| We have audited the accompanying financial statements of Ramsarup
Industries limited, which comprise the Balance Sheet as at March 31,
2015, and the Statement of profit and loss and Cash Flow Statement for
the year then, ended and a summary of significant accounting policies
and other explanatory information.
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 that give a true and
fair view of the financial position, financial performance and cash
flows of the Company in accordance with the accounting principles
generally accepted in India, including the Accounting Standards
specified under Section 133 of the Act, read with Rule 7 of the
Companies (Accounts) Rules, 2014. this responsibility also includes
maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding of the assets of the Company and
for preventing and detecting frauds and other irregularities; selection
and application of appropriate accounting policies; making judgments
and estimates that are reasonable and prudent; and design,
implementation and maintenance of adequate internal financial controls,
that were operating effectively for ensuring the accuracy and
completeness of the accounting records, relevant to the preparation and
presentation of the financial statements that give a true and fair view
and are free from material misstatement, whether due to fraud or error.
Auditor's Responsibility
our responsibility is to express an opinion on these financial
statements based on our audit. We have taken into account the
provisions of the Act, the accounting and auditing standards and
matters which are required to be included in the audit report under the
provisions of the Act and the Rules made there under.
We conducted our Audit in accordance with the Standards on Auditing
specified under Section 143(10) of the Act. those Standards require
that we comply with ethical requirements and plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. the
procedures selected depend on the auditor's judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the
Company's preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on
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 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 on the financial
statements.
Basis for Qualified opinion:-
1) the Company has four manufacturing units at Kalyani, Shyamnagar,
Kharagpur and Durgapur, all of which are under the suspension of work
for the last few years and they are under the symbolic /physical
possession of lenders due to default of payment of the outstanding
loans. Detail physical verifications of fixed assets and inventories
could not be conducted by the management. We have also not been able to
obtain sufficient appropriate audit evidences (SAAe) in respect of
existence and valuation of fixed assets and inventories lying in these
factories.
2) Borrowings from banks and financial institutions have been
classified as nonperforming assets by the lenders. no balance
confirmation of the outstanding loan could be obtained nor any bank
statement has been provided by them. In absence of the same, we are
unable to confirm the accuracy of the balances appearing in the books
of account. As the borrowings have been considered as npA, no interest
has been charged by the banks since then. During the year the company
has provided interest on these borrowings up to 1st quarter June 2014
but interest of Rs. 395.84 crore for the three quarters from 1st July
to 31st March, 2015 has not been provided.
3) the net worth of the company has been fully eroded and therefore the
company filed an application before the ld. BIFR which is still
pending. the Company's ability to continue the business is
significantly dependent upon the viability of the restructuring plan to
be approved by the ld. BIFR.
Qualified Opinion:-
In our opinion and to the best of our information and according to the
explanations given to us, except for the possible effects of the matter
described in the basis for qualified opinion paragraph, the aforesaid
financial statements give the information required by the Act in the
manner so required and give a true and fair view in conformity with the
accounting principle generally accepted in India of the state of
affairs of the company as at 31st March 2015, and its loss and its Cash
flows for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) order, 2015 ("the
order") issued by the Central Government of India in terms of
sub-section (11) of section 143 of the Act, we give in the Annexure a
statement on the matters specified in paragraphs 3 and 4 of the order,
to the extent applicable.
2. As required by section 143(3) of the Act, we report that:
a) We have sought and except for the matters described in the basis for
Qualified opinion paragraph, obtained all the information and
explanations which to the best of our knowledge and belief were
necessary for the purpose of our audit;
b) except for the possible effects of the matter described in the basis
for Qualified opinion paragraph above, 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) except for the possible effects of the matter described in the basis
for Qualified opinion paragraph, 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) the matter described in the basis for Qualified opinion paragraph
above, in our opinion, may have an adverse effect on the functioning of
the Company.
f) 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.
g) the Qualification relating to the maintenance of accounts and other
matters connected therewith are as stated in the basis for qualified
opinion paragraph above.
h) With respect to other matters to be included in the Auditor's Report
in accordance with Rule 11 of the Companies (Audit and Auditors) Rule
2014,in our opinion and to the best of our information and according to
the explanations given to us:
i) A number of litigations have been filed by some of the lender banks
and creditors of the company against which primary liabilities stands
provided in the books except for other claims and interest thereon.
Apart from these various statutory / non-statutory liabilities as
stated in note no 33 of financial statement have not been provided for
although the financial impact thereon have been disclosed.
ii) the Company is carrying on infrastructure work at Rajasthan wherein
substantial delay has happened for various reasons in execution of the
contract. this may lead to cancellation of contract and losses so
incurred will be ascertained at the relevant time. total outstanding
work contract is estimated to the tune of Rs 40 crore against which the
Bank Guarantee is covered by Rs. 1.37 crore. there are no outstanding
derivative contracts in the Company.
iii) there has been some delay in transferring amounts required to be
transferred to the Investor education & protection Fund by the Company.
