Mar 31, 2017
Report on the Financial Statements
We have audited the accompanying financial statements of M/s Mukand Engineers Limited (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2017, the Statement of Profit and Loss, Cash Flow Statement for the year then ended, and a summary of 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 of these financial statements to 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 referred to in 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 are operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditors'' Responsibility
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 and the Rules made there under including the Accounting and Auditing Standards and matters which are required to be included in the audit report.
We have conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors'' 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 true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the 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 financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2017 and its Loss and its cash flows for the year ended on that date.
Emphasis of Matter
We draw attention to the following matter in notes to Financial Statements:
(i) Note No. 28 to the financial statements, relating to overdue loans, aggregating Rs.4,43,00,000/- (Previous Year Rs.5,88,00,000/-) and Interest
Receivable thereon, aggregating Rs.2,22,71,683 /-(Previous Year Rs.2,92,28,810/-), at the end of the year, that are due from investment companies whose net worth have eroded. The Managementâs assessment on the recoverability from the financial assets of these companies is subject to uncertainties and which if do not materialize, could significantly impact the carrying values of the aforesaid loans & interest thereon. Our report is not modified in respect of the above matter.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditorâs Report) Order, 2016 issued by the Central Government of India in terms of sub-section (11) of the section 143 of the Act (hereinafter referred to as âthe Orderâ), 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 paragraph 3 and 4 of the Order.
2. As required by Section 143(3) of the Act, we report that:
a. We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit.
b. In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
c. The Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account.
d. In our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
e. On the basis of written representations received from the Directors as on March 31, 2017, and taken on record by the Board of Directors, none of the Directors is disqualified as on March 31, 2017, from being appointed as a Director in terms of Section 164(2) of the Act.
f. With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in âAnnexure Bâ.
g. With respect to the other matters to be included in the Auditors'' Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our knowledge and belief and according to the information and explanations given to us:
i. The Company has disclosed the impact, if any, of pending litigations as at 31st March, 2017 on its financial position in its financial statements as referred to in Note 27 to the financial statements.
ii. The Company has made provision as at March 31, 2017 as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts. The Company has not entered in to any Derivative Contracts during the financial year.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended March 31, 2017.
iv. The Company has provided requisite disclosures in the standalone financial statements as to holding as well as dealings in Specified Bank Notes during the period from 8th November, 2016 to 30th December, 2016, on the basis of information available with the Company. Based on audit procedures, and relying on managementâs representation, we report that disclosures are in accordance with the books of accounts maintained by the Company and as produced to us by the Management.- Refer Note No.39
ANNEXURE A TO INDEPENDENT AUDITORSâ REPORT
(The Annexure referred to in our report to the members of Mukand Engineers Limited (âthe Companyâ) for the year ended March 31, 2017.)
(i) In respect of its Fixed Assets:
(a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
(b) As per the explanation given to us, the Fixed Assets were physically verified by the Management in accordance with a regular programme covering all the assets over a period of three years, which in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the program, the management during the year has physically verified a portion of the fixed assets and no material discrepancies were noticed on such verification. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and nature of is assets.
(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company does not hold any immovable properties in its name.
(ii) The physical verification of inventory excluding stocks with third parties and contractors has been conducted at reasonable intervals by the Management during the year. In respect of inventory lying with third parties, these have substantially been confirmed by them. In our opinion, the frequency of verification is reasonable.
(iii) In our opinion, and according to information and explanations given to us, the Company has not granted any loans, secured or unsecured, to Companies, firms or other parties covered in the register maintained under Section 189 of the Act during the year. Consequently, clauses (iii) (a), (iii) (b) and (iii) c of paragraph 3 of the Order are not applicable to the Company.
(iv) In our opinion and according to the information and explanations given to us, the Company has not granted any loans or provided any guarantees or security in respect of any loans to any party covered under Section 185 and 186 of the Act. The Company has complied with the provisions of Section 186 of the Act, in respect of investments made in body corporate.
(v) In our opinion and according to the information and explanations given to us, the Company has generally complied with the directives issued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any other provisions of the Act and the Companies (Acceptance of Deposits) Rules, 2014 to the extent notified, with regard to deposits accepted from the public. The Company not being an âEligible Companyâ as defined in Companies (Acceptance of Deposits) Rules, 2014, sought and obtained the approval from the Company Law Board for extension in time limit for repayment of Public Deposits outstanding as on March 31 2015 on the respective due dates of maturity.
(vi) The Central Government has not prescribed the maintenance of cost records under section 148(1) of the Act, for any of the services rendered by the Company.
(vii) In respect of Statutory Dues:
(a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is generally regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employeesâ State Insurance, Income Tax, Sales Tax including Value Added Tax, Service Tax, Entry Tax, Cess and other material statutory dues as applicable to it with the appropriate authorities. As explained to us, there were no dues towards Custom Duty, Wealth Tax and Excise Duty during the year.
According to information and explanations given to us, there were no undisputed amounts payable in respect of Income Tax, Service Tax, Entry Tax, Value Added Tax, Cess and other material statutory dues in arrears as on 31st March,2017 for a period of more than six months from the date they become payable.
(b) According to information and explanations given to us upon our enquiries in this regard and records of the Company, the following statutory dues in respect of Income Tax, Works Contract Tax, Entry Tax and Service Tax as at 31st March, 2017 have not been deposited by the Company on account of disputes:
Nature of dues |
Amount |
Period to which the amount relates |
Forum where the dispute is pending |
Income Tax |
86,22,250 |
2000-2001, 2001-2002 |
High Court of Bombay |
Income Tax |
84,55,448 |
1999-2000 2005-2006 |
Income Tax Appellate Tribunal |
Income Tax |
16,13,533 |
2011-2012 to 2012-2013 |
Commissioner of Income Tax |
Income Tax |
98,95,634 |
2002-2003 to 2012-2013 |
Income Tax Department Authorities |
Works Contracts Tax |
75,83,974 |
2001-2002 and 2002-2003 |
High Court |
Works Contracts Tax |
1,88,91,961 |
2001-2002 to 2004-2005, 2011-2012, 2012-2013, 2014-2015 |
Sales Tax Department Authorities |
Entry Tax |
8,11,173 |
1999-2000 to 2002-2003 |
High Court, Odisha |
Entry Tax |
1,27,835 |
2003-2004 1999-2000 |
Asst. Commissioner (Sales Tax) |
(viii) According to the records of the Company examined by us and information and explanations given to us, the Company has not defaulted in repayment of dues to any financial institution or bank during the year. There are no dues to any debenture holders.
(ix) The Company did not raise any money by way of initial public offer or further public offer (including debt instruments) and term loans during the year. Accordingly, clause (ix) of paragraph 3 of the Order is not applicable.
(x) 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.
(xi) According to the information and explanations give to us and based on our examination of the records of the Company, the Company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act.
(xii) In our opinion and according to the information and explanations given to us, the Company is not a Nidhi Company. Accordingly, clause (xii) of paragraph 3 of the Order is not applicable.
(xiii) According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with Sections 177 and 188 of the Act, where applicable. The details of related party transactions have been disclosed in the financial statements as required under Accounting Standard (AS)18, related party disclosures as specified under section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
(xiv) According to the information and explanations give to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.
(xv) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into non-cash transactions with Directors or persons connected with him. Accordingly, clause (xv) of paragraph 3 of the Order is not applicable.
(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 (xvi) of paragraph 3 of the Order are not applicable to the Company.
GIRISH M. PATHAK
Partner
Membership No. 102016
For and on behalf of
K.K.MANKESHWAR & CO.,
Chartered Accountants
FRN- 106009W
Mumbai, May 24, 2017
Mar 31, 2016
To the Members
Mukand Engineers Limited
Report on the Financial Statements
We have audited the accompanying financial statements of M/s Mukand Engineers Limited (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2016, the Statement of Profit and Loss, Cash Flow Statement for the year then ended, and a summary of 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 of these financial statements to 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 referred to in 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 are operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditorsâ 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 and the Rules made there under including the Accounting and Auditing Standards and matters which are required to be included in the audit report.
We have conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditorsâ 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 true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the 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 financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2016 and its Loss and its cash flows for the year ended on that date.
Emphasis of Matter
We draw attention to the following matter in notes to Financial Statements:
(i) Note No. 28 to the financial statements, relating to overdue loans, aggregating Rs. 5,88,00,000/- (Previous Year Rs. 8,05,50,000/-) and Interest Receivable thereon, aggregating Rs. 2,92,28,810/- (Previous Year Rs. 4,29,57,419/-), at the end of the year, that are due from investment companies whose net worth have eroded. The Managementâs assessment on the recoverability from the financial assets of these companies is subject to uncertainties and which if do not materialize, could significantly impact the carrying values of the aforesaid loans & interest thereon.
Our report is not modified in respect of the above matter. Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditorâs Report) Order, 2016 issued by the Central Government of India in terms of sub-section (11) of the section 143 of the Act (hereinafter referred to as âthe Orderâ), 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 âAnnexure Aâ, a statement on the matters specified in paragraph 3 and 4 of the Order.
