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Chambal Fertilisers & Chemicals Ltd.

BSE: 500085 Sector: Agri and agri inputs
NSE: CHAMBLFERT ISIN Code: INE085A01013
BSE LIVE 15:47 | 21 Nov 149.10 7.00
(4.93%)
OPEN

143.00

HIGH

153.65

LOW

143.00

NSE 15:57 | 21 Nov 149.70 7.00
(4.91%)
OPEN

142.90

HIGH

154.40

LOW

142.90

OPEN 143.00
PREVIOUS CLOSE 142.10
VOLUME 165953
52-Week high 157.10
52-Week low 55.65
P/E 14.15
Mkt Cap.(Rs cr) 6,206
Buy Price 149.55
Buy Qty 747.00
Sell Price 0.00
Sell Qty 0.00
OPEN 143.00
CLOSE 142.10
VOLUME 165953
52-Week high 157.10
52-Week low 55.65
P/E 14.15
Mkt Cap.(Rs cr) 6,206
Buy Price 149.55
Buy Qty 747.00
Sell Price 0.00
Sell Qty 0.00

Chambal Fertilisers & Chemicals Ltd. (CHAMBLFERT) - Auditors Report

Company auditors report

To the Members of Chambal Fertilisers and Chemicals Limited

Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements ofChambal Fertilisers and Chemicals Limited ("the Company") which comprise theBalance Sheet as at March 31 2017 the Statement of Profit and Loss including OtherComprehensive Income the Cash Flow Statement and the Statement of Changes in Equity forthe year then ended and a summary of signi3cant accounting policies and other explanatoryinformation in which are incorporated the returns for the year ended on that date auditedby the branch auditors of the Company's Shipping division at Kolkata.

Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the mattersstated in Section 134(5) of the Companies Act 2013 ("the Act") with respect tothe preparation of these standalone financial statements that give a true and fair view ofthe financial position financial performance including other comprehensive income cash3ows and changes in equity of the Company in accordance with the accounting principlesgenerally accepted in India including the Indian Accounting Standards (Ind AS) prescribedunder Section 133 of the Act read with the Companies (Indian Accounting Standards)Rules32015 as amended. This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting frauds and other irregularities;selection and application of appropriate accounting policies; making judgments andestimates that are reasonable and prudent; and the design implementation and maintenanceof adequate internal financial controls that were operating effectively for ensuring theaccuracy and completeness of the accounting records relevant to the preparation andpresentation of the financial statements that give a true and fair view and are free frommaterial misstatement whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these standalonefinancial statements based on our audit. We have taken into account the provisions of theAct the accounting and auditing standards and matters which are required to be includedin the audit report under the provisions of the Act and the Rules made thereunder. Weconducted our audit of the standalone financial statements in accordance with theStandards on Auditing issued by the Institute of Chartered Accountants of India asspeci3ed under Section 143(10) of the Act. Those Standards require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether the financial statements are free from material misstatement. An audit involvesperforming procedures to obtain audit evidence about the amounts and disclosures in thefinancial statements. The procedures selected depend on the auditor's judgmentincluding the assessment of the risks of material misstatement of the standalone financialstatements whether due to fraud or error. In making those risk assessments the auditorconsiders internal financial control relevant to the Company's preparation of thestandalone financial statements that give a true and fair view in order to design auditprocedures that are appropriate in the circumstances. An audit also includes evaluatingthe appropriateness of accounting policies used and the reasonableness of the accountingestimates made by the Company's Board of Directors as well as evaluating the overallpresentation of the standalone financial statements. We believe that the audit evidence wehave obtained is su3cient and appropriate to provide a basis for our audit opinion on thestandalone financial statements.

Opinion

In our opinion and to the best of our information and according to theexplanations given to us the standalone financial statements give the informationrequired by the Act in the manner so required and give a true and fair view in conformitywith the accounting principles generally accepted in India of the state of a3airs of theCompany as at March 31 2017 its Profit including other comprehensive income its cash3ows and the changes in equity for the year ended on that date.

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 in terms of sub-section (11) ofSection 143 of the Act we give in the ‘Annexure 1' a statement on the mattersspeci3ed in paragraphs 3 and 4 of the Order.

