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Birla Transasia Carpets Ltd.

BSE: 503823 Sector: Industrials
NSE: N.A. ISIN Code: INE646O01013
BSE LIVE 13:00 | 02 Dec 5.77 -0.30
(-4.94%)
OPEN

6.31

HIGH

6.31

LOW

5.77

NSE LIVE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 6.31
PREVIOUS CLOSE 6.07
VOLUME 295
52-Week high 20.20
52-Week low 5.26
P/E
Mkt Cap.(Rs cr) 1.64
Buy Price 5.77
Buy Qty 582.00
Sell Price 0.00
Sell Qty 0.00
OPEN 6.31
CLOSE 6.07
VOLUME 295
52-Week high 20.20
52-Week low 5.26
P/E
Mkt Cap.(Rs cr) 1.64
Buy Price 5.77
Buy Qty 582.00
Sell Price 0.00
Sell Qty 0.00

Birla Transasia Carpets Ltd. (BIRLATRANSCARP) - Auditors Report

Company auditors report

to the Members of Birla Trans Asia Carpets Limited

Report on the Financial Statements

We have audited the accompanying financial statements of Birla TranAsia Carpets Limited("the Company") which comprises the Balance Sheet as at 31st March2015 the Statement of Profit and Loss and Cash Flow Statement for the year ended and asummary of significant accounting policies and other explanatory information.

Managements Responsibility for the financial statements

The Company's Board of Directors is responsible for the matters in section 134(5) ofthe Companies Act 2013 ("the Act") with respect to the preparation of thesefinancial statements that give a true and fair view of the financial position financialperformance and cash flow of the Company in accordance with the accounting principlesgenerally accepted in India including the Accounting Standards specified under Section133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014. Thisresponsibility also includes the maintenance of adequate accounting records in accordancewith the provision of the Act for safeguarding of the assets of the Company and forpreventing and detecting the frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of internal financial control thatwere operating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror.

Auditors Responsibility

Our responsibility is to express an opinion on these financial statements based on ouraudit. We have taken into account the provisions of the Act the accounting and auditingstandards and matters which are required to be included in the audit report under theprovisions of the Act and the Rules made there under.

We conducted our audit in accordance with the Standards on Auditing specified undersection 143(10) of the Act. Those Standards require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetherthe financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the financial statements. The procedures selected depend on the auditor'sjudgment including the assessment of the risks of material misstatement of the financialstatements whether due to fraud or error. In making those risk assessments the auditorconsiders internal financial control relevant to the Company's preparation of thefinancial statements that give true and fair view in order to design audit procedures thatare appropriate in the circumstances. An audit also includes evaluating theappropriateness of accounting policies used and the reasonableness of the accountingestimates made by Company's Directors as well as evaluating the overall presentation ofthe financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the financial statements.

Basis of Qualified Opinion

1. Attention is invited to Note 6 on Long Term Provisions. Accounting Standard (AS) 15- Employee Benefits (Revised 2005) requires the provisioning of retirement benefits basedon actuarial valuation of retirement benefits and additional disclosures as required interms of AS-15. The management has made the provisions based on their own estimates.

2. Note No. 5 and 7 of Notes to Financial Statements with regard to non-provision ofinterest on Inter Corporate Loans (amount unascertained) and PICUP loans (amounting to Rs26734127/- up to 31st March 2013 and interest amount uncertain from 1stApril 2013 to 31st March 2015) resulting into understatement of loss for theyear. Similarly non-accounting of interest liability resulting in to understatement ofcurrent liabilities as on 31-03-2015 to the same extent.

3. Sundry Debtors/Creditors unsecured loan and advances have been considered as goodfor recovery/payable by the management. Also are subject to confirmation andreconciliation. A detailed analysis of actual recoverability/payable which is overdueaccording to normal operating cycle of the company should be quantified and necessaryprovision need to be made. The non creation of provision for debts and interest areresulted into under/over statement of balances and loss. (Also Refer Notes on 5 7 8 911 14 16 and 28 to Financial Statements).