2. As required by Section 143(3) of the Act, we report that:
a. We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit.
b. In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
c. The Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account.
d. In our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
e. On the basis of written representations received from the Directors as on March 31, 2016, and taken on record by the Board of Directors, none of the Directors is disqualified as on March 31, 2016, from being appointed as a Director in terms of Section 164(2) of the Act.
f. With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in âAnnexure Bâ.
g. With respect to the other matters to be included in the Auditorsâ Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our knowledge and belief and according to the information and explanations given to us:
i. The Company has disclosed the impact, if any, of pending litigations as at March 31, 2016 on its financial position in its financial statements as referred to in Note 27 to the financial statements.
ii. The Company has made provision as at March 31, 2016 as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts. The
Company has not entered in to any Derivative Contracts during the financial year.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended March 31, 2016.
ANNEXURE A TO INDEPENDENT AUDITORSâ REPORT
(The Annexure referred to in our report to the members of Mukand Engineers Limited (âthe Companyâ) for the year ended March 31, 2016.)
(i) In respect of its Fixed Assets:
(a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
(b) As per the explanation given to us, the Fixed Assets were physically verified by the Management in accordance with a regular programme covering all the assets over a period of three years, which in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the program, the management during the year has physically verified a portion of the fixed assets and no material discrepancies were noticed on such verification. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and nature of is assets.
(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company does not hold any immovable properties in its name.
(ii) The physical verification of inventory excluding stocks with third parties and contractors has been conducted at reasonable intervals by the Management during the year. In respect of inventory lying with third parties, these have substantially been confirmed by them. In our opinion, the frequency of verification is reasonable.
(iii) In our opinion, and according to information and explanations given to us, the Company has not granted any loans, secured or unsecured, to Companies, firms or other parties covered in the register maintained under Section 189 of the Act during the year. Consequently, clauses (iii) (a), (iii) (b) and (iii) c of paragraph 3 of the Order are not applicable to the Company.
(iv) In our opinion and according to the information and explanations given to us, the Company has not granted any loans or provided any guarantees or security in respect of any loans to any party covered under Section 185 and 186 of the Act. The Company has complied with the provisions of Section 186 of the Act, in respect of investments made in body corporate.
(v) In our opinion and according to the information and explanations given to us, the Company has generally complied with the directives issued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any other provisions of the Act and the Companies (Acceptance of Deposits) Rules, 2014 to the extent notified, with regard to deposits accepted from the public. The Company not being an âEligible Companyâ as defined in Companies (Acceptance of Deposits) Rules, 2014, sought and obtained the approval from the Company Law Board for extension in time limit for repayment of Public Deposits outstanding as on March 31 2015 on the respective due dates of maturity.
(vi) The Central Government has not prescribed the maintenance of cost records under section 148(1) of the Act, for any of the services rendered by the Company.
(vii) In respect of Statutory Dues:
(a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is generally regular in depositing undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employeesâ State Insurance, Income Tax, Sales Tax including Value Added Tax, Service Tax, Entry Tax, Cess and other material statutory dues as applicable to it with the appropriate authorities. As explained to us, there were no dues towards Custom Duty, Wealth Tax and Excise Duty during the year.
According to information and explanations given to us, there were no undisputed amounts payable in respect of Income Tax, Service Tax, Entry Tax, Value Added Tax, Cess and other material statutory dues in arrears as on 31st March,2016 for a period of more than six months from the date they become payable.
(b) According to information and explanations given to us upon our enquiries in this regard and records of the Company, the following statutory dues in respect of Income Tax, Works Contract Tax, Entry Tax and Service Tax as at 31st March, 2016 have not been deposited by the Company on account of disputes:
Nature of dues |
Amount |
Period to which the amount relates |
Forum where the dispute is pending |
Income Tax |
86,22,250 |
2000-2001, 2001-2002 |
High Court of Bombay |
Income Tax |
84,55,448 |
1999-2000 2005-2006 |
Income Tax Appellate Tribunal |
Income Tax |
20,17,828 |
2010-2011 to 2012-2013 |
Commissioner of Income Tax |
Income Tax |
98,95,634 |
2002-2003 to 2012-2013 |
Income Tax Department Authorities |
Works Contracts Tax |
75,83,974 |
2001-2002 and 20022003 |
High Court |
Works Contracts Tax |
1,15,11,927 |
2001-2002 to 2004-2005 |
Sales Tax Department Authorities |
Entry Tax |
8,11,173 |
1999-2000 to 2002-2003 |
High Court, Odisha |
Entry Tax |
1,27,835 |
2003-2004 1999-2000 |
Asst. Commissioner (Sales Tax) |
(xii) In our opinion and according to the information and explanations given to us, the Company is not a Nidhi Company. Accordingly, clause (xii) of paragraph 3 of the Order is not applicable.
(xiii) According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with Sections 177 and 188 of the Act, where applicable. The details of related party transactions have been disclosed in the financial statements as required under Accounting Standard (AS)18, related party disclosures as specified under section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
(xiv) According to the information and explanations give to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.
(xv) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into non-cash transactions with Directors or persons connected with him. Accordingly, clause (xv) of paragraph 3 of the Order is not applicable.
(xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act 1934.
(viii) According to the records of the Company examined by us and information and explanations given to us, the Company has not defaulted in repayment of dues to any financial institution or bank during the year. There are no dues to any debenture holders.
(ix) The Company did not raise any money by way of initial public offer or further public offer (including debt instruments) and term loans during the year. Accordingly, clause (ix) of paragraph 3 of the Order is not applicable.
(x) 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.
(xi) According to the information and explanations give to us and based on our examination of the records of the Company, the Company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act.
ANNEXURE B TO INDEPENDENT AUDITORSâ REPORT
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (âthe Actâ)
We have audited the internal financial controls over financial reporting of Mukand Engineers Limited (âthe Companyâ) as of March 31, 2016 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.
Managementâs Responsibility for Internal Financial Controls
The 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 (the âGuidance Noteâ) issued by the Institute of Chartered Accountants of India (âICAIâ). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to Companyâs policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013 (âthe Actâ).
Auditorsâ Responsibility
Our responsibility is to express an opinion on the Companyâs internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note 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 ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditorâs judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Companyâs internal financial controls system over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A Companyâs internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A Companyâs internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and Directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Companyâs assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls Over Financial Reporting
Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 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.
GIRISH M. PATHAK
Partner
Membership No. 102016
For and on behalf of
K.K. MANKESHWAR & CO.,
Chartered Accountants
FRN- 106009W
Mumbai, 20th May, 2016
Mar 31, 2015
We have audited the accompanying financial statements of M/s Mukand
Engineers Limited ("the Company"), which comprise the Balance Sheet
as at March 31, 2015, the Statement of Profit and Loss, 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 Board of
Directors is responsible for the matters stated in Section 134(5) of
the Companies Act, 2013 ("the Act") with respect to the preparation
of these financial statements to 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 referred to in 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 are operating effectively for
ensuring the accuracy and completeness of the accounting records,
relevant to the preparation and presentation of the financial
statements that give a true and fair view and are free from material
misstatement, whether due to fraud or error.
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 and the Rules made there under including the
Accounting and Auditing Standards and matters which are required to be
included in the audit report.
We have conducted our audit in accordance with the Standards on
Auditing specified under Section 143(10) of the Act. Those standards
require that we comply with ethical requirements and plan and perform
the audit to obtain reasonable assurance about whether the financial
statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The procedures
selected depend on the auditor's judgment, including the assessment of
the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, the auditor
considers internal financial control relevant to the Company's
preparation of the financial statements that give true and fair view in
order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on
whether the Company has in place an adequate internal financial
controls system over financial reporting and the operating
effectiveness of such controls. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of
the accounting estimates made by the Company's 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 financial statements give the information
required by the Act in the manner so required and give a true and fair
view in conformity with the accounting principles generally accepted in
India, of the state of affairs of the Company as at March 31, 2015 and
its profit and its cash flows for the year ended on that date.
Emphasis of Matter
Without qualifying our opinion, we draw your attention to:
(i) Note No. 28 to the financial statements, relating to overdue loans,
aggregating Rs. 8,05,50,000/- (Previous Year Rs. 10,14,50,000/-) and
Interest Receivable thereon, aggregating Rs. 4,29,57,419/- (Previous Year
Rs. 4,29,57,419/-), at the end of the year, that are due from investment
companies whose net worth have eroded. The Management's assessment on
the recoverability from the financial assets of these companies is
subject to uncertainties and which if do not materialize, could
significantly impact the carrying values of the aforesaid loans &
interest thereon.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order, 2015 issued
by the Central Government of India in terms of sub- section (11) of the
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 a statement on the
matters specified in paragraph 3 and 4 of the Order.
