrower. We have been
informed that the said advance was made to the holding company of
Marmagoa Steel Limited, out of the interest free loan received from
another company with which there were no terms and conditions attached
regarding repayment of the principal. Under these circumstances, in
our opinion, the transaction is prima facie not prejudicial to the
interest of the company.
(c) The company has not taken during the year any loans from
companies, firms or other parties covered in the register maintained
under section 189 of the Companies Act.
(d) We have been informed that there were no specific terms and
conditions attached to the loans taken in earlier years including
repayment. The rate of interest charged on such loans is not
prima-facie prejudicial to the interest of the company.
(e) In the absence of specific terms and conditions for repayment of
the loan, we are informed; the principal has not been paid/partially
paid. Interest has not been charged during the year under
consideration.
iv. In our opinion and according to the information and as per the
explanations given to us, there is an adequate internal control system
in the company commensurate with its size and the nature of its
business for the purchase of inventory and fixed assets and for the
sale of goods. There were no services rendered by the company. During
the course of our audit, we did not come across any continuing failure
to correct any major weaknesses in the internal control system
prevailing in the Company.
v. To the best of our knowledge and belief and according to our
information and as per the explanations given to us, there were no
contracts or arrangements entered into by the Company that needed to
be entered in the register maintained under Section 189 of the
Companies Act.
vi. In our opinion and according to the information and as per the
explanations given to us, the Company has neither accepted deposits
from the public during the year under consideration nor has the
Company Law Board or National Company Law Tribunal or Reserve Bank of
India or any court or any other Tribunal have passed any orders
against the Company for any contravention under Sections 73 & 74 or
any other provisions of the Companies Act.
vii. During the year under consideration, the company did not have an
Internal Audit System.
viii. The Central Government has prescribed maintenance of cost
records under Section 209(1)(d) of the Companies Act, 1956, for the
products of the Company. We have broadly reviewed the books of account
maintained by the Company pursuant to the order made under the said
Section and are of the opinion that prima-facie; the Company has
maintained the prescribed accounts and records.
ix In our opinion and according to the information and as per the
explanations given to us, during the year, the Company was not regular
in depositing undisputed statutory dues including Provident Fund,
Employees'' State Insurance, VAT, Income Tax and Service Tax. However,
in the payment of Customs duty, Excise duty, cess and Wealth tax the
company was regular in depositing undisputed dues with the appropriate
authorities. As on 31st March 2014, a sum of Rs. 1,558.98 lakhs of tax
was outstanding for a period of more than six months from the date
they became payable comprising of the following -
x. The company has accumulated losses at the end of the year which are
more than 50% of its net worth. The Company has incurred cash losses
during the current financial year and during the immediately preceding
financial year.
xi. In our opinion and according to the information and as per the
explanations given to us, the Company has defaulted in the repayment
of dues in the case of 69 Letters of Credit and Bank Guarantees which
had devolved on the Company / invoked. The date of default, the name
of the Bank, the amount of the Letter of Credit / Bank Guarantee and
the number of days of delay up to 31st March 2014 are given here
below.
xii. The Company has not granted loans and advances on the basis of
security given by way of pledge of shares, debentures and other
securities.
xiii. In our opinion and according to the information and as per the
explanations given to us, the provisions of any special statutes
applicable to chit funds are not applicable to the Company.
xiv. In our opinion and according to the information and as per the
explanations given to us, the Company is not dealing or trading in
Shares, Securities, Debentures and other Investments.
xv. In our opinion and to the best of our information and as per the
explanations given to us and as per the records of the Company, the
Company has not given any guarantee for loans taken by others from
Banks or Financial Institutions.
xvi. In our opinion and to the best of our information and as per the
records of the Company, no Term Loans were borrowed during the period
under consideration for any specific purpose.
xvii In our opinion and to the best of our information and as per the
records of the Company, no funds have been raised on short-term basis
during the period under consideration.
xviii. During the period under consideration, the Company did not
allot shares to any parties or companies covered in the register
maintained under Section 189 of the companies Act.
xvix. During the period, the Company did not issue any debentures.
xx. The Company had not made any Public issue of Shares during the
period under consideration.
xxi. During the course of our audit, we have neither come across any
frauds on or by the Company nor has the same been reported to us by
the management.
For N.D.HEGDE & ASSOCIATES,
CHARTERED ACCOUNTANTS
ICAI Firm Reg.No.103616W
Sd/-
NAGESH D.
