To The Members of Consolidated Construction Consortium Ltd.
1. Report on the StandaloneFinancial Statements
We have audited the accompanying standalonefinancial statements of ConsolidatedConstruction Consortium Limited ("the Company") which comprise the BalanceSheet as at March 31 2016 the Statement of Profit and Loss the Cash Flow Statement forthe year then ended and a summary of significant accounting policies and otherexplanatory information.
2. Managements Responsibility for the Standalone Financial Statements
The Companys Board of Directors is responsible for the matters stated in Section134(5) of the Companies Act 2013 ("the Act") with respect to the preparationand presentation of these financial statements that give a true and fair view of thefinancial position financial performance and cash flows of the Company in accordance withthe accounting 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. This responsibility also includes maintenance of adequate accounting recordsin accordance with the provisions of the Act for safeguarding of the assets of the Companyand 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 ofthe financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
3. Auditors Responsibility
Our responsibility is to express an opinion on thesestandalone 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. 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 andthe disclosures in the financial statements. The procedures selected depend on theauditors judgment including the assessment of the risks of material misstatement ofthe financial statements whether due to fraud or error. In making those risk assessmentsthe auditor considers internal financial control relevant to the Companyspreparation of the financial statements that give a true and fair view in order to designaudit procedures that are appropriate in the circumstances. An audit also includesevaluating the appropriateness of the accounting policies used and the reasonableness ofthe accounting estimates made by the Companys Directors as well as evaluating theoverall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on thefinancial statements.
In our opinion and to the best of our information and according to the explanationsgiven to usthe financial statements give the information required by the Act in themanner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India:
a) in the case of the Balance Sheet of the state of affairs of the Company as at March31 2016; and
b) in the case of the Statement of Profit and Loss of the loss for the year ended onthat date;
c) in the case of the Cash Flow Statement of the cash flows for the year ended on thatdate.
5. Emphasis of Matter
1. We draw your attention to Note 5.1 regarding financial condition and mitigatingfactors and preparation of financial statements on going concern basis by management. Thefinancial statements do not include any adjustment in lieu of assertion in this regard.
2. We also draw your attention to Note 5.7 with regard to receivablesand provisionsthereon made by the management based on the recoverability; Furtherstatus on the bankguarantees invoked by the clients in earlier yearsdue to alleged contractualnon-performance and on-going legal/arbitration proceedingsfor which provisioning will beconsidered by the management based on the final outcome of the resolution of theproceedings.
Our opinion is not qualified/modified in respect of these matters.
6. Report on Other Legal and Regulatory Requirements
6.1 As required by the Companies (Auditors Report) Order 2016 ("theOrder") issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Act we give in the "Annexure A" statement on the mattersspecified in paragraphs 3 and 4 of the Order tothe extent applicable.
6.2 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 of those books.
c) The Balance Sheet the Statement of Profit and Loss and the Cash Flow Statementdealt with by this Report are in agreement with the books of account.
d) In our opinion the aforesaid standalonefinancial 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 the written representations received from the directors and taken onrecord by the Board of Directors none of the directors is disqualified as on March 312016 from being appointed as a director in terms of Section 164 (2) of the Act.
f) With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer ourseparate Report in "Annexure B".
g) With respect to the other matters to be included in the Auditors 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::
i. The Company has disclosed the impact of pending litigations on its financialposition in its financial statements- referNote 5.12 to the financial statements;
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;
iii. There were no amounts which were pending to be transferred to the InvestorEducation and Protection Fund by the Holding Company and its Subsidiary Companiesincorporated in India .
| ||For ASA & ASSOCIATES LLP |
| ||Firm Registration No: 009571N/N500006 |
| ||Chartered Accountants |
| ||S Sundar Rajan |
|Place : Chennai ||Partner |
|Date : May 25 2016 ||Membership No:211414 |
Annexure-A to the Independent Auditors Report
Referred to in paragraph 6.1 of the Independent Auditors Report of even date tothe members of
Consolidated Construction Consortium Limited on the standalone financial statements forthe year ended March 31 2016
(i) a. The company is maintaining proper records showing full particulars includingquantitative details and situation of the fixed assets.
b. The company has a regular programme of physical verification of fixed assets in aphased manner at periodical interval. Pursuant to the program certain assets were coveredby physical verification during the year. In our opinion the frequency of verification ofthe fixed assets is reasonable having regard to the size of the company and the nature itsassets.
c. In our opinion and according to the information and explanation given to us thetitle deed of immovable property being land is in the name of the Company. However thesame is offered as Collateral for the loan taken by the Company.