2. As required by Section 143(3) of the Act, we report that:
a. We have sought and obtained all the information and explanations
which to the best of our knowledge and belief were necessary for the
purpose of our audit.
b. In our opinion, proper books of account as required by law have been
kept by the Company so far as appears from our examination of those
books.
c. The Balance Sheet, Statement of Profit and Loss, and Cash Flow
Statement dealt with by this Report are in agreement with the books of
account.
d. In our opinion, the Balance Sheet, Statement of Profit and Loss and
Cash Flow Statement comply with the Accounting Standards specified
under Section 133 of the Act, read with Rule 7 of the Companies
(Accounts) Rules, 2014.
e. On the basis of written representations received from the Directors
as on March 31, 2015, and taken on record by the Board of Directors,
none of the Directors is disqualified as on March 31,2015, from being
appointed as a director in terms of Section 164(2) of the Act.
f. With respect to the other matters to be included in the 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 knowledge and belief
and according to the information and explanations given to us:
i. The Company has disclosed the impact of pending litigations as at
March 31, 2015 on its financial position in its financial statements as
referred to in Note 27 to the financial statements.
ii. The Company has made provision as at March 31,2015 as required
under the applicable law or accounting standards, for material
foreseeable losses, if any, on long-term contracts. The Company has not
entered in to any Derivative Contracts during the financial year.
iii. There has been no delay in transferring amounts, required to be
transferred, to the Investor Education and Protection Fund by the
Company during the year ended March 31,2015.
ANNEXURE TO INDEPENDENT AUDITORS' REPORT
(The Annexure referred to in our report to the members of Mukand
Engineers Limited ('the Company') for the year ended March 31, 2015.)
(i) In respect of its Fixed Assets:
(a) The Company has generally maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) As per the explanation given to us, the Fixed Assets were
physically verified by the Management in accordance with a regular
programme covering all the assets over a period of three years, which
in our opinion, is reasonable having regard to the size of the company
and the nature of its assets. Pursuant to the program, the management
during the year has physically verified a portion of the fixed assets
and no material discrepancies were noticed on such verification. In our
opinion, this periodicity of physical verification is reasonable having
regard to the size of the Company and nature of its assets.
(ii) In respect of its Inventories:
(a) The inventory excluding stocks with sub contractors/third parties
and Work- in-Progress has been physically verified by the management
during the year. In our opinion, the frequency of verification is
reasonable.
(b) In our opinion and according to information and explanations given
to us, the procedures of physical verification of inventories followed
by the Management were reasonable and adequate in relation to the size
of the Company and the nature of its business.
(c) On the basis of our examination of the inventory records, we are of
the opinion that the Company has maintained proper records of
inventory. The discrepancies noticed on physical verification of
inventory as compared to book records were not material.
(iii) The Company has not granted any loans, secured or unsecured, to /
from companies, firms or other parties covered in the register
maintained under section 189 of the Act during the year. Consequently,
clauses (iii) (a) and (iii) (b) of paragraph 3 of the Order are not
applicable to the Company.
(iv) In our opinion and according to the information and explanations
given to us, having regard to the explanations that certain items of
purchase/services availed are of special nature for which suitable
alternative sources are not readily available for obtaining comparable
quotations, there are adequate internal control procedures commensurate
with the size of the Company and the nature of its business with regard
to purchase of inventory, fixed assets and for the sale of goods and
services. Further, on the basis of our examination of the books and
records of the Company, and according to the information and
explanation 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.
(v) In our opinion and according to the information and explanations
given to us, the Company has generally complied with the directives
issued by the Reserve Bank of India and the provisions of Sections 73
to 76 or any other provisions of the Act and the Companies (Acceptance
of Deposits) Rules, 2014 to the extent notified, with regard to
deposits accepted from the public. The Company not being an "Eligible
Company" as defined in Companies (Acceptance of Deposits) Rules,
2014, sought and obtained the approval from the Company Law Board for
extension in time limit for Repayment of Public Deposits outstanding as
on March 31 2015 on the respective due dates of maturity.
(vi) In our opinion and according to the information and explanations
given to us, the Company is not required to maintain cost records
prescribed under sub section (1) of Section 148 of the Act, as the
Central Government has not specified the maintenance of cost records
for any of the products/services of the Company.
(vii) In respect of Statutory Dues:
(a) According to the information and explanations given to us and the
records of the Company examined by us, in our opinion, the Company is
generally regular in depositing undisputed statutory dues including
Provident Fund, Investor Education and Protection Fund, Employees'
State Insurance, Income Tax, Sales Tax including Value Added Tax,
Service Tax, Entry Tax, Cess and other material statutory dues
applicable to it with the appropriate authorities. There were no dues
towards Custom Duty, Wealth Tax and Excise Duty during the year.
According to information and explanations given to us, there were no
undisputed amounts payable in respect of Income Tax, Service Tax, Entry
Tax, Cess and other material statutory dues in arrears as on 31st
March,2015 for a period of more than six months from the date they
become payable.
(b) According to information and explanations given to us upon our
enquiries in this regard and records of the Company, the disputed
statutory dues in respect Income Tax, Works Contract Tax, Entry Tax and
Cess as at 31st March, 2015 which have not been deposited on account of
a dispute, are as under:
Nature of Amount Period to Forum where the
dues Rs which the dispute is pending
amount relates
Income Tax 86,22,250 2000-01 , 2001- High Court of
2002 Bombay
Income Tax 84,55,448 1999-2000 Income Tax
2005-2006 Appellate Tribunal
Income Tax 638,879 2010-2011 and Commissioner of
2011-12 Income Tax
Income Tax 97,62,006 2002-2003 to Income Tax
2011-2012 Department
Authorities
Works 7,583,974 2001-02 and High Court
Contracts 2002-03
Tax
Works 11,511,927 2001-02 to Sales Tax
Contracts 2004-05 Department
Tax Authorities
Entry Tax 811,173 1999-00 to High Court, Odisha
2002-03
Entry Tax 1,27,835 2003-04 Asst. Commissioner
(Sales Tax)
According to the information and explanations given to us and
the records of the Company examined by us, there are no dues of
wealth-tax, service-tax and excise duty which have not been deposited
on account of any dispute.
(c) According to information and explanations given to us, the amount
required to be transferred to the Investor Education and Protection
Fund has been transferred within the stipulated time in accordance with
the provisions of the Companies Act, 1956 and the rule made there
under.
(viii) In our opinion and according to information & explanations given
to us the Company does not have any accumulated losses at the end of
the financial year and has not incurred cash losses during the
financial year covered by our audit and in the immediately preceding
financial year.
(ix) According to the records of the Company examined by us and
information and explanations given to us, the Company has not defaulted
in repayment of dues to any financial institution or bank during the
year. There are no dues to any debenture holders.
(x) In our opinion and according to information & explanations given to
us and the representations made by the Management, the terms and
conditions at which the guarantees given by the Company for loans taken
from financial institutions and/ or banks by others, are prima facie
not prejudicial to the interests of the Company.
(xi) In our opinion and according to information and explanations given
to us, on an overall basis, the term loans have been applied for the
purposes for which they were obtained.
(xii) 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.
GIRISH M. PATHAK
Partner
Membership No. 102016
For and on behalf of
K.K.MANKESHWAR & CO.,
Chartered Accountants
FRN- 106009W
Mumbai,
dated the 28th May, 2015
Mar 31, 2014
We have audited the accompanying financial statements of M/s Mukand
Engineers Limited ("the Company"), which comprise the Balance Sheet
as at March 31,2014, the Statement of Profit and Loss and Cash Flow
Statement for the year then ended, and a summary of significant
accounting policies and other explanatory information.
Management''s Responsibility for the Financial Statements
Management is responsible for the preparation of these financial
statements that give a true and fair view of the financial position,
financial performance and cash flows of the Company in accordance with
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 issued by Ministry of
Corporate Affairs in respect of Section 133 of the Companies Act, 2013.
This responsibility includes the design, implementation and maintenance
of internal control relevant to the preparation and presentation of the
financial statements that give a true and fair view and 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 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 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
entity''s preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the entity''s internal control. An audit also includes
evaluating the appropriateness of accounting policies used and the
reasonableness of the accounting estimates made by Management, as well
as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the financial statements give the information
required by the Act in the manner so required and give a true and fair
view in conformity with the accounting principles generally accepted in
India:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31,2014;
(b) in the case of the Statement of Profit and Loss, of the profit for
the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Emphasis of Matter
Without qualifying our opinion, we draw your attention to:
(i) Note No. 28.1 to the financial statements, relating to overdue
loans, aggregating Rs.10,14,50,000/- (Previous Year Rs. 10,34,00,000/-)
and Interest Receivable thereon, aggregating Rs. 4,29,57,419/- (Previous
Year Rs. 4,95,48,194/-), at the end of the year, that are due from
investment companies whose net worth have eroded. The Management''s
assessment on the recoverability from the financial assets of these
companies is subject to uncertainties and which if do not materialize,
could significantly impact the carrying values of the aforesaid loans &
interest thereon.
(ii) Note No. 30 to the financial statements, relating to the change in
accounting policy during the year in respect of valuation of contract
work in progress, resulting into increase in Profit before tax by Rs.
