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Godrej Industries Ltd.

BSE: 500164 Sector: Industrials
NSE: GODREJIND ISIN Code: INE233A01035
BSE LIVE 15:44 | 25 Sep 577.65 -12.50
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590.25

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NSE 15:46 | 25 Sep 575.95 -13.25
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OPEN

593.00

HIGH

593.00

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OPEN 590.25
PREVIOUS CLOSE 590.15
VOLUME 43558
52-Week high 699.70
52-Week low 363.90
P/E
Mkt Cap.(Rs cr) 19,426
Buy Price 0.00
Buy Qty 0.00
Sell Price 577.65
Sell Qty 244.00
OPEN 590.25
CLOSE 590.15
VOLUME 43558
52-Week high 699.70
52-Week low 363.90
P/E
Mkt Cap.(Rs cr) 19,426
Buy Price 0.00
Buy Qty 0.00
Sell Price 577.65
Sell Qty 244.00

Godrej Industries Ltd. (GODREJIND) - Auditors Report

Company auditors report

TO THE MEMBERS OF

GODREJ INDUSTRIES LIMITED

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying Standalone Ind AS Financial Statements of GODREJINDUSTRIES LIMITED ("the Company") which comprise the Balance Sheet as atMarch 31 2017 the Statement of Profit and Loss (including Other Comprehensive Income)the Statement of Cash Flows and the Statement of Changes in Equity for the year then endedand a summary of significant accounting policies and other explanatory information(hereinafter referred to as "the Standalone Ind AS Financial Statements").

Management's Responsibility for the Standalone Ind AS 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 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 read with relevant rules issued thereunder. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; anddesign implementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the Standalone Ind AS 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 Standalone Ind AS FinancialStatements based on our audit. We have taken into account the provisions of the Act theaccounting and auditing standards and matters which are required to be included in theaudit report under the provisions of the Act and the Rules made 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 andthe disclosures in the Standalone Ind AS Financial Statements. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the Standalone Ind AS Financial Statements whether due to fraud or error.In making those risk assessments the auditor considers internal financial controlrelevant to the Company's preparation of the Standalone Ind AS Financial Statements thatgive a true and fair view in order to design audit procedures that are appropriate in thecircumstances. An audit also includes evaluating the appropriateness of the accountingpolicies used and the reasonableness of the accounting estimates made by the Company'sDirectors as well as evaluating the overall presentation of the Standalone Ind ASFinancial 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.

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 conformitywith the accounting principles generally accepted in India including the Ind AS of thefinancial position of the Company as at March 31 2017 and its financial performanceincluding Other Comprehensive Income its cash flows and the changes in equity for theyear ended on that date.

Emphasis of Matter

We draw attention to Note No. 49 to the Standalone Ind AS Financial Statementsrelating to remuneration paid to two Directors which is in excess of the limits prescribedunder Section 197 read with Schedule V to the Companies Act 2013 by Rs. 4.54 crore. TheCompany has made an application to the Central Government for payment of the saidremuneration which is in excess of the prescribed limits the approval for which isawaited. Pending such approval the amount is held in trust on behalf of the Company.

Our opinion is not modified in respect of this matter.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order 2016 ("theOrder") issued by the Central Government of India in terms of Section 143(11) of theCompanies Act 2013 we give in the "Annexure A" a statement on the mattersspecified in paragraphs 3 and 4 of the said 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 (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 (Ind AS) prescribed under Section 133 of the Act read withrelevant rules issued thereunder.

e) On the basis of the written representations received from the Directors of theCompany as on March 31 2017 and taken on record by the Board of Directors none of theDirectors of the Company is disqualified as on March 31 2017 from being appointed as aDirector 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 to ourseparate Report in "Annexure B".

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. Refer Note No. 26 to theStandalone Ind AS Financial Statements.

ii) The Company has made provision as required under the applicable laws or AccountingStandards for material foreseeable losses if any on long term contracts includingderivative contracts. Refer Note No. 53 to the Standalone Ind AS Financial Statements.

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 its Standalone Ind AS FinancialsStatements as to holdings as well as dealings in Specified Bank Notes during the periodfrom November 08 2016 to December 30 2016. Based on audit procedures and relying on theManagement representation we report that the disclosures are in accordance with the booksof account and other records maintained by the Company and as produced to us by theManagement. Refer Note No. 47 to the Standalone Ind AS Financials Statements.

