We have audited the accompanying financial statements of MOUNT SHIVALIK
INDUSTRIES LIMITED ("the company"), which comprise the Balance Sheet as
at 30th June 2015, the Statement of Profit and Loss for the year then
ended, cash flow statement 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 and presentation of these financial statements that
give a true and fair view of the financial position and financial
performance of the Company in accordance with the accounting principles
generally accepted in India, including the Accounting Standards
specified under Section 133 of the Act, read with Rule 7 of the
Companies (Accounts) Rules, 2014. This responsibility also includes the
maintenance of adequate accounting records in accordance with the
provision of the Act for safeguarding of the assets of the Company and
for preventing and detecting the 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 control,
that were operating effectively for ensuring the accuracy and
completeness of the accounting records, relevant to the preparation and
presentation of the financial statements that give a true and fair view
and are free from material misstatement, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express an opinion on these financial
statements based on our audit.
We have taken into account the provisions of the Act, the accounting
and auditing standards and matters which are required to be included in
the audit report under the provisions of the Act and the Rules made
thereunder. We conducted our audit in accordance with the Standards on
Auditing 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 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 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 aforesaid financial statements give the
information required by the Act in the manner so required and give a
true and fair view in conformity with the accounting principles
generally accepted in India of the state of affairs of the Company as
at 30th June 2015 and its Loss for the year ended on that date.
Emphasis of matter
Attention is drawn to note no 43 of the accompanying financial
statements to the effect for the reason and in the circumstances stated
by the management and notwithstanding also the accumulated losses of the
company have exceeded the paid up capital and reserve & surplus causing
the company to be registered with SICA. The financial statements have
been considered justified as drawn up as a going concern.
Report on other Legal and Regulatory Requirements
1. Requirements of 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, are applicable and annexed
herewith.
2. As required by section 143(3) of the Act, we report that:
a) We have sought and obtained all the information and explanations
which to the best of our knowledge and belief were necessary for the
purposes of our audit.
b) In our opinion proper books of account as required by law have been
kept by the Company so far as it appears from our examination of those
books.
c) the Balance Sheet, the Statement of Profit and Loss and cash flow
statement dealt with by this Report are in agreement with the books of
account.
d) In our opinion, the aforesaid financial statements comply with the
Accounting Standards specified under Section 133 of the Act, read with
Rule 7 of the Companies (Accounts) Rules, 2014.
e) On the basis of written representations received from the directors
as on 30th June, 2015, taken on record by the Board of Directors, none
of the directors is disqualified as on 30th June, 2015, from being
appointed as a director in terms of Section 164(2) of the Act.
f) In our opinion and to the best of our information and according to
the explanations given to us, we report as under with respect to other
matters to be included in the Auditor's Report in accordance with Rule
11 of the Companies (Audit and Auditors) Rules, 2014:
i. The Company does not have any pending litigations which would
impact its financial position except as stated in para vii (b) of CARO
report attached herewith.
ii. The Company did not have any long-term contracts including
derivatives contracts for which there were any material foreseeable
losses.
iii. There was amount of Rs 3,74,380/- which is related to FY 2006-07,
which has been transferred by the Company to the Investor Education and
Protection Fund.
Annexure to the Auditors' Report
[Referred to in paragraph 1 under 'Report on Other Legal and Regulatory
Requirements' of our Report of even date to the members of MOUNT
SHIVALIK INDUSTRIES LIMITED on the accounts of the company for the year
ended 30th June, 2015] On the basis of such checks as we considered
appropriate and according to the information and Explanations given to
us during the course of our audit, 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 the fixed assets.
(b) As explained to us, fixed assets have been physically verified by
the management during the year in accordance with the phased programme
of verification adopted by the management which, in our opinion,
provides for physical verification of all the fixed assets at
reasonable intervals. According to the information and explanations
given to us, no material discrepancies were noticed on such
verification.
(ii) In respect of its inventory:
a) As explained to us, the inventories of finished goods, semi-finished
goods, stores, spare parts and raw materials were physically verified
at regular intervals (at the end of the year) by the Management. In
case of inventories lying with third parties, certificates of stocks
holding have been received.
b) In our opinion and according to the information and explanation
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). In our opinion and according to the information and explanations
given to us, the Company has maintained proper records of its
inventories and no material discrepancies were noticed on physical
verification of stocks as compared to book records.
(iii) In respect of loans, secured or unsecured, granted to the parties
covered in register maintained under section 189 of the Companies Act
2013:
(a) According to the information and explanations given to us, the
Company has not granted any loans to companies, firms or other parties
covered in the Register maintained under Section 189 of the Companies
Act, 2013; and therefore paragraph
(iii) of the Order is not applicable.
(iv) In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
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). During the course of our Audit, we have not
observed any continuing failure to correct major weaknesses in internal
control.
(v) The company has not received any public deposits during the year.
(vi) As informed to us, the Central Government has prescribed
maintenance of cost records under sub- section (1) of Section 148 of
the Act, in respect of the activities carried on by the Company. We
have broadly reviewed the cost records maintained by the company and
are of the opinion, prima facie, the prescribed cost records but
however we have not made a detailed examination of the cost records
with a view to determine whether they are accurate or complete.
(vii) In respect of statutory dues:
(a) According to the records of the company and information and
explanations given to us, the Company has generally been regular in
depositing undisputed statutory dues, including Provident Fund,
employees state insurance (ESI), Investor Education and Protection Fund,
Income-tax, Tax deducted at sources, Tax collected at source,
Professional Tax, Sales Tax, value added tax (VAT), Wealth Tax, Service
Tax, Custom Duty, Excise Duty, Cess and other material statutory dues
applicable to it, with the appropriate authorities.
(b) According to the information and explanations given to us, there
were no undisputed amounts payable in respect of Income-tax, Wealth
Tax, Custom Duty, Excise Duty, sales tax, VAT, Cess and other material
statutory dues in arrears /were outstanding as at 30th June, 2015 for a
period of more than six months from the date they became payable except
as stated hereunder
Name of the statute Nature of dues Amount
Central Sales Tax CST 84,66,78,493/-
Name of the statute Related period Forum
Central Sales Tax 2009-10 to 2013-14 CST Appellate
Authority
(c) There were amounts of Rs 3,74,380/- related to FY 2006-07 which has
been transferred by the Company to the Investor Education and
Protection Fund.
(viii) The company does have the accumulated losses of Rs
26,05,89,501/- at the end of financial year and Rs 21,85,99,336/- in
the last year. The company has incurred Cash loss of Rs 3,31,23,042/-
during the financial covered by our Audit and Rs 13,88,82,867/- in
immediately preceding financial year.
(ix) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in the repayment of dues to
financial institutions, banks and debenture holders.
(x) In our opinion, and according to the information and the
explanation given to us, the company has not given any guarantee for
loans taken by others from banks or financial institutions during the
year.
(xi) The company has not obtained any term loan during the year, so
this para of order is not applicable.
(xii) To the best of our knowledge and according to the information and
explanations given to us, no fraud by the Company and no material fraud
on the Company has been noticed or reported during the year.
For R.K. Relan & Co
Chartered Accountants
(Firm Registration No. : 002267N)
HEMANT RELAN
Partner
(Membership No.:085317)
Place: New Delhi
Date: 03rd December, 2015
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