2. As required by Section 143 (3) of the Act we report that:

(a) We have sought and obtained all the information and explanationswhich to the best of our knowledge and belief were necessary for the purpose of our audit;

(b) In our opinion proper books of account as required by law havebeen kept by the Company so far as it appears from our examination of those books andproper returns adequate for the purposes of our audit have been received from the branchnot visited by us; (c) The report on the accounts of the Shipping division of the Companyaudited under Section 143(8) of the Act by branch auditor has been sent to us and havebeen properly dealt by us in preparing this report; (d) The Balance Sheet Statement ofProfit and Loss Other Comprehensive Income the Cash Flow Statement and Statement ofChanges in Equity dealt with by this Report are in agreement with the books of account andwith the returns received from the branch not visited by us; (e) In our opinion theaforesaid standalone financial statements comply with the Indian Accounting Standardsspeci3ed under Section 133 of the Act read with Companies (Indian Accounting Standards)Rules 2015 as amended; (f) On the basis of written representations received from thedirectors as on March 31 2017 and taken on record by the Board of Directors none of thedirectors is disquali3ed as on March33132017 from being appointed as a director in termsof Section 164 (2) of the Act; (g) With respect to the adequacy of the internal financialcontrols over financial reporting of the Company and the operating effectiveness of suchcontrols refer to our separate Report in "Annexure 2" to this report; (h) Withrespect to the other matters to be included in the Auditor's Report in accordancewith Ruleff11 of the Companies (Audit and Auditors) Rules 2014 in our opinion and to thebest of our information and according to the explanations given to us: i. The Company hasdisclosed the impact of pending litigations on its financial position in its standalonefinancial statements – Refer Note 26(i)(B) to the standalone financial statements;ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses; iii. There has been no delay intransferring amounts required to be transferred to the Investor Education and ProtectionFund by the Company; iv. The Company (including Shipping Division of the Company) hasprovided requisite disclosures in Note 50 to these standalone financial statements as tothe holding of Speci3ed Bank Notes on November 8 2016 and December 30 2016 as well asdealings in Speci3ed Bank Notes during the period from November 8 2016 to December 302016. Based on our audit procedures and relying on the management representation regardingthe holding and nature of cash transactions including Speci3ed Bank Notes we report thatthese disclosures are in accordance with the books of account maintained by the Company(including Shipping Division of the Company) and as produced to us by the Management ofthe Company.

Other Matter

We did not audit the financial statements and other financialinformation of Shipping Division included in the accompanying standalone financialstatements of the Company whose financial statements and other financial informationreffect total assets of Rs.61322.16 lacs as at March 31 2017 total revenues (includedin discontinued operations in the statement of Profit and loss - Refer note 46(A)(ii)) ofRs.29644.58 lacs and loss before tax and other comprehensive income of Rs.8453.97 lacsfor the year ended on that date. The financial statements and other financial informationof the Shipping Division have been audited by the branch auditors whose reports have beenfurnished to us and our opinion in so far as it relates to the amounts and disclosuresincluded in respect of such branch is based solely on the report of such branch auditors.Our opinion is not modi3ed in respect of this matter.

For S.R. Batliboi & Co. LLP
Chartered Accountants
ICAI Firm Registration Number: 301003E/EFF00005
per Anil Gupta
Place : New Delhi Partner
Date : May 20 2017 Membership Number: 87921

ANNEXURE 1 REFERRED TO IN PARAGRAPH ‘REPORT ON OTHER LEGAL ANDREGULATORY REQUIREMENTS' OF OUR REPORT OF EVEN DATE

Re: Chambal Fertilisers and Chemicals Limited (‘the Company')

(i) (a) The Company has maintained proper records showing fullparticulars including quantitative details and situation of 3xed assets. (b) the 3xedassets have been physically veri3ed by the management during the year based on a phasedprogramme of verifying all the assets over a period of two years which in our opinion isreasonable having regard to the size of the Company and nature of its assets. No materialdiscrepancies were noticed on physical veri3cation.

(c) According to the information and explanations given by themanagement the title deeds of immovable properties included in the property plant andequipment are held in the name of the Company except for one Office premises of carryingvalue of Rs.390.98 lacs freehold land of carrying value of Rs.0.89 lac and leasehold landof carrying value of Rs.32.04 lacs as at March 31 2017 for which the title deeds are notin the name of the Company.

(ii) The management has conducted physical veri3cation of inventory atreasonable intervals during the year and no material discrepancies were noticed on suchphysical veri3cation.

(iii) (a) The Company has granted loan (brought forward from last year)to one party covered in the register maintained under Section 189 of the Companies Act2013. In our opinion and according to the information and explanations given to us theterms and conditions of the grant of such loans are not prejudicial to the Company'sinterest.