2,63,81,549/-
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order"), as amended the Companies (Auditor''s Report) (Amendment)
Order, 2004, ("the Order") issued by the Central Government of
India in terms of sub-section (4A) of Section 227 of the Act, we give
in the Annexure a statement on the matters specified in paragraphs 4
and 5 of the Order.
2. As required by Section 227(3) of the Act, we report that:
a. we have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purpose of our
audit;
b. in our opinion proper books of account as required by law have been
kept by the Company so far as appears from our examination of those
books;
c. the Balance Sheet, Statement of Profit and Loss, and Cash Flow
Statement dealt with by this Report are in agreement with the books of
account;
d. in our opinion, the Balance Sheet, Statement of Profit and Loss and
Cash Flow Statement comply with the accounting standards referred to in
sub-section (3C) of Section 211 of the Act read with the General
Circular 15/2013 dated 13th September, 2013 issued by Ministry of
Corporate Affairs in respect of Section 133 of the Companies Act, 2013;
and
e. on the basis of written representations received from the Directors
as on March 31,2014, and taken on record by the Board of Directors,
none of the Directors is disqualified as on March 31,2014, from being
appointed as a director in terms of clause (g) of sub-section (1) of
Section 274 of the Act.
ANNEXURE TO INDEPENDENT AUDITOR''S REPORT (The Annexure referred to
in our report to the members of Mukand Engineers Limited (''the Company'')
for the year ended March 31,2014.)
(i) In respect of its Fixed Assets:
(a) The Company has generally maintained proper records showing full
particulars, including quantitative details and situation offixed
assets;
(b) As per the explanation given to us, the Fixed Assets were
physically verified by the Management in accordance with a regular
program covering all the assets over a period of three years, which in
our opinion, is reasonable having regard to the size of the company and
the nature of its assets. Pursuant to the program, a portion of the
fixed assets have been physically verified by the management during the
year. As per the information and explanations given to us, no material
discrepancies were noticed on such verification.
(c) Based on the information and explanations given by the Management
and on the basis of audit procedures performed by us, we are of the
opinion that the fixed assets disposed off during the year do not
constitute a substantial part of fixed assets of the Company and such
disposal has not affected the going concern status of the Company.
(ii) In respect of its Inventories:
(a) The inventory excluding stocks with sub contractors/ third parties
and Work- in-Progress has been physically verified by the management
during the year. In our opinion, the frequency ofverification is
reasonable.
(b) In our opinion and according to information and explanations given
to us, the procedures of physical verification of inventories followed
by the Management were reasonable and adequate in relation to the size
of the Company and the nature of its business.
(c) On the basis of our examination of the inventory records, we are of
the opinion that the Company has maintained proper records of
inventory. The discrepancies noticed on physical verification of
inventory as compared to book records were not material.
(iii) The Company has neither granted nor taken any loans, secured or
unsecured, to / from companies, firms or other parties covered in the
register maintained under section 301 of the Act. Consequently, clauses
(iii) (a) to (iii) (g) of paragraph 4 of the Order are not applicable
to the Company.
(iv) In our opinion and according to the information and explanations
given to us, having regard to the explanations that certain items of
purchase/services availed are of special nature for which suitable
alternative sources are not readily available for obtaining
comparable quotations, there are adequate internal control procedures commensurate with the size of the Company and the nature of its
business with regard to purchase of inventory, fixed assets and for
the sale of goods and services. Further, on the basis of our examina
-tion of the books and records of the Company, and according to the
information and explanation 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.
(v) In respect of contracts or arrangements entered in the Register
maintained in pursuance of Section 301 of the Act, to the best of our
knowledge and belief and according to information and explanations
given to us:
(a) The particulars of contracts or arrangements referred to in Section
301 that needed to be entered in the Register have been so entered.
(b) Where each of such transaction is in excess of Rupees Five Lacs in
respect of any party, transactions have been made at prices which are
prima facie reasonable having regard to the prevailing market prices at
the relevant time.
(vi) In our opinion and according to the information and explanations
given to us, the Company has complied with the directives issued by the
Reserve Bank of India and the provisions of Sections 58 A and 58AA or
any other provisions of the Act and the Companies (Acceptance of
Deposits) Rules 1975 with regards to deposits accepted from the public.
According to the information and explanations given to us, no order has
been passed by the Company Law Board or the National Company Law
Tribunal or the Reserve Bank of India or any Court or any other
Tribunal on the Company in respect of the aforesaid deposits.
(vii) In our opinion, the Company has an adequate internal audit system
commensurate with the size and nature of its business;
(viii) In respect of Statutory Dues:
(a) According to the information and explanations given to us and the
records of the Company examined by us, in our opinion the Company is
generally regular in depositing undisputed statutory dues including
Provident Fund, Investor Education and Protection Fund, Employees''
State Insurance, Income Tax, Sales Tax, Service Tax, Entry Tax, Cess
and other material statutory dues applicable to it with the appropriate
authorities. There were no dues towards Custom Duty, Wealth Tax and
Excise Duty during the year.
(b) According to information and explanations given to us, there were
no undisputed amounts payable in respect of Income Tax, Service Tax,
Entry Tax, Cess and other material statutory dues in arrears as on
31st March,2014 for a period of more than six months from the date
they become payable.
(c) According to information and explanations given to us upon our
enquiries in this regard and records of the Company, the disputed
statutory dues in respect Income Tax, Service Tax, Customs Duty, Excise
Duty, Works Contract Tax, Entry Tax and Cess unpaid as at the last day
of the financial year, are as under:
Nature of dues Amount Period to Forum where
which the the dispute is
amount pending relates
Income Tax 11,309,594 2000-01,2001-02 High Court of Bombay
and 2002-03
Income Tax 8,455,448 1999-2000 Income Tax
2005-06 Appellate Tribunal
Income Tax 183,504 2009-10 Commissioner of Income Tax
Income Tax 7,310,187 2002-03 to Income Tax Department
2009-10 Authorities
Works 2,472,505 2001-02 to Sales Tax
Contracts Tax 2004-05 Department Authorities
Entry Tax 811,713 1999-2000 High Court
to 2002-03
Entry Tax 127,835 2003-04 Asst.
1999-2000 Commissioner (Sales Tax)
(ix) The Company does not have any accumulated losses at the end of the
financial year and has not incurred cash losses during the financial
year covered by our audit and in the immediately preceding financial
year;
(x) According to the records of the Company examined by us and
information and explanations given to us, the Company has not defaulted
in repayment of dues to any financial institution or bank during the
year. There are no dues to any debenture holder;
(xi) In our opinion and according to information & 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;
(xii) In our opinion and according to information & explanations given
to us, the Company is not a dealer or trader in shares, securities,
debentures and other investments. All the investments are held by the
Company, in its own name;
(xiii) In our opinion and according to information & explanations given
to us and the representations made by the Management, the terms and
conditions at which the guarantees given by the Company for loans taken
from financial institutions and/ or banks by others, are prima facie
not prejudicial to the interests of the Company;
(xiv) In our opinion and according to information and explanations
given to us, on an overall basis, the term loans have been applied for
the purposes for which they were obtained.
(xv) On the basis of review of utilization of funds on an overall
basis, related information as made available to us and examination of
the financial statements of the Company, we are of the opinion that
prima facie short term funds have not been used for long term purposes
during the year;
(xvi) According to the information and explanations given to us, the
Company has not made any preferential allotment of shares during the
year to parties and companies covered in the register maintained under
Section 301 of the Companies Act;
(xvii) According to information and explanations given to us, the
Company has not issued any debentures during the year.
(xviii) The Company has not raised any monies by public issue during
the year under review;
(xix) 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.
Looking at the nature of activities being carried on, at present, by
the Company, and also considering the nature of matters referred to in
various clauses of the Order, as amended, issued by the Central
Government in terms of Section 227 (4A) of the Act, clauses (viii) &
(xiii) of paragraph 4 of the aforesaid Order, are in our opinion, not
applicable to the Company.
GIRISH M. PATHAK
Partner
Membership No. 102016
For and on behalf of
K.K.MANKESHWAR & CO.,
Chartered Accountants
FRN - 106009W
Mumbai, dated the 28th May, 2014
Mar 31, 2013
Report on the Financial Statements
We have audited the accompanying financial statements of M/s Mukand
Engineers Limited ("the Company"), which comprise the Balance Sheet
as at March 31, 2013, the Statement of Profit and Loss and Cash Flow
Statement for the year then ended, and a summary of significant
accounting policies and other explanatory information.
