Mar 31, 2019
Report on the Audit of the Standalone Financial Statements Opinion
We have audited the standalone financial statements of MITCON Consultancy & Engineering Services Limited (âthe Companyâ), which comprise the Balance Sheet as at 31st March 2019, and the Statement of Profit and Loss, and Statement of Cash Flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies and other explanatory information.
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 (the âActâ) in the manner so required and give a true and fair view in conformity with the accounting standards prescribed under section 133 of the Act and other accounting principles generally accepted in India, of the state of affairs of the Company as at 31 March 2019, and its profit and its cash flows for the year ended on that date.
Basis for Opinion
We conducted our audit of the Standalone Financial Statements in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Companies Act, 2013. 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 together with the ethical requirements that are relevant to our audit of the Standalone financial statements under the provisions of the Companies Act, 2013 and the Rules there under, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matter described below to be the key audit matters to be communicated in our audit report.
Key audit matters |
How our audit addressed the key audit |
matter |
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Investment in Subsidiaries |
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The Company carries investments in subsidiaries in its standalone financial statements. There is a risk that the carrying amount of investments is impaired. Management tests investments for impairment which involves significant estimates and judgements. This is one of the key Management judgmental areas. Refer Note 40 to the standalone financial statements. |
Our audit procedures include the following procedures: - Obtained an understanding of any internal or external impairment indicators for investments in subsidiary; - For investments where there was an impairment trigger, obtained cash flow forecasts as done by management and valuation reports of independent valuer considered by management for impairment assessment of investment |
Tax provision |
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The Company is required to estimate its income tax liabilities according to the tax laws. Further, there are matters of interpretation in terms of application of tax laws and rules. This requires Management to make judgements to determine the possible outcome of tax positions taken. Refer Note 44 to the standalone financial statements. |
Our audit procedures include the following procedures: - We obtained an understanding of the key tax positions; - Obtained a list of updates to tax assessments and tax litigations during the year including an assessment of the impact of these updates on the tax positions and assessment of outcomes; - Discussed with management and evaluated managementâs estimations of tax provisions. |
Emphasis of Matter
We draw attention to the following matters in the Note 40 to the standalone financial statements regarding financial exposure of the company in the below mentioned subsidiary companies - Krishna Windfarms Developers Private Limited (KWDPL)
a. Companyâs investments in equity share capital of KWDPL of INR 120,388,200 pledged with Axis Trustee Services Limited for Loan availed by KWDPL from L&T Infrastructure Finance Company Limited
b. Issue of Corporate Guarantee on behalf of KWDPL of INR 420,000,000 for availing loan from L&T Infrastructure Finance Company Limited
c. Outstanding trade receivable of INR 7,910,859
d. Outstanding inter-corporate loan of INR 148,149,525
e. Outstanding Interest on inter-corporate loan & debentures aggregating to INR 24,650,634
f. Out of the inter-corporate loan granted in earlier year, an amount of INR 75,000,000 was converted during the year into 75,00,000 10.50% Compulsorily Convertible Debentures of Rs.10/- each, which are convertible into equity shares after a period of 15 months, and are outstanding as on 31st March 2019.
MITCON Sun Power Ltd. (MSPL)
a. Outstanding inter-corporate loan of INR 9,600,000
b. Outstanding Interest on inter-corporate loan of INR 376,136 MITCON Solar Alliance Ltd. (MSAL)
a. Outstanding inter-corporate loan of INR 170,917,327
b. Outstanding Interest on inter-corporate loan of INR 4,876,191
Subsidiaries have incurred losses during current and / or previous year and net-worth of subsidiaries as at 31 March 2019 have been substantially / fully eroded. However, based on certain estimates like future business plans, growth prospects and valuation report of independent valuer, the management is of the opinion that above stated inter corporate loans, interest on inter corporate loans and trade receivables are good and recoverable and investment in debenture and equity of the subsidiaries does not require any reduction in value of investment and hence no provision in respect of aforesaid amounts has been made in the accompanying standalone financial statements.
Our opinion is not modified in respect of the matter above.
Information Other than the Standalone Financial Statements and Auditorâs Report Thereon
The Companyâs Board of Directors is responsible for the preparation of the other information. The other information comprises the information included in the Management Discussion and Analysis, Boardâs Report including Annexures to Boardâs Report, but does not include the standalone financial statements and our auditorâs report thereon. These reports are expected to be made available to us after the date of our 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 other information included in the above reports, if we conclude that there is material misstatement therein, we are required to communicate the matter to those charged with governance and determine the actions under the applicable laws and regulations.
Responsibilities of Management and Those Charged with Governance 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 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. 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.
In preparing the standalone financial statements, management is responsible for assessing the Companyâs ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
The Board of Directors are also responsible for overseeing the Companyâs financial reporting process.
Auditorâs Responsibilities for the Audit of the Standalone financial statements
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 SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.
As part of an audit in accordance with SAs, 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 Companies Act, 2013, we are also responsible for expressing our opinion on whether the company has adequate internal financial controls system in place and the operating effectiveness of such controls.
- Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
- Conclude on the appropriateness of managementâs use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Companyâs ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditorâs report to the related disclosures in the 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.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the 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
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 Companies Act, 2013, we give in the âAnnexure Aâ a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.
2. As required by Section 143(3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
(c) The Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.
(d) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
(e) The matters described under Emphasis of Matter paragraph above may have an adverse effect on the functioning of the company.
(f) On the basis of the written representations received from the directors as on 31st March, 2019 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2019 from being appointed as a director in terms of Section 164 (2) of the Act.
(g) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Bâ.
(h) With respect to the other matters to be included in the Auditorâs Report in accordance with the requirements of section 197(16) of the Act, as amended:
In our opinion and to the best of our information and according to the explanations given to us, the remuneration paid by the Company to its director during the year is in accordance with the provisions of section 197 of the Act.
(i) 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 26 to the standalone financial statements;
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.
iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.
ANNEXURE A TO THE INDEPENDENT AUDITORSâ REPORT
(Referred to in paragraph 1 of the Independent Auditorsâ Report of even date to the members of the company on the standalone financial statements as of and for the year ended March, 31, 2019)
i. In respect of its fixed assets:
a) The Company is maintaining proper records showing full particulars including quantitative details and situation of fixed assets.
b) As explained to us, the fixed assets have been physically verified by the management during the year. The discrepancies noticed on such verification were not material and have been properly dealt with in the books of account.
c) The title deeds of immovable properties, as disclosed in Note 11 on Property, Plant and Equipment to the standalone financial statements, are held in the name of the company.
ii. As the company does not have any inventory at the end of the year, the provisions of clause 3(ii) of the Order are not applicable to the company.
iii. The company has not granted any loans, secured or unsecured to firms, limited liability partnerships or other parties covered in the register maintained under section 189 of the Act. The company has granted loans to the under mentioned companies covered in the register maintained u/s 189 of the Act :
Krishna Windfarms Developers Private Limited (KWDPL) - Wholly owned subsidiary:
As per the terms agreed with the Subsidiary Company, repayment of principal amount and interest shall be done upon repayment of term loan availed by the said Subsidiary Company from another financial institution or on availability of cash surplus with Subsidiary Company after repayment of term loan and meeting all operational expenses. Repayment of INR 2,160,080 has been done towards principal amount during the year.