HEGDE PROPRIETOR
MEMBERSHIP NO.41345
Place : Curtorim
Date : 06.09.2014
Mar 31, 2013
1. We have audited the accompanying financial statements of "MARMAGOA
STEEL LIMITED"'' ("the Company"), which comprise the Balance Sheet as at
31st March 2013, the Statement of Profit & Loss, the Cash Flow
Statement for the year then ended and a summary of the significant
accounting policies and other explanatory information.
Management''s Responsibility for the Financial Statements:
2. The Company''s Management is responsible for the preparation of
these financial statements that give a true and fair view of the
financial position and financial performance of the Company in
accordance with the Accounting Standards referred to in Section 211
(3C) of the Companies Act, 1956("the Act") and in accordance with the
accounting principles generally accepted in India. This responsibility
includes the design, implementation and maintenance of internal control
relevant to the preparation and presentation of the financial
statements that give a true and fair view and are free from material
misstatement, whether due to fraud or error.
Auditors'' Responsibility:
3. Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing, issued by the Institute of Chartered
Accountants of India. Those standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
4. An audit involves performing procedures to obtain audit evidence
about the amounts and the disclosures in the financial statements. The
procedures selected depend on the auditor''s judgement, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers the 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 controls. An audit also
includes evaluating the appropriateness of the accounting policies used
and the reasonableness of the accounting estimates made by the
Management, as well as evaluating the overall presentation of the
financial statements.
5. We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our audit opinion.
Opinion:
6. In our opinion and to the best of our information and according to
the explanations given to us, the aforesaid financial statements read
together with the Notes thereon, 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:
i) In the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March 2013.
ii) In the case of the Statement of Profit & Loss, of the Losses for
the year ended 31st March 2013 and
iii) In the case of the Cash Flow Statement, of the Cash Flows during
the year ended that date in the functioning of the Company.
Report on other Legal and Regulatory requirements:
7. 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 of account.
(c) The Balance Sheet, the Statement of Profit & Loss, and the Cash
Flow Statement dealt with by this report are in agreement with the
books of account maintained by the Company.
(d) In our opinion, the Balance Sheet, the Statement of Profit & Loss
and the Cash Flow Statement dealt with by this report comply with the
Accounting Standards referred to in Sub-section (3C) of Section 211 of
The Companies Act, 1956 to the extent applicable to the Company as
stated in para (1) of the Notes on the Financial Statements.
(e) On the basis of the written representations received from three
Directors, including the Managing Director, the said Directors are not
disqualified as on 31st March 2013 from being appointed as Directors in
terms of Section 274(1)(g) of the Act. No such representations from the
rest of the Directors have been produced for our perusal. Under these
circumstances, we are unable to state as to whether they were or were
not disqualified as on 31st March 2013 from being appointed as
Directors in terms of Section 274(1)(g) of the Act.
8) As required by the Companies (Auditors'' Report) Order 2003, issued
by the Ministry of Finance (Department of Company Affairs) in terms of
Section 227 (4A) of the Companies Act 1956, we report on the matters
specified in paragraphs 4 & 5 of the said Order to the extent
applicable:
i. (a) The Company has maintained proper records in electronic medium
showing full particulars including quantitative details and situation
of fixed assets.
(b) As represented to us in writing, the company has made a policy of
verifying physically, the fixed assets in a block of two years.
Accordingly, a part of the fixed assets have been physically verified
during the year by the Internal Auditors jointly with the management
and no material discrepancies have been noticed on such verification.
(c) No substantial part of the fixed assets of the company was sold
during the year.
ii. (a) We have been informed that Physical Verification of inventory
has been made by the management only once during the year jointly with
the Internal Auditors. Relevant records have been produced for our
perusal in support of such claim. To comment as to whether such
physical verification has been made at reasonable intervals, there
should be at least two such physical verifications. In the absence of
the same, we are of the opinion that the number of such physical
verifications are inadequate.
(b) The procedures of physical verification of inventory followed by
the management are reasonable but not 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 as per the
explanations given to us, the Company is maintaining proper records of
inventory. The discrepancies noticed on verification between the
physical stocks and the book records were not material having regard to
the size and operations of the Company and the nature of its business
and the same have been properly dealt with in the books of account of
the Company.
iii. (a) The company has granted during the year an interest free loan
to a company, covered in the register maintained under Section 301 of
the Companies Act. No such loans were given to any firms or other
parties covered under Section 301 of the Companies Act. The amount
advanced was Rs.300.02 Lakhs. Balance at the end of the year was
Rs.52.52 Lakhs.
