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Essel Propack Ltd.

BSE: 500135 Sector: Industrials
NSE: ESSELPACK ISIN Code: INE255A01020
BSE LIVE 15:50 | 15 Dec 279.80 -0.10
(-0.04%)
OPEN

283.50

HIGH

290.70

LOW

279.00

NSE 15:41 | 15 Dec 280.15 0.75
(0.27%)
OPEN

281.90

HIGH

289.75

LOW

278.10

OPEN 283.50
PREVIOUS CLOSE 279.90
VOLUME 7633
52-Week high 317.00
52-Week low 226.00
P/E 66.46
Mkt Cap.(Rs cr) 4,400
Buy Price 279.80
Buy Qty 3.00
Sell Price 0.00
Sell Qty 0.00
OPEN 283.50
CLOSE 279.90
VOLUME 7633
52-Week high 317.00
52-Week low 226.00
P/E 66.46
Mkt Cap.(Rs cr) 4,400
Buy Price 279.80
Buy Qty 3.00
Sell Price 0.00
Sell Qty 0.00

Essel Propack Ltd. (ESSELPACK) - Auditors Report

Company auditors report

To

The Members of

Essel Propack Limited

1. Report on the standalone Ind AS financial statements

We have audited the accompanying standalone Ind AS financial statements of EsselPropack Limited ('the Company') which comprise the balance sheet as at 31 March 2017the statement of profit and loss (including other comprehensive income) the statement ofcash flows and the statement of changes in equity for the year then ended and a summary ofthe significant accounting policies and other explanatory information (herein afterreferred to as "standalone Ind AS financial statements").

2. Management's responsibility for the standalone Ind AS financial statements

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act 2013 (" the Act") with respect to the preparation ofthese standalone Ind AS financial statements that give a true and fair view of thefinancial position financial performance including other comprehensive income cash flowsand 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.

This responsibility also 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; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the standalone IndAS financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

3. Auditor's responsibility

Our responsibility is to express an opinion on these standalone Ind AS financialstatements based on our audit. While conducting the audit we have taken into account theprovisions of the Act the accounting and auditing standards and matters which arerequired to be included in the audit report under the provisions of the Act and the Rulesmade thereunder.

We conducted our audit of the standalone Ind AS financial statements in accordance withthe Standards on Auditing specified under Section 143(10) of the Act. Those Standardsrequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether the standalone Ind AS financial statements are freefrom material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the standalone Ind AS financial statements. The procedures selected dependon the auditor's judgment including the assessment of the risks of material misstatementof the standalone Ind AS financial statements whether due to fraud or error. In makingthose risk assessments the auditor considers internal financial control relevant to theCompany's preparation of the standalone Ind AS financial statements that give a true andfair view in order to design audit procedures that are appropriate in the circumstances.An audit also includes evaluating the appropriateness of the accounting policies used andthe reasonableness of the accounting estimates made by the Company's Directors as well asevaluating the overall presentation of the standalone Ind AS 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 Ind AS financial statements

4. Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone Ind AS financial statements give the informationrequired by the Act in the manner so required and give

a true and fair view in conformity with the accounting principles generally accepted inIndia of the state of affairs of the Company as at 31 March 2017 and its profit totalcomprehensive income its cash flows and the changes in equity for the year ended on thatdate.

5. Other Matters

The comparative financial information of the Company for the year ended 31 March 2016and the transition date opening balance sheet as at 1 April 2015 included in thesestandalone Ind AS financial statements are based on the statutory financial statementsprepared in accordance with the Companies (Accounting Standards) Rules 2006 audited by uswhose report for the year ended 31 March 2016 and 31 March 2015 dated 28 April 2016 and 28April 2015 respectively expressed an unmodified opinion on those standalone financialstatements as adjusted for the differences in the accounting principles adopted by theCompany on transition to the Ind AS which have been audited by us.

Our opinion on the standalone Ind AS financial statements and our report on Other Legaland Regulatory Requirements below is not modified in respect of these matters.

6. Report on other Legal and Regulatory requirements

I. As required by the Companies (Auditor's Report) Order 2016 issued by the CentralGovernment of India in terms of section 143(11) of the Act ("the Order") and onthe basis of such checks of the books and records of the Company as we consideredappropriate and according to the information and explanations given to us we give in theAnnexure A a statement on the matters specified in the paragraph 3 and 4 of the Order.

