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Cals Refineries Ltd.

BSE: 526652 Sector: Others
NSE: N.A. ISIN Code: INE040C01022
BSE LIVE 15:53 | 09 Dec 0.19 0






NSE LIVE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 0.19
VOLUME 5552972
52-Week high 0.29
52-Week low 0.05
Mkt Cap.(Rs cr) 157.59
Buy Price 0.19
Buy Qty 4460413.00
Sell Price 0.00
Sell Qty 0.00
OPEN 0.19
CLOSE 0.19
VOLUME 5552972
52-Week high 0.29
52-Week low 0.05
Mkt Cap.(Rs cr) 157.59
Buy Price 0.19
Buy Qty 4460413.00
Sell Price 0.00
Sell Qty 0.00

Cals Refineries Ltd. (CALSREFINERIES) - Auditors Report

Company auditors report



Report on the Financial Statements

We have audited accompanying financial statements of CALS REFINERIES LIMITED ("theCompany") which comprise the Balance Sheet as at March 31 2015 and the Statement ofProfit and Loss and Cash Flow Statement for the period then ended and a summary ofsignificant accounting policies and other explanatory information.

Management' Responsibility for the Financial Statements

The Company's Board of Directors are responsible for the matters stated in Section134(5) of Companies Act 2013 ("the Act") with respect to the preparation andpresentation of these 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. This responsibility includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; design implementation and maintenance of adequate internal financial controlsthat are operating effectively for ensuring the accuracy and completeness of theaccounting records relevant to the preparation and presentation of the financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on ouraudit. We conducted our audit in accordance with the provisions of the Act the Accountingand Auditing standards and the matters which are required to be included in the auditreport under the provisions 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 control relevant to the Company's preparation and fair presentation ofthe financial statements in order to design audit procedures that are appropriate in thecircumstances but not for the purpose of expressing an opinion on the effectiveness ofthe entity's internal control. An audit also includes evaluating the appropriateness ofaccounting policies used and the reasonableness of the accounting estimates made by themanagement as well as evaluating the overall 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.

Basis of Qualified Opinion

Attention of the matters is invited to note no. 30 (d) of the notes to accountsregarding the financial statements of the company having been prepared on a Going Concernbasis not withstanding that due to continuous losses incurred by the company during thepast years and current year the accumulated losses of the Company have far exceeded itsNet Worth resulting in negative net worth on Balance Sheet date. The company haswritten-off a substantial part of its Fixed Asset during the year. This situationindicates the existence of a material uncertainty that may cast a significant doubt on thecompany's ability to continue as a going concern.

Qualified Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us except for the effects of the matters described in the basis of QualifiedOpinion paragraph the financial statements give the information required by the Actin the manner 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 2015;

b) in the case of the Statement of Profit and Loss of the loss for the period ended onthat date; and

c) in the case of Cash Flow Statement of the cash flows for the period ended on thatdate.

Emphasis of matter

Without qualifying our opinion we draw attention to:

(a) In absence of any development in the project and withdrawal of the permissivepossession of land. Cost of leasehold land Rs. 990.71 million (including cost of landdevelopment Rs. 196.91 million) civil work of factory building (included in capital workin progress) Rs. 49.64 million expenses incurred on the project which are 'PreoperativeExpenses Pending Allocation' Rs. 432.51 million 'Consultancy Fees' Rs. 65.62 millionshown under 'Capital Work in Progress' and 'Capital Advances' Rs. 4723.59 million shownunder 'Loan and Advances' are written off.

(b) The Securities Exchange Board of India (SEBI) has issued a final order datedOctober 23 2013 against the Company in the matter of "Market Manipulation using GDRIssues" which imposes a restriction on any further issue of equity shares or anyother instruments convertible into equity shares or any other security by the Company fora period of ten years. As on date of order the Company has undergone such prohibition aslaid down in the order for approximately two year which means the restriction will bereduced effectively to eight years from the date of order. Further SEBI vide order dated31/12/2014 has also raised a question of siphoning of funds for the benefit of promotersof the Company. The Company is in appeal against the aforesaid order of SEBI in SecuritiesAppellate Tribunal (SAT). The matter is sub-judice and the impact if any of the outcomeof the same cannot be ascertained at this stage.

(c) The Company had deferred expenses related to equity and GDR issues amounting to Rs.246.24 million which forms part of other non-current assets. With reference to theaforementioned order of SEBI and the embargo on the further issuance of equity or anyequity convertible instruments by the Company since there is no future economic benefitarising out of such expenses incurred during the previous years the expense has beenwritten off in the current year.