Following are the instances of delay in transferring amounts, to the
Investor education & protection Fund by the Company.
Nature Amount Due for Transfer Actual Transfer
Final Dividend
for 05-06 Rs.46,455.00 Sept 2013 28.05.2014
Interim
Dividend
for 05-06 Rs 2,38,034.80 Sept 2013 14.06.2014
ANNEXURE TO THE AUDITOR'S REPORT
the Annexure referred to in our Independent Auditors' Report to the
members of the Company on the financial statements for the year ended
31st March 2015,We report that:
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) the Company had a regular program of physical verification of fixed
assets, and these were being verified in a phased manner over a period
of three years, but due to suspension of work in all its manufacturing
units it has not been possible for the company during the year, to have
physical verification done.
c) no fixed assets have been disposed off during the year.
ii) In respect of its Inventories:
a) As explained to us the Inventories could not be physically verified
by the management due to suspension of its manufacturing units. the
Stock has been taken on the basis of previous period with estimated
realizable value for deterioration in quality due to efflux of time.
b) the Company has been maintaining proper records of its inventories
but in absence of physical verifications of inventories, actual
comparison with book records have not been possible.
iii) As informed to us, the Company during the year has not granted any
loan, secured or unsecured to companies, firms or other parties covered
in register maintained under section 189 of the Companies Act, 2013.
Accordingly, the provisions of sub clause (iii) (b) & (c) of the
Companies (Auditors Report) order, 2013 (as amended) are not
applicable.
iv) In our opinion and according to the information & explanations
given to us, there is adequate internal control system commensurate
with the size of the company and the nature of its business for the
purchase of Inventory, Fixed Assets and also for the sale of goods.
During the course of our Audit no major weakness has been noticed in
the internal control system in respect of these areas.
v) According to the information and explanation given to us, the
Company has not accepted any deposit from the public; therefore the
provisions of clause (v) of the order are not applicable to the
company.
vi) We have broadly reviewed the Books of Accounts maintained by the
company in respect of generation of electricity where pursuant to the
rules made by the Central Government of India, the maintenance of Cost
Records have been prescribed u/s 148(1) of the Act and are of the
opinion that prima facie, the prescribed accounts and records have been
made and maintained. We have not, however, made a detailed examination
of the records with a view to determine whether they are accurate or
complete.
vii) In respect of Statutory Dues:
a) According to the information and explanations given to us and on the
basis of records of the Company, amount deducted / accrued in the books
of accounts in respect of undisputed statutory dues including provident
Fund, Income tax, Sales tax, Wealth tax, Service tax, Duty of Customs,
Value Added tax,Cess and other material statutory dues have been
regularly deposited with appropriate authorities during the year except
the delays as below:
Statement of arrears of Statutory Dues outstanding for more than six
months up to 31.03.2015:
Sl. Name of Statute Amount (Rs in lacs)
No.
i) excise Duty Demand for F.Y. 2010-11 307.50
ii) eSI Contribution 6.49
iii) professional tax 1.55
Total 315.54
b) the disputed statutory dues that have not been deposited{net of
Amount paid under protest} on account of disputed matter pending before
appropriate authorities are as under:
Sl. Name of Statute Nature of Dues Amount
No. (Rs. in Lacs)
1 West Bengal Sales Sales tax 59.41
tax Act, 1994
2 West Bengal Sales Sales tax 3,576.58
tax Act, 1994
3 West BengaL VAt tax VAt 4,015.57
Act, 2003
4 West Bengal VAt tax VAt 16.24
Act, 2003
5 West Bengal VAt tax VAt 701.99
Act, 2003
6 West Bengal VAt tax VAt 696.60
Act, 2003
7 West Bengal VAt tax VAt 1,433.79
Act, 2003
8 West Bengal VAt tax VAt 2,613.51
Act, 2003
9 West Bengal VAt tax VAt 1,550.63
Act, 2003
10 Central Sales tax
Sales tax 51.68
Act,1956
11 Central Sales Sales tax 200.63
tax Act, 1956
12 Central Sales Sales tax 306.17
tax Act, 1956
13 Central Sales Sales tax 1,033.76
tax Act, 1956
14 Central Sales Sales tax 865.41
tax Act, 1956
15 Central Sales Sales tax 71.23
tax Act, 1956
16 Central Sales Sales tax 172.03
tax Act, 1956
17 Central Sales Sales tax 5.63