II. As required by Section143 (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 (including other comprehensiveincome) the statement of cash flows and the statement of changes in equity dealt with bythis Report are in agreement with the books of account;

d) In our opinion the aforesaid standalone Ind AS financial statements comply with theIndian Accounting Standards specified under Section 133 of the Act;

e) On the basis of the written representations received from the directors as on 31March 2017 taken on record by the Board of Directors none of the directors isdisqualified as on 31 March 2017 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 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:

i. The Company has disclosed the impact of pending litigations on its financialposition in its standalone Ind As financial statements;

ii. The Company did not have any long-term contracts including derivative contractshaving any material foreseeable losses; and

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

iv. The Company has provided requisite disclosures in the standalone Ind AS financialstatements as to holdings as well as dealings in Specified Bank Notes during the periodfrom 8 November 2016 to 30 December 2016 on the basis of information available with theCompany. Based on audit procedures and relying on management's representation we reportthat disclosures are in accordance with the books of account maintained by the Company andas produced to us by the Management. Refer Note 45 to the standalone Ind AS financialstatements.

For MGB & Co LLP

Chartered Accountants

Firm Registration Number 101169W/W-100035

Hitendra Bhandari

Partner

Membership Number 107832

Mumbai 23 May 2017

Annexure A to the Independent Auditor's Report

Annexure referred to in paragraph 6(I) under "Report on other Legal and Regulatoryrequirements" of our report of even date to the members of the Company on thestandalone Ind AS financial statements for the year ended 31 March 2017

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

(b) The fixed assets have been physically verified by the management during the year asper the phased program designed to cover all the fixed assets over a period which in ouropinion is reasonable having regard to the size of the Company and nature of its assets.Pursuant to the program certain fixed assets have been physically verified by themanagement during the year. Discrepancies noticed on such verification which are notmaterial have been properly dealt with in the books of accounts.

(c) According to the information and explanations given to us and on the basis of ourexamination of records the title deeds of immovable properties are held in the name ofthe Company.

ii. The physical verification of inventory excluding stocks lying with third partiesand stocks in transit have been conducted by the Management at reasonable intervals duringthe year. In respect of inventory lying with third parties these have been confirmed bythem. As explained to us the discrepancies noticed on physical verification of inventoryas compared to book records were not material.

iii. The Company has granted unsecured loan of Rs. 9607 lakhs to a company covered inthe register maintained under Section 189 of the Act;

(a) In our opinion the rate of interest and other terms and conditions on which theloan had been granted to the company listed in the register maintained under Section 189of the Act is not prima facie prejudicial to the interests of the Company.

(b) The aforesaid loan granted is repayable on demand. The borrower is regular in thepayment of interest as stipulated.

(c) There is no amount of interest overdue for more than 90 days as at 31 March 2017.

iv. 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 ofloans and investments made and guarantees and securities provided by it.

v. The Company has not accepted any deposits from the public within the meaning ofSections 73 to 76 of the Act.

vi. We have broadly reviewed the cost records maintained by the Company pursuant to theCompanies (Cost Records and Audit) Rules 2014 as amended prescribed by the CentralGovernment under Section 148(1) of the Act and are of the opinion that prima facie theprescribed accounts and records have been made and maintained. We have however not made adetailed examination of such records with a view to determine whether they are accurate orcomplete.

vii. According to the records of the Company examined by us and information andexplanations given to us:

(a) Undisputed statutory dues including provident fund employees' state insuranceincome tax sales tax service tax duty of customs duty of excise value added tax cessand others as applicable have generally been regularly deposited with the appropriateauthorities except delay in few cases. There are no undisputed amounts payable in respectof aforesaid dues outstanding as at 31 March 2017 for a period of more than six monthsfrom the date they became payable.

