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Dishman Pharmaceuticals and Chemicals Ltd(Merged).

BSE: 532526 Sector: Health care
NSE: DISHMAN ISIN Code: INE353G01020
BSE LIVE 15:59 | 29 May Stock Is Not Traded.
NSE 15:57 | 29 May Stock Is Not Traded.
OPEN 293.00
PREVIOUS CLOSE 292.65
VOLUME 460499
52-Week high 346.25
52-Week low 170.50
P/E 200.70
Mkt Cap.(Rs cr) 4,859
Buy Price 0.00
Buy Qty 0.00
Sell Price 301.05
Sell Qty 375.00
OPEN 293.00
CLOSE 292.65
VOLUME 460499
52-Week high 346.25
52-Week low 170.50
P/E 200.70
Mkt Cap.(Rs cr) 4,859
Buy Price 0.00
Buy Qty 0.00
Sell Price 301.05
Sell Qty 375.00

Dishman Pharmaceuticals and Chemicals Ltd(Merged). (DISHMAN) - Auditors Report

Company auditors report

To

The Members of

Dishman Pharmaceuticals and Chemicals Limited

Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements of DishmanPharmaceuticals and Chemicals Limited ("the Company") which comprise theBalance Sheet as at March 31 2016 the Statement of Profit and Loss 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. 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 standalone 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 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. Those 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 anddisclosures in the standalone financial statements. The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of thestandalone financial statements whether due to fraud or error. In making those riskassessments the auditor considers internal financial control relevant to the Company'spreparation of the standalone financial statements that give a true and fair view in orderto design audit procedures that are appropriate in the circumstances. An audit alsoincludes evaluating the appropriateness of accounting policies used and the reasonablenessof the accounting estimates made by the Company's Directors as well as evaluating theoverall presentation of 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 standalone 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 31 st March 2016 its profit and its cash flows for the year ended on that date.

Other Matter

The figures for the year ended March 31 2015 in the standalone financial statementswere audited by one of the joint statutory auditor V. D. Shukla & Co. CharteredAccountants who vide their report dated August 22 2015 had expressed an unmodifiedopinion thereon.

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 of sub-section (11) of Section 143 ofthe Act we give in "Annexure 1" a statement on the matters specified inparagraphs 3 and 4 of the 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 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 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 March312016 and taken on record by the Board of Directors none of the directors isdisqualified as on March 31 2016 from being appointed as a director in terms of Section164 (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 we give ourseparate Report in "Annexure 2".

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:

(i) The Company has disclosed the impact of pending litigations on its financialposition in its standalone financial statements - Refer Note 27.01 to the standalonefinancial 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 - Refer Note 6 10 and 27.04 to the standalone financial statements;

(iii) There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.

For Haribhakti & Co. LLP For V. D. Shukla & Co.
Chartered Accountants Chartered Accountants
ICAI Firm Registration No.103523W ICAI Firm Registration No.110240W
Bhavik L. Shah Vimal D. Shukla
Partner Proprietor
Membership No.122071 Membership No.036416
Place : Ahmedabad Place : Ahmedabad
Date : May 19 2016 Date : May 19 2016

ANNEXURE 1 TO THE INDEPENDENT AUDITOR'S REPORT

[Referred to in paragraph 1 under 'Report on Other Legal and Regulatory Requirements'in the Independent Auditors' Report of even date to the members of Dishman Pharmaceuticalsand Chemicals Limited on the standalone financial statements for the year ended March 312016]

(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.

(b) During the year certain fixed assets have been physically verified by themanagement as per the regular programme of verification which in our opinion isreasonable having regard to the size of the Company and the nature of its assets. Asinformed no material discrepancies were noticed on such verification.

(c) According to the information and explanation given to us the title deeds ofimmovable properties other than self- constructed properties recorded as fixed assets inthe books of account of the Company as on March 312016 are held in the name of theCompany. However in respect of one lease hold land with gross block and net block of Rs.104.70 crores the lease deed has been executed but not registered with the relevantauthorities.

(ii) The inventory (excluding stock lying with third parties) has been physicallyverified by the management during the year. In respect of inventory lying with thirdparties these have substantially been confirmed by them. In our opinion the frequency ofverification is reasonable. As informed no material discrepancies were noticed onphysical verification carried out during the year.