4. No provision has been made for contingent liabilities as defined under AS 29 aresummarized in Note No. 25 to Notes to Financial Statements.

Qualified Opinion

In our opinion and to the best of our knowledge and according to the information andexplanations given to us except for the effects of the matters described in paragraphs 1to 4 of the Basis for Qualified Opinion paragraph the said financial statements give theinformation required by the Act in the manner so required and give a true and fair view inconformity 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 March31 2015

b. In the case of Statement of Profit and Loss of the loss for the year ended on thatdate and

c. In the case of Cash Flow statement of the cash flows for the year ended on thatdate

Emphasis of Matter:

Attention is invited to regarding the financial statements being prepared on a goingconcern basis notwithstanding the fact that the Company's net worth is eroded. Net worthas at March 31 2015 is negative Rs.398908950. The company has referred to BIFR on04/11/1991. Although the final order has not been passed by the BIFR and it is pendingsince long. The latest communication was dated 21/11/2013. These facts cast a significantdoubt on the ability of the Company to continue as a going concern as rescheduling ofdebt Loans other liabilities and resuming normal operations. Our opinion is not modifiedin this respect.

Report on other legal and regulatory requirements

1. As required by the Companies (Audit Report) Order 2015 ('the Order) issued by theCentral Government of India in terms of sub-section (11) of section 143 of Act we give inthe Annexure a statement on the matters specified in the paragraph 3 & 4 of the orderto 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 bestof our knowledge and belief were necessary for the purpose of our audit.

b. In our opinion proper books of accounts as required by law have been kept by thecompany so far as it appears from our examination of those books.

c. The Balance Sheet Statement of Profit & Loss and Cash Flow Statement dealt withby this report are in agreement with the books of account.

d. In our opinion the Balance Sheet Statement of Profit & Loss and Cash FlowStatement dealt with by this report comply with the accounting standards specified undersection 133 of the Act; except for the effects of matters described in the Basis forQualified Opinion paragraph

e. On the basis of written representations received from the directors we report thatnone of the directors is disqualified as on 31st March 2015 from beingappointed as a director in terms of section 164(2) Act.

f. With respect to the other matters included in the Auditor's Report and to our bestof our information and according to the explanations given to us -

i. As mentioned in the Basis for Qualified Opinion paragraph The Company has disclosedthe pending litigations on its financial position in its financial statements ascontingent liability. However no provision has been made for contingent liabilities asdefined under AS 29 are summarized in Note No. 25 to Notes to Financial Statementspertaining to disputed liabilities.

ii. The Company has made provision as required under the applicable law or accountingstandards for material foreseeable losses if any on long term contracts includingderivative contracts except for pending litigation as mentioned in Point (i) above.

iii. There was no liability towards amount required to be transferred to the InvestorEducation and Protection Fund by the Company

For LKM & Co.
Firm Registration Number - 126823W
Chartered Accountants
Laxmikant Malpani (Proprietor) Place: Mumbai
Membership Number - 106989 Date: 29th May 2015

Annexure to Audit Report

The Annexure referred to in our Independent Auditors' Report to the members of theCompany on the

financial statements for the year ended 31st March 2015 we report that:

i. FIXED ASSETS

a) The company is maintaining proper records showing full particulars includingquantitative details and situation of fixed assets;

b) As explained to us the assets have been physically verified by the management inaccordance with a phased program of verification of its fixed assets adopted by theCompany which in our opinion is reasonable considering the size and the nature of itsbusiness. No material discrepancies have been noticed on such physical verification;

ii. INVENTORY

a) As explained to us inventories were physically verified during the year by themanagement at reasonable intervals;

b) In our opinion and according to the information and explanations given to us theprocedures of physical verification of inventories followed by the management weregenerally reasonable and adequate in relation to the size of the company and the nature ofits business;

c) In our opinion and according to the information and explanations given to us andrecords produced before us the company is maintaining proper records of its inventoriesand no material discrepancy has been observed by the management during the course ofverification;

iii. LOANS AND ADVANCES GRANTED

The Company has not granted any Loans Secured or Unsecured to Companies Firms orother parties covered under register maintained under section 189 of the Act. Accordinglythis clause is not applicable to the Company

iv. INTERNAL CONTROL SYSTEM

In our opinion and according to the information and explanations given to us there isadequate internal control system commensurate with the size of the Company and nature ofits business for the purchase of inventory and fixed assets and for the sale of goods andservices.

