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Bil Energy System Ltd.

BSE: 533321 Sector: Metals & Mining
NSE: BILENERGY ISIN Code: INE607L01029
BSE LIVE 15:15 | 15 Dec 1.60 -0.08
(-4.76%)
OPEN

1.60

HIGH

1.60

LOW

1.60

NSE 14:43 | 07 Oct Stock Is Not Traded.
OPEN 1.60
PREVIOUS CLOSE 1.68
VOLUME 48262
52-Week high 1.69
52-Week low 0.61
P/E
Mkt Cap.(Rs cr) 17
Buy Price 0.00
Buy Qty 0.00
Sell Price 1.60
Sell Qty 72225.00
OPEN 1.60
CLOSE 1.68
VOLUME 48262
52-Week high 1.69
52-Week low 0.61
P/E
Mkt Cap.(Rs cr) 17
Buy Price 0.00
Buy Qty 0.00
Sell Price 1.60
Sell Qty 72225.00

Bil Energy System Ltd. (BILENERGY) - Auditors Report

Company auditors report

To the Members of

BIL ENERGY SYSTEMS LIMITED.

Report on the Financial Statements

We have audited the accompanying financialstatements of Bil Energy Systems Limited ("the Company") which comprise theBalance Sheet as at March 31 2017 the Statement of Profit and Loss and Cash FlowStatement for the year then ended and a summary of significant accounting policies andother explanatory information.

Management's Responsibility for the FinancialStatements

Management is responsible for the preparationof these financial statements that give a true and fair view of the financial positionfinancial performance and cash flows of the Company in accordance with the AccountingPrinciples generally accepted in India including Accounting Standards referred to inSection 133 of the Companies Act 2013 read with Rule 7 of the Company (Accounts) Rules2014. This responsibility includes the design implementation and maintenance of internalcontrol relevant to the preparation and presentation of the financial statements that givea true and fair view and are free from material misstatement whether due to fraud orerror.

Auditor's Responsibility

Our responsibility is to express an opinion onthese financial statements based on our audit. We conducted our audit in accordance withthe Standards on Auditing specified under section 143(10) of the Act. Those Standardsrequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether the financial statements are free from materialmisstatements.

An audit involves performing procedures toobtain audit evidence about the amounts and disclosures in the financial statements. Theprocedures selected depend on the auditor's judgement including the assessment of therisks 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 theCompany's preparation and fair presentation of the financial statements in order to designaudit procedures that are appropriate in the circumstances. An audit also includesevaluating the appropriateness of accounting policies used and the reasonableness of theaccounting estimates made by management as well as evaluating the overall presentation ofthe financial statements.

We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our qualified audit opinion.

Basis for Qualified opinion

a) With regard to pending confirmation ofbalances

The company has sent letters to customers inrespect of trade receivables for confirming balances outstanding as at March 31 2017 butin most of the cases the customers have not sent written confirmation confirming thebalance outstanding as at March 31 2017. In the absence of confirmation any provision tobe made for adverse variation in the carrying amounts of trade receivable is notquantified.

b) Regarding non provision of demand ofRs.215.82 Crores received from State Bank of India in respect of Corporate Guarantee givenby the company in respect of Loan Facilities availed by Bil Power Limited

The lender Bank of Bilpower Limited haspursuant to certain corporate guarantees given by the company demanded from the companytheir dues from Bilpower Limited amounting to Rs.215.82 crores. No provision has been madein the accounts for the probable loss that may arise on account of above demand ofRs.215.82 crores.

c) Regarding non provision of Interest onvarious loans availed from State Bank of India for the financial year 2016-17

The Company has not provided for interestpayable to State Bank of India amounting to Rs 1321.55 Lakhs for the year ended 31stMarch 2017. The Company has not made any provision for penal interest claimed by thebank. As a result the loss for the year ended 31st March 2017 is understated by Rs.1321.55 Lakhs & current liabilities as at 31st March 2017 are alsounderstated by Rs. 1321.55 Lakhs and also reserves are overstated by Rs.1321.55 Lakhs. Theamount of penal interest cannot be quantified as the details have not been received fromthe bank. Also the company has not provided for interest amounting to Rs.1179.58 for thefinancial year 2015-16 and Rs. 1045.12 Lakhs for the financial year 201415 as a resultthe accumulated losses as on 31st March 2017 are understated by Rs. 3546.23lakhs and also current liabilities are understated by Rs.3546.25 lakhs. The amount ofpenal interest cannot be quantified as the details have not been received from the bank.

d) Regarding interest free loan given by thecompany.