(iii) The Company has granted unsecured loan in earlier years to one company covered inthe register maintained under Section 189 of the Act whose outstanding balance as on March31 2016 is Rs. 38 Crore.

(a) According to the information and explanations given to us the Company has notgranted any loan during the year to companies firms Limited Liability Partnerships orother parties covered in the register maintained under Section 189 of the Act..

(b) The schedule of repayment of principal and payment of interest in respect of aboveloan granted in earlier years has been stipulated. As per the terms of agreement norepayment of principal or interest was due during the year.

(c) In respect of the aforesaid loan no amount is overdue as per the terms ofagreement.

(iv) Based on information and explanation given to us in respect of loans investmentsguarantees and securities the Company has complied with the provisions of Section 185 and186 of the Act.

(v) In our opinion and according to the information and explanations given to us theCompany has not accepted any deposits from the public within the provisions of Sections 73to 76 of the Act and the rules framed there under.

(vi) We have broadly reviewed the books of account maintained by the Company in respectof products where the maintenance of cost records has been specified by the CentralGovernment under sub-section (1) of Section 148 of the Act and the rules framed thereunder and we are of the opinion that prima facie the prescribed accounts and records havebeen made and maintained.

(vii) (a) According to the information and explanation given to us and the records ofthe Company examined by us in our opinion the Company is generally regular in depositingwith appropriate authorities undisputed statutory dues including provident fund incometax sales tax service tax value added tax customs duty excise duty cess and anyother material statutory dues applicable to it.

According to the information and explanations given to us no undisputed amountspayable in respect of provident fund employees' state insurance income tax sales taxservice tax value added tax customs duty excise duty cess and any other materialstatutory dues applicable to it were outstanding at the year end for a period of morethan six months from the date they became payable.

(b) According to the information and explanation given to us the dues outstanding withrespect to income tax sales tax service tax value added tax customs duty excise dutyon account of any dispute are as follows:

Name of the statute Nature of dues Amount (Rs. in Crores) Period to which the amount relates Forum where dispute is pending
Central Excise Act 1944 Excise Duty and Service Tax 0.13 2.20 2003-04 2006-07 2008- 09 2009- 10 2012-13 High Court Central Excise and Service Tax Appellate Tribunal
2.17 2006-07 2008-09 to 2015-16 Commissioner of Central Excise (Appeals)
Central Sales Tax Act 1956 Sales tax 0.24 2001-02 Joint Commissioner Commercial Tax
1.18 2006-07 Commercial Tax Gujarat VAT Tribunal
Gujarat Sales Tax Act Sales tax 1.43 2001-02 2007-08 Joint Commissioner Commercial Tax
1.46 2006-07 Commercial Tax Gujarat VAT Tribunal
Income TaxAct 1961 Demand under section 143(3) 2.01 FY 2001-02 High Court of Gujarat
Income Tax Act 1961 Demand under section 143(3) 4.06 FY 2002-03 High Court of Gujarat
Income Tax Act 1961 Demand under section 143(3) 1.56 FY 2003-04 Income Tax Appellate Tribunal
Income Tax Act 1961 Demand under section 143(3) 7.62 FY 2004-05 High Court of Gujarat
Income Tax Act 1961 Demand under section 143(3) 14.32 FY 2005-06 Income Tax Appellate Tribunal
Income Tax Act 1961 Demand under section 271(1)(c) 3.04 FY 2005-06 Income Tax Appellate Tribunal
Income Tax Act 1961 Demand under section 143(3) 14.69 FY 2006-07 Income Tax Appellate Tribunal
Income Tax Act 1961 Demand under section 271(1)(c) 4.73 FY 2006-07 Income Tax Appellate Tribunal
Income Tax Act 1961 Demand under section 143(3) 8.42 FY 2007-08 Income Tax Appellate Tribunal
Income Tax Act 1961 Demand under section 143(3) 0.25 FY 2008-09 Income Tax Appellate Tribunal
Income Tax Act 1961 Demand under section 271(1)(c) 0.47 FY 2008-09 Commissioner of Income Tax (Appeals)
Income Tax Act 1961 Demand under section 147 r.w.s. 143(3) 1.53 FY 2009-10 Commissioner of Income Tax (Appeals)
Income Tax Act 1961 Demand under section 143(3) 13.98 FY 2010-11 Commissioner of Income Tax (Appeals)
Income Tax Act 1961 Demand under section 143(3) 24.49 FY 2011-12 Commissioner of Income Tax (Appeals)

Out of the above '22.88 Crores have been paid under protest in respect of Income TaxDues.