However in our opinion the company does not have an Internal Audit System commensuratewith the size & nature of the business resulting in non compliance of Sec 138 of theAct.

v. ACCEPTANCE OF DEPOSITS

In our opinion and according to information and explanations given to us the companyhas not accepted any deposits from public during the year. Hence the provisions of section73 to 76 of the Companies Act 2013 and the Companies (Acceptance of Deposits) Rules 1975are not applicable to the company.

vi. COST RECORDS

The Central Government has not prescribed maintenance of cost records under section 148of the Companies Act 2013 for any of the products of the Company;

vii. STATUTORY DUES

a) According to the information and explanations given to us following are theundisputed amounts of Provident Fund Excise Duty and Sales tax etc. payable as on 31stMarch 2015 and due for a period of more than six months from the date they become payableand provided for in the books of accounts:

Name of the Statute Nature of the dues Amount (Rs.)* Period for which the amount relates Due Date Date of Payment
Excise Duty 1332900 2003- 04 & 2004- 05 31.03.2005 Not Paid
Central Excise Act Interest 706000 2003-04 Up to 31.03.04 Not Paid
1944 Interest 770000 2004-05 Up to 31.03.05 Not Paid
Interest 456718 2005-06 Up to 31.03.06 Not Paid
Interest 208293 2006-07 Up to 31.03.07 Not Paid
Delhi Sales Tax Act1975 Sales Tax 1467631 2004-05 31.03.2005 Not Paid
Fringe FBT 53005 2006-07 31.03.200 Not Paid
Benefit Tax FBT 131438 2008-09 15.12.2008 Not Paid
The Income Tax Act TDS u/s 194J 159932 2014-15 30.04.2015 Not Paid
1961 TDS u/s 192 61700 2014-15 30.04.2015 Not Paid

* Above amounts are subject to interest on overdue and penalty.

b) According to the information and explanations given to us and as per ourverification of records of the company the following disputed amounts of tax not providedfor in the accounts of the company has not been deposited with appropriate authority as at31st March 2015:

Name of the Statute Nature of the Dues Amount (Rs.) Period to which the amount relates Forum where dispute is pending
2875017 1998-99 Joint Commissioner of Trade tax (Appeal) Uttar Pradesh.
9545 2001-02 Deputy Commissioner Uttar Pradesh
75196 2004-05 —Do---
UP Sales Tax Sales Tax 1453367 2005-06 —Do---
859396 2006-07 —Do---
504180 2007-08 —Do---
12890 2009-10 —Do---
71419 2010-11 —Do---
90903 2011-12 —Do---
114038 1985-86 Deputy Commissioner of Sales tax (Appeal) Delhi
68956 1990-91 —Do---
109656 1993-94 —Do---
173753 1994-95 —Do---
39004 1995-96 —Do---
118144 1996-97 —Do---
Delhi Sales Tax Act 1975 Sales Tax 87794 1997-98 —Do---
1602224 1998-99 —Do---
2566329 1999-00 —Do---
738160 2000-01 —Do---
122840 2001-02 —Do---
153361 2002-03 —Do---
440128 2003-04 —Do---
12536 2003-04 —Do---
128158 2004-05 —Do---

Central Excise Act 1944

i) One appeal filed at Appellate Tribunal New Delhi on 06/10/2009 for Rs. 1725392/-with interest from the date of payment till the refund being granted. It is still pendingbefore the adjusting authority.

ii) Contempt Petition filed against Excise Department at Allahabad High Court againstour refund of Rs. 1725392/- against the order of Supreme Court in our favor. Summonsissued to concerned authority.