(b) There are no dues of service tax and duty of customs which have not been depositedon account of any dispute. The disputed dues of income tax sales tax duty of excise andvalue added tax which have not been deposited are as under:

Name of the Statute Nature of the Dues ' in lakhs Period to which the amount relate Forum where dispute is pending
Central Excise Act 1944 Duty of Excise 128 FY 2001-2002 to FY 2005-2006 Tribunal CESTAT
25 FY 2009-2010 to FY 2011-2012 Commissioner of Central Excise (Appeals)
Maharashtra Value Value added tax 54 FY 2005-2006 Maharashtra Sales Tax Tribunal
Added Tax Act 2002 243 FY 2005-2006 and FY 2006-2007 Joint Commissioner of Sales Tax (Appeals)
Himachal Pradesh Value Added Tax Act 2005 Value added tax 3 FY 2008-2009 Additional Excise and Taxation Commissioner
Central Sales Tax Act Central sales tax 120 FY 2002-2003 and FY 2005-2006 Maharashtra Sales Tax Tribunal
1956 228 FY 2002-2003 to FY 2004-2005 Commissioner of VAT-Dadra and Nagar Haveli
112 FY 2002-2003 FY 2007-2008 and FY 2008-2009 Deputy Commissioner of Sales Tax (Appeals)
506 FY 2001-2002 FY 2003-2004 to FY 2005-2006 FY 2008-2009 and FY 2012-2013 Joint Commissioner of Sales Tax (Appeals)
24 FY 2009-2010 FY 2011-2012 and FY 2012-2013 Assistant Commissioner of Commercial Taxes
The Income Tax Act 1961 Income tax- 55 FY 2006-2007 Income Tax Appellate Tribunal
Penalty 397 FY 2007-2008 and FY 2011-2012 Commissioner of Income Tax (Appeals)
Income tax 57 FY 2009-2010 Income Tax Appellate Tribunal
1732 FY 2006-2007 and FY 2010- 2011 to FY 2012-2013 Commissioner of Income Tax (Appeals)

viii. According to the records of the Company examined by us and the information andexplanations given to us the Company has not defaulted in repayment of loans orborrowings to financial institutions banks government or dues to debenture holders.

ix. In our opinion and according to the information and explanations given to us theCompany has not raised any money by way of initial public offer or further public offer(including debt instruments). The moneys raised by way of term loans during the year havebeen applied 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 been informed of any such case by theManagement.

xi. According to the records of the Company examined by us and information andexplanations given to us the Company has paid/provided for managerial remuneration inaccordance with the requisite approvals mandated by the provisions of Section 197 readwith 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 and the Nidhi Rules 2014 are not applicable to it.

xiii. According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with Sections 177 and 188 of the Act and details of such transactions have beendisclosed in the standalone Ind AS financial statements as required by the applicableIndian Accounting Standards.

xiv. According to the records of the Company examined by us and information andexplanations given to us the Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures during the year.

xv. According to the records of the Company examined by us and information andexplanations given to us the Company has not entered into non-cash transactions withdirectors or persons connected with him.

xvi. The Company is not required to be registered under Section 45-IA of the ReserveBank of India Act 1934.

For MGB & Co LLP

Chartered Accountants Firm Registration Number 101169W/W-100035

Hitendra Bhandari

Partner

Membership Number 107832 Mumbai 23 May 2017

Annexure B to the Independent Auditor's Report

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act") as referred to in paragraph 6(II)(f)under "Report on other Legal and Regulatory requirements" of our report of evendate to the members of the Company on the standalone Ind AS financial statements for theyear ended 31 March 2017

We have audited the internal financial controls over financial reporting of EsselPropack Limited ("the Company") as of 31 March 2017 in conjunction with ouraudit of the standalone Ind AS financial statements of the Company for the year ended onthat 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 Reporting (the"Guidance Note") issued by the Institute of Chartered Accountants of India(ICAI). These responsibilities include the design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theorderly and efficient conduct of its business including adherence to company's policiesthe safeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Act.

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 and the Standards on Auditing issued by ICAI and deemed to beprescribed 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 ICAI. Those Standards and the Guidance Note require that we complywith ethical requirements and plan and perform the audit to obtain reasonable assuranceabout whether adequate internal financial controls over financial reporting wasestablished and maintained and if such controls operated effectively in all materialrespects.

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 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 31 March 2017 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note issued by theICAI.

For MGB & Co LLP

Chartered Accountants Firm Registration Number 101169W/W-100035

Hitendra Bhandari

Partner

Membership Number 107832

Mumbai 23 May 2017