Out of the inter-corporate loan granted to KWDPL in earlier year an amount of INR 75,000,000/- was converted during the year into 7,500,000 10.50% Compulsorily Convertible Debentures of INR 10/- each, which are convertible into equity shares after a period of 15 months.
Inter-corporate loan aggregating to INR 148,149,525/- is outstanding from KWDPL as on 31.3.2019.
Interest on loans and debentures charged during the year amounts to INR 24,351,212. Repayment of INR 12,479,139 has been done towards outstanding interest for previous year including the amount of Tax Deducted at Source on the said interest deposited by the Subsidiary Company with the Government Authority. Interest outstanding as at the end of the year amounts to INR 24,650,634.
MITCON Sun Power Limited (MSPL) - Wholly owned subsidiary:
Inter-corporate loan granted during the year aggregating to INR 9,600,000 and interest thereon is INR 417,929. As per the terms agreed with the Subsidiary Company, repayment of principal amount and interest shall be done upon availability of cash surplus with Subsidiary Company after meeting all operational expenses. No repayment of principal amount and interest has been made by the Subsidiary Company during the year except the amount of Tax Deducted at Source on the said interest and deposited by the Subsidiary Company with the Government Authority.
MITCON Solar Alliance Limited (MSAL) - Subsidiary of MSPL:
Inter-corporate loan granted during the year aggregating to INR 270,917,327 and interest thereon is INR 5,417,992 As per the terms agreed with MSAL, repayment of principal amount and interest shall be done upon availability of cash surplus with MSAL after meeting all operational expenses. Repayment of INR 100,000,000 has been done towards principal amount. No payment of interest has been made by MSAL during the year except the amount of Tax Deducted at Source on the said interest and deposited by MSAL with the Government Authority.
iv. Based on the audit procedures conducted by us and according to the information and explanations given to us, in our opinion the company has not given any loans, guarantees or securities to any of its Directors or to any other persons in whom the Director is interested under provisions of Section 185 of the Act. In our opinion and according to the information and explanations given to us, the company has complied with the provisions of section 186 of the Act in respect of loans and investments made by it.
v. The company has not accepted any deposits from the public within the meaning of sections 73, 74, 75 and 76 of the Act and the Rules framed there under to the extent notified.
vi. The Central Government has specified maintenance of cost records under Sec.148 (1) of the Act, applicable in respect of wind power generation activity of the company and we are of the opinion that prima facie such accounts and records are made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they were accurate or complete.
vii. (a) According to the information and explanations given to us and on the basis of our examination of records of the Company, undisputed statutory dues including Provident Fund, Employeesâ State Insurance, Income-Tax, Goods & Service Tax, Duty of Customs, Cess and other statutory dues have been regularly deposited with the appropriate authorities. As explained to us, the company did not have any dues on account of Sales Tax, Service Tax and duty of Excise.
According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Employeesâ State Insurance, Income-Tax, Value added Tax, Sales Tax, Service Tax, Goods & Service Tax, Cess, and other statutory dues were in arrears as at 31st March, 2019 for a period of more than six months from the date they became payable.
(b) According to the information and explanations given to us and the records of the Company, examined by us there are no dues of Sales Tax, Service Tax, Goods and Service Tax, duty of Custom, duty of Excise, Value added Tax and Cess as at 31st March 2019, which have not been deposited on account of any dispute.
viii. According to the records of the Company examined by us and the information and explanation given to us, the Company has not defaulted in repayment of loans or borrowings from a Bank. The Company does not have any loan or borrowings from Financial Institutions or Government. There are no debenture holders.
ix. The company has not raised any moneys by way of initial public offer, further public offer (including debt instruments). The moneys raised by way of term loan from a bank during the year were applied for the purposes for which they were raised.
x. Based upon the audit procedures performed and information and explanations given to us by the Management, we have neither come across any instance of fraud on or by the Company or on the Company by its officers or employees, noticed or reported during the year, nor have we been informed of such case by the management.
xi. According to the information and explanations given to us and based on our examination of the records of the company, the company has paid / provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with schedule V to the Act.
xii. As the Company is not a nidhi company and the nidhi rules 2014 are not applicable to it, the provisions of clause 3 (xii) of the Order are not applicable to the Company.
xiii. According to the information and explanations given to us and based on our examination of the records of the company, transactions with the related parties are in compliance with Sections 177 and 188 of the Act where applicable and details of such transactions have been disclosed in the standalone financial statements as required by the applicable accounting standards.
xiv. The company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review. Accordingly, the provisions of clause 3(xiv) of the Order are not applicable to the company (See Note 39(iv) of Standalone financial statements).
xv. According to the information and explanations given to us and based on our examination of the records of the company, the company has not entered into any non-cash transactions with its directors or persons connected with him. Accordingly, the provisions of clause 3(xv) of the order are not applicable to the company.
xvi. The company is not required to be registered under section 45-IA of the Reserve Bank of India act, 1934. Accordingly, the provisions of clause 3(xvi) of the Order are not applicable to the company.
Annexure B to Independent Auditorsâ Report Referred to in paragraph 2(g) of the Independent Auditorsâ Report of even date to the members of MITCON Consultancy & Engineering Services Ltd. on the standalone financial statements for the year ended 31st March, 2019 Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of section 143 of the Companies Act, 2013 (The Actâ).
1. We have audited the internal financial controls over financial reporting with reference to standalone financial statements of MITCON Consultancy & Engineering Services Ltd. (âthe Companyâ) as of March 31, 2019 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.
Managementâs Responsibility for Internal Financial Controls
2. 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 Act.
Auditorsâ Responsibility
3. Our responsibility is to express an opinion on the Companyâs internal financial controls over financial reporting with reference to standalone financial statements based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the âGuidance Noteâ) and the Standards on Auditing as specified under section 143(10) of the Act to the extent applicable to an audit of internal financial controls both applicable to an audit of internal financial controls and both issued by the lnstitute 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 with reference to standalone financial statements was 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 internal financial controls system over financial reporting with reference to standalone financial statements and their operating effectiveness. Our audit of internal financial controls over financial reporting with reference to standalone financial statements included obtaining an understanding of internal financial controls over financial reporting with reference to standalone financial statements, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditorâs judgment, including the assessment of the risks of material misstatement of the standalone 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 internal financial controls system over financial reporting with reference to standalone financial statements.
Meaning of Internal Financial Controls over Financial Reporting
6. 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 standalone 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 standalone 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 unauthorized acquisition, use, or disposition of the companyâs assets that could have a material effect on the standalone financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
7. 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 with reference to standalone financial statements 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, an adequate internal financial controls system over financial reporting with reference to standalone financial statements and such internal financial controls over financial reporting with reference to standalone financial statements were operating effectively as at March 31, 2019 based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
FOR JOSHI & SAHNEY
CHARTERED ACCOUNTANTS
(ICAI Firm Reg.No.104359W)
Sd/-
H.M.JOSHI
PARTNER
ICAI Membership No.031689
PUNE
DATE: 24th May, 2019
Mar 31, 2018
Report on the Standalone Financial Statements :
We have audited the accompanying standalone financial statements of MITCON Consultancy & Engineering Services Ltd. (âthe Companyâ), which comprise the Balance Sheet as at 31st March, 2018, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.
