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Bombay Dyeing & Manufacturing Company Ltd.

BSE: 500020 Sector: Industrials
NSE: BOMDYEING ISIN Code: INE032A01023
BSE LIVE 15:46 | 17 Nov 187.35 3.20
(1.74%)
OPEN

186.55

HIGH

193.35

LOW

186.25

NSE 15:59 | 17 Nov 186.85 3.10
(1.69%)
OPEN

187.90

HIGH

192.90

LOW

185.75

OPEN 186.55
PREVIOUS CLOSE 184.15
VOLUME 326985
52-Week high 245.70
52-Week low 41.20
P/E
Mkt Cap.(Rs cr) 3,870
Buy Price 0.00
Buy Qty 0.00
Sell Price 187.35
Sell Qty 1117.00
OPEN 186.55
CLOSE 184.15
VOLUME 326985
52-Week high 245.70
52-Week low 41.20
P/E
Mkt Cap.(Rs cr) 3,870
Buy Price 0.00
Buy Qty 0.00
Sell Price 187.35
Sell Qty 1117.00

Bombay Dyeing & Manufacturing Company Ltd. (BOMDYEING) - Auditors Report

Company auditors report

TO

THE MEMBERS OF

THE BOMBAY DYEING AND MANUFACTURING COMPANY LIMITED

Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements of THE BOMBAYDYEING AND MANUFACTURING COMPANY LIMITED ("the Company") which comprise theBalance Sheet as at March 31 2017 Statement of Profit and Loss and the Cash FlowStatement for the year then ended and a summary of significant accounting policies andother explanatory information.

Management's Responsibility for the standalone Financial Statements

"The Company's Board of Directors is responsible for the matters stated in Section134(5) of the Companies Act 2013 ("the Act") with respect to the preparation ofthese standalone financial statements that give a true and fair view of the financialposition financial performance and cash flows of the Company in accordance with theaccounting principles generally accepted in India including the Accounting Standardsspecified under Section 133 of the Act read with Rule 7 of the Companies (Accounts)Rules 2014. "Diis responsibility also includes maintenance of adequate accountingrecords in accordance with the provisions of the Act for safeguarding the assets of theCompany and for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation of thestandalone financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these standalone financial statementsbased on our audit.

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 thereunder.

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

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the financial statements. "The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of thefinancial statements whether due to fraud or error. In making those risk assessments theauditor considers internal financial control relevant to the Company's preparation of thefinancial statements that give a true and fair view in order to design audit proceduresthat are appropriate in the circumstances. An audit also includes evaluating theappropriateness of the accounting policies used and the reasonableness of the accountingestimates made by the Company's Directors as well as evaluating the overall presentationof the standalone 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.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the Act in the manner so required and give a true and fair view in conformity with theaccounting principles generally accepted in India of the state of affairs of the Companyas at March 31 2017 and its profit and its cash flows for the year ended on that date.

Emphasis of Matter

We draw attention to:

1) Note 39 to the financial statements regarding agreements to sell certain apartmentsin the proposed residential towers being constructed at Island City Centre to SCALServices Ltd. a Group Company in terms of various MOUs entered between the companiestill March 2017. "The Company has during the year recognized net revenues of Rs.156.07 crore (2015-16: Rs. 239.26 crore) and resultant profit before tax of' 102.63 crore(2015-16: Rs. 158.63 crore) on sale ofsaid apartments to SCAL.

2) Note 43 to the financial statements regarding the remuneration paid to the ManagingDirector in excess of the limits prescribed under Section 197 read with Schedule V of theAct by Rs. 4.29 crore due to inadequacy of profits. "The Company has received anapproval from the Central Government dated June 21 2017 for payment of remunerationamounting to Rs. 2.12 crore only. "The Company is proposing to make a representationto the Central Government with a request to reconsider the amount approved. Pending suchrepresentation no adjustments have been made in the accounts for the year ended March 312017 and the excess amount is held by the Managing Director in trust for the Company.