For KALYANIWALLA & MISTRY LLP

Chartered Accountants

Firm Regn. No.: 104607W / W100166

Daraius Z. Fraser

Partner

M. No.: 42454

Mumbai: May 22 2017

Annexure A to the Independent Auditor's Report

The Annexure referred to in paragraph 1 ‘Report on Other Legal and RegulatoryRequirements' in our Independent Auditor's Report to the members of the Company on theStandalone Ind AS Financial Statements for the year ended March 31 2017:

Statement on Matters specified in paragraphs 3 and 4 of the Companies (Auditor'sReport) Order 2016:

1. Fixed Assets:

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

b) The Company has a program for physical verification of fixed assets at periodicintervals. In our opinion the period of verification is reasonable having regard to thesize of the Company and the nature of its assets. The discrepancies noticed on suchverification are not material and have been properly dealt with in the books of account.

c) According to the information and explanations given to us and on the basis of therecords of the Company examined by us the title deeds of immovable properties are held inthe name of the Company.

2. The Management has conducted physical verification of inventory at reasonableintervals except goods in transit. In case of inventory lying at third party locationswritten confirmations have been obtained by the Management. The discrepancies noticed onphysical verification were not material in relation to the operations of the Company andthe same have been properly dealt with in the books of account.

3. During the year the Company has not granted any loans secured or unsecured tocompanies firms LLP or other parties covered in the register maintained under Section189 of the Companies Act 2013. Therefore the provisions of sub-clauses (a) (b) and (c)of paragraph 3 (iii) of the Order are not applicable.

4. In our opinion and according to the information and explanations given to us theCompany has not advanced any loans to parties or granted securities covered under Section185 of the Companies Act 2013. In our opinion and according to the information andexplanations given to us and records examined by us the provisions of Section 186 of theCompanies Act 2013 in respect of loans given guarantees given and investments made havebeen complied with by the Company.

5. In our opinion and according to the information and explanations given to us theCompany has complied with the directives issued by the Reserve Bank of India and theprovisions of Sections 73 to 76 or any other relevant provisions of the Companies Act2013 and the Rules framed thereunder in respect of the deposits accepted from the public.

6. We have broadly reviewed the books of account and records maintained by the Companyin respect of products covered under the Rules made by the Central Government formaintenance of cost records under Sub Section (l) of Section 148 of the Companies Act andare of the opinion that prima facie the prescribed accounts and records have been madeand maintained. We have not however made a detailed examination of the records with aview to determine whether they are accurate or complete.

7. Statutory Dues:

a) According to the information and explanations given to us and on the basis of therecords examined by us in our opinion the Company is regular in depositing undisputedstatutory dues including Provident Fund Employees' State Insurance Income-taxSales-tax Service Tax Duty of Customs Duty of Excise Value added tax Cess and anyother statutory dues with the appropriate authorities wherever applicable. We have beeninformed that there are no undisputed dues which have remained outstanding as at the lastday of the financial year for a period of more than six months from the date they becamepayable.

b) According to the information and explanations given to us there are no dues ofIncome-tax Sales tax Service tax Duty of Customs Duty of Excise Value added tax orCess outstanding on account of any dispute other than the following:

Name of Statute Nature of Dues Amount Rs. ( crores) Period to which the amount relates Forum where dispute is pending
Central Excise Act 1944 Excise Duty / Service Tax demands relating to disputed classification post manufacturing expenses assessable values etc. which the Company has contested and is in appeals at various levels. 0.43 2002-03 2004-07 2005-08 2007-12 2008-09 2009-10 2009-11 2009-14 2010-11 2011-12 2011-13 2012-13 2013-14 2014-15 2015-16 Assistant Commissioner
1.29 1993-97 2009-13 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2012-14 2013-14 Joint Commissioner
1.40 2008-09 2009-13 2010-11 2011-12 2012-13 2013-14 2013-15 2014-15 2015-16 Additional Commissioner
0.01 2006-10 2009-10 Deputy Commissioner
0.14 2010-11 Commissioner
0.26 2005-06 2009-10 Commissioner (Appeals)
0.00 2009-10 2012-14 2013-14 2013-15 2014-15 2015-16 Superintendent
3.55 2008-11 2009-13 2010-11 CESTAT
0.28 1997-98 Tribunal
0.04 1995-96 High Court
3.91 1993-97 The Supreme Court
The Customs Act 1962 Custom Duty demands relating to lower charge differential duty classifications etc. 2.63 2010-11 Commissioner (Appeals)
1.32 1978-93 High Court
VAT Acts of Sales Tax demands relating to 0.02 1997-98 Sales Tax Officer
Various States purchase tax on Branch Transfer / 0.07 2000-01 Commissioner (Appeals)
Disallowance of high sea sales. 11.07 2003-04 2005-06 2010-11 Deputy Commissioner
32.91 2002-03 2003-04 2006-07 2007-08 2008-09 2009-10 2011-12 Joint Commissioner
1.96 2003-04 2004-05 2005-06 2006-07 Tribunal
Income-tax Act 1961 Income-tax demands against which the company has preferred appeals. 2.96 A.Y. 2007-08 A.Y. 1993-94 1994-95 1995-96 1996-97 1997-98 2012-13 Assessing Officer
15.29 CIT
16.03 A.Y. 2006-07 2011-12 2013-14 2014-15 Deputy Commissioner
16.74 A.Y. 1986-87 1988-89 1990-91 1991-921996-97 1998-99 2000-01 2001-02 2002-03 2003-04 ITAT
16.90 A.Y.1989-90 1993-94 1997-98 2000-01 2001-02 2002-03 High Court
Octroi Octroi demand relating to classification issue on import of Palm Stearine and interest thereon. 0.03 1997-98 Deputy Commissioner
0.24 1997-2003 Tribunal
0.02 1998-99 2000-01 The Supreme Court
Stamp Duty Stamp Duties claimed on certain properties which are under appeal by the Company.
1.82 2000-01 Controlling Revenue Authority