Managementâs Responsibility for the Standalone Financial statements :
The Companyâs Board of Directors is responsible for the matters stated in Section 134(5) ofthe Companies Act, 2013 (âthe Actâ) with respect to the preparation and presentation of these standalone financial statements that give a true and fair view ofthe financial position, financial performance and cash flows ofthe Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 ofthe Act, read with Rule 7 ofthe 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 ofthe accounting records, relevant to the preparation and presentation ofthe financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditorâs Responsibility :
Our responsibility is to express an opinion on these standalone financial statements based on our audit.
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) ofthe Act and other applicable authoritative pronouncements issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whetherthe financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditorâs judgment, including the assessment of the risks of material misstatement ofthe financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Companyâs preparation ofthe 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 ofthe accounting policies used and the reasonableness ofthe accounting estimates made by the Companyâs Directors, as well as evaluating the overall presentation ofthe financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.
Opinion :
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, ofthe state of affairs ofthe Company as at 31st March, 2018, and its profit and its cash flows for the year ended on that date.
Emphasis of Matter
We draw attention to the following matters in the Notes No.43 and No.44 to the financial statements:
a) Note No.43 relating to issue of bank guarantee by the company on behalf of Mitcon Megaskill Centers Pvt. Ltd.(MMCPL) to Jharkhand Skill Development Mission Society (JSDMS), Government of Jharkhand against mobilization advance received by MMCPL from JSDMS. The guarantee issued by the company on behalf of MMCPL is currently outstanding and the status regarding companyâs financial exposure remains unchanged. In the event ofany unforeseen invocation ofbank guarantee, the company would face financial exposure which may extend maximum to the amount of bank guarantee issued i.e. INR 127,247,200/-.
b) Note No.44- Regarding financial exposure ofthe company for pledge of investment in equity shares of Krishna Windfarms Developers Pvt. Ltd. (KWDPL) aggregating to face value of INR 58,800,000/-, issue of Corporate Guarantee on behalf of KWDPL of INR 420,000,000/- and inter-corporate loan to KWDPL of INR 225,309,605/- outstanding and interest thereon of INR 12,778,561/- receivable from KWDPL as on 31.3.2018
Our opinion is not modified in respect ofthe matters (a) and (b) above.
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 (hereinafter referred to as the âOrderâ) and on the basis of such checks of the books and records of the company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure A a statement on the matters specified in paragraphs 3 and 4 ofthe Orderto the extent applicable.
2. As required by Section 143(3) ofthe Act, we report that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge and beliefwere necessary forthe purposes ofour 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 ofthose books.
c) The Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.
d) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 ofthe Act, read with Rule 7 ofthe Companies (Accounts) Rules, 2014.
e) The matters described under Emphasis of Matter paragraph above in our opinion may have an adverse effect on the functioning ofthe company
f) On the basis ofthe written representations received from the directors as on 31st March, 2018 taken on record by the Board of Directors, none ofthe directors is disqualified as on 31st March, 2018 from being appointed as a director in terms ofSection 164 (2) ofthe Act.
g) With respect to the adequacy of the internal financial controls over financial reporting with reference to standalone financial statements ofthe Company and the operating effectiveness of such controls, referto ourseparate Reportin Annexure B.
h) 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 financial statements - Refer Note 26 to the financial statements;
ii) The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.
iii) There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.
ANNEXURE B TO INDEPENDENT AUDITORSâ REPORT
Referred to in paragraph 2(g) ofthe Independent Auditorsâ Report of even date to the members of MITCON Consultancy & Engineering Services Ltd. on the standalone financial statements for the year ended 31st March, 2018.
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of section 143 ofthe Companies Act, 2013 (âThe Actâ).
1) We have audited the internal financial controls over financial reporting with reference to standalone financial statements of MITCON Consultancy & Engineering Services Ltd. (âthe Companyâ) as of March 31, 2018 in conjunction with our audit ofthe standalone financial statements ofthe Company for the year ended on that date.
Managementâs Responsibility for Internal Financial Controls
2) 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 ofthe accounting records, and the timely preparation ofreliable financial information, as required underthe Act.
Auditorsâ Responsibility
3) Our responsibility is to express an opinion on the Companyâs internal financial controls over financial reporting with reference to standalone financial statement 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 Note1) and the Standards on Auditing as specified under section 143(10) ofthe Actto 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 with reference to standalone financial statement was 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 internal financial controls system over financial reporting with reference to standalone financial statements and their operating effectiveness. Our audit of internal financial controls over financial reporting with reference to standalone financial statements included obtaining an understanding ofinternal financial controls over financial reporting with reference to standalone financial statements, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditorâs judgment, including the assessment ofthe risks of material misstatement ofthe standalone 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 internal financial controls system over financial reporting with reference to standalone financial statements.
Meaning of Internal Financial Controls over Financial Reporting
6) 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 standalone financial statements for external purposes in accordance with generally accepted accounting principles. Acompanyâs 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 standalone financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures ofthe 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 unauthorized acquisition, use, or disposition ofthe companyâs assets that could have a material effect on the standalone financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
7) 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 orfraud may occurand not be detected. Also, projections of any evaluation ofthe internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting with reference to standalone financial statements 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, an adequate internal financial controls system over financial reporting with reference to standalone financial statements and such internal financial controls over financial reporting with reference to standalone financial statements were operating effectively as at March 31, 2018 based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants oflndia.
ANNEXURE A TO THE INDEPENDENT AUDITORSâ REPORT
(Referred to in paragraph 1 of the Independent Auditorsâ Report of even date to the members of the company on the standalone financial statements as of and forthe yearended 31st March, 2018)
i) In respect of its fixed assets:
a) The Company is maintaining proper records showing full particulars including quantitative details and situation offixed assets.
b) As explained to us, the fixed assets have been physically verified by the management during the year. The discrepancies noticed on such verification were not material and have been properly dealt with in the books of account.
c) The title deeds of immovable properties, as disclosed in Note 10 on fixed assets to the financial statements, are held in the name ofthe company.
ii) As the company does not have any inventory at the end ofthe year, the provisions of clause 3(ii) of the Order are not applicable to the company.
iii) The company has not granted any loans, secured or unsecured to firms, limited liability partnerships or other parties covered in the register maintained under section 189 ofthe Act. The company has granted a loan to an Associate Company covered in the register maintained u/s 189 of the Act. (loan amountgranted INR 226,445,879/-. At the end ofthe year, principal outstanding is INR 225,309,605/and interest receivable thereon is INR 12,778,561/-.) As per the terms agreed with the Associate Company, repayment of principal amount and interest shall be done upon repayment of rupee term loan availed by the said Associate Company from another financial institution or on availability of cash surplus with Associate Company after repayment of rupee term loan and meeting all operational expenses. No interest has been recovered from the Associate Company during the year except the amount of Tax Deducted at Source on the said interest and deposited by the Associate Company.
iv) Based on the audit procedures conducted by us and according to the information and explanations given to us, in our opinion the company has not given any loans, guarantees or securities to any of its Directors or to any other persons in whom the Director is interested under provisions of Section 185 ofthe Act. In our opinion and according to the information and explanations given to us, the company has complied with the provisions of sec.186 ofthe Act in respect of loans and investments made by it.
v) The company has not accepted any deposits from the public within the meaning of sections 73, 74, 75 and 76 ofthe Act and the Rules framed there underto the extent notified.
vi) The Central Government has specified maintenance of cost records under Sec.148 (1) ofthe Act, applicable in respect of wind power generation activity ofthe company and we are ofthe opinion that prima facie such accounts and records are made and maintained. We have not, however, made a detailed examination ofthe records with a view to determine whether they were accurate or complete.
vii) a) According to the information and explanations given to us and on the basis of our examination of records ofthe Company, undisputed statutory dues including Provident Fund, Employeesâ State Insurance, Income-Tax, Value added Tax, Service Tax, Goods & Service Tax, Cess and other statutory dues have been regularly deposited with the appropriate authorities. As explained to us, the company did not have any dues on account of Sales Tax, duty of Customs and duty of Excise.