Loan and advances given includes 6 parties towhom interest free unsecured loans given of Rs. 191.08 Lakhs.

Qualified Opinion

In our opinion and to the best of ourinformation and according to the explanations given to us except for the effects of thematters described in the basis for qualified opinion paragraph the said financialstatements give the information required by the Act in the manner so required and give atrue and fair view in conformity with the accounting principles generally accepted inIndia:

a) in the case of the Balance Sheet of thestate of affairs of the Company as at March 31 2017; and

b) in the case of the Profit and Loss Accountof the Loss for the year ended on that date.

c) in the case of the Cash Flow Statement ofthe cash flows for the year ended on that date.

Report on Other Legal and RegulatoryRequirements

1. As required by the Companies (Auditor'sReport) Order 2016 ("the Order") issued by the Central Government of India interms of Sub-Section (11) of Section 143 of the Act we give in the Annexure a statementon the matters specified in paragraphs 3 and 4 of the Order.

2. As required by section 143(3) of the Actwe report that:

a) We have obtained all the information andexplanations which to the best of our knowledge and belief were necessary for the purposeof our audit;

b) In our opinion proper books of account asrequired by law have been kept by the Company so far as appears from our examination ofthose books;

c) The Balance Sheet the Statement of Profitand Loss dealt with by this Report are in agreement with the books of account;

d) Except for the effects of the mattersdescribed in the basis for qualified opinion paragraph in our opinion the Balance Sheetthe Statement of Profit and Loss comply with the Accounting Standards Section 133 of theCompanies Act 2013 With Rule 7 of Companies (Accounts) Rules 2014;

e) On the basis of written representationsreceived from the directors as on March 31 2017 and taken on record by the Board ofDirectors none of the directors is disqualified as on March 31 2017 from beingappointed as a director in terms of clause of Section 164(2) of the Companies Act 2013;

f) with respect to the adequacy of theinternal financial controls over financial reporting of the Company and the operatingeffectiveness of such controls refer to our separate report in "Annexure B";and

g) With respect to the other matters to beincluded in the Auditor's Report in accordance with Rule 11 of the Companies (Audit andAuditor's) Rules 2014 in our opinion and to the best of our information and according tothe explanations given to us:

i. There are pending litigations against thecompany but the impact of such litigation on the financial position of the company isundetermined.

ii. The company has made provision asrequired under the applicable law or accounting standards for material foreseeablelosses if any on long-term contracts including derivative contracts

iii. There has been no delay in transferringamounts required to be transferred to the Investor Education and Protection Fund by theCompany.

3. The Company has provided requisitedisclosures in its standalone financial statement as to holdings as well as dealings inSpecified Bank Notes during the Period from 8th November 2016 to 30thDecember 2016 and these are in accordance with the books of accounts maintained by theCompany - Refer Note 43 to the Standalone financial statements.

For Bansal Bansal & Co.
Chartered Accountants
FRN: 100986W
Manoj Agrawal
Place: Mumbai Partner
Date: 30th May 2017 Membership No.: 107624

Annexure A to Independent Auditor's Report

The annexure referred to in our report to themember of Bil Energy System Limited for the year ended 31st March 2017 wereport that:

1. In respect of its Fixed Assets :

a. The company has maintained proper recordsshowing full particulars including quantitative details and situation of its fixed assets.

b. As informed to us by the management theCompany has a policy of physically verifying fixed assets in a phased manner over a periodwhich in our opinion is responsible having regard to the size of the Company and thenature of its assets. We are informed that there were no material discrepancies noticed onsuch verification and the same has been properly dealt in the books of account.

c. According to the information andexplanations given to us the title deeds of immovable properties of the Company are heldin the name of Company.

2. In respect of its inventories:

a. As explained to us that inventory has beenphysically verified during the year by the management at regular intervals during theyear.

b. In our opinion and according to theinformation given to us the procedures of physical verification of inventories followed bythe management were reasonable and adequate in relation to the size of the entity andnature of their business.

c. In our opinion and according to theinformation given to us proper record of inventories has been maintained and no materialdiscrepancies were noticed on physical verification.

3. According to information and explanationgiven to us the company has granted interest free unsecured loans and advances to fourparties covered in the register maintained under section 189 of the Companies Act.

a. Except for the fact that these loans andadvances are interest free in our opinion and according to the information andexplanation given to us the other terms and conditions of loans given are not primafacies prejudicial to the interest of the company.

b. The principle amount is repayable over theperiod of two to three years.

c. In respect of the aforesaid loans there isno overdue amount.