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"). This
responsibility includes the design, implementation and maintenance of
internal control relevant to the preparation and presentation of the
financial statements that give a true and fair view and are free from
material misstatement, whether due to fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The
procedures selected depend on the auditor''s judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the
Company''s preparation and fair presentation of the financial
statements in order to design audit procedures that are appropriate in
the circumstances. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of
the accounting estimates made by Management, as well as evaluating the
overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, the financial statements, give the
information required by the Act in the manner so required and give a
true and fair view in conformity with the accounting principles
generally accepted in India:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2013;
(b) in the case of the Statement of Profit and Loss, of the profit for
the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Emphasis of Matter
Without qualifying our opinion, we draw your attention to:
(i) Note No. 28.1 to the financial statements, relating to overdue
loans, aggregating Rs.103,400,000 (Previous Year Rs. 103,400,000/-) and
Interest Receivable thereon, aggregating Rs. 49,548,194/- (Previous
Year Rs. 49,548,194/-), at the end of the financial year, that are due
from investment companies whose net worth have eroded. The
Management''s assessment on the recoverability from the financial
assets of these companies is subject to uncertainties and which, if do
not materialize, could significantly impact the carrying values of the
aforesaid loans & interest thereon.
(ii) Note No. 30 to the financial statements, relating to the change in
accounting policy during the financial year in respect of threshold
limits to be applied for Income Recognition, resulting into an increase
in Revenue by Rs. 107,735,676/- and Profit before tax by Rs.
5,707,456/-.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order"), as amended, issued by the Central Government of India in
terms of sub-section (4A) of section 227 of the Act, we give in the
Annexure a statement on the matters specified in paragraphs 4 and 5 of
the Order.
2. As required by section 227(3) of the Act, we report that:
a. we have obtained all the information and explanations which, to the
best of our knowledge and belief, were necessary for the purpose of our
audit;
b. in our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books;
c. the Balance Sheet, Statement of Profit and Loss, and Cash Flow
Statement dealt with by this Report are in agreement with the books of
account;
d. in our opinion, the Balance Sheet, Statement of Profit and Loss and
Cash Flow Statement comply with the accounting standards referred to in
sub-section (3C) of section 211 of the Act;
e. on the basis of written representations received from the directors
as on March 31, 2013, and taken on record by the Board of Directors,
none of the directors is disqualified as on March 31, 2013, from being
appointed as a director in terms of clause (g) of sub-section (1) of
section 274 of the Act.
ANNEXURE TO INDEPENDENT AUDITOR''S REPORT
(The Annexure referred to in our report to the members of the Company
for the year ended March 31, 2013.)
(i) (a) The Company has generally maintained proper records showing
full particulars, including quantitative details and situation of fixed
assets;
(b) As per the explanation given to us, the Fixed assets were
physically verified by the Management in accordance with a regular
programme covering all the assets over a period of three years, which
in our opinion, is reasonable having regard to the size of the Company
and the nature of its assets. Pursuant to the programme, a portion of
the fixed assets have been physically verified by the Management during
the year. As per the information and explanations given to us, no
materia) discrepancies were noticed on such verification.
(c) Based on the information and explanations given by the Management
and on the basis of audit procedures performed by us, we are of the
opinion that the fixed assets disposed off during the year do not
constitute a substantial part of fixed assets of the Company and such
disposal has not affected the going concern status of the Company.
(ii) (a) The inventory excluding stocks with sub contractors/ third
parties and Work- in-Progress has been physically verified by the
Management during the year. In our opinion, the frequency of
verification is reasonable.
(b) In our opinion and according to information and explanations given
to us, the procedures of physical verification of inventories followed
by the Management were reasonable and adequate in relation to the size
of the Company and the nature of its business.
(c) On the basis of our examination of the inventory records, we are of
the opinion that the Company has maintained proper records of
inventory. The discrepancies noticed on physical verification of
inventory as compared to book records were not material.
(iii) The Company has neither granted nor taken any loans, secured or
unsecured, to / from companies, firms or other parties covered in the
register maintained under section 301 of the Act. Consequently, clauses
(iii) (a) to
(iii) (g) of paragraph 4 of the Order are not applicable to the
Company.
(iv) In our opinion and according to the information and explanations
given to us, having regard to the explanations that certain items of
purchase/services availed are of special nature for which suitable
alternative sources are not readily available for obtaining comparable
quotations, there are adequate internal control procedures commensurate
with the size of the Company and the nature of its business with regard
to purchase of inventory, fixed assets and for the sale of goods and
services. Further, on the basis of our examination of the books and
records of the Company, and according to the information and
explanation 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.
(v) In respect of contracts or arrangements entered in the Register
maintained in pursuance of Section 301 of the Act, to the best of our
knowledge and belief and according to information and explanations
given to us:
(a) The particulars of contracts or arrangements referred to in Section
301 that needed to be entered in the Register have been so entered.
(b) Where each of such transaction is in excess of Rupees Five Lacs in
respect of any party, transactions have been made at prices which are
prima facie reasonable having regard to the prevailing market prices at
the relevant time.
(vi) In our opinion and according to the information and explanations
given to us, the Company has complied with the directives issued by the
Reserve Bank of India and the provisions of Sections 58 A and 58AA or
any other provisions of the Act and the Companies (Acceptance of
Deposits) Rules 1975, with regards to deposits accepted from the
public. According to the information and explanations given to us, no
order has been passed by the Company Law Board or the National Company
Law Tribunal or the Reserve Bank of India or any Court or any other
Tribunal on the Company in respect of the aforesaid deposits.
(vii) In our opinion, the Company has an adequate internal audit system
commensurate with the size and nature of its business;
(viii) (a) According to the information and explanations given to us
and the records of the Company examined by us, in our opinion the
Company is generally regular in depositing undisputed statutory dues
including Provident Fund, Investor Education and Protection Fund,
Employees'' State Insurance, Income Tax, Sales Tax, Service Tax, Entry
Tax, Cess and other material statutory dues applicable to it with the
appropriate authorities. The Company has identified certain un-
reconciled VAT balances relating to earlier years and the adjustment
towards amounts, if any, will be carried out on compilation and
confirmation of the reconciliations. There were no dues towards Custom
Duty, Wealth Tax and Excise Duty during the year.
(b) According to information and explanations given to us, there were
no undisputed amounts payable in respect of Income Tax, Service Tax,
Entry Tax, Cess and other material statutory dues in arrears as on 31
st March,2013 for a period of more than six months from the date they
become payable.
(c) According to information and explanations given to us upon our
enquiries in this regard and records of the Company, the disputed
statutory dues in respect Income Tax, Service Tax, Customs Duty, Excise
Duty, Works Contract Tax, Entry Tax and Cess unpaid as at the last day
of the financial year, are as under:
Nature of Amount Period to
dues Rs. which the amount relates
Income Tax 8,622,250 2000-2001 and 2001-2002
Income Tax 1,309,112 1999-2000
7,146,336 2005-2006
Income Tax 183,504 2009-2010
Income Tax 9,340,669 2002-2003 to 2009-2010
Works 2,472,505 2001-2002
Contracts to
Tax 2004-2005
Entry Tax 852,181 1999-2000 to 2002-2003
Entry Tax 86,827 2003-2004
Nature of dues Forum where the dispute is pending
Income Tax High Court of Bombay
Income Tax Income Tax Appellate Tribunal
Income Tax Commissioner of Income Tax
Income Tax Income Tax Department Authorities
Works Contracts Tax Sales Tax Department Authorities
Entry Tax High Court
Entry Tax Asst Commissioner (Sales Tax)
(ix) The Company does not have any accumulated losses at the end of the
financial year and has not incurred cash losses during the financial
year covered by our audit and in the immediately preceding financial
year;
(x) According to the records of the Company examined by us and
information and explanations given to us, the Company has not defaulted
in repayment of dues to any financial institution or bank during the
year. There are no dues to any debenture holder;
(xi) In our opinion and according to information & 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;
(xii) In our opinion and according to information & explanations given
to us, the Company is not a dealer or trader in shares, securities,
debentures and other investments. All the investments are held by the
Company, in its own name;
(xiii) In our opinion and according to information & explanations given
to us and the representations made by the Management, the terms and
conditions at which the guarantees given by the Company for loans taken
from financial institutions and/ or banks by others, are prima facie
not prejudicial to the interests of the Company;
(xiv) In our opinion and according to information and explanations
given to us, on an overall basis, the term loans have been applied for
the purposes for which they were obtained.
(xv) On the basis of review of utilization of funds on an overall
basis, related information as made available to us and examination of
the financial statements of the Company, we are of the opinion that
prima facie short term funds have not been used for long term
investment during the year;
(xvi) According to the information and explanations given to us, the
Company has not made any preferential allotment of shares during the
year to parties and companies covered in the register maintained under
section 301 of the Companies Act;
(xvii) According to information and explanations given to us, the
Company has not issued any debentures during the year.
(xviii) The Company has not raised any monies by public issue during
the year under review;
(xix) 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.
Looking at the nature of activities being carried on, at present, by
the Company, and also considering the nature of matters referred to in
various clauses of the Order, as amended issued by the central
Government in terms of Section 227 (4A) of the Act, clauses (viii) &
(xiii) of paragraph 4 of the aforesaid Order, are in our opinion, not
applicable to the Company.