tax Act, 1956
18 employee State ESI 26.03
Insurance
19 employee State ESI 6.54
Insurance
20 provident Fund
Act PF 19.90
21 Service tax Act Service tax 4422.54
Name of the statue Period to which Forum where
amount relates dispute is pending
WestBengal sales
Tax Act, 1994 Various Years from Appellate &
1994-95 to1999-00 Revisional Board
West Bengal Sales 2004-05 Appellate &
tax Act, 1994 Revisional Board
West Bengal Sales 2005-06 Appellate &
tax Act, 1994 Revisional Board
West BengaL VAT TAX 2006-07 Appellate &
Act,2003 Revisional Board
West Bengal VAT TAX 2007-08 Appellate &
Act, 2003 Revisional Board
West Bengal VAT TAX 2008-09 Appellate &
Act, 2003 Revisional Board
West Bengal VAT TAX 2009-10 Appellate &
Act, 2003 Revisional Board
West Bengal VAT TAX 2010-11 Appellate &
Act, 2003 Revisional Board
West Bengal VAT TAX 2011-12 Appellate
Act, 2003 Forum CD-01
Central Sales tax various from
1994 -95 to 1999-00
Act,1956
Appellate &
Revisional Board
various fyear from
Central Sales 2000- 01 & 2003-04
tax Act, 1956 kolkata high court
Central Sales
2004-05 & 2005-06 Appellate &
tax Act, 1956 Revisional Board
Central Sales 2006-07 &2007- 08 Appellate &
tax Act, 1956 Revisional Board
Central Sales 2008-09 Appellate &
tax Act, 1956 Revisional Board
Central Sales 2009-10 Appellate
tax Act, 1956 Revisional Board
Central Sales 2010- 11 Appallate&
tax Act, 1956 Revisional Board
Central Sales 2012- 12 Appelate &
from CD -01
tax Act, 1956
employee state
insurance various year from
2002-03to 2006-07 EI- court
employee State 2001- 02tand 2002-03
insurance EI court
provident fund act, Various Years from Assistant / Regional
2009-10 to2013-14 p. F. Commissioner
Service tax Act Various Years from Service tax
2007-08 to2011-12 Commissionerate
(Kol) (CBeC)
Sl. Name of Statute Nature of Dues Amount
No. (Rs. in Lacs)
22 Commissioner of excise Duty 467.85
Central excise
23 Commissioner of excise Duty 15.00
Central excise
24 Commissioner of excise Duty 454.28
Central excise
25 Commissioner of excise Duty 620.43
Central excise
26 Income tax Act,
1961 Income tax 417.67
27 Income tax Act,
1961 Income tax 1141.81
28 Income tax Act,
1961 Income tax 674.30
29 Wealth tax Act,
1957 Wealth tax 1.66
Name of the statue Period to which Forum where
amount relates dispute is pending
2008-09 the Customs,
Commissioner of excise and
central exercersise Service tax Appellate
tribunal
Commissioner of
Central excise 2009-10 the Customsexcise
and Service tax Appellate
tribunal
Commissioner of
Central excise 2010-11 the Customs,excise and
Service tax Appellate
tribunal
Commissioner of
Central excise 2011-12 the Customs,excise and
Service tax Appellate
tribunal
Income tax Act, A.Y. 2007-08 C I t (A)
1961
Income tax Act, A.Y. 2008-09 C I t (A)
1961
Income tax Act, A.Y. 2010-11 C I t (A)
1961
Wealth tax Act, A.Y. 2010-11 C I t (A)
1957
c) According to the information and explanations given to us the
amounts which are required to be transferred to Investor education and
protection Fund in accordance with the relevant provisions of the
Companies Act, 1956 (1 of 1956) and rules made there under has been
transferred to such fund within time except the followings:-
Nature Amount Due for Transfer Actual Transfer
Final Dividend
for 05-06 Rs 46,455.00 Sept 2013 28.05.2014
Interim Dividend
for 05-06 Rs2,38,034.80 Sept 2013 14.06.2014
viii) the Company has accumulated losses of Rs.1, 63,727 lacs (p.Y 1,
45,425/- lacs) at the end of the year, due to which the net Worth of
the company has fully eroded. the Company has incurred Cash losses of
Rs. 12,961 lacs during the financial year covered by the audit and in
the immediately preceding financial year, Rs. 45,759 lacs.
ix) Based on our Audit procedure and on the basis of information and
explanations given us, we are of the opinion that the company has
defaulted in the entire payment of loans and Interest to the Banks &
Financial Institutions etc.
x) According to the information and explanation given to us, the
company has not given any guarantee for loans taken by others from bank
or financial institutions.
xi) Based on information and explanation given to us by the management
no term loans has been raised during the year and earlier term loans
outstanding are stated in financial statement.
xii) Based upon the audit procedures performed and information and
explanation given by the management, we report that no material fraud
on or by the company has been noticed or reported during the course of
our audit.
For P. K. Lilha & Co.
Chartered Accountants
FRn: 307008e
C.A. C.S. Agrawal
place: Kolkata Partner
Date:30.05.2015 Membership no. : 059534 |