According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Employeesâ State Insurance, Income-Tax, Value added Tax, Sales Tax, Service Tax, Goods & Service Tax, Cess, and other statutory dues were in arrears as at 31st March, 2018 for a period of more than six months from the date they became payable.
b) According to the information and explanations given to us and the records of the Company, examined by us there are no dues of Sales Tax, Service Tax, duty of Custom, duty of Excise, Value added Tax and Cess as at 31st March 2018, which have not been deposited on account of any dispute.
viii) The company has not availed of any loans or borrowings from financial institutions, bank or government. There are no debenture holders. Accordingly the provisions of Clause 3(viii) of the Order are not applicable to the company.
ix) The company has not raised any moneys by way of initial public offer, further public offer (including debt instruments) and term loans. Accordingly the provisions of clause 3(ix) of the Order are not applicable to the company.
x) Based upon the audit procedures performed and information and explanations given to us by the Management, we have neither come across any instance of fraud on or by the Company or on the Company by its officers or employees, noticed or reported during the year, nor have we been informed ofsuch case by the management.
xi) According to the information and explanations given to us and based on our examination of the records ofthe company, the company has paid / provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with schedule V to the Act.
xii) As the Company is not a nidhi company and the nidhi rules 2014 are not applicable to it, the provisions ofclause 3 (xii) ofthe Order are not applicable to the Company.
xiii) The company has issued guarantees to Jharkhand Skill Development Mission Society (JSDMS) for mobilization advance INR 127,247,200/- and towards performance guarantee INR 10,048,000/- on behalf of Mitcon Megaskill Centers Pvt. Ltd. (Associate in which company holds 26% stake) and issued guarantee of INR 3,776,088/- to Rajasthan Skills & Livelihood Development Corporation (RSLDC) on behalf of Clear Maze Consulting Pvt. Ltd. (CMCPL) (company in which director ofthe company is a director and member). Issue of above guarantees requires approval / ratification ofthe Audit Committee u/s 177 and the Board of Directors / Shareholders u/s 188 ofthe Companies Act, 2013. The Audit Committee and Board of Directors have for various reasons recorded in the Minutes of their respective meetings decided not to approve / ratify the said act of issue of guarantees by the company to JSDMS and RSLDC.
Apart from the above, according to the information and explanations given to us and based on our examination ofthe records ofthe company, transactions with the related parties are in compliance with Sections 177 and 188 ofthe Act where applicable. Details of related party transactions have been disclosed in the financial statements as required by the applicable accounting standards.
xiv) The company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review. Accordingly, the provisions of clause 3(xiv) of the Order are not applicable to the company.
xv) According to the information and explanations given to us and based on our examination ofthe records ofthe company, the company has not entered into any non-cash transactions with its directors or persons connected with him. Accordingly, the provisions of clause 3(xv) of the order are not applicable to the company.
xvi) The company is not required to be registered under section 45-IA ofthe Reserve Bank of India act, 1934. Accordingly, the provisions ofclause 3(xvi) ofthe Order are not applicable to the company.
FOR JOSHI & SAHNEY
CHARTERED ACCOUNTANTS
Firm Registration No.: 104359W
Sd/-
H.M.JOSHI
Place : Pune PARTNER
Date : 29th May, 2018 Membership No. 031689
Mar 31, 2016
INDEPENDENT AUDITORâS REPORT TO THE MEMBERS OF MITCON CONSULTANCY & ENGINEERING SERVICES LIMITED
Report on the Financial Statements :
We have audited the accompanying financial statements of MITCON Consultancy & Engineering Services Ltd. (âthe Companyâ), which comprise the Balance Sheet as at 31st March, 2016, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.
Managementâs Responsibility for the Financial statements :
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 and presentation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting 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 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 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 and other applicable authoritative pronouncements issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditorâs judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Companyâs preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. 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.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the financial statements.
Opinion :
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2016, and its profit and its cash flows for the year ended on that date.
Emphasis of Matter :
We draw attention to the following matter in the Notes to the financial statements:
Note No. 37A(i) to the financial statements relating to show cause-cum-demand notice dated 26.2.2014 received from the Commissioner of Central Excise, Pune - III, for recovery of an amount of INR 89,48,928 being Service Tax earlier refunded to the company.
Note no.37A(ii) to the financial statements relating to show cause-cum-demand notices dated 16.4.2013 and 29.4.2014 calling upon the company to show cause as to why an amount of INR 1,46,40,244/- should not be charged/ demanded and recovered from it for the period from 1.7.2011 to 31.3.2012 and a further amount of INR 86,01,654/- should not be charged/ demanded and recovered from it for the period 1.4.2012 to 30.6.2012 (being periods for which company did not pay service tax).
Our opinion is not qualified 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 (hereinafter referred to as the ''Order'') and on the basis of such checks of the books and records of the company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure B a statement on the matters specified in paragraphs 3 and 4 of the Order to the extent applicable.
2. As required by Section 143(3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
(c) The Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.
(d) In our opinion, the aforesaid financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
(e) On the basis of the written representations received from the directors as on 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) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in Annexure A.
(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 financial statements - Refer Note 28 to the financial statements;
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.
iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.
Report on the Internal Financial Controls under Clause (i) of Sub-section3 of section 143 of the Companies
Act, 2013 (''The Actâ).
1. We have audited the internal financial controls over financial reporting of MITCON Consultancy & Engineering Services Ltd. (âthe Companyâ) as of 31st March, 2016 in conjunction with our audit of the financial statements of the Company for the year ended on that date.
Managementâs Responsibility for Internal Financial Controls
2. 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 company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.
Auditorsâ Responsibility
3. Our responsibility is to express an opinion on the Company''s 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 "Guidance Note") and the Standards on Auditing deemed to be prescribed under section 143(10) of the Act to the extent applicable to an audit of internal financial controls both applicable to an audit of internal financial controls and both issued by the lCAI. 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.
4. 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.
5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
6. 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
7. 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
8. 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 31st March 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.
1. In respect of its fixed assets:
a) The Company is maintaining proper records showing full particulars including quantitative details and situation of fixed assets.
b) As explained to us, the fixed assets have been physically verified by the management during the year. The discrepancies noticed on such verification were not material and have been properly dealt with in the books of account.
c) The title deeds of immovable properties, as disclosed in Note 10 on fixed assets to the financial statements, are held in the name of the company.