(b) No interest has been charged to the borrower. We have been informed
that the said advance was made to the holding company of Marmagoa Steel
Limited, out of the interest free loan received from another company
and that there were no terms and conditions attached regarding
repayment of the principal. Under these circumstances, in our opinion,
the transaction is prima facie not prejudicial to the interest of the
company. of the following -
Statutory Dues Rs.In Lakhs
EPF - Employers Contribution (MSL) 18.08
EPF - Employers Contribution (Contractors) 0.49
Service Tax 13.98
Income Tax - TDS 3.78
Entry Tax 5.97
Central Sales Tax 1,064.36
VAT of various states 275.69
Total 1,382.35
(c) The company has not taken during the year any loans from companies,
firms or other parties covered in the register maintained under section
301 of the Companies Act.
(d) We have been informed that there were no specific terms and
conditions attached to the loans taken in earlier years including
repayment. The rate of interest charged on such loans is not
prima-facie prejudicial to the interest of the company.
(e) In the absence of specific terms and conditions for repayment of
the loan, we are informed, the principal has not been paid/ partially
paid. Interest has been credited to the current amounts.
iv. In our opinion and according to the information and as per the
explanations given to us, there is an adequate internal control system
in the company commensurate with its size and the nature of its
business for the purchase of inventory and fixed assets and for the
sale of goods. There were no services rendered by the company. During
the course of our audit, we did not come across any continuing failure
to correct any major weaknesses in the internal control system
prevailing in the Company.
v. To the best of our knowledge and belief and according to our
information and as per the explanations given to us, there were no
contracts or arrangements entered into by the Company that needed to be
entered in the register maintained under Section 301 of the Companies
Act.
vi. In our opinion and according to the information and as per the
explanations given to us, the Company has neither accepted deposits
from the public during the year under consideration nor has the Company
Law Board or National Company Law Tribunal or Reserve Bank of India or
any court or any other Tribunal have passed any orders against the
Company for any contravention under Sections 58A & 58AA or any other
provisions of the Companies Act.
vii. During the year under consideration, the company had an Internal
Audit System, which was fairly commensurate with the size of the
Company and the nature of its business.
viii. The Central Government has prescribed maintenance of cost
records under Section 209(1)(d) of the Companies Act, 1956, for the
products of the Company. We have broadly reviewed the books of account
maintained by the Company pursuant to the order made under the said
Section and are of the opinion that prima-facie, the Company has
maintained the prescribed accounts and records. i x In our opinion and
according to the information and as per the explanations given to us,
during the year, the Company was generally not regular in depositing
undisputed statutory dues including Provident Fund, Employees'' State
Insurance, VAT, Income Tax and Service Tax. However, in the payment of
Customs duty, Excise duty, cess and Wealth tax the company was regular
in depositing undisputed dues with the appropriate authorities. As on
31st March 2013, a sum of Rs.1,382.35 lakhs of tax was outstanding for
a period of more than six months from the date they became payable
comprising
x. The company has accumulated losses at the end of the year which are
more than 50% of its net worth. The Company has incurred cash losses
during the current financial year and during the immediately preceding
financial year.
xi. In our opinion and according to the information and as per the
explanations given to us, the Company had not defaulted in the
repayment of dues excepting in the case of 41 Letters of Credit which
had devolved on the Company. The date of default, the name of the Bank,
the amount of the Letter of Credit and the number of days of delay upto
31st March 2013 are given here below.
xii. The Company has not granted loans and advances on the basis of
security given by way of pledge of shares, debentures and other
securities.
xiii. In our opinion and according to the information and as per the
explanations given to us, the provisions of any special statutes
applicable to chit funds are not applicable to the Company.
xiv. In our opinion and according to the information and as per the
explanations given to us, the Company is not dealing or trading in
Shares, Securities, Debentures and other Investments.
xv. In our opinion and to the best of our information and as per the
explanations given to us and as per the records of the Company, the
Company has not given any guarantee for loans taken by others from
Banks or Financial Institutions.