(viii) According to the information and explanations given to us the Company has notdefaulted in repayment of loans or borrowings to financial institutions banks governmentor dues to debenture holders.

(ix) The Company has not raised any money by way of initial public offer or furtherpublic offer (including debt instruments) during the year. In our opinion and according tothe information and explanations given to us the Company has utilised the money raised byway of term loans during the year for the purposes for which they were raised.

(x) 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 by the Company or on the Company by its officers or employeesnoticed or reported during the year nor have we been informed of any such instance by themanagement.

(xi) According to the information and explanations given to us managerial remunerationhas been paid in accordance with the requisite approvals mandated by the provisions ofSection 197 read with Schedule V to the Act.

(xii) In our opinion and according to the information and explanations given to us theCompany is not a Nidhi Company. Therefore paragraph 3(xii) of the Order is not applicableto the Company.

(xiii) According to the information and explanation given to us and based on ourexamination of the records of the Company transactions entered into by the Company withthe related parties are in compliance with Sections 177 and 188 of Act where applicable.

The details of related party transactions as required under Accounting Standard (AS)18 Related Party Disclosures specified under Section 133 of the Act read with Rule 7 ofthe Companies (Accounts) Rules 2014 have been disclosed in the financial statements.

(xiv) The Company has not made any preferential allotment or private placement ofshares or fully or partly convertible debentures during the year under review. Thereforeparagraph 3(xiv) of the Order is not applicable to the Company.

(xv) According to the information and explanations given to us the Company has notentered into any non-cash transactions with directors or persons connected with him duringthe year.

(xvi) According to the information and explanation given to us the Company is notrequired to be registered under Section 45-IA of the Reserve Bank of India Act 1934.

For Haribhakti & Co. LLP For V. D. Shukla & Co.
Chartered Accountants Chartered Accountants
ICAI Firm Registration No.103523W ICAI Firm Registration No.110240W
Bhavik L. Shah Vimal D. Shukla
Partner Proprietor
Membership No.122071 Membership No.036416
Place : Ahmedabad Place : Ahmedabad
Date : May 19 2016 Date : May 19 2016

ANNEXURE 2 TO THE INDEPENDENT AUDITOR'S REPORT

[Referred to in paragraph 2 under 'Report on Other Legal and Regulatory Requirements'in the Independent Auditors' Report of even date to the members of Dishman Pharmaceuticalsand Chemicals Limited on the standalone financial statements for the year ended March 312016]

Report on the Internal Financial Controls over Financial Reporting under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls over financial reporting of DishmanPharmaceuticals and Chemicals Limited ("the Company") as of March 31 2016 inconjunction with our audit of the standalone 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 ("ICAI"). Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to company's policies the safeguarding ofits assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required under the Companies Act 2013.

Auditor's 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 specified under section143(10) of the Act to the extent applicable to an audit of internal financial controlsboth issued by the ICAI. Those Standards and the Guidance Note require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether adequate internal financial controls over financial reporting was established andmaintained and if such controls operated 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 included obtaining anunderstanding of internal financial controls over financial reporting assessing the riskthat a material weakness exists and testing and evaluating the design and operatingeffectiveness of internal control based on the assessed risk. The procedures selecteddepend on the auditors' judgement including the assessment of the risks of materialmisstatement 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 controls systemover financial 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 the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at March 312016 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the ICAI.

For Haribhakti & Co. LLP For V. D. Shukla & Co.
Chartered Accountants Chartered Accountants
ICAI Firm Registration No.103523W ICAI Firm Registration No.110240W
Bhavik L. Shah Vimal D. Shukla
Partner Proprietor
Membership No.122071 Membership No.036416
Place : Ahmedabad Place : Ahmedabad
Date : May 19 2016 Date : May 19 2016