PROVIDENT FUND

In the matter of the proceedings under section 14-B & 7-Q of the Employee'sProvident Fund & Misc. Provisions Act 1952 and imposed the damages & interest forthe period from 12/1997 to 11/2001 amounting Rs. 2173215/- and Rs. 743883/-respectively for which Stay was taken Before the Hon'ble Employee's Provident FundAppellate Tribunal New Delhi. After several hearings the case was dismissed in favor ofP.F. Commissioner however the final order was kept under ambiance.

1) Notice for interest payment from 10.06.2007 to 31.12.2014 (7Q) for M/ s. GayatriAllied & Security Services of Panel Interest of Rs. 4 08964/- to be paidimmediately. Hearing is in progress.

2) Pending deposit of P.F. for M/ s. Gayatri Allied & Security Services fromOctober 13 to December 14 Rs.268553/- to be Paid.

INCOME TAX

Income Tax Act. Demand 4867100/- 1997-98 Joint Commissioner of Income Tax New Delhi.
Income Tax Act. Demand 200887/- 2001-02 Deputy Commissioner of Income Tax New Delhi.
Income Tax Act. Demand 171201/- 2005-06 Assistant Commissioner of Income Tax New Delhi.
Income Tax Act. Demand 10533346/- 2007-08 Deputy Commissioner of Income Tax New Delhi.

1) A demand of Rs. One Crore five Lacs raised by Income Tax department (for AY2008-2009) and approached to BIFR for recovery last hearing was on 21.11.2013 case pendingwith BIFR. Documents submitted by BTCL and case was remanded and referred to Ward fortheir comments.

2) Case for scrutiny AY - 2012 - 13 required documents submitted to department somedocuments to be received from Mumbai Office. Next date of hearing is on 17/12/2014.Required details submitted on 19.02.2015 final Hearing was conducted on 24/02/2015. Thefinal ruling is awaited.

E.S.I.C

Particular Amount
Employees State Insurance Corporation Dues 2351993/-

Speaking Order no. K/INSP/II/67 - 7713 - 11 dated 20.04.11 in the form of C - 18 forthe period from May 2006 to March 2011 in the tune of Rs. 2351993/- Appeal submitted toJoint Director Sub- Reginal Office Noida. Recd Notice from department dated 17.02.15regarding per person hearing on 24.02.2015.

Trade Tax

Particular Year Amount
Appeal pending before Jt. Commissioner of Trade Tax Uttarakhand 2000-01 4329922

viii. ACCUMULATED LOSSES

The accumulated losses/Reserves of the company are more than fifty percent of itsEquity Capital amounting to Rs. 427259240/-. The company has incurred cash lossesduring the financial year covered by our audit and in the immediately preceding financialyear. Company has referred to BIFR on 04/11/1991. The final order is yet to be passed.

ix. DUES TO FINANCIAL INSTITUTIONS BANKS AND DEBENTURE HOLDERS

The Company had procured loan from The Pradeshiya Industrial and Investment Corporationof U.P. Ltd. (PICUP) which is having a Balance Outstanding as on year end of Rs.14700125 towards principal which is overdue. Also the interest payable thereon has notbeen accounted which is resulting in understatement of liability.

x. GUARANTEES GIVEN

As per the information and explanation given to us and records produced before usCompany has not given any guarantee for loans taken by others from Bank or FinancialInstitution and accordingly this clause is not applicable to the Company;

xi. TERM LOANS

The Company has not taken any term loan during the year.

xii. FRAUD NOTICED

During the course of our examination of the books and records of the Company carriedout in accordance with generally accepted auditing practices in India and according tothe information and explanations given to us we have neither come across any instances offraud on or by the Company noticed or reported during the year nor have we been informedof such case by management.

For LKM & Co.
Firm Registration Number - 126823W
Chartered Accountants
Laxmikant Malpani (Proprietor) Place: Mumbai
Membership Number - 106989 Date: 29th May 2015

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