(ii) As explained to us the inventories including site materials stores andconstruction aids have been physically verified by the management at reasonable intervalsand informed that no material discrepancies were noticed on such physical verification;
(iii) According to the information and explanations given to us and records of thecompany examined by us the Company has granted interest free unsecured loans to itssubsidiary company and Step down subsidiaries companies covered in the register maintainedunder section 189 of the Companies Act 2013. In the absence of any schedule of repaymentwe could not report on the overdue amounts as required under clause (iii) of the Order2013;
(iv) According to the information and explanation given to us in respect of the loangrantedinvestments made and guarantees provided provisions of Sections 185 and Sections186 of Companies Act 2013 have been complied with except for charging of Interest on theloans as required u/s.186(7) of the Act;
(v) The Company has not accepted any deposits from the public within the meaning of thedirectives issued by the Reserve Bank of India and the provisions of sections 73 to 76 orany other relevant provisions of the Companies Act and the rules framed there under.
(vi) We have broadly reviewed the books of account maintained by the Company in respectof services where pursuant to the rules made by the Central Government of India themaintenance of cost records has been prescribed under the Act been madeand are of theopinion that prime facie the prescribed accounts and records have been made andmaintained. We have not however made a detailed examination of the records with a view todetermine whether they are accurate or complete.
(vii) a) According to the information and explanations given to us and the records ofthe Company examined by us in our opinion the Company is generally regular in depositingthe undisputed statutory dues including provident fund investor education andprotectionfund employees state insurance income-tax sales tax/Value Added Tax(VAT) wealthtax service tax customs duty excise duty cess and other material statutory dues asapplicable with the appropriate authorities. There are no undisputed statutory dues whichare in arrear for more than six month from the date it became due.
b. According to the information given to us the particulars of dues of income-taxsales-tax/ Value Added Tax(VAT) wealth tax service tax customs duty excise duty andcess as at March 31 2016 which have not been deposited on account of a dispute are asfollows:
| || || || || ||(Rs. in lakhs) |
|Name of Statue ||Nature of Dispute ||Reference ||Amount ||Periods to which the amount relates (F.Y.) ||Forum where the disputes are pending |
| ||Disallowance of certain expenditure and claims ||AO dated 28.12.2010 ||225.68*** ||2005-2006 ||High Court of Madras |
| || ||AO dated 28.03.2013 ||258.42 ||2009-10 ||Income Tax Appellate Tribunal |
| || ||AO dated 31.03.2014 ||1708.98** ||2010-11 ||Commissioner of Income Tax (Appeals)-I Chennai |
|Income Tax Act 1961 || ||AO dated 13.03.2015 ||88.51** ||2011-12 ||Commissioner of |
| || || || || ||Income Tax (Appeals)-I Chennai |
| || ||AO dated 30.03.2016 ||584.30** ||2012-13 ||Commissioner of Income Tax (Appeals)-I Chennai |
|Kerala VAT ||Sales made to SEZ claimed as exempt (Extension of benefit in KGST Sought) ||Assessment No. D/753/ 06/2005-06 dated 31.07.2008 ||55.10 ||2005-2006 ||Appellate Assistant Commissioner Cochin |
|Karnataka VAT ||Inputs Rejected by applying the Centum industries Judgment i.e input is taken in a particular tax period which is not relevant to that period ||Assessment dated 31/03/2015 ||165.77 ||2010-2011 ||FAA (Joint Commissioner of Commercial Taxes Appeals - 3 Bangalore. |
| ||Inputs Rejected by applying the Centum industries Judgment i.e input is taken in a particular tax period which is not relevant to that period ||Assessment dated 04/05/2015 ||173.89 ||2011-2012 ||FAA (Joint Commissioner of Commercial Taxes Appeals - 3 Bangalore. |
| ||Inputs Rejected by applying the Centum industries Judgment i.e input is taken in a particular tax period which is not relevant to that period ||Assessment dated 12/05/2015 ||224.86 ||2012-2013 ||FAA (Joint Commissioner of Commercial Taxes Appeals - 3 Bangalore. |
| ||Inputs Rejected by applying the Centum industries Judgment i.e input is taken in a particular tax period which is not relevant to that period ||Assessment dated 04/06/2015 ||180.86 ||2013-2014 ||FAA (Joint Commissioner of Commercial Taxes Appeals - 3 Bangalore. |
