| We have audited the accompanying financial statements of ENNORE COKE
LIMITED ("the Company"), which comprise the Balance Sheet as at March
31,2015, the Statement of Profit and Loss and the Cash Flow Statement
for the year then ended, and a summary of significant accounting
policies and other explanatory information.
Management's Responsibility for the Financial Statements
The Company's 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 financial statements that give a
true and fair view of the financial position, financial performance and
cash flows of the Company in accordance with the accounting principles
generally accepted in India, including the Accounting Standards
specified under Section 133 of the Act, read with Rule 7 of the
Companies (Accounts) Rules, 2014. This responsibility also includes
maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding the assets of the Company and
for preventing and detecting frauds and other irregularities; selection
and application of appropriate accounting policies; making judgments
and estimates that are reasonable and prudent; and design,
implementation and maintenance of adequate internal financial controls,
that were operating effectively for ensuring the accuracy and
completeness of the accounting records, relevant to the preparation and
presentation of the financial statements that give a true and fair view
and are free from material misstatement, whether due to fraud or error.
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 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 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.
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 31,2015;
b) in the case of the Statement of Profit and Loss, of the Loss forthe
year ended on that date; and
c) in the case of the Cash Flow Statement, of the cash flows forthe
year ended on that date.
Emphasis of Matter
We draw attention of the shareholders for the followings:
a) Note No 14 of Notes to Financial Statements relating to transferof
the leasehold land.
b) Note No 16c of Notes to Financial Statements regarding non reversal
of deferred tax asset.
c) Note No 31 of Notes to Financial Statements regarding
non-availability of confirmation of balances relating to certain Loans
and Advances, Trade Payables, and Deposits.
d) Note No 47 of Notes to Financial Statements regarding VAT payment.
e) Note No 48 (ii) of Notes to Financial Statements regarding change in
accounting policy on inventory of stores and consumables.
f) Note No 48 (ill) of Notes to Financial Statements regarding change
in accounting policy on finance charges on letters of credit.
g) Note No 48 (iv) of Notes to Financial Statements regarding
non-recognition of interest income.
Our opinion is not qualified in respect of matters mentioned above.
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 the paragraph 3 and 4 of the
Order, to the extent applicable.
2. As required by Section 143 (3) of the Act, we report that:
a. We have sought and obtained all the information and explanations
which to the best of our knowledge and belief were necessary for the
purpose of our audit;
b. In our opinion proper books of account as required by law have been
kept by the Company so far as appears from our examination of those
books;
c. The Balance Sheet, Statement of Profit and Loss, and Cash Flow
Statement dealt with by this Report are in agreement with the books of
account;
d. In our opinion, the aforesaid financial statements comply with the
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 of the
Companies Act, 2013.
f. With respect to the other matters to be included in the Auditor's
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its
financial position in its financial statements (Refer Note 8 and Note
49 to the Notes to financial statements);
ii. The Company has made provision, as required under the applicable law
or accounting standards, for material foreseeable losses, if any, on
long-term contracts including derivative contracts
iii. The Company is not required to transfer any amount to the Investor
Education and Protection Fund.
ANNEXURE TO THE INDEPENDENT AUDITORS' REPORT OF EVEN DATE TO THE
MEMBERS OF ENNORE COKE LIMITED, ON THE FINANCIAL STATEMENTS FOR THE
YEAR ENDED MARCH 31,2015
Based on the audit procedures performed for the purpose of reporting a
true and fair view on the financial statements of the Company and
taking into consideration the information and explanations given to us
and the books of account and other records examined by us in the normal
course of audit, we report that:
(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) The Company has a regular programme of physical verification of its
fixed assets by which fixed assets are verified in a phased manner over
a period of three years. In accordance with this programme, certain
fixed assets were verified during the year 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 the nature of its assets.
(ii) (a) The verification of inventory has been conducted at reasonable
intervals by the management by an independent technical agency.
(b) The procedures of physical verification of inventory lying at multi
locations followed by the management are reasonable considering the
size of the Company and the nature of its business.
(c) The Company is maintaining proper records of inventory and no
material discrepancies were noticed on physical verification.
(iii) In respect of Loan qiven:-
(a) The Company has granted unsecured loan to ONE party covered in the
register maintained under section 189 of the Companies Act, 2013 ("the
Act"). The maximum amount involved during the year is Rs. 11,72,390/-
and the year-end balance of such loans Rs. Nil.
(b) In respect of the regularity on the repayment of principal and
interest of the above unsecured loans, we are unable to comment as to
whether the repayment of principal amount and the payment of interest
is as stipulated, as no terms of repayment have been stipulated.
(c) Reporting on whether the above unsecured loans are overdue does not
arise, as no terms of repayment have been stipulated.