(b) In respect of the loan granted to the party covered in the registermaintained under Section 189 of the Companies Act 2013 the schedule of repayment ofprincipal and payment of interest has been stipulated and the receipts are regular.

(c) There is no overdue amount of loans granted to the party listed inthe register maintained under Section 189 of the Companies Act 2013.

(iv) In our opinion and according to the information and explanationsgiven to us the Company has not advanced loans to directors including entities in whichdirectors are interested to which provisions of Section 185 of the Companies Act 2013apply. In our opinion and according to the information and explanations given to usprovisions of Section 186 of the Companies Act 2013 in the respect of loans and advancesgiven investments made guarantees and securities given have been complied with by theCompany. (v) The Company has not accepted any deposits from the public.

(vi) We have broadly reviewed the books of account maintained by theCompany pursuant to the rules made by the Central Government for the maintenance of costrecords under Section 148(1) of the Companies Act 2013 related to the manufacture ofUrea and SSP and are of the opinion that prima facie the speci3ed accounts and recordshave been made and maintained. We have not however made a detailed examination of thesame.

(vii) (a) The Company is generally regular in depositing withappropriate authorities undisputed statutory dues including provident fundemployees' state insurance income-tax sales-tax service tax custom duty exciseduty value added tax cess and other statutory dues applicable to it.

(b) According to the information and explanations given to us noundisputed amounts payable in respect of provident fund employees' state insuranceincome-tax service tax sales-tax custom duty excise duty value added tax cess andother statutory dues were outstanding at the year end for a period of more than sixmonths from the date they became payable. (c) According to the records of the Company thedues outstanding of income-tax sales-tax service tax customs duty excise duty valueadded tax and cess on account of any dispute are as follows:

Name of the statute Nature of dues Amount (Rs. in lacs) Period to which the amount relates Forum where dispute is pending
Finance Act 1994 Service tax demand (including penalty) raised in respect of service tax not paid on payments made in foreign currency to foreign parties 17414.79 FY 2007-08 to 2011-12 Commissioner Service Tax Audit Commissionerate Kolkata
Rajasthan Sales Tax Act 1994 Sales Tax demand on usage of natural gas other than urea manufacture 352.34 1996-2001 Rajasthan High Court Jodhpur
Central Excise Act 1944 Wrong availment of proportionate cenvat credit on input services 10.35 April 2008 to August 2013 CESTAT New Delhi
Central Excise Act 1944 Wrong availment of proportionate cenvat credit on input services 4.57 November 2013 to July 2014 CESTAT New Delhi
Income Tax Act 1961 Disallowances for various expenses 24017.29 AYs 2009-10 to 2012-13 ITAT Jaipur
Income Tax Act 1961 Interest under Section 201 14.83 AY 2011-12 ITAT Jodhpur
Central Sales Tax Act 1956 Non-submission of Form F 197.81 2012-13 Deputy Commissioner Commercial Tax Appeal-I Ahmedabad
Uttar Pradesh Value Added Tax Act 2008 Sales Tax 2.24 September 2011 to March 2012 Uttar Pradesh Commercial Tax Tribunal Bench Agra Uttar Pradesh
Uttar Pradesh Value Added Tax Act 2008 Sales Tax 17.99 April 2012 to March 2013 Additional Commissioner Grade – II (Appeals) – Ist Commercial Taxes Agra Uttar Pradesh
Bihar value Added Tax Act 2005 Finance Act 1994 Sales Tax Service Tax 61.89 31.22 2013-14 F.Y. 2008-09 to June 2012 Joint Commissioner Com- mercial Tax Patna Bihar CESTAT Allahabad Uttar Pradesh

(viii) In our opinion and according to the information and explanationsgiven by the management the Company has not defaulted in repayment of loans or borrowingsto any financial institution or bank. Further the Company did not have any outstandingdebentures and loan from government during the year.

(ix) In our opinion and according to the information and explanationsgiven by the management the Company has utilized the monies raised by way of term loansfor the purposes for which those were raised. The Company has not raised any money by wayof initial public offer/ further public offer (including debt instruments) during theyear.

(x) Based upon the audit procedures performed for the purpose ofreporting the true and fair view of the financial statements and according to theinformation and explanations given by the management we report that no fraud by theCompany and no fraud on the Company by the Officers and employees of the Company has beennoticed or reported during the year.

(xi) According to the information and explanations given by themanagement the managerial remuneration has been paid in accordance with the requisiteapprovals mandated by the provisions of Section 197 read with Schedule V to the CompaniesAct 2013.

