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Jindal Stainless Ltd.

BSE: 532508 Sector: Metals & Mining
NSE: JSL ISIN Code: INE220G01021
BSE LIVE 15:40 | 22 Aug 85.00 2.60
(3.16%)
OPEN

82.60

HIGH

87.90

LOW

82.55

NSE 15:49 | 22 Aug 85.25 2.95
(3.58%)
OPEN

83.75

HIGH

88.10

LOW

82.70

OPEN 82.60
PREVIOUS CLOSE 82.40
VOLUME 117619
52-Week high 93.80
52-Week low 22.00
P/E 24.36
Mkt Cap.(Rs cr) 3,910
Buy Price 85.50
Buy Qty 1299.00
Sell Price 0.00
Sell Qty 0.00
OPEN 82.60
CLOSE 82.40
VOLUME 117619
52-Week high 93.80
52-Week low 22.00
P/E 24.36
Mkt Cap.(Rs cr) 3,910
Buy Price 85.50
Buy Qty 1299.00
Sell Price 0.00
Sell Qty 0.00

Jindal Stainless Ltd. (JSL) - Auditors Report

Company auditors report

TO THE MEMBERS OFJINDAL STAINLESS LIMITED

Report on the Standalone Financial Statements (REVISED)

We have audited the accompanying REVISED standalone financial statements of JindalStainless Limited ("the Company") which comprise the REVISED Balance Sheet asat 31st March 2015 the REVISED Statement of Profit and Loss the REVISED Cash FlowStatement for the year then ended and a summary of the significant accounting policiesand other explanatory information in which are incorporated the REVISED Retern for theyear ended on that date audited by the branch auditors of the Company’s branch atJindal Nagar Kothavalsa Dist. Vizianagaram (A.P.) in which impact of the Scheme (asstated in Note no. 27) have been incorporated.

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 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 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 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 there under.

We conducted our audit in accordance with the Standards on Auditing specified underSection 143(10) of the Act. Those Standards require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetherthe financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the financial statements. The procedures selected depend on theauditor’s judgment including the assessment of the risks of material misstatement ofthe financial statements whether due to fraud or error. In making those risk assessmentsthe auditor considers internal financial control relevant to the Company’spreparation of the financial statements that give a true and fair view in order to designaudit procedures that are appropriate in the circumstances but not for the purpose ofexpressing an opinion on whether the Company has in place an adequate internal financialcontrols system over financial reporting and the operating effectiveness of such controls.An audit also includes evaluating the appropriateness of the accounting policies used andthe reasonableness of the accounting estimates made by the Company’s Directors aswell as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion 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 31st March 2015 and its profit and its cash flows for the year ended on that date.

Emphasis of Matters

Attention is drawn to the following:

(a) Note no. 55(C)(i) regarding pending necessary approvals for managerial remunerationas explained in the said note.

(b) Note no. 34(A)(iii)(f) &34(B) read with Note no. 43(B) and 43(A) regardingpending receipt of consent / confirmations of balances of certain secured loans loans& advances trade receivables trade payables creditors & other liabilities asstated in the said note.

(c) Note no. 43(C) regarding certain investments and loan & advances considered asgood and fully realizable/ recoverable related to certain subsidiary companies for thereason stated in the said note and no provision for diminution in value is necessary inthe opinion of the management.

(d) Note no 37 regarding investments made in MJSJ Coal Limited and Jindal SynfuelsLimited respectively. The company continues to treat the investment as good andrecoverable in view of the pending decision challenging the Order and other circumstancesas mentioned in the said note.

Our opinion is not qualified in respect of above matters.

Other Matter

The financial statements of the Company for the year ended 31stMarch 2015 were earlierapproved by the Board of Directors at their meeting held on 30th May 2015 on which theStatutory Auditors of the Company had issued their report dated 30th May 2015. Thesefinancial statements have been reopened and revised to give effect to the Scheme asexplained in Note No. 27(4).

Our opinion is not modified in respect of these matters.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order 2015 ("theOrder") issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Act and on the basis of such checks of the books and records of theCompany as we considered appropriate and according to the information and explanationsgiven to us during the course of audit we give in the Annexure a statement on the mattersspecified in the paragraphs 3 and 4 of the Order.

2. As required by Section 143 (3) of the Act we report that: (a) We have sought andobtained all the information and explanations which to the best of our knowledge andbelief 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 and proper returnsadequate for the purpose of our audit have been received from the branch not visited byus.

(c) The reports on the accounts of the branch office of the company audited undersection 143 (8) of the Act by branch auditors have been sent to us and have been properlydealt with us in preparing this report.

(d) The REVISED Balance Sheet REVISED the Statement of Profit and Loss and REVISEDthe Cash Flow Statement dealt with by this Report are in agreement with the books ofaccount and with the returns received from the branch not visited by us.

(e) In our opinion the aforesaid REVISED standalone financial statements comply withthe Accounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules2014.

(e) On the basis of the written representations received from the directors as on31stMarch 2015 taken on record by the Board of Directors none of the directors isdisqualified as on 31stMarch 2015 from being appointed as a director in terms of Section164 (2) of the Act.

(f) With respect to the other matters to be included in the Auditor’s Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our information and according to the explanations given to us: i. TheCompany has disclosed the impact of pending litigations on its financial position in itsfinancial statements- Refer Note no. 28(A) 31 37 39 41to the financial 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.

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

For LODHA & CO. For S.S. KOTHARI MEHTA &CO.
Chartered Accountants Chartered Accountants
FRN 301051E FRN 000756N
(N.K. LODHA) (ARUN K. TULSIAN)
Partner Partner
Membership No. 85155 Membership No. 89907
Place : New Delhi
Date : 6th November 2015

Annexure referred to in paragraph 1 under the heading "Report on Other Legal andRegulatory Requirements" of our report of even date for the year ended 31st March2015- Jindal Stainless Limited.

1.

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

(b) We have been informed that certain fixed assets of the company have been physicallyverified by the management according to a phased programme of periodic verification whichin our opinion is reasonable having