2. As informed to us, the management has conducted physical verification of inventory being in the nature of course material at reasonable intervals during the year. As explained to us, discrepancies noticed on physical verification of inventories as compared to the book records, though not material, have been properly dealt with in the books of account.
3. The Company has not granted any loans, secured or unsecured, to Companies, firms, limited liability partnerships or other parties covered in the register maintained under section 189 of the Act. Accordingly, the provisions of clause 3 (iii) of the Order are not applicable to the Company.
4. The company has not given any loan, given guarantees or provided security which are covered under provisions of Section 185 and Section 186 of the Act. In our opinion and according to the information and explanation given to us, the company has complied with the provisions of sec. 186 of the Act in respect of investments made by it as applicable.
5. The company has not accepted any deposits from the public within the meaning of sections 73, 74, 75 and 76 of the Act and the Rules framed there under to the extent notified.
6. The Central Government has specified maintenance of cost records under Sec.148 (1) of the Act, applicable in respect of wind power generation activity of the company and we are of the opinion that prima facie such accounts and records are made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they were accurate or complete.
7. (a) According to the information and explanations given to us and on the basis of our examination of records of the Company, undisputed statutory dues including Provident Fund, Employeesâ State Insurance, Income-Tax, Value added Tax, Service Tax, Cess and other material statutory dues have been regularly deposited with the appropriate authorities. As explained to us, the company did not have any dues on account of Sales Tax, duty of Customs and duty of Excise.
According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Employeesâ State Insurance, Income-Tax, Value added Tax, Sales Tax, Service Tax, Cess and other material statutory dues were in arrears as at 31st March, 2016 for a period of more than six months from the date they became payable.
(b) According to the information and explanations given to us and the records of the Company, examined by us there are no dues of Sales Tax, Service Tax, duty of Custom, duty of Excise, Value added Tax and Cess as at 31st March 2016, which have not been deposited on account of any dispute. The particulars of dues of income tax outstanding as at 31st March 2016 which have not been deposited on account of dispute are as follows (Also see Note No. 37B)
Name of the Statute |
Nature of dues |
Period for which amount relates |
Amount in INR |
Forum where the dispute is pending |
Income Tax Act, 1961 |
Income Tax and interest (Disallowance of certain expenses* and short credit for prepaid taxes) |
FY 2009-10 |
17,22,200* |
Jurisdictional Assessing Officer |
Income Tax Act, 1961 |
Tax on Fringe Benefit |
FY 2008-09 |
1,59,580 |
Commissioner of Income Tax (Appeals) - 7, Pune |
Income Tax Act, 1961 |
Tax deducted at Source |
FY 2013-14 |
3,00,000 |
Deputy Commissioner of Income Tax - I (TDS) Pune |
*Out of the demand of Rs. 17,22,200/-, Income Tax Appellate Tribunal has allowed Companyâs appeal in respect of disallowance of expenses. However appeal effect relating to reduction of tax demand has not yet been received from the Jurisdictional Assessing Officer.
8. The company has not availed of any loans or borrowings from financial institutions, bank or government. There are no debenture holders. Accordingly the provisions of Clause 3(viii) of the Order are not applicable to the company.
9. The company has not raised any moneys by way of initial public offer, further public offer (including debt instruments) and term loans. Accordingly the provisions of clause 3(ix) of the Order are not applicable to the company.
10. Based upon the audit procedures performed and information and explanations given to us by the Management, we have neither come across any instance of fraud on or by the Company or on the Company by its officers or employees, noticed or reported during the year, nor have we been informed of such case by the management.
11. According to the information and explanations given to us and based on our examination of the records of the company, the company has paid / provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with schedule V to the Act.
12. As the Company is not a Nidhi company and the Nidhi rules 2014 are not applicable to it, the provisions of clause 3 (xii) of the Order are not applicable to the Company.
13. According to the information and explanations given to us and based on our examination of the records of the company, transactions with the related parties are in compliance with Sections 177 and 188 of the Act where applicable and details of such transactions have been disclosed in the financial statements as required by the applicable accounting standards.
14. The company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review. Accordingly the provisions of clause 3(xiv) of the Order are not applicable to the company.
15. According to the information and explanations given to us and based on our examination of the records of the company, the company has not entered into any non-cash transactions with its directors or persons connected with him. Accordingly the provisions of clause 3(xv) of the order are not applicable to the company.
16. The company is not required to be registered under section 45-IA of the Reserve Bank of India act, 1934. Accordingly the provisions of clause 3(xvi) of the Order are not applicable to the company.
FOR JOSHI & SAHNEY
CHARTERED ACCOUNTANTS
Firmâs Registration No.: 104359W
Sd/-
H.M.JOSHI
Place : Pune PARTNER
Date : 27th May, 2016 Membership No. 031689
Mar 31, 2015
We have audited the accompanying financial statements of MITCON
Consultancy & Engineering Services Ltd. ("the Company"), which comprise
the Balance Sheet as at 31st March, 2015, the Statement of Profit and
Loss, the Cash Flow Statement for the year then ended, and a summary of
the significant accounting policies and other explanatory information.
Management''s Responsibility for the Financial statements :
The Company''s Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 ("the Act") with respect
to the preparation and presentation of these financial statements that
give a true and fair view of the financial position, financial
performance and cash flows of the Company in accordance with the
accounting principles generally accepted in India, including the
Accounting Standards specifed 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 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 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
specifed under Section 143(10) of the Act. Those Standards require that
we comply with ethical requirements and plan and perform the audit to
obtain reasonable assurance about whether the financial statements are
free from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and the disclosures in the financial statements. The
procedures selected depend on the auditor''s judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal financial control relevant
to the Company''s preparation of the financial statements that give a
true and fair view in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing
an opinion on whether the Company has in place an adequate internal
financial controls system over financial reporting and the operating
effectiveness of such controls. An audit also includes evaluating the
appropriateness of the accounting policies used and the reasonableness
of the accounting estimates made by the Company''s Directors, as well as
evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is suffcient and
appropriate to provide a basis for our audit opinion on the financial
statements.
Opinion :
In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid financial statements give the
information required by the Act in the manner so required and give a
true and fair view in conformity with the accounting principles
generally accepted in India, of the state of affairs of the Company as
at 31st March, 2015, and its Profit and its cash flows for the year ended
on that date.
Emphasis of Matter :
We draw attention to the following matter in the Notes to the financial
statements:
Note No. 38A(i) to the financial statements relating to show
cause-cum-demand notice dated 26.2.2014 received from the Commissioner
of Central Excise, Pune - III, for recovery of an amount of INR
89,48,928 being Service Tax earlier refunded to the company.
Note no.38A(ii) to the financial statements relating to show
cause-cum-demand notices dated 16.4.2013 and 29.4.2014 calling upon the
company to show cause as to why an amount of INR 1,46,40,244/- should
not be charged/ demanded and recovered from it for the period from
1.7.2011 to 31.3.2012 and a further amount of INR 86,01,654/- should
not be charged/ demanded and recovered from it for the period 1.4.2012
to 30.6.2012 (being periods for which company did not pay service tax).
Our opinion is not modifed in respect of these matters.