xvi. In our opinion and to the best of our information and as per the
records of the Company, no Term Loans were borrowed during the year
under consideration for any specific purpose. However, a sum of
Rs.2,340 lakhs being Letters of Credit, which had devolved on the banks
has been converted into term loans (previous year nil).
xvii. During the year under consideration, a sum of Rs.1.95 Lakhs
(previous year Rs.15.04 Lakhs) was used for purchase of assets net of
sales from funds raised on short term basis.
xviii. During the year under consideration, the Company did not allot
shares to any parties or companies covered in the register maintained
under Section 301 of the companies Act.
xix. During the year, the Company did not issue any debentures.
xx. The Company had not made any Public issue of Shares during the
year under consideration.
xxi. During the course of our audit, we have neither come across any
frauds on or by the Company nor has the same been reported to us by the
management.
For KAMATH & RAU
CHARTERED ACCOUNTANTS
ICAI FIRM REG. NO.001689S
Sd/-
(S. S.KAMATH - PARTNER)
Membership No.007560.
Place: Camp, Curtorim
Date : 14-05-2013
Mar 31, 2012
We have audited the attached Balance Sheet of MARMAGOA STEEL LIMITED as
at 31 st March 2012, as also the Statement of Profit and Loss and the
Cash Flow Statement for the year ended on that date annexed thereto.
These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with the Auditing Standards
generally accepted in India. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the Accounting Principles used and significant estimates made
by the management, as well as evaluating the overall financial
statement presentation. We believe, our audit provides a reasonable
basis for our opinion. We further report that:
1. 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.
2. 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.
3. The Balance Sheet, and the Statement of Profit and Loss, dealt with
by this report are in agreement with the books of account maintained by
the Company.
4. In our opinion, the Balance Sheet and the Statement of Profit and
Loss dealt with by this report comply with the Accounting Standards
referred to in Sub-section (3C) of Section 211 of The Companies Act,
1956 to the extent applicable to the Company as stated in para (1) of
the Notes on Financial Statements.
5. On the basis of the written representations of the directors as on
31-03-2012 and taken on record by the Board of Directors, we report
that none of the said Directors is disqualified as on 31-03-2012 from
being appointed as a Director in terms of clause (g) of Sub-section (1)
of Section 274 of the Companies Act, 1956.
6. In our opinion and to the best of our information and as per the
explanations given to us, the said accounts read together with the
Notes thereon give the information required by the Companies Act, 1956,
in the manner required and give ,a true and fair view in conformity
with the Accounting Principles generally accepted in India:
i) In the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March 2012. .
ii) In the case of the Statement of Profit and Loss, of the Losses for
the year ended 31st March 2012, and Further, as required by the
Companies (Auditors' Report) Order 2003, issued by the Ministry of
Finance (Department of Company Affairs) in terms of Section 227 (4A) of
the Companies Act 1956, we report on the matters specified in
paragraphs 4 & 5 of the said Order to the extent applicable:
i. (a) The Company has maintained proper
records in electronic medium showing
full particulars including quantitative details and situation of fixed
assets.
(b) As represented to us in writing, the company has made a policy of
verifying physically, the fixed assets in a block of two years.
Accordingly, a part of the fixed assets have been physically verified
during the year by the Internal Auditors jointly with the management
and no material discrepancies have been noticed on such verification.
(c) No substantial part of the fixed assets of the company were sold
during the year.
ii. (a) We have been informed that Physical Verification of inventory
has been made by the management during the year jointly with the Internal
Auditors. Relevant records have been produced for our perusal in support
of such claims. In our opinion such verification has been made at
reasonable intervals.
(b) The procedures of physical verification of inventory followed by
the management are inadequate in relation to the size of the Company
and the nature of its business.
(c) In our opinion and according to the information and as per the
explanations given to us, the Company is maintaining proper records of
inventory. The discrepancies noticed on verification between the
physical stocks and the book records were not material having regard to
the size and operations of the Company and the nature of its business
and the same have been properly dealt with in the books of account of
the Company.
iii. (a) The company has not granted during the _ year loans to
companies, firms or other parties covered in the register maintained
under Section 301 of the Companies Act.
(b) The company has not taken any loans from companies, firms or other
parties covered in the register maintained under section 301 of the
Companies Act.
(c) We have been informed that there were no specific terms and
conditions attached to the loans taken in earlier years including
repayment. The rate of interest charged on such loans is not
prima-facie prejudicial to the interest of the company.