Our opinion is not modified in respect of the above matters.

Report on Other Legal and Regulatory Requirements

1) As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in terms ofsub-section (11) ofsection 143 of theAct we give in Annexure 'A' a statement on the matters specified in paragraphs 3 and 4 ofthe 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 bestof 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 theCompany so far as it appears from our examination ofthose books.

(c) The Balance Sheet the Statement of Profit and Loss and Cash Flow Statement dealtwith by this report are in agreement with the books of account.

(d) In our opinion the aforesaid standalone financial statements comply with theAccounting Standards specified under section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014.

(e) On the basis of written representations received from the directors as on March 312017 and taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2017 from being appointed as a director in terms of section 164(2) of theAct.

(f) With respect to the adequacy of the internal financial controls over financialreporting of the company and the operating effectiveness of such controls refer to ourseparate report in Annexure 'B'; and

(g) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our information and according to the explanations given to us wefurther report that:

i. The Company has disclosed the impact of pending litigations on its financialposition in the financial statements- Refer Notes 32 and 42 to the standalone financialstatements.

ii. The Company does not have any long term contracts including derivative contractsfor which there were any material foreseeable losses.

Hi. There has been no delay in transferring amounts required to be transferred to theInvestor Education and Protection Fund by the Company.

iv The company has provided requisite disclosures in its financial statements as toholdings as well as dealings in Specified Bank Notes as defined in the Notification S.0.3407 (E) dated 8th November 2016 of the Ministry of Finance during theperiod from 8th November 2016 to 30th December 2016. Based onaudit procedures performed and the representations of management we report that thedisclosures are in accordance with books of account maintained by the Company - Refer Note47 to the standalone financial statements.

For KALYANIWALLA & MISTRY LLP
Chartered Accountants
Firm Registration No. 104607W/W100166
DARAIUS Z. FRASER
Place: Mumbai Partner
Date: 28th June 2017 Membership No.: 42454

ANNEXURE 'A' TO THE INDEPENDENT AUDITOR'S REPORT

Referred to in Para 1 ‘Report on Other Legal and Regulatory Requirements' of ourReport to the members of the Company on the standalone financial statements for the yearended March 31 2017:

Statement on Matters Specified in paragraphs 3 and 4 of the Companies (Auditors Report)Order 2016

1. (a) The Company has maintained records showing full particulars includingquantitative details and situation of fixed assets. The records of certain assets need tobe assimilated to make identification possible.

(b) The Company has a program for physical verification of fixed assets in a phasedmanner. The Company did not carry out physical verification of fixed assets during theyear however the dismantling and slare of its Ranjangaon plant is in progress. In thecircumstances we are unable to state whether any material discrepancies were noticed.

(c) According to the information and explanation given to us and based on the documentsand records produced before us the title deeds of immovable properties are held in thename of the company.

2. (a) The Management has conducted physical verification of inventory (excludingstocks lying with third parties) at reasonable intervals. In respect of inventory lyingwith third parties these have substantially been confirmed by them.

(b) The discrepancies noticed on verification between physical stock and book recordswere not material in relation to the operations of the Company and the same have beenproperly dealt with in the books ofaccount.

3. The Company has granted unsecured loans/deposits to two companies and an interestfree shareholders' deposit to a jointly controlled entity covered in the registermaintained under section 189 of the Companies Act.

(a) The terms and conditions of the grant of such loans are not prima facie prejudicialto the Company's interest;

(b) The principal amount and interest on the loans / deposits have been repaidregularly as stipulated. The shareholder's deposit is free of interest and repaymentthereof was due on 31st December 2015.

(c) The shareholder's deposit is overdue for more than ninety days. The Company hasmade adequate provision against the same and has also made an application to Reserve Bankof India for further extension of five years which is pending.

4. In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of section 185 and 186 of the Act in respect ofgrant of loans making investments and providing guarantees and securities as applicable.