Report on Other Legal and Regulatory Requirements :
1. As required by the Companies (Auditor''s Report) Order, 2015 ("the
Order") issued by the Central Government of India in terms of
Sub-section (11) of Section 143 of the Act, we give in the Annexure a
statement on the matters specifed in paragraphs 3 and 4 of the Order to
the extent applicable.
2. As required by Section 143(3) of the Act, we report that:
a) We have sought and obtained all the information and explanations
which to the best of our knowledge and belief were necessary for the
purposes of our audit.
b) In our opinion, proper books of account as required by law have been
kept by the Company so far as it appears from our examination of those
books.
c) The Balance Sheet, the Statement of Profit and Loss, and the Cash
Flow Statement dealt with by this Report are in agreement with the
books of account.
d) In our opinion, the aforesaid financial statements comply with the
Accounting Standards specifed 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, 2015 taken on record by the Board of
Directors, none of the directors is disqualifed as on 31st March, 2015
from being appointed as a director in terms of Section 164 (2) of the
Act.
f) With respect to the other matters to be included in the Auditor''s
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its
financial position in its financial statements  Refer Note 28 to the
financial statements;
ii. The Company did not have any long-term contracts including
derivative contracts for which there were any material foreseeable
losses.
iii. There were no amounts which were required to be transferred to
the Investor Education and Protection Fund by the Company
ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT (Referred to in paragraph
1 under ''Report on Other Legal and Regulatory Requirements'' section of
our report of even date)
1. In respect of its fixed assets :
a) The Company has maintained proper records showing full particulars
including quantitative details and situation of fixed assets.
b) As explained to us, the fixed assets have been physically verifed by
the management at the end of the year. The discrepancies noticed on
such verifcation were not material and have been properly dealt with in
the books of account.
2. In respect of its inventories :
a) The management has conducted physical verifcation of inventory being
in the nature of course material at reasonable intervals during the
year.
b) In our opinion and according to the information and explanations
given to us, the procedures of physical verifcation of inventory
followed by the management are reasonable and adequate in relation to
the size of the Company and the nature of its business.
c) The Company has maintained proper records of inventory. As explained
to us, discrepancies noticed on physical verifcation of inventories as
compared to the book records, though not material, have been properly
dealt with in the books of account.
3. The Company has not granted any loans, secured or unsecured, to
Companies, frms or other parties covered in the register maintained
under section 189 of the Act.
4. In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchase of inventory, fixed assets and also for the sale of goods and
services. On the basis of our examination of the books and records of
the company and according to the information and explanations given to
us, we have neither come across nor have been informed of any
continuing failure to correct major weaknesses in the aforesaid
internal control system.
5. The company has not accepted any deposits from the public within
the meaning of Sections 73 and 74 of the Act and the Rules framed there
under to the extent notifed.
6. According to the information and explanations given to us, Central
Government has not prescribed maintenance of cost record under sub
section (1) of section 148 of the Act.
7. a) According to the information and explanations given to us and on
the basis of our examination of records of the Company, undisputed
statutory dues including Provident Fund, Employees'' State Insurance,
Income-Tax, Value added Tax, Sales Tax, Service Tax, Cess and other
material statutory dues have been generally regularly deposited with
the appropriate authorities. As explained to us, the company did not
have any dues on account of Wealth Tax, duty of Customs and duty of
Excise.
According to the information and explanations given to us, no
undisputed amounts payable in respect of Provident Fund, Employees''
State Insurance, Income-Tax, Value added Tax, Sales Tax, Wealth Tax,
Service Tax, Cess, and other material statutory dues were in arrears as
at 31st March, 2015 for a period of more than six months from the date
they became payable.
b) According to the information and explanations given to us and the
records of the Company, examined by us there are no dues of Sales Tax,
Service Tax, Wealth Tax, Employees'' State Insurance, duty of Custom,
duty of Excise, Value added Tax and Cess as at 31st March 2015, which
have not been deposited on Account of any dispute. The particulars of
dues outstanding of income tax as at 31st March 2015 which have not
been deposited on account of dispute are as follows (Also see Note No.
38B)
Period
Forum where
the dispute is
Name of the for which Amount in
Nature of dues pending
Statute amount INR
relates
Income Tax
and interest
Income Tax (Disallowance of
FY 2009-10 17,22,200* Jurisdicti
-onal
Assessing
Officer
Act, 1961 certain expenses*
and short credit for
prepaid taxes)
Income Tax Commissioner
of Income Tax
Tax on Fringe
Benefit FY 2008-09 1,59,580
Act, 1961 (Appeals)-7,
Pune
* Out of the demand of Rs. 17,22,200/-, Income Tax Appellate Tribunal
has allowed Company''s appeal in respect of disallowance of expenses.
However appeal effect relating to reduction of tax demand has not yet
been received from the Jurisdictional Assessing officer.
c) According to the information and explanations given to us, there
were no amounts which were required to be transferred to Investor
Education and Protection Fund in accordance with the relevant
provisions of the Companies Act, 1956 (I of 1956) and rules made
thereunder.
8. The Company does not have any accumulated losses as at 31st March
2015 and it has not incurred any cash losses in the financial year ended
on that date and in the immediately preceding financial year.
9. There are no dues to financial institutions or banks. There are no
debenture holders.
10. 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.
11. According to the information and explanations given to us no term
loans have been obtained by the company during the year.
12. During the course of our examination of the books and records of
the Company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
material fraud on or by the Company, noticed or reported during the
year, nor have we been informed of such case by the management.
FOR & ON BEHALF OF JOSHI AND SAHNEY
CHARTERED ACCOUNTANTS
Firm''s Registration No.: 104359W
Sd/-
H.M.JOSHI
Place : Pune PARTNER
Date : 27th May, 2015 Membership No. 031689
Mar 31, 2014
Report on the Financial Statements :
We have audited the accompanying financial statements of MITCON
CONSULTANCY & ENGINEERING SERVICES LIMITED ("the Company"), which
comprise the Balance Sheet as at 31st March 2014, the Statement of
Profit and Loss and the Cash Flow Statement for the year then ended and
a summary of significant accounting policies and other explanatory
information.
Management''s Responsibility for the Financial statements :
The Company''s Management is responsible for the preparation of these
financial statements that give a true and fair view of the financial
position, financial performance and cash flows of the Company in
accordance with the Accounting Standards referred to in 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 & presentation of the
financial statements that give a true and fair view and are free from
material misstatement, whether due to fraud or error.
Auditor''s Responsibility :
Our responsibility is to express an opinion on these 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 the disclosures in the financial statements. The
procedures selected depend on the auditor''s judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the
Company''s preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the
circumstances , but not for the purpose of expressing an opinion on the
effectiveness of the Company''s internal control. An audit also includes
evaluating the appropriateness of the accounting policies used and the
reasonableness of the accounting estimates made by the Management, as
well as evaluating the overall presentation of the financial
statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
Opinion :
In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid financial statements give the
information required by the Act in the manner so required and give a
true and fair view in conformity with the accounting principles
generally accepted in India:
(a) in the case of the Balance Sheet of the state of affairs of the
Company as at 31st March 2014;
(b) in the case of the Statement of Profit and Loss , of the profit of
the company for the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
Emphasis of Matter :
We draw attention to Note no.38A(i) to the financial statements
relating to show cause-cum-demand notice dated 26.2.2014 received from
the Commissioner of Central Excise, Pune-III, for recovery of an amount
of Rs.89,48,928 being Service Tax earlier refunded to the company and
note no.38A(ii) to the financial statements relating to show
cause-cum-demand notices dated 16.4.2013 and 29.4.2014 calling upon the
company to show cause as to why an amount of INR 1,46,40,244/- should
not be charged/ demanded and recovered from it for the period from
1.7.2011 to 31.3.2012 and a further amount of INR 86,01,654/- should
not be charged/ demanded and recovered from it for the period 1.4.2012
to 30.6.2012 (being periods for which company did not pay service tax).