8. According to the information and explanations given to us and based on the documentsand records produced before us there has been no default in repayment of dues to banks.There are no dues to financial institutions Government or debenture holders.

9. According to the information and explanations given to us and the records examinedby us the term loans obtained by the Company were applied for the purpose for which theloans were obtained. The Company did not raise any money by way of initial public offer orfurther public offer (including debt instruments) during the year.

10. During the course of our examination of the books of account and records of theCompany to the best of our knowledge and belief and according to the information andexplanations given to us by the Management no fraud on or by the Company has beennoticed or reported during the year.

11. According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has paid / provided for managerialremuneration in accordance with the requisite approvals mandated by the provisions ofSection 197 read with Schedule V to the Act except for remuneration paid to two Directorswhich is in excess of the limits prescribed under Section 197 read with Schedule V to theCompanies Act 2013 by Rs. 4.54 crore. The Company has made an application to the CentralGovernment for payment of the said remuneration which is in excess of the prescribedlimits the approval for which is awaited. Pending such approval the amount is held intrust on behalf of the Company.

12. In our opinion and according to the information and explanations given to us theCompany is not a Nidhi Company; hence the provisions of Clause 3(xii) of the Order are notapplicable to the Company.

13. According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with related parties are incompliance with Sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the Standalone Ind AS Financial Statements as requiredby the applicable accounting standards.

14. According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year. Accordingly the provisions of Clause 3(xiv) of the Order are not applicable tothe Company.

15. According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not entered into non-cashtransactions with Directors or persons connected with him. Accordingly the provisions ofClause 3(xv) of the Order are not applicable to the Company.

16. The Company is not required to be registered under Section 45-IA of the ReserveBank of India Act 1934. Accordingly the provisions of Clause 3(xvi) of the Order are notapplicable to the Company.

For KALYANIWALLA & MISTRY LLP

Chartered Accountants

Firm Regn. No.: 104607W / W100166

Daraius Z. Fraser

Partner

M. No.: 42454

Mumbai: May 22 2017

Annexure B to the Independent Auditor's Report

Referred to in Paragraph 2(f) ‘Report on Other Legal and Regulatory Requirements'in our Independent Auditor's Report to the members of the Company on the Standalone Ind ASFinancial Statements for the year ended March 31 2017.

Report on the Internal Financial Controls under Clause (i) of Sub-Section 3 of Section143 of the Companies Act 2013.

We have audited the internal financial controls over financial reporting of GODREJINDUSTRIES LIMITED ("the Company") as of March 31 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 of reliablefinancial information as required under the Companies Act 2013 (the "Act" orthe "Companies Act").

Auditors' 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 Companies Act 2013 to the extent applicable toan audit of internal financial controls both issued by the Institute of CharteredAccountants of India. 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 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 Standalone Ind AS Financial Statements whether due to fraudor error. We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the Company's internal financialcontrols system over 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 Standalone Ind AS Financial Statements for external purposes in accordancewith generally accepted accounting principles. A Company's internal financial control overfinancial reporting includes those policies and procedures that:

1. pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the Company;

2. provide reasonable assurance that transactions are recorded as necessary to permitpreparation of Standalone Ind AS Financial Statements in accordance with generallyaccepted accounting principles and that receipts and expenditures of the Company are beingmade only in accordance with authorisations of Management and Directors of the Company;and

3. provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the Company's assets that could have amaterial effect on the Standalone Ind AS 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 31 2017 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 KALYANIWALLA & MISTRY LLP

Chartered Accountants

Firm Regn. No.: 104607W / W100166

Daraius Z. Fraser

Partner

M. No.: 42454

Mumbai: May 22 2017