| ||Disallowance of Margin on sub contract portion Security service and repair service ||Order Dated 19.10.2010 ||34.20 ||2009-2010 ||Joint Commissioner of Commercial tax (Appeals) Banglore |
| ||Inclusion of turnover of SEZ under Section 6 TNVAT and Stock Transfers ||Based on Sworn ||407.85 ||Jan. 2007 to March 2008 ||Commercial Tax Officer Chennai |
|TNVAT || ||Statement || || || |
| ||Reversal of Input Tax Credit for SEZ projects Stock Transfers Unregistered Purchases and schedule rate variation in RMC ||Notice dated 28.11.2011 ||552.56 ||April 2008 to March 2010 ||Commercial Tax Officer Chennai |
|R VAT ||Tax is already discharged on receipt basis subsequent year but tax is levied based on WCT TDS ||Notice dated 26/03/2016 ||9.51 ||2008-2009 ||The Appellate Authority Commercial Taxes (Appeal)-1 Jaipur |
| ||Tax is already discharged on receipt basis subsequent year but tax is levied based on WCT TDS ||Notice dated 26/03/2016 ||8.38 ||2009-2010 ||The Appellate Authority Commercial Taxes (Appeal)-1 Jaipur |
|WB VAT ||The Sub Contractor expenditure is disallowed ||Notice dated 3/12/2015 ||160.6 ||2011-2012 ||The Joint Commissioner Commercial Taxes Alipore Charge Kolkata -700034 |
| ||The expenditure is added back to turnover ||Assessment order date 29/06/2015 ||167.62 ||2012-2013 ||West Bengal Taxation TribunalSalt Lake Kolkata |
|Customs Duty ||Short payment of Customs Duty for import of Equipment on ||SCN 1908 dated ||2.93 ||2008-2009 ||Directorate of Revenue Intelligence Mumbai |
| ||High Sea Sale ||21.02.2013 || || || |
| || ||Stay Order No.166 to 169/12 obtainted from CESTAT on 21/03/2012 ||8022.06 ||April 2006 - Sep. 2008 ||Customs Excise and |
|Service Tax ||CENVAT Credit on Capital Goods utilized in discharging Service Tax where Notification 1/2006 is availed ||Order-in- Original No. 64/2011 dt. 30/11/2011 ||1338.46 ||Oct. 2008 to Sep. 2009 ||Service Tax Appellate Tribunal (CESTAT) Chennai |
| || ||Order -in- Original No. 19 & 20 /2013 dated 28/02/2013 ||462.41 ||Oct. 2009 to Sep. 2010 || |
| || ||Order-in- Original No. 19 & 20 /2013 dated 28/02/2013 ||263.70 ||Oct. 2010 to Mar. 2011 || |
| || ||SCN 227/2013 dt. 02.07.2013 ||170.58 ||April 2011 to March 2012 ||Commissioner of Service Tax Chennai |
| || ||SCN No. 243/2014 dated 27/08/2014 ||19.67 ||April 2012 to June 2012 ||Joint Commissioner of Service Tax Service Tax Commissionerate Chennai |
| || ||SCN No. 02/2015 dated 06/01/2015 ||21.15 ||July 2012 to March 2013 ||Joint Commissioner of Service Tax II Commissionerate Chennai |
| ||Service Tax demanded on Retention monies held by client as the same is yet to receive from Client by us Capital ||Order -in- Original No. 65/2011 dated ||446.21 ||2008-2009 ||Customs Excise and |
| ||Goods used in SEZ Zone and Wrong availment of CVD in respect of ||30/11/2011 || || ||Service Tax Appellate |
| ||'Schwing Boom Placer' and CENVAT Credit on Capital Goods utilized in discharge ||Order -in- Original No. 66/2011 dated 30/11/2011 ||394.74 ||2009-2010 ||Tribunal (CESTAT) Chennai |
| || ||Order -in- Original No. 50 & 51 ||80.17 ||2010-2011 || |
| ||Service Tax demanded on Retention monies held by client as the same is yet to receive from Client by us Capital ||-13-14 dated || || ||Customs Excise and |
| ||Goods and Scaffolding Materials which are exclusively used in Airport ||22/01/2014 || || ||Service Tax Appellate Tribunal (CESTAT) Chennai |
| || ||Order -in- Original No. 50 & 51 -13-14 dated 22/01/2014 ||13.76 ||April 2011 to June 2011 || |
|Service Tax ||Service Tax on Works Contract Service provided to M/s. Bangalore Metropolitan Transport Corporation Bangalore ||SOD No. 237/2013 dated 10/07/2013 ||93.07 ||Sep 2011 to Sep 2012 ||Commissioner of Service Tax Chennai |
| || ||SOD No. 29/2014 dated 09/12/2014 ||6.05 ||Oct 2012 to June 2014 ||Joint Commissioner of Service Tax II Commissionerate Chennai |
| ||Short Payment of Service Tax on Rebate Allowed by the Sub-Contractors ||SCN No. 174/2014 dated 23/07/2014 ||41.07 ||April 2011 to Sep 2012 ||Commissioner of Service Tax (Appeals-II) Service Tax Commissionerate Chennai |
| || ||SOD No. 30/2014 dated 09/12/2014 ||20.20 ||Oct 2012 to Mar 2014 ||Commissioner of Service Tax (Appeals-II) Service Tax Commissionerate Chennai |
| || ||O/o No.27/2013 dated 30/05/2013 & Appeal No.59/2013 dt. 16/08/2013 ||14.78 ||April 2011 to January 2012 ||Customs Excise and Service Tax Appellate Tribunal (CESTAT) Chennai |