4. In our opinion in respect of loansinvestments guarantees and security the provisions of section 185 & sec 186 have notbeen complied. The details of same are given below :

Name of the Party Relationship Amount of transaction during the Year Nature of Transaction
Tarapur Transformers Limited Associate Rs. 0.11 Lakhs Loans given
Choudhary Global Limited Associate Rs. 3.93 Lakhs Loans given
Bilpower Limited Associate Rs. 3.02 Lakhs Loan given

5. The company has not accepted any depositsfrom the public. No order has been passed by Company Law Board or National Company LawTribunal or Reserve Bank of India or any Court or any other Tribunal.

6. As per information & explanation givenby the management maintenance of cost records has been prescribed by the CentralGovernment under sub-section (1) of section 148 of the Companies Act 2013 and we are ofthe opinion that prima facie the prescribed cost records have been maintained. We havehowever not made a detailed examination of the cost records with a view to determinewhether they are accurate or complete.

7. a. Undisputed amounts payable in respect ofSales Tax of Rs. 22832603/- (relating to Financial Year 2011-12- Rs. 2901565/- relating to Financial Year 2012-13 Rs. 9378242/- related to Financial Year 2013-14 Rs.6824514/- & related to Financial Year 2014-15 Rs. 3728282/- ) Interest on SalesTax of Rs.14174216/- (relating to Financial Year 2010-11 Rs. 387364/- relating toFinancial Year 2011-12 Rs. 2321958/- relating to Financial Year 2012-13 Rs. 6173273/- relating to Financial Year 2013-14 Rs. 3700851/- & relating to Financial Year2014-15 Rs. 1590770/-) were outstanding for a period of more than six months from thedate they became payable. The due dates for these amounts are as per the respectivestatutes.

b)The disputed statutory dues aggregating toRs. 303.07 Lakhs that have not been deposited on account of matters pending beforeappropriate authorities are as under :-

Sr. No. Name of the Statute Nature of dues Period for which the amount relates Forum where dispute is pending Amt (' in Lakhs)
1 Sales Tax VAT F.Y. 2010-11 Deputy/Joint Commissioner of Sales Tax (Appeal) 86.69
2 Sales Tax CST F.Y. 2010-11 2011-12 Deputy/Joint Commissioner of Sales Tax (Appeal) 216.38

8. Based on our audit procedures and accordingto the information and explanation given to us by the management the company hasdefaulted in repayment of loans and interest to bank.

The company has defaulted in repayment of duesto State Bank of India on its various fund facilities availed outstanding at the yearendamounting to Rs.79.69 Crores. The estimated unpaid interest on the above loans amounts toRs. 13.21 crores.

9. According to the information andexplanations given to us the Company has not raised any moneys by way of initial publicoffer or further public offer and has not taken any term loan during the year.

10. During the course of our examination ofthe books and records of the Company carried out in accordance with the generallyaccepted auditing practices in India and according to the information and explanationsgiven to us we have neither come across any instance of material fraud by the Company oron the Company by its officers or employees noticed or reported during the year nor wehave been informed of any such case by the Management.

11. According to the information andexplanations given to us and based on our examination of the records of the Company themanagerial remuneration has been paid or provided in accordance with the requisiteapproval mandated by the provisions of section 197 read with Schedule V to the CompaniesAct 2013.

12. In our opinion and according to theinformation and explanations given to us the Company is not a Nidhi Company. Accordinglyparagraph 3(xii) of the Order is not applicable to the Company.

13. According to the information andexplanations given to us and based on our examination of the records of the Companytransactions with the related parties are incompliance with sections 177 and 188 of theCompanies Act 2013 where applicable and details of such transactions have been disclosedin the standalone financial statements as required under Accounting Standard - 18"Related Party Disclosure".

14. According to the information andexplanations given to us the Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures during the year.Accordingly paragraph 3(xii) of the Order is not applicable to the Company.

15. In our opinion and according to theinformation and explanation given to us the Company has not entered into non-cashtransactions with directors or persons connected with him. Accordingly paragraph 3(xv) ofthe Order is not applicable to the Company.

16. In our opinion and according to theinformation and explanation given to us the Company is not required to be registeredunder section 45-IA of the Reserve Bank of India Act 1934. Accordingly paragraph 3(xv)of the Order is not applicable to the Company.

For Bansal Bansal & Co.
Chartered Accountants
FRN: 100986W
Manoj Agrawal
Place : Mumbai Partner
Date : 30th May 2017 Membership No.: 107624