(xii) In our opinion the Company is not a nidhi company. Thereforethe provisions of clause 3(xii) of the order are not applicable to the Company and hencenot commented upon.

(xiii) According to the information and explanations given by themanagement transactions with the related parties are in compliance with Section 177 and188 of Companies Act 2013 where applicable and the details have been disclosed in thenotes to the financial statements as required by the applicable accounting standards.

(xiv) According to the information and explanations given to us and onan overall examination of the balance sheet the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year under review and hence reporting under clause 3(xiv) of the Order is notapplicable to the Company and accordingly not commented upon.

(xv) According to the information and explanations given by themanagement the Company has not entered into any non-cash transactions with directors orpersons connected with them as referred to in Section 192 of Companies Act 2013.

(xvi) According to the information and explanations given to us theprovisions of Section 45-IA of the Reserve Bank of India Act 1934 are not applicable tothe Company.

For S.R. Batliboi & Co. LLP
Chartered Accountants
ICAI Firm Registration Number: 301003E/EFF00005
per Anil Gupta
Place : New Delhi Partner
Date : May 20 2017 Membership Number: 87921

ANNEXURE 2 TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THESTANDALONE FINANCIAL STATEMENTS OF CHAMBAL FERTILISERS AND CHEMICALS LIMITED Report on theInternal Financial Controls under clause (i) of sub-section 3 of Section 143 of theCompanies Act 2013 ("the Act")

To the Members of Chambal Fertilisers and Chemicals Limited

We have audited the internal financial controls over financialreporting of Chambal Fertilisers and Chemicals Limited ("the Company") asof March33132017 in conjunction with our audit of the standalone financial statements ofthe Company for the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's Management is responsible for establishing andmaintaining internal financial controls based on the internal control over financialreporting criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting issued by the Institute of Chartered Accountants of India (‘theGuidance Note'). These responsibilities include the design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the orderly and effcient conduct of its business including adherence to theCompany's policies the safeguarding of its assets the prevention and detection offrauds and errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Act.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company'sinternal financial controls over financial reporting based on our audit. We conducted ouraudit in accordance with the Guidance Note and the Standards on Auditing as speci3ed undersection 143(10) of the Act to the extent applicable to an audit of internal financialcontrols both issued by the Institute of Chartered Accountants of India. Those Standardsand the Guidance Note require that we comply with ethical requirements and plan andperform the audit to obtain reasonable assurance about whether adequate internal financialcontrols over financial reporting were established and maintained and if such controlsoperated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence aboutthe adequacy of the internal financial controls system over financial reporting and theiroperating effectiveness. Our audit of internal financial controls over financial reportingincluded obtaining an understanding of internal financial controls over financialreporting assessing the risk that a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal control based on the assessed risk. Theprocedures selected depend on the auditor's judgement including the assessment ofthe risks of material misstatement of the financial statements whether due to fraud orerror. We believe that the audit evidence we have obtained and the audit evidence obtainedby the other auditor in terms of their report referred to in the paragraph ‘OtherMatter' below is su3cient and appropriate to provide a basis for our audit opinionon the internal financial controls system over financial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

A company's internal financial control over financial reporting isa process designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles. A company's internal financial controlover financial reporting includes those policies and procedures that (1) pertain to themaintenance of records that in reasonable detail accurately and fairly reffect thetransactions and dispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of financialstatements in accordance with generally accepted accounting principles and that receiptsand expenditures 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 FinancialReporting

Because of the inherent limitations of internal financial controls overfinancial reporting including the possibility of collusion or improper managementoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projections of any evaluation of the internal financial controls overfinancial reporting to future periods are subject to the risk that the internal financialcontrol over financial reporting may become inadequate because of changes in conditionsor that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion the Company has in all material respects an adequateinternal financial controls system over financial reporting and such internal financialcontrols over financial reporting were operating effectively as at March33132017 basedon the internal control over financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note.

Other Matter

Our report under Section 143(3)(i) of the Act on the adequacy andoperating effectiveness of the internal financial controls over the financial reporting ofthe Company in so far as it relates to the Shipping division is based on thecorresponding report of the auditor of such division.

For S.R. Batliboi & Co. LLP
Chartered Accountants
ICAI Firm Registration Number: 301003E/EFF00005
per Anil Gupta
Place : New Delhi Partner
Date : May 20 2017 Membership Number: 87921