Our opinion is not qualified in respect of this matter
Report on Other Legal and Regulatory Requirements :
1. As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order") issued by the Central Government in terms of Section 227(4A) of
the Act, we give in the Annexure a statement on the matters specified
in paragraphs 4 and 5 of the Order.
2. As required by Section 227(3) of the Act, we report that:
a) We have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purposes of our
audit.
b) In our opinion, proper books of account as required by law have been
kept by the Company so far as it appears from our examination of those
books.
c) The Balance Sheet, the Statement of Profit and Loss, and the Cash
Flow Statement dealt with by this Report are in agreement with the
books of account.
d) In our opinion, the Balance Sheet, the Statement of Profit and Loss,
and the Cash Flow Statement comply with the Accounting Standards
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.
e) On the basis of the written representations received from the
directors as on 31st March 2014 taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March 2014
from being appointed as a director in terms of Section 274(1)(g) of the
Act.
ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT
(Referred to in paragraph 1 under
''Report on Other Legal and Regulatory Requirements'' section of our
report of even date)
1. In respect of its fixed assets :
a) The Company has maintained proper records showing full particulars
including quantitative details and situation of fixed assets.
b) As explained to us, the fixed assets have been physically verified
by the management at the end of the year. The discrepancies noticed on
such verification were not material and have been properly dealt with
in the books of account.
c) The fixed assets disposed off during the year, in our opinion, do
not constitute a substantial part of the fixed assets of the Company
and such disposal has, in our opinion, not affected the going concern
status of the Company.
2. In respect of its inventories :
a) The management has conducted physical verification of inventory
being in the nature of course material at reasonable intervals during
the year.
b) In our opinion and 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) The Company has maintained proper records of inventory. As explained
to us, discrepancies noticed on physical verification of inventories as
compared to the book records, though not material, have been properly
dealt with in the books of account.
3. The Company has neither granted nor taken any loans, secured or
unsecured, to or from Companies, firms or other parties covered in the
register maintained under section 301 of the Companies Act 1956.
Therefore, the provisions of Clause 4(iii)[(b), (c) and (d), (f) and
(g)] of the said Order are not applicable to the Company.
4. In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchase of inventory, fixed assets and also for the sale of goods and
services. On the basis of our examination of the books and records of
the company and according to the information and explanations given to
us, we have neither come across nor have been informed of any
continuing failure to correct major weaknesses in the aforesaid
internal control system.
5. a) According to the information and explanations given to us, we are
of the opinion that the particulars of all contracts or arrangements
that need to be entered into the register maintained under Section
301 of the Companies Act 1956 have been so entered.
b) In our opinion, and according to the information and explanations
given to us, the transactions made in pursuance of such contracts or
arrangements and exceeding the value of Rupees Five
Lakhs in respect of each party during the year have been made at prices
which are reasonable having regard to the prevailing market prices at
the relevant time.
6. The company has not accepted any deposits from the public.
7. In our opinion, the internal audit function carried out during the
year by a firm of Chartered Accountants appointed by the management has
been commensurate with the size of the company and the nature of its
business.
8. According to the information and explanations given to us, Central
Government has not prescribed maintenance of cost record under clause
(d) of sub section (1) of section 209 of the Act.
9. a) According to the information and explanations given to us and on
the basis of our examination of records of the Company, undisputed
statutory dues including Provident Fund, Employees'' State Insurance,
Income-Tax, Value added Tax, Service Tax, Cess and other material
statutory dues have been generally regularly deposited with the
appropriate authorities. As explained to us, the company did not have
any dues on account of Wealth Tax, Investor Education and Protection
Fund, Custom Duty and Excise Duty.
According to the information and explanations given to us, no
undisputed amounts payable in respect of Provident Fund, Employees''
State Insurance, Income-Tax, Value added Tax, Wealth Tax, Service Tax,
Cess, and other material statutory dues were in arrears as at 31st
March, 2014 for a period of more than six months from the date they
became payable.
b) According to the information and explanations given to us and the
records of the Company, examined by us there are no dues of Sales Tax,
Service Tax, Wealth Tax, Investor Education and Protection Fund,
Employees'' State Insurance, Custom Duty, Excise Duty and Cess as at
31st March 2014, which have not been deposited on Account of any
dispute. The particulars of dues outstanding of income tax as at 31st
March 2014 which have not been deposited on account of dispute are as
follows (Also see Note No.38B)
Name of the Nature of Period Amount in Forum where
Statute dues for which in INR the dispute is pending
amount
relates
Income
Income Tax Tax and fy 2009-10 17,22,200 Jurisdictional
Act,1961 interest Assessing Officer and
(Disallo Income Tax Appellate
-wance of Tribunal, Pune
certain
expenses
and short
credit for
prepaid
taxes)
10. The Company does not have any accumulated losses as at 31st March
2014 and it has not incurred any cash losses in the financial year
ended on that date and in the immediately preceding financial year.
11. There are no dues to financial institutions or banks. There are no
debenture holders.
12. According to the information and explanations given to us, the
Company has not granted any loans and advances on the basis of security
by way of pledge of shares, debentures and other securities.
13. According to the information and explanations given to us, the
Company is not a chit fund, nidhi, mutual benefit fund.
14. According to the information and explanations given to us, the
Company is not dealing or trading in shares, securities, debentures and
other investments.
15. The guarantee given by the company in earlier year to a bank for
loan taken by MITCON Foundation, a Trust promoted by the Company, has
been cancelled on repayment of said loan by MITCON Foundation.
16. According to the information and explanations given to us no term
loans have been obtained by the Company during the year.
17. On the basis of an overall examination of the balance sheet of the
Company, in our opinion and according to the information and
explanations given to us, there are no funds raised on a short term
basis which have been used for long term investment.
18. The Company has not made any preferential allotment of shares to
parties and companies covered in the Register maintained under Section
301 of the Companies Act, 1956 during the year.
19. The Company has not issued debentures during the year and hence
question of creating security/ charge does not arise.
20. We have verified the end-use of the money raised by public issue
as disclosed by the Management in Note no.42 to the financial
statements.
21. During the course of our examination of the books and records of
the Company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
fraud on or by the Company, noticed or reported during the year, nor
have we been informed of such case by the management.
FOR & ON BEHALF OF
JOSHI AND SAHNEY
CHARTERED ACCOUNTANTS
Firm''s Registration No.: 104359W
Sd/-
H.M.JOSHI
Place: Pune PARTNER
Date : 30/05/2014 Membership No. 031689
Mar 31, 2013
We have audited the accompanying financial statements of MITCON
CONSULTANCY & ENGINEERING SERVICES LIMITED ("the Company"), which
comprise the Balance Sheet as at 31st March 2013, the Statement of
Profit and Loss and the Cash Flow Statement for the year then ended and
a summary of significant accounting policies and other explanatory
information.