| ||Levy of Excise Duty on manufacture of Ready Mix Concrete vide Notification ||O/o No.147/2013 dated 30/12/2013 & ||1.02 ||February 2012 to March 2012 ||Customs Excise and Service Tax Appellate |
|Central Excise Act 1944 ||1/2011 dated 1.3.2011 for removal from a Batching plant located outside the Project location and used exclusively for the project. ||Appeal No.17/2014 (M-IV) dt. 03/03/2014 || || ||Tribunal (CESTAT) Chennai |
| || ||O/o No.10/2013 dated 28/01/2013 (REFUND) & Appeal No.32/2013 (M-IV) dt. 26/04/2013 ||1.62 ||March 2011 ||Customs Excise and Service Tax Appellate Tribunal (CESTAT) Chennai |
| || ||O/o No.02/2013 dated 21/02/2013 & Appeal No.31/2013 (M-IV) dt. 25/04/2013 ||3.96 ||July 2011 to March 2012 ||Customs Excise and Service Tax Appellate Tribunal (CESTAT) Chennai |
| || ||O/o 10/2014 dated.30/05/2014 & Appeal No. 58/2014 (M-IV) dated 13/08/2014 ||25.05 ||April 2012 to March 2013 ||Customs Excise and Service Tax Appellate Tribunal (CESTAT) Chennai |
| || ||Order-in- Appeal No. 204 dated 09/01/2014 ||4.39 ||2011-2012 ||Customs Excise and Service Tax Appellate Tribunal (CESTAT) Principal Bench New Delhi |
| || ||SCN No. 66/2011-12/2273 dt 30.07.2013 ||4.59 ||Aug 2012- Dec 2012 ||Commissioner of Central Excise(Appeals) New Delhi |
| || ||O/o No.MLR- EXCUS-000- UDDN-JTC-KDK- 029-14-15 dt. 23/07/2014 ||10.07 ||May 2011 to Jan- 2013 ||Commissioner of Customs and Central Excise (Appeals) Mysore |
|Central Excise Act 1944 ||Levy of Excise Duty on manufacture of Ready Mix Concrete vide Notification 1/2011 dated 1.3.2011 for removal from ||O-I-O No.09/ 2013-14 dt. 22/07/2013 ||13.61 ||Oct 2011 to July 2012 ||Commissioner of Customs and Central Excise (Appeals) Delhi |
| ||a Batching plant located outside the Project location and used exclusively for the project. ||SCN 843 dt. 09/04/2014 ||4.78 ||Jan 2013 to June 2013 ||The Assistant Commissioner of Central Excise Division - VI Nehru Place New Delhi |
| || ||SCN 22/2014 dt. 28/04/2014 ||16.36 ||April 2013 to March 2014 ||Commissioner of Customs and Central Excise (Appeals) Chennai |
** 50% paid balance through BG
*** Adjusted against the refund due
(viii) According to the records of theCompany examined by us and the information andexplanations given to us the Company has not defaulted in repayment of dues to FinancialInstitution or banks or debenture holders as at the balance sheet date.
(ix) According the information and explanations provided to us and examination ofthebooks of account Company has not raised any moneys by way of initial public offerorfurther public offer or the term loans except conversion of part of the debt into equityas per CDR package sanctioned. Accordingly reporting as to application of themoneys underclause (ix) of the Order is not applicable.
(x) According to the information and explanation provided to us there were no fraud bythe Company or any fraud on the Company by its officers or employees has been noticed orreported during the year;
(xi) According to the information and explanation provided and records of the companyexamined by us no managerial remuneration is paid or provided during the year; During theyear ended 31/3/2014 company had paid Rs.118 lakh excess remuneration to its whole timedirectors approval for which is pending from Central Government;
(xii) The Company is not a Nidhi Company;
(xiii) According to the information and explanation given to us all the transactionswith therelated parties are in compliance with section 177 and 188 of Companies Act2013where applicable and the details have been disclosed in the Financial Statementsasrequired by the applicable accounting standards
(xiv) The company has not made any preferential allotment or private placement ofsharesor fully or partly convertible debentures during the year under review.
(xv) According to the information and explanation given to us the company hasnotentered into any non-cash transactions with the directors or persons connected withhim.
(xvi) According to the information and explanation provided to us the Company is notaNon-Banking Financial Corporationand accordingly registration under section 45IAof theReserve Bank of India Act 1934 is not required.
| ||For ASA & ASSOCIATES LLP |
| ||Firm Registration No: 009571N/N500006 |
| ||Chartered Accountants |
| ||S Sundar Rajan |
|Place : Chennai ||Partner |
|Date : May 25 2016 ||Membership No:211414 |