(d) The company has share application money pending allotment for a period of more thanone year and cannot issue shares or refund the money as instructed by SEBI in its order asmentioned in point (b) above.

(e) Trade payables appearing in the books of accounts are subject to confirmation andreconciliation if any. Consequential impact if any will be considered as and whendetermined.

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 subsection (11) of 143 of the Actwe give in the Annexure a statement on the matters specified in the paragraph 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 obtained all the information and explanations which to the best of ourknowledge 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 theCompany so far as appears from our examination of those books.

c) The Balance Sheet Statement of Profit and 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 and Loss and Cash FlowStatement comply with the Accounting Standards specified under section 133 of the Actread with rule 7 of the Companies (Accounts) Rules 2014.

e) On the basis of the written representations received from the directors as on March31 2015 and taken on record by the Board of Directors we report that none of thedirectors is disqualified as on March 31 2015 from being appointed as a director in termsof Section 164 (2) of the Act; and

f) 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:

1) The Company has disclosed the impact of pending litigations on its financialposition in its standalone financial statements - Refer Note 22 to the financialstatements;

2) The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.

3) There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company during the year ended 31st March 2015.

For Kanu Doshi Associates
Chartered Accountants
Firm Registration Number: 104746W
Jayesh Parmar
Place: Mumbai Partner
Date: 30.05.2015 Membership No: 45375


Referred to in paragraph 1 of 'Report on other Legal and Regulatory Requirements'in our Report of even date on the accounts of CALS REFINERIES LIMITED for the yearended March 31 2015

i. (a) The Company has generally maintained proper records showing full particularsincluding quantitative details and situation of fixed assets.

(b) As explained to us all fixed assets have been physically verified by themanagement at reasonable intervals during the year and no material discrepancies werenoticed on such verification.

ii. The Company's nature of operations does not require it to hold inventories.Consequently clause (ii) of the order is not applicable.

iii. As informed to us the Company has not granted loans secured or unsecured tocompanies firms or other parties covered in the register maintained under section 189 ofthe Act. Hence clauses 3(iii) (iii) (a) & (iii) (b) of the order are not applicableto the Company.

iv. In our opinion and according to the information and explanations given to us thereare adequate internal control procedures commensurate with the size of the Company and thenature of its business with regard to purchase of inventory fixed assets and with regardto the sale of goods and services. During the course of our audit we have not observed anycontinuing failure to correct major weaknesses in internal control system.

v. During the year the Company has not accepted any deposits. As such the compliancewith directives issued by the Reserve Bank of India and the provisions of section 73 and78 the Act and the rules framed there under are not applicable.

vi. We have been informed that the Central Government has not prescribed maintenance ofcost records under sub-section (1) of section 148 of the Act.

vii. (a) According to the information and explanations given to us and on the basis ofrecords produced before us the Company is generally regular in depositing withappropriate authorities undisputed statutory dues including provident fund employees'state insurance income tax sales tax wealth tax custom duty excise duty cess andother material statutory dues applicable to it though there has been a slight delay infew cases. According to the information and explanations given to us no undisputedarrears of statutory dues were outstanding as at March 31 2015 for a period of more thansix months from the date they became payable.

(b) There are no dues in respect of Income Tax Sales Tax Wealth Tax Customs DutyExcise duty and cess that have not been deposited with appropriate authorities on accountof any dispute.

(c) There is no dividend outstanding hence; clause 3 (vii) c is not applicable.

viii. The Company has accumulated losses at the end of the financial year exceedingfifty percent of its net worth. Further the Company has incurred cash losses in thecurrent financial year and in the immediately preceding financial year.

ix. In our opinion and according to the information and explanations given to us theCompany has not taken any loans from any financial institutions banks or debentureholders and hence the question of defaulting in repayment of dues does not arise.

x. According to the information and explanations given to us and the record examined byus the Company has not given any guarantee for loans taken by others from banks orfinancial institutions.

xi. There were no term loans taken during the year.

xii. During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing practices in India andaccording to the information and explanations given to us we have neither come across anyinstance of material fraud on or by the Company noticed or reported during the year norhave we been informed of any such case by the Management.

For Kanu Doshi Associates
Chartered Accountants
Firm Registration Number: 104746W
Jayesh Parmar
Place: Mumbai Partner
Date: 30.05.2015 Membership No: 45375

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