(d) In the absence of specific terms and conditions for repayment of
the loan, we are informed, the principal has not been paid/ partially
paid. Interest has been credited to the current amounts.
iv. In our opinion and according to the information and as per the
explanations given to us, there is an adequate internal control system
in the company commensurate with its size and the nature of its
business for the purchase of inventory and fixed assets and for the sale
of goods. There were no services rendered by the company. During the
course of our audit, we did not come across any continuing failure to
correct any major weaknesses in the internal control system prevailing
in the Company.
v. To the best of our knowledge and belief and according to our
information and as per the explanations given to us, there were no
contracts or arrangements entered into by the Company that needed to be
entered in the register maintained under Section 301 of the Companies
Act.
vi. (n our opinion and according to the information and as per the
explanations given to us, the Company has neither accepted from the
public during the year under consideration nor has the Company Law
Board or National Company Law Tribunal or Reserve Bank of India or any
court or any other Tribunal have passed any orders against the Company
for any contravention under Sections 58A & 58AA or any other provisions
of the Companies Act.
vii. During the year under consideration, the company had an Internal
Audit System, which was fairly commensurate with the size of the
Company and the nature of its business.
viii. The Central Government has prescribed maintenance of cost records
under Section 209 (1) (d) of The Companies Act, 1956, for the products
of the Company. We have broadly reviewed the books of account
maintained by the Company pursuant to the order made under the said
Section and are of the opinion that prima-facie, the Company has
maintained the prescribed accounts and records.
ix. In our opinion and according to the information and as per the
explanations given to us, the Company is generally regular in
depositing undisputed statutory dues including Provident Fund,
Employees' State Insurance, Customs duty, Excise duty, cess, Income tax
and Wealth tax with the appropriate authorities. However, a sum of Rs.
208 lakhs of tax comprising of VAT collected in various branches
amounting to Rs. 202 lakhs and entry tax in a branch amounting to Rs. 6
lakhs was outstanding as at the last day of the financial year for a
period of more than six months from the date it became payable.
x. The company has accumulated losses at the end of the year which are
more than 50% of its net worth. The Company has incurred cash losses
during the current financial year and during the immediately preceding
financial year.
xi. In our opinion and according to the information and as per the
explanations given to us, the Company had not defaulted in the
repayment of dues excepting in the case of 21 Letters of Credit which
had devolved on the Company. The date of default, the name of the
Bank, the amount of the Letter of Credit and the number of days of
delay upto 31" March 2012 are given here below.
1) Bank of Maharashtra:
Date of Outstanding Delay upto
default Amount 31.3.2012
(Rs. in (in days)
lakhs)
06.02.2012 68.69 55
07.02.2012 121.63 54
17.02.2012 81.61 44
07.03.2012 21.41 25
09.03.2012 39.85 23
12.03.2012 96.93 20
19.03.2012 31.19 13
24.03.2012 36.79 8
26.03.2012 176.56 6
674.66
2) Union Bank of India
Date of Outstanding Delay upto
default Amount 31.3.2012
(Rs. in (in days)
lakhs)
13.01.2012 27.49 79
14.01.2012 122.82 78
23.01.2012 24.50 69
01.02.2012 48.56 60
09.02.2012 54.50 52
16.02.2012 61.74 45
23.02.2012 41.40 38
25.02.2012 76.28 36
06.03.2012 75.32 26
19.03.2012 119.88 13
30.03.2012 77.46 2
31.03.2012 22.22 1
752.17
xii. The Company has not granted loans and advances on the basis of
security given by way of pledge of shares, debentures and other
securities.
xiii. In our opinion and according to the information and as per the
explanations given to us, the provisions of any special statutes
applicable to chit funds are not applicable to the Company.
xiv. In our opinion and according to the information and as per the
explanations given to us, the Company is not dealing or trading in
Shares, Securities, Debentures and other Investments.
xv. In our opinion and to the best of our information and as per the
explanations given to us and as per the records of the Company, the
Company has not given any guarantee for loans taken by others from
Banks or Financial Institutions.
xvi. In our opinion and to the best of our information and as per the
records of the Company, no Term Loans were borrowed during the year
under consideration.
xvii. During the year under consideration, a sum of Rs.15.04 lakhs
(previous year Rs.25.41 lakhs) was used for purchase of assets from
funds raised on short term basis.
xviii. During the year under consideration, the Company did not allot
shares to any parties or companies covered in the register maintained
under Section 301 of the companies Act.
xix. During the year, the Company did not issue any debentures.
xx. The Company had not made any Public issue of Shares during the
year under consideration.
xxi. During the course of our audit, we have neither come across any
frauds on or by the Company nor has the same been reported to us by the
management.