GIRISH M. PATHAK
Partner
Membership No. 102016
For and on behalf of
K.K.MANKESHWAR & CO.,
Chartered Accountants
FRN- 106009W
Mumbai, dated the 23rdMay, 2013
Mar 31, 2012
We have audited the attached Balance Sheet of Mukand Engineers Limited,
as at 31St March, 2012 and also the annexed Statement of Profit & Loss
and the Cash Flow statement of the Company for the year ended on that
date. These financial statements are the responsibility of the
Company's Management. Our responsibility is to express an opinion on
these financial statements based on our audit.
1. We conducted our audit in accordance with the accounting standards
generally accepted in India. These standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material mis-statements. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating overall financial statement
presentation. We believe that our audit provides a reasonable basis
for our opinion.
2. As required by the Companies (Auditor's Report) Order, 2003, as
amended by the Companies (Auditor's Report) (Amendment) order,2004
('the Order') issued by the central Government in terms of Section
227 (4A) of the Companies Act, 1956, we annex hereto a Statement on the
matters specified in paragraphs 4 & 5 of the said Order.
3. Further to our comments in the Annexure referred to in paragraph 2
above, we report that:
(i) We have obtained all the information and explanations, which, to
the best of our knowledge and belief, were necessary for the purposes
of our audit;
(ii) In our opinion, proper books of account as required by law, have
been kept by the Company so far as appears from our examination of the
books of the Company;
(iii) The Balance Sheet, Statement of Profit & Loss and Cash Flow
statement dealt with by this report, are in agreement with the books of
account of the Company;
(iv) In our opinion, the Statement of Profit & Loss and Balance Sheet
together with the Notes thereon dealt with by this report, comply with
the Mandatory accounting standards referred to in Section 211 (3C) of
the Companies Act, 1956 to the extent applicable;
(v) On the basis of written representations received from the Directors
of the Company as on 31s' March, 2012 and taken on record by the Board
of Directors of the Company, we report that no Director is disqualified
as on 31st March, 2012 from being appointed as a director of the
Company in terms of clause (g) of sub-section (1) of Section 274 of the
Companies Act, 1956;
(vi) Without qualifying our opinion, we draw your attention to Note No.
28.1 to the financial statements, relating to the recoverability of the
overdue loans, aggregating f 103,400,000 (Previous Year f 119,675,000)
and Interest Receivable thereon, aggregating Rs 49,548,194 (Previous
Year Rs 56,589,934), at the end of the year, that are due from
investment companies (related parties) whose net worth have eroded, and
the Management's assessment on their recoverability due to the reason
stated therein, which are susceptible to inherent uncertainties which,
if not materialized could significantly impact the carrying values of
the aforesaid loans & interest thereon.
(vii) In our opinion, and to the best of our information and according
to the explanations given to us, the said financial statements, subject
to our observation expressed in para 3(vi) above, and read together
with the notes thereon, give the information required by the Companies
Act, 1956, in the manner so required and give a true and fair view in
conformity with the accounting principles generally accepted in India:
(a) in the case of the Balance Sheet, of the state of the affairs of
the Company as at 31st March, 2012;
(b) in the case of the Statement of Profit & Loss, of the Profit for
the year ended on that date and;
(c) In the case of the Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
ANNEXURE TO THE AUDITOR'S REPORT
(Referred to in our report of even date)
(i) (a) The Company has generally maintained proper records showing
full particulars, including quantitative details and situation of fixed
assets;
(b) As per the explanation given to us, the Fixed assets were
physically verified by the Management in accordance with a regular
programme covering all the assets over a period of three years, which
in our opinion, is reasonable having regard to the size of the company
and the nature of its assets. Pursuant to the programme, a portion of
the fixed assets have been physically verified by the management during
the year. As per the information and explanations given to us, no
material discrepancies were noticed on such verification.
(c) Based on the information and explanations given by the Management
and on the basis of audit procedures performed by us, we are of the
opinion that the fixed assets disposed off during the year do not
constitute a substantial part of fixed assets of the Company and such
disposal has not affected the going concern status of the Company.
(ii) (a) The inventory excluding stocks with sub contractors third
parties and Work- in-Progress has been physically verified by the
management during the year. In our opinion, the frequency of
verification is reasonable.
(b) In our opinion and according to information and explanations given
to us, the procedures of physical verification of inventories followed
by the management were reasonable and adequate in relation to the size
of the Company and the nature of its business.
(c) On the basis of our examination of the inventory records, we are of
the opinion that the Company has maintained proper records of
inventory. The discrepancies noticed on physical verification of
inventory as compared to book records were not material.
(iii) The Company has neither granted nor taken any loans, secured or
unsecured, to / from companies, firms or other parties covered in the
register maintained under section 301 of the Company's Act, 1956.
Consequently, clauses
(iii) (a) to (iii) (g) of paragraph 4 of the Companies (Auditor's
Report) Order are not applicable to the Company.
(iv) In our opinion and according to the information and explanations
given to us, having regard to the explanations that certain items of
purchase / services availed are of special nature for which suitable
alternative sources are not readily available for obtaining comparable
quotations, there are adequate internal control procedures commensurate
with the size of the Company and the nature of its business with regard
to purchase of inventory, fixed assets and for the sale of goods and
services. Further, on the basis of our examination of the books and
records of the Company, and according to the information and
explanation 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.
(v) In respect of contracts or arrangements entered in the Register
maintained in pursuance of Section 301 of the Companies Act, 1956, to
the best of our knowledge and belief and according to information and
explanations given to us:
(a) The particulars of contracts or arrangements referred to in Section
301 that needed to be entered in the Register have been so entered.
(b) Where each of such transaction is in excess of Rupees Five Lacs in
respect of any party, transactions have been made at prices which are
prima facie reasonable having regard to the prevailing market prices at
the relevant time.
(vi) In our opinion and according to the information and explanations
given to us, the Company has complied with the directives issued by the
Reserve Bank of India and the provisions of Sections 58 A and 58AA or
any other provisions of the Act and the Companies (Acceptance of
Deposits) Rules 1975 with regards to deposits accepted from the public.
According to the information and explanations given to us, no order has
been passed by the Company Law Board or the National Company Law
Tribunal or the Reserve Bank of India or any Court or any other
Tribunal on the Company in respect of the aforesaid deposits.
(vii) In our opinion, the Company has an adequate internal audit system
commensurate with the size and nature of its business.
(viii) (a) According to the information and explanations given to us
and the records of the Company examined by us, in our opinion, the
Company is generally regular in depositing undisputed statutory dues
including Provident Fund, Investor Education and Protection Fund,
Employees'State Insurance, Income Tax, Sales Tax, Service Tax, Entry
Tax, Cess and other material statutory dues applicable to it with the
appropriate authorities. The Company is in the process of reconciling
Service Tax, Provident Fund, Works Contract Tax, Employees' State
Insurance and Tax Deducted at Source balances relating to earlier years
and the amounts due, if any, will be ascertained on completion of
reconciliations. There were no dues towards Custom Duty, Wealth Tax and
Excise Duty during the year.
(b) According to information and explanations given to us, there were
no undisputed amounts payable in respect of Income Tax, Service Tax,
Entry Tax, Cess and other material statutory dues in arrears as on
31s' March,2012 for a period of more than six months from the date
they became payable.
(c) According to information and explanations given to us upon our
enquiries in this regard and records of the Company, the disputed
statutory dues in respect of Income Tax, Service Tax, Customs Duty,
Excise Duty, Works Contract Tax, Entry Tax and Cess unpaid as at the
last day of the financial year, are as under:
Nature Amount Period to Forum where
of dues Rs which the the dispute
amount is pending
relates
Income 8,622,250 2000-2001 High Court
Tax and of
2001 -2002 Bombay
Income 1,309,112 2000-2001 Income Tax
Tax 7,146,336 2005-2006 Appellate
Tribunal
Income 9,008,892 2002-2003 Income Tax
Tax to Department
2008-2009 Authorities
Works 2,472,506 2001-2002 Sales Tax
Contracts to Department
Tax 2004-2005 Authorities
Entry Tax 1,009,008 1999-2000 High Court/
to Supreme
2003-2004 Court
(ix) The Company does not have any accumulated losses at the end of the
financial year and has not incurred cash losses during the financial
year covered by our audit and in the immediately preceding financial
year;
(x) According to the records of the Company examined by us and
information and explanations given to us, the Company has not defaulted
in repayment of dues to any financial institution or bank during the
year. There are no dues to any debenture holder;
(xi) In our opinion and according to information & 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;
(xii) In our opinion and according to information & explanations given
to us, the Company is not a dealer or trader in shares, securities,
debentures and other investments. All the investments are held by the
Company, in its own name;
(xiii) In our opinion and according to information & explanations given
to us and the representations made by the Management, the terms and
conditions at which the guarantees given by the Company for loans taken
from financial institutions and / or banks by others, are prima facie
not prejudicial to the interests of the Company;
(xiv) In our opinion and according to information and explanations
given to us, on an overall basis, the term loans have been applied for
the purposes for which they were obtained.