(iv) In our opinion, 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 and fixed assets and for the
sale of goods and services.
(v) The Company has not accepted any deposits from the public within
the meaning of the directives issued by the Reserve Bankof India and
the provisions of sections 73 to 76 or any other relevant provisions of
the Companies Act, 2013 and the rules framed there under. Accordingly,
the provisions of clause 4(v) of the Order are not applicable.
(vi) The Central Governmenthas prescribed maintenance ofcost records
under sub-section (1) ofSection 148 of the Companies Act, 2013 in
respect of Company's products effective June 2014. However the Company
has not maintained the cost records prescribed.
(vii) (a) Undisputed statutory dues towards Income tax, Sales Tax
(VAT),Service Tax, Customs Duty, Excise Duty, Cess and other material
statutory dues have been regularly deposited with the appropriate
authorities and there have been delays in remittance in few cases.
Undisputed amounts payable in respect thereof, which were outstanding,
at the year- end for a period of more than six months from the date
they became payable are as follows:
Name of the Statute Nature of Amount Period to
dues (Rs.) which it
relates
CST 78,90,069 uptoJune,2013
Odisha VAT Act
VAT 1,14,86,178 uptoJune,2014
Gujarat VAT Act VAT 83,82,425 uptoSeptember,
2014
Name of the Statute Due Date of
date payment
Various -
Odisha VAT Act
Various -
Gujarat VAT Act Various On 2nd, 6th &
30th April 2015
(b) There are dues in respect of income tax, and service tax, that have
not been deposited with the appropriate authorities on account of
dispute as mentioned below:-
Nature of Amount Period to
Name of the Statute dues (Rs.) which it
relates
23,84,17,370 AY 2011-12
Income Tax Act Income tax
4,27,78,240 AY2012-13
ServiceTaxAct ServiceTax 99,61,269 AY2009-10to
AY 2012-13
Name of the Statute Forum where
dispute is pending
CIT (A)
Income Tax Act
CIT (A)
ServiceTaxAct CESTAT
(c) According to the information and explanations given to us the
company is not required to transfer any amounts which were required to
be transferred to the investor education and protection fund in
accordance with the relevant provisions of the Companies Act, 1956 (1
of 1956) and rules there under.
(viii) In our opinion, the Company's accumulated losses are not less
than 50% of its net worth as at the end of the financial year. Further
the Company has incurred cash losses amounting to Rs.41,38,70,257/- in
the current year and Rs. 20,44,85,389/- in the immediately preceding
financial year
(ix) In our opinion and according to the information and explanations
given to us, in the following instances, the Company have defaulted in
repayment of dues to banks during the year
Name of the Bank Due Amount
on due
30-Jun-14 50,00,000
UnionBankoflndia 30-Sep-14 50,00,000
31-Dec-14 50,00,000
StateBankof 30-Jun-14 50,00,000
Hyderabad
30-Sep-14 50,00,000
30-Jun-14 45,25,000
Indian 30-Sep-14 45,25,000
OverseasBank
31-Dec-14 45,50,000
30-Jun-14 1,00,00,000
State Bank of lndia 30-Sep-14 1,00,00,000
31-Dec-14 1,00,00,000
Name of the Bank Paid Amount Delay in
on days
05-Aug-14 50,00,000 36
UnionBankoflndia
27-Nov-14 50,00,000 58
16-Feb-15 50,00,000 47
StateBankof
Hyderabad 23-Jul-14 50,00,000 23
10-Nov-14 50,00,000 41
11-M-14 45,25,000 11
14-Aug-14 16,00,000 -
Indian
OverseasBank
28-Oct-14 29,25,000 28
28-Oct-14 16,00,000 -
21-Jan-15 29,50,000 21
25-Aug-14 1,00,00,000 56
05-Dec-14 50,00,000 66
State Bank of lndia
16-Dec-14 50,00,000 77
08-Jan-15 50,00,000 8
29-Jan-15 50,00,000 29
Further the company does not have any dues to financial institution or
debenture holders during the year.
(x) In our opinion and according to the information given to us , the
terms and conditions on which the Company has given guarantees for
loans taken by related parties for a sum of Rs.2,14,18,08,000/-from
banks, are not prima facie prejudicial to the interest of the Company.
(xi) In our opinion, the Company has not availed new term loans
outstanding during the year. Accordingly the provisions of clause 4(xi)
of the Order are not applicable.
(xii) According to the information and explanations given to us, no
material fraud on or by the Company has been noticed or reported during
the course of ouraudit.
For Sreedhar, Suresh & Rajagopalan
Chartered Accountants
Firm Registration No.003957S
S. Subramaniam
Place : Chennai Partner
Date : 22.05.2015 Membership No. 025433
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