For KAMATH & RAU
CHARTERED ACCOUNTANTS
ICAI FIRM REG NO. 001689S
Sd/-
S. S. KAMATH
Place: Camp Bangalore, PARTNER
Date : 29.06.2012 Membership No.007560
Mar 31, 2010
We have audited the attached Balance Sheet of MARMAGOA STEEL LIMITED as
at 31 st March 2010, as also the Profit and Loss Account and the Cash
Flow Statement for the year ended on that date annexed thereto. These
financiaf 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 the Auditing Standards
generally accepted in India! Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the Accounting Principles used and significant estimates made
by the management, as well as evaluating the overall financial
statement presentation. We believe, our audit provides a reasonable
basis for our opinion. We further report that:
1. 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.
2. 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.
3. The Balance Sheet, the Profit and Loss Account, and the Cash Flow
Statement dealt with by this report are in agreement with the books of
account maintained by the Company.
4. In our opinion, the Profit and Loss Account, the Balance Sheet and
the Cash Flow Statement dealt with by this report comply with the
Accounting Standards referred to in Sub-section (3C) of Section 211 of
The Companies Act, 1956 to the extent applicable to the Company as
stated in para (1) of the Notes on Accounts in Schedule 22.
5. On the basis of the written representations of the directors as on
31-03-2010 and taken on record by the Board of Directors, we report
that none of the said Directors are disqualified as on 31-03-2010 from
being appointed as a Director in terms of clause (g) of Sub-section (1)
of Section 274 of the Companies Act, 1956.
6. In our opinion and to the best of our information and as per the
explanations given to us, the said accounts read together with the
Notes thereon give the information required by the Companies Act, 1956,
in the manner required and give a true and fair view in conformity with
the Accounting Principles generally accepted in India:
i) In the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March 2010.
ii) In the case of the Profit and Loss Account, of the Losses for the
year Ended 31st March 2010, and
iii) In the case of the Cash Flow Statement, of the Cash Flows during
the year ended that date in the functioning of the Company.
Further, as required by the Companies (Auditors Report) Order 2003,
issued by the Ministry of Finance (Department of Company Affairs) in
terms of Section 227 (4A) of the Companies Act 1956, we report on the
matters specified in paragraphs 4 & 5 of the said Order to the extent
applicable:
i) (a) The Company has maintained proper records showing full
particulars including quantitative details and situation of fixed
assets.
(b) As represented to us in writing, the company has made a policy of
verifying physically, the fixed assets in a block of two years.
Accordingly, a part of the fixed assets have been physically
verified during the year by the Internal Auditors jointly with the
management and no material discrepancies have been noticed on such
verification.
(c) No substantial part of the fixed assets of the company were sold
during the year.
ii) (a) We have been informed that Physical Verification of inventory
has been made by the management during the year. Relevant records have
been produced for our perusal in support of such claims.
(b) The procedures of physical verification of inventory followed by
the management are reasonable and adequate in relation to the size of
the Company and the nature of its business.
(c) In our opinion and according to the information and as per the
explanations given to us, the Company is maintaining proper records of
inventory. The discrepancies noticed on verification between the
physical stocks and the book records were not material having regard to
the size of the operations of the Company and the nature of its
business and the same have been properly dealt with in the books of
account of the Company.
iii) (a) The company has granted during the year unsecured loans to
three companies covered in the register maintained under Section 301 of
the Companies Act aggregating to Rs. 93.09 lakhs.
(b) We have been informed that there were no specific terms and
conditions laid down for granting the loans including repayment. The
rate of interest charged are not prima-facie prejudicial to the
interest of the company.
(c) The loans are given in current account. Loans given to two
companies have been squared off with interest. Only in the case of one
company Rs. 105.41 lakhs inclusive of interest charged, is outstanding
as at the end of the year.
(d) Since the loan was granted without any stipulations regarding
repayment and the same is in current account, no recovery proceedings
have been taken.
(e) The company has taken unsecured loans from two companies covered in
the register maintained under section 301 of the Companies Act
aggregating to Rs. 66.32 lakhs. These are in the current accounts of
the companies mentioned in clause (c ) above.