Management''s Responsibility for the Financial statements :
The Company''s Management is responsible for the preparation of these
financial statements that give a true and fair view of the financial
position, financial performance and cash flows of the Company in
accordance with the Accounting Standards referred to in Section 211(3C)
of the Companies Act,1956("the Act"). This responsibility includes the
design, implementation and maintenance of internal control relevant to
the preparation & presentation of the financial statements that give a
true and fair view and are free from material misstatement, whether due
to fraud or error.
Auditor''s Responsibility :
Our responsibility is to express an opinion on these 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 misstatements
An audit involves performing procedures to obtain audit evidence about
the amounts and the disclosures in the financial statements. The
procedures selected depend on the auditor''s judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the
Company''s preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Company''s internal control. An audit also includes
evaluating the appropriateness of the accounting policies used and the
reasonableness of the accounting estimates made by the Management, as
well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
Opinion :
In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid financial statements give the
information required by the Act in the manner so required and give a
true and fair view in conformity with the accounting principles
generally accepted in India:
(a) in the case of the Balance Sheet of the state of affairs of the
Company as at 31st March 2013;
(b) in the case of the Statement of Profit and Loss , of the profit of
the company for the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
Emphasis of Matter :
We draw attention to Note no.41III to the financial statements relating
to show cause-cum-demand notice dated 16.4.2013 received from The
Commissioner of Central Excise, Pune-III, calling upon the company to
show cause as to why an amount of INR 1,46,40,244/- for the period from
1.7.2011 to 31.3.2012 should not be charged/ demanded and recovered
from the company. Our opinion is not qualified in respect of this
matter
Report on Other Legal and Regulatory Requirements :
1. As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order") issued by the Central Government in terms of Section 227(4A) of
the Act, we give in the Annexure a statement on the matters specified in
paragraphs 4 and 5 of the Order.
2. As required by Section 227(3) of the Act, we report that:
a) We have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purposes of our
audit.
b) In our opinion, proper books of account as required by law have been
kept by the Company so far as it appears from our examination of those
books.
c) The Balance Sheet, the Statement of Profit and Loss, and the Cash
Flow Statement dealt with by this Report are in agreement with the
books of account.
d) In our opinion, the Balance Sheet, the Statement of Profit and Loss,
and the Cash Flow Statement comply with the Accounting Standards
referred to in Section 211(3C) of the Act.
e) On the basis of the written representations received from the
directors as on 31st March 2013 taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March 2013
from being appointed as a director in terms of Section 274(1)(g) of the
Act.
ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT (Referred to in paragraph
1 under Report on Other Legal and Regulatory Requirements'' section of
our report of even date)
1. In respect of its fixed assets :
a) The Company has maintained proper records showing full particulars
including quantitative details and situation of fixed assets.
b) The fixed assets have been physically verified by the management at
the end of the year. The discrepancies noticed on such verification were
not material and have been properly dealt with in the books of account.
c) The fixed assets disposed off during the year, in our opinion, do not
constitute a substantial part of the fixed assets of the Company and
such disposal has, in our opinion, not affected the going concern
status of the Company.
2. In respect of its inventories :
a) The management has conducted physical verification of inventory being
in the nature of course material at reasonable intervals during the
year.
b) In our opinion and 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) The Company has maintained proper records of inventory. As explained
to us, discrepancies noticed on physical verification of inventories as
compared to the book records, though not material, have been properly
dealt with in the books of account.
3. The Company has neither granted nor taken any loans, secured or
unsecured, to or from Companies, forms or other parties covered in the
register maintained under section 301 of the Companies Act 1956.
4. In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchase of inventory, fxed assets and also for the sale of goods and
services. On the basis of our examination of the books and records of
the company and according to the information and explanations given to
us, we have neither come across nor have been informed of any
continuing failure to correct major weaknesses in the aforesaid
internal control system.
5. Based on the information and explanations given to us, there are no
transactions required to be entered into the register in pursuance of
Section 301 of the Companies Act 1956.
6. The company has not accepted any deposits from the public.
7. In our opinion, the internal audit function carried out during the
year by a form of Chartered Accountants appointed by the management has
been commensurate with the size of the company and the nature of its
business.
8. According to the information and explanations given to us, Central
Government has not prescribed maintenance of cost record under clause
(d) of sub section (1) of section 209 of the Act.
9. (a) According to the information and explanations given to us and
on the basis of our examination of records of the Company, undisputed
statutory dues including Provident Fund, Employees'' State Insurance,
Income-Tax, Value added Tax, Service Tax, Cess and other material
statutory dues have been generally regularly deposited with the
appropriate authorities. As explained to us, the company did not have
any dues on account of Wealth Tax, Investor Education and Protection
Fund, Custom Duty and Excise Duty.
According to the information and explanations given to us, no
undisputed amounts payable in respect of Provident Fund, Employees''
State Insurance, Income-Tax, Value added Tax, Wealth Tax, Service Tax,
Cess, and other material statutory dues were in arrears as at 31st
March, 2013 for a period of more than six months from the date they
became payable.
b) According to the information and explanations given to us and the
records of the Company, examined by us there are no dues of Income Tax,
Sales Tax, Service Tax, Wealth Tax, Investor Education and Protection
Fund, Employees'' State Insurance, Custom Duty, Excise Duty and Cess as
at 31st March 2013, which have not been deposited on Account of any
dispute.
10. The Company does not have any accumulated losses as at 31st March
2013 and it has not incurred any cash loss in the financial year ended
on that date or in the immediately preceding financial year.
11. There are no dues to financial institutions or banks. There are no
debenture holders.
12. According to the information and explanations given to us, the
Company has not granted any loans and advances on the basis of security
by way of pledge of shares, debentures and other securities.
13. According to the information and explanations given to us, the
Company is not a chit fund, nidhi, mutual benefit fund.
14. According to the information and explanations given to us, the
Company is not dealing or trading in shares, securities, debentures and
other investments.
15. The Company has given guarantee for loan from a bank taken by
MITCON Foundation, a Trust promoted by the Company. According to the
information and explanations given to us, we are of the opinion that
the terms and conditions thereof are not prima-facie prejudicial to the
interest of the Company.
16. According to the information and explanations given to us no term
loans have been obtained by the company during the year.
17. On the basis of an overall examination of the balance sheet of the
company, in our opinion and according to the information and
explanations given to us, there are no funds raised on a short term
basis which have been used for long term investment.
18. The Company has not made any preferential allotment of shares to
parties and companies covered in the Register maintained under Section
301 of the Companies Act, 1956 during the year.
19. The Company has not issued debentures during the year and hence
question of creating securities does not arise.
20. The Company has not raised any money by way of public issues
during the year.
21. During the course of our examination of the books and records of
the Company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
fraud on or by the Company, noticed or reported during the year, nor
have we been informed of such case by the management.
For JOSHI & SAHNEY
Chartered Accountants
Firm Registration No: 104359W
Sd/-
H.M.JOSHI
Place: Pune PARTNER
Date: 12/07/2013 Membership No. 031689