5. In our opinion and according to the information and explanations given to us theCompany has complied with directives issued by Reserve Bank of India and the provision ofsections 73 to 76 or any other applicable provisions of the Act and The Companies(Acceptance of Deposits) Rules 2014 with regard to the deposits accepted from the public.According to the information and explanations given to us no order has been passed by theCompany Law Board or the National Company Law Tribunal or the Reserve Bank of India or anyCourt or any other Tribunal.

6. We have broadly reviewed the books of accounts and records maintained by the Companyin respect of manufacture of products covered under the Rules made by the CentralGovernment for maintenance of cost records under section 148 (1) of the Companies Actand are of the opinion that prima facie the prescribed accounts and records have beenmade and maintained. We have not however made a detailed examination of the records witha view to determine whether they are accurate or complete.

7. (a) According to the information and explanation given to us and the recordsexamined by us the Company is generally regular in depositing undisputed statutory duesincluding dues pertaining to provident fund employees' state insurance income-taxsales-tax service tax duty of customs duty of excise value added tax cess and anyother statutory dues with the appropriate authorities. According to the information andexplanations given to us there are no undisputed dues which have remained outstanding asat the end of the financial year for a period of more than six months from the date theybecame payable.

(b) According to the information and explanations given to us there are no dues ofsales tax income tax custom duty service tax excise duty or cess which have not beendeposited on account of any dispute except as stated below:

No. Name of the statute Nature of dues Amount (' in crores) Period to which the amount relates Forum where dispute is pending
1 Sales Tax and Value Sales tax 0.09 1999-2000 Deputy CommissionerAppeal - II
Added Tax MVAT 0.38 2008-09 Maharashtra Sales Tax Tribunal
CST 1.80 2008-09 Maharashtra Sales Tax Tribunal
CST 1.52 2009-10 Department ofTrade and Taxes New Delhi
CST 2.74 2011-12 Department ofTrade and Taxes New Delhi
CST 0.50 2012-13 Joint Commissioner ofSales Tax Mumbai
2 IncomeTaxAct Income tax 0.09 2006-07 IncomeTax Appellate Tribunal
1961 Income tax 0.03 2007-08 Deputy Commissioner oflncome Tax- TDS Mumbai
Income tax 0.15 2007-08 IncomeTax Appellate Tribunal
Income tax 0.02 2008-09 Deputy Commissioner oflncome Tax- TDS Mumbai
Income tax 0.43 2008-09 IncomeTax Appellate Tribunal
Income tax 1.86 2009-10 IncomeTax Appellate Tribunal
Income tax 0.36 2010-11 IncomeTax Appellate Tribunal
Income tax 0.13 2011-12 Commissioner oflncome Tax (Appeal)
Income tax 1.07 2012-13 Commissioner oflncome Tax (Appeal)
Income tax 0.96 2013-14 Commissioner oflncome Tax (Appeal)
3 The Customs Act 1962 Interest on customs duty 0.95 1995-2012 Commissioners ofCustoms (Appeals) Mumbai
4 The Central Excise Act 1944 Excise Duty 0.16 1989-90 to 1995-96 Commissioners of Central Excise (Appeals) Mumbai
Excise Duty 0.62 1995-96 to 1996-97 Customs Excise and Service Tax Appellate Tribunal (CESTAT) Mumbai
Excise Duty 0.03 1997-1998 Customs Excise and Service Tax Appellate Tribunal (CESTAT) Mumbai
Service Tax 0.76 2003-04 to 2005-06 Commissioner ofServiceTax Mumbai Tribunal
Interest on excise duty 0.20 2002-2006 Bombay High Court
5 Municipal Corporation ofGreaterMumbai Octroi Rules 1965 Octroi 2.16 2007-2008 Deputy Assessor & Collector (Octroi)

8. In our opinion and according to the information and explanations given to us theCompany has not defaulted in repayment of loans or borrowing to financial institutionsbanks or government. The Company has not issued any debentures.

9. The Company has not raised moneys by way of initial public offer or further publicoffer (including debt instruments). The monies raised by way of term loans were appliedfor the purposes for which those were raised.