(f) We have been informed that there were no specific terms and
conditions attached to the loans taken including repayment. The rate of
interest charged is not prima-facie prejudicial to the interest of the
company.
(g) In the case of one company, the loan has been paid off. In the case
of the other company, in the absence of specific terms and conditions
for repayment of the loan, we are informed, the principal has not been
paid. Interest has been credited to the loan amount.
iv) In our opinion and according to the information and as per the
explanations given to us, there is an adequate internal control system
in the company commensurate with its size and the nature of its
business for the purchase of inventory and fixed assets and for the
sale of goods. There were no services rendered by the company. During
the course of our audit we did not come across any continuing failure
to correct any major weaknesses in the internal control system
prevailing in the Company.
v) To the best of our knowledge and belief and according to our
information and as per the explanations given to us, there were no
contracts or arrangements entered into by the Company that needed to be
entered in the register maintained under Section 301 of the Companies
Act.
vi) In our opinion and according to the information and as per the
explanations given to us, the Company has neither accepted deposits
from the public during the year under consideration nor the Company Law
Board or National Company Law Tribunal or Reserve Bank of India or any
court or any other Tribunal have passed any orders against the Company
for any contravention under Sections 58A & 58AA or any other provisions
of the Companies Act.
vii) During the year under consideration, the company had an Internal
Audit System, which was commensurate with the size of the Company and
the nature of its business.
viii) The Central Government has prescribed maintenance of cost records
under Section 209 (1) (d) of The Companies Act, 1956, for the products
of the Company. We have broadly reviewed the books of account
maintained by the Company pursuant to the order made under the said
Section and are of the opinion that prima-facie, the Company has
maintained the prescribed accounts and records.
ix) In our opinion and according to the information and as per the
explanations given to us, the Company is generally regular in
depositing undisputed statutory dues including Provident Fund,
Employees State Insurance, Customs duty, Excise duty.cess.lncome tax
and Wealth tax with the appropriate authorities. However, a sum of
Rs.146 lakhs of tax comprising of VAT collected in various branches
amounting to Rs. 117 lakhs, entry tax in a branch amounting to Rs. 6
lakhs and TDS of Rs. 23 lakhs was outstanding as at the last day of the
financial year for a period of more than six months from the date it
became payable. However, TDS of Rs. 23 lakhs was paid on 31st May 2010.
x) There was no accumulated loss in the books at the end of the
Financial Year. The Company has incurred cash losses during the current
financial year and during the immediately preceding financial year.
xi) In our opinion and according to the information and as per the
explanations given to us, the Company had not defaulted in repayment of
dues to Banks. The Company has neither taken any loans from financial
institutions nor had it issued any Bonds or Debentures as on 31s1 March
2010. Regarding term loans taken from banks, repayment installments,
wherever due, have been paid.
xii) The Company has not granted loans and advances on the basis of
security given by way of pledge of shares, debentures and other
securities.
xiii) In our opinion and according to the information and as per the
explanations given to us, the provisions of any special statutes
applicable to chit funds are not applicable to the Company.
xiv) In our opinion and according to the information and as per the
explanations given to us, the Company is not dealing or trading in
Shares, Securities, Debentures and other Investments.
xv) In our opinion and to the best of our information and as per the
explanations given to us and as per the records of the Company, the
Company has not given any guarantee for loans taken by others from
Banks or Financial Institutions.
xvi) In our opinion and to the best of our information and as per the
records of the Company, no Term Loans were borrowed during the year
under consideration.
xvii) During the year under consideration, a sum of Rs. 238 lakhs
(previous year Rs. 187 iakhs) was used for repayment of long term
investment borrowings from funds raised on short term basis.
xviii) During the year under consideration, the Company did not allot
shares to any parties or companies covered in the register maintained
under Section 301 of the companies Act.
xix) During the year, the Company did not issue any debentures.
xx) The Company had not made any Public issue of Shares during the year
under consideration.
xxi) During the course of our audit, we have neither come across any
frauds on or by the Company nor has the same been reported to us by the
management.
For KAMATH & RAU
CHARTERED ACCOUNTANTS
FIRM REG NO. 001689 S
Sd/-
S. S. KAMATH
Place: Curtorim, Goa PARTNER
Date : 31.05.2010 Membership No.007560
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