(xv) On the basis of review of utilization of funds on an overall
basis, related information as made available to us and examination of
the financial statements of the Company, we are of the opinion that
prima facie short term funds have not been used for long term purposes
during the year;
(xvi) According to the information and explanations given to us, the
Company has not made any preferential allotment of shares during the
year to parties and companies covered in the register maintained under
section 301 of the Companies Act;
(xvii) According to information and explanations given to us, the
Company has not issued any debentures during the year.
(xviii)The Company has not raised any monies by public issue during the
year under review;
(xix) 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.
Looking at the nature of activities being carried on, at present, by
the Company, and also considering the nature of matters referred to in
various clauses of the Companies (Auditor's Report) Order, 2003, as
amended by the Companies (Auditor's Report) (Amendment) order, 2004
('the Order') issued by the central Government in terms of Section
227 (4A) of the Companies Act, 1956, clauses (viii) & (xiii) of
paragraph 4 of the aforesaid Order, are in our opinion, not applicable
to the Company.
GIRISH M. PATHAK
Partner
Membership No.: 102016
For & on behalf of
K. K. MANKESHWAR & CO
Chartered Accountants
FRN 106009W
Mumbai dated the 23rd May, 2012.
Mar 31, 2011
We have audited the attached Balance Sheet of Mukand Engineers Limited,
as at 31st March, 2011 and also the annexed Profit & Loss Account and
the statement of Cash Flows of the Company for the year ended on that
date. These financial statements are the responsibility of the
Companys Management. Our responsibility is to express an opinion on
these financial statements based on our audit.
1. We conducted our audit in accordance with the accounting standards
generally accepted in India. These standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material mis-statements. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
2. As required by the Companies (Auditors Report) Order, 2003, as
amended by the Companies (Auditors Report) (Amendment) order,2004
(the Order) issued by the Central Government in terms of Section 227
(4A) of the Companies Act, 1956, we annex hereto a Statement on the
matters specified in paragraphs 4 & 5 of the said Order.
3. Further to our comments in the Annexure referred to in paragraph 2
above, we report that:
(i) We have obtained all the information and explanations, which, to
the best of our knowledge and belief, were necessary for the purposes
of our audit;
(ii) In our opinion, proper books of account as required by law, have
been kept by the Company so far as appears from our examination of the
books of the Company;
(iii) The Balance Sheet, Profit & Loss Account and Cash Flow statement
dealt with by this report, are in agreement with the books of account
of the Company;
(iv) In our opinion, the Profit & Loss Account and Balance Sheet
together with the Notes thereon dealt with by this report, comply with
the Mandatory accounting standards referred to in Section 211 (3C) of
the Companies Act, 1956 to the extent applicable;
(v) On the basis of written representations received from the Directors
of the Company as on 31st March, 2011 and taken on record by the Board
of Directors of the Company, we report that no Director is disqualified
as on 31st March, 2011 from being appointed as a Director of the
Company in terms of clause (g) of sub-section (1) of Section 274 of the
Companies Act, 1956;
(vi) Without qualifying our opinion, we draw your attention to Note No.
B 7 in schedule 20 to the financial statements, relating to the
recoverability of the overdue loans, aggregating Rs.119,675,000
(Previous Year Rs. 151,675,000) and Interest Receivable thereon,
aggregating Rs. 56,589,934 (Previous Year Rs. 62,332,753), at the end
of the year, that are due from investment companies (related parties)
whose net worth have eroded, and the Managements assessment on their
recoverability due to the reason stated therein, which are susceptible
to inherent uncertainties which, if not materialized could
significantly impact the carrying values of the aforesaid loans &
interest thereon.
(vii) In our opinion, and to the best of our information and according
to the explanations given to us, the said financial statements, subject
to our observation expressed in para 3(vi) above, and read together
with the notes thereon, give the information required by the Companies
Act, 1956, in the manner so required and give a true and fair view in
conformity with the accounting principles generally accepted in India:
(a) in the case of the Balance Sheet, of the state of the affairs of
the Company as at 31st March, 2011;
(b) in the case of the Profit & Loss Account, of the Profit 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.
ANNEXURE TO THE AUDITORS REPORT
(Referred to in our report of even date)
i) (a) The Company has generally maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets;
(b) As per the explanation given to us, the Fixed assets were
physically verified by the Management in accordance with a regular
programme covering all the assets over a period of three years, which
in our opinion, is reasonable having regard to the size of the company
and the nature of its assets. Pursuant to the programme, a portion of
the fixed assets have been physically verified by the management during
the year. As per the information and explanations given to us, no
material discrepancies were noticed on such verification.
(c) Based on the information and explanations given by the Management
and on the basis of audit procedures performed by us, we are of the
opinion that the fixed assets disposed off during the year do not
constitute a substantial part of fixed assets of the Company and such
disposal has not affected the going concern status of the Company.
ii) (a) The inventory excluding stocks with sub contractors/ third
parties has been physically verified by the management during the year.
In our opinion, the frequency of verification is reasonable.
(b) In our opinion and according to information and explanations given
to us, the procedures of physically verification of inventories
followed by the management were reasonable and adequate in relation to
the size of the Company and the nature of its business.
c) On the basis of our examination of the inventory records, we are of
the opinion that the Company has maintained proper records of
inventory. The discrepancies noticed on physical verification of
inventory as compared to book records were not material.
iii) The Company has neither granted nor taken any loans, secured or
unsecured, to / from companies, firms or other parties covered in the
register maintained under 301 of the Company Act, 1956. Consequently,
clauses (iii) (a) to (iii) (g) of paragraph 4 of the Companies
(Auditors Report) Order are not applicable to the Company.
(iv) In our opinion and according to the information and explanations
given to us, having regard to the explanations that certain items
purchased/services availed are of special nature for which suitable
alternative sources are not readily available for obtaining comparable
quotations, there are adequate internal control procedures commensurate
with
the size of the Company and the nature of its business with regard to
purchase of inventory, fixed assets and for the sale of goods and
services. Further, on the basis of our examination of the books and
records of the Company, and according to the information and
explanation 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.
(v) In respect of contracts or arrangements entered in the Register
maintained in pursuance of Section 301 of the Company Act 1956, to the
best of our knowledge and belief and according to information and
explanations given to us:
(a) The particulars of contracts or arrangements referred to in Section
301 that needed to be entered in the Register have been so entered.
(b) Where each of such transaction is in excess of Rupees Five Lacs in
respect of any party, transactions have been made at prices which are
prima facie reasonable having regard to the prevailing market prices at
the relevant time.
(vi) In our opinion and according to the information and explanations
given to us, the Company has compiled with the directives issued by the
Reserve Bank of India and the provisions of Sections 58 A and 58AA or
any other provisions of the Act and the Companies (Acceptance of
Deposits) Rules 1975 with regards to deposits accepted from the public.
According to the information and explanations given to us, no order has
been passed by the Company Law Board or the National Company Law
Tribunal or the Reserve Bank of India or any Court or any other
Tribunal on the Company in respect of the aforesaid deposits.
(vii) In our opinion, the Company has an adequate internal audit system
commensurate with the size and nature of its business however, the same
needs to be further strengthened;
(viii) (a) According to the information and explanations given to us
and the records of the Company examined by the us, in our opinion the
Company is generally regular in depositing undisputed statutory dues
including Provident Fund, Investor Education and Protection Fund,
Employees State Insurance, Service Tax, Income Tax, Sales Tax, Cess and
other material statutory dues applicable to it with the appropriate
authorities. The Company is in the process of reconciling Service Tax,
Provident Fund, Works Contract Tax, Employees State Insurance and Tax
Deducted at Source balances relating to earlier years and the amounts
due, if any, will be ascertained on completion of reconciliations.
There were no dues towards Custom Duty, Wealth Tax and Excise Duty
during the year.
(b) According to information and explanations given to us, there were
no undisputed amounts payable in respect of Income Tax, Service Tax,
Cess and other material statutory dues in arrears as on 31st March,
2011 for a period of more than six months from the date they become
payable
(c) According to information and explanations given to us upon our
enquiries in this regard and records of the Company, the disputed
statutory dues in respect Income Tax, Service Tax, Customs Duty, Excise
Duty, Works Contract Tax and Cess unpaid as at the last day of the
financial year, are as under:
Nature Amount Period to Forum where
of dues Rs. which the the dispute
amount is pending
relates
Income 8,622,250 2000-01 High Court
Tax and of
2001 -2002 Bombay
Income 2,429,636 2002-2003 Income Tax
Tax Appellate
Tribunal
Income 748,636 2005-06 Income Tax
Tax Department
Authorities
Works 2,349,419 2001-02 Sales Tax
Contracts to Department
Tax 2004-05 Authorities
Entry 1,009,008 1999-00 High Court/
Tax to Supreme
2003-04 Court
(ix) The Company does not have any accumulated losses at the end of the
financial year and has not incurred cash losses during the financial
year covered by our audit and in the immediately preceding financial
year;
(x) According to the records of the Company examined by us and
information and explanations given to us, the Company has not defaulted
in repayment of dues to any financial institution or bank during the
year. There are no dues to any debenture holder;
(xi) In our opinion and according to information & 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;
(xii) In our opinion and according to information & explanations given
to us, the Company is not a dealer or trader in shares, securities,
debentures and other investments. All the investments are held by the
Company, in its own name;
(xiii) In our opinion and according to information & explanations given
to us and the representations made by the Management, the terms and
conditions at which the guarantees given by the Company for loans taken
from financial institutions and / or banks by others, are prima facie
not prejudicial to the interests of the Company;
(xiv)ln our opinion and according to information and explanations given
to us, on an overall basis, the term loans have been applied for the
purposes for which they were obtained.