10. Based upon the audit procedures performed by us to the best of our knowledge andbelief and according to the information and explanations given to us by the Management nofraud by the Company or fraud on the Company by its officers or employee has been noticedor reported during the year.

11. According to the information and explanations given to us and based on ourexamination of the records of the Company the managerial remuneration paid or provided tothe Managing Director is in excess of the limits prescribed under Section 197 read withSchedule V of the Act by Rs. 4.29 crore due to inadequacy of profits. The Company hasreceived an approval from the Central Government dated June 21 2017 for payment ofremuneration amounting to Rs. 2.12 crore only "ftie Company is proposing to make arepresentation to the Central Government with a request to reconsider the amount approved.Pending such representation no adjustments have been made in the accounts for the yearended March 31 2017 and the excess amount is held by the Managing Director in trust forthe Company.

12. In our opinion and according to the information and explanations given to us theCompany is not a Nidhi Company.

13. According to the information and explanations given to us and based on thedocuments and records produced before us the transactions with related parties are incompliance with section 177 and 188 of the Act and the details thereof have been disclosedin the Financial Statements as required by the applicable accounting standards.

14. According to the information and explanations given to us and based on thedocuments and records produced before us the company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year. Accordingly the provisions of Clause (xiv) of the order are not applicable.

15. According to the information and explanations given to us and based on thedocuments and records produced before us the Company has not has entered into anynon-cash transactions with directors or persons connected with them.

16. According to the information and explanations given to us and based on thedocuments and records produced before us the Company is not required to be registeredunder section 45- IA of the Reserve Bank oflndia Act 1934.

For KALYANIWALLA & MISTRY LLP
Chartered Accountants
Firm Registration No. 104607W/W100166
DARAIUS Z. FRASER
Place: Mumbai Partner
Date: 28th June 2017 Membership No.: 42454

ANNEXURE 'B' TO THE INDEPENDENT AUDITOR'S REPORT

The Annexure referred to in Para 2 (f) ‘Report on Other Legal and RegulatoryRequirements' of our Independent Auditors' Report to the members of the Company on thefinancial statements for the year ended March 31 2017:

Report on the Internal Financial Controls under Clause (i) of Subsection 3 of Section143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls over financial reporting of THEBOMBAY DYEING AND MANUFACTURING COMPANY LIMITED ("the Company") as at March31 2017 in conjunction with our audit of the financial statements of the Company for theyear ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls over Financial Reportingissued by the Institute of Chartered Accountants of India (1CAI'). These responsibilitiesinclude the design implementation and maintenance of adequate internal financial controlsthat were operating effectively for ensuring the orderly and efficient conduct of itsbusiness including adherence to company's policies the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Companies Act 2013.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note on Audit of Internal Financial Controls over Financial Reporting(the "Guidance Note") and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Act to the extent applicable to an audit ofinternal financial controls both applicable to an audit of Internal Financial Controlsand both issued by the Institute of Chartered Accountants of India ffiose Standards andthe Guidance Note require that we comply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whether adequate internal financialcontrols over financial reporting was established and maintained and if such controlsoperated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk The proceduresselected depend on the auditor's judgment including the assessment of the risks ofmaterial misstatement of the financial statements whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company's internal financial controlssystemoverfinancial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal financial control over financialreporting includes those policies and procedures that (1) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the company are being made only in accordance with authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised acquisition use or disposition of thecompany's assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion to the best of out information and according to the explanations givento us the Company has in all material respects an adequate internal financialcontrolssystem overfinancial reporting and such internal financial controls overfinancialreporting were operating effectively as at March 31 2017 based on the internal controlover financial reporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls over Financial Reporting issued by the Institute of Chartered Accountants ofIndia.

For KALYANIWALLA & MISTRY LLP
Chartered Accountants
Firm Registration No. 104607W/W100166
DARAIUS Z. FRASER
Place: Mumbai Partner
Date: 28th June 2017 Membership No.: 42454