(xv) On the basis of review of utilization of funds on an overall
basis, related information as made available to us and examination of
the financial statements of the Company, we are of the opinion that
prima facie short term funds have not been used for long term purposes
during the year;
(xvi) According to the information and explanations given to us, the
Company has not made any preferential allotment of shares during the
year to parties and companies covered in the register maintained under
section 301 of the Companies Act;
(xvii) According to information and explanations given to us, the
Company has not issued any debentures during the year.
(xviii) The Company has not raised any monies by public issue during
the year under review;
(xix) 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, not have we been informed of such case by the Management.
Looking at the nature of activities being carried on, at present, by
the Company, and also considering the nature of matters referred to in
various clauses of the Companies (Auditors Report) Order, 2003, as
amended by the Companies (Auditors Report) (Amendment) Order, 2004
(the Order) issued by the Central Government in terms of Section 227
(4A) of the Companies Act, 1956,clauses (viii) & (xiii) of paragraph 4
of the aforesaid Order, are in our opinion, not applicable to the
Company.
GIRISH M. PATHAK
Partner
Membership No.: 102016
For & on behalf of
K. K. MANKESHWAR & CO.
Chartered Accountants
FRN 106009W
Mumbai dated the May 26th, 2011
Mar 31, 2010
1. We have audited the attached Balance sheet of Mukand Engineers
Limited, as at 31st March, 2010, the related Profit and Loss Account
and Cash Flow Statement for the year ended on that date annexed
thereto, which we have signed under reference to this report. These
financial statements are the responsibility of the Companys
management. Our responsibility is to express an opinion on these
financial statements based on our audit.
2. We conducted our audit in accordance with the auditing standards
generally accepted in India. Those Standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes,
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the .Companies (Auditors Report) Order, 2003, as
amended by the Companies (Auditors Report) (Amendment) Order, 2004
(together the "Order"), issued by the Central Government of India in
terms of sub-section (4A) of Section 227 of The Companies Act, 1956,
of India (the Act) and on the basis of such checks of the books and
records of the Company as we considered appropriate and according to
the information and explanations given to us, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
4. Further to our comments in the Annexure referred to in paragraph 3
above, we report that:
(a) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purposes of our
audit;
(b) In our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books;
(c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account;
(d) In our opinion, the Balance Sheet, Profit and Loss Account and Cash
Flow Statement dealt with by this report comply with the accounting
standards referred to in sub-section (3C) of Section 211 of the Act;
(e) On the basis of written representations received from the
directors, as on 31st March, 2010 and taken on record by the Board of
directors, none of the directors is disqualified as on 31st March, 2010
from being appointed as a Director in terms of clause (g) of sub-
section (1) of Section 274 of the Act;
(f) Without qualifying our opinion, we draw your attention to Note No.
7 in Schedule 20 to the financial statements, relating to the
recoverability of the overdue loans, aggregating Rs. 151,675,000
(Previous Year Rs. 179,450,000) and Interest Receivable thereon,
aggregating Rs. 62,332,753 (Previous Year Rs. 62,332,753), at the end
of the year, that are due from six investment companies (related
parties) whose net worths have eroded, and the Managements assessment
on their recoverability due to the reasons stated therein, which are
susceptible to inherent uncertainties which, if not materialised could
significantly impact the carrying values of the aforesaid loans and
interest thereon.
(g) In our opinion and to the best of our information and according to
the explanations given to us, the said financial statements together
with the notes thereon and attached thereto give, in the prescribed
manner, the information required by the Act and give a true and fair
view in conformity with the accounting principles generally accepted in
India:
(i) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31st March, 2010;
(ii) in the case of the Profit and Loss Account, of the profit for the
year ended on that date; and
(iii) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
ANNEXURE TO AUDITORS REPORT
Referred to in paragraph 3 of the Auditors Report of even date to the
members of Mukand Engineers Limited on the financial statements for the
year ended 31st March, 2010
1. (a) The Company is maintaining proper records showing
full particulars including quantitative details and situation of fixed
assets.
(b) The fixed assets are physically verified by the management
according to a phased programme designed to cover all the items over a
period of three years, which in our opinion, is reasonable having
regard to the size of the Company and the nature of its assets.
Pursuant to the programme, a portion of the fixed assets has been
physically verified by the management during the year and no material
discrepancies between the book records and the physical inventory has
been noticed.
(c) In our opinion and according to the information and explanations
given to us, a substantial part of fixed assets has not been disposed
of by the Company during the year.
2. (a) The inventory has been physically verified by the
management during the year. In our opinion, the frequency of
verification is reasonable.
(b) In our opinion, 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) On the basis of our examination of the inventory records, in our
opinion, the Company is maintaining proper records of inventory. The
discrepancies noticed on physical verification of inventory as compared
to book records were not material.
3. The Company has not granted / taken any loans, secured or
unsecured, to / from companies, firms or other parties covered in the
register maintained under Section 301 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 for the sale of goods and
services. Further, 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) In our opinion and according to the information and
explanations given to us, the particulars of contracts or arrangements
referred to in Section 301 of the Act have been entered in the register
required to be maintained under that section.
(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 Lacs in respect of
any party during the year have been made at prices which are reasonable
having regard to the prevailing market prices at the relevant time.
6. In our opinion and according to the information and explanations
given to us, the Company has complied with the directives issued by the
Reserve Bank of India and the provisions of Sections 58A and 58AA or
any other provisions of the Act and the Companies (Acceptance of
Deposit) Rules, 1975 with regard to deposits accepted from the public.
According to the information and explanations given to us, no Order has
been passed by the Company Law Board or National Company Law Tribunal
or Reserve Bank of India or any Court or any other Tribunal on the
Company in respect of the aforesaid deposits.
7. In our opinion, the Company has an internal audit system
commensurate with its size and nature of its business.
8. (a) According to the information and explanations given to us and
the records of the Company examined by us, in our opinion, except for
undisputed service tax dues, the Company is generally regular in
depositing the undisputed statutory dues including provident fund,
investor education and protection fund, employees state insurance,
income-tax, sales-tax, wealth tax, customs duty, excise duty, cess and
other material statutory dues as applicable with the appropriate
authorities. There were no arrears of statutory dues outstanding as at
31 st March, 2010, 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, the particulars of dues of
income-tax, sales- tax, wealth tax, service tax, customs duty, excise
duty and cess as at 31st March, 2010 which have not been deposited on
account of disputes are as follows:
Nature of Amount Period to Forum where
Dues (Rs.) which the the dispute is
amount pending
relates
Income tax 19,882,170 2000-01 to Income tax
2002-2003 Appellate Tribunal
748,636 2005-06 Income Tax
Departmental
Authorities
Works 2,349,419 2001-02to Sales Tax
Contracts 2004-05 Department
Tax Authorities
Entry Tax 1.009,008 1999-00to High Court /
2003-04 Supreme Court
9. The Company has no accumulated losses as at 31st March 2010 and it
has not incurred any cash losses in the financial year ended on that
date or in the immediately preceding financial year.
10. According to the records of the Company examined by us and the
information and explanations given to us, the Company has not defaulted
in repayment of dues to any bank. There were no dues to any financial
institution or debenture holder.
11. The Company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
12. In our opinion, the Company is not a dealer or trader in shares,
securities, debentures and other investments. All the investments are
held by the Company in its own name
13. in our opinion and according to the information and explanations
given to us, and the representations made by the management, the terms
and conditions of the guarantees given by the Company, for loans taken
by others from banks or financial institutions, are not prejudicial to
the interest of the Company.
14. In our opinion, and according to the information and explanations
given to us, on an overall basis, the term loans have been applied for
the purposes for which they were obtained.
15. 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.
16. The Company has not made any preferential allotment of shares to
parties and companies covered in the register maintained under Section
301 of the Act during the year.
17. On the basis of the records and documents examined by us, the
Company has not issued any debentures during the year.
18. The Company has not raised any money by public issues during the
year.
19. 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.
20. The other clauses (iii)(b), (iii)(c), (iii)(d), (iii)(f),
(iii)(g), (viii) and (xiii) of Paragraph 4 of the Order, are not
applicable in the case the Company for the current year, since in our
opinion, there is no matter which arises to be reported in the
aforesaid Order.
For DALAL & SHAH
Firm Registration Number: 102021W
Chartered Accountants
S. Venkatesh
Partner
Membership Number: 037942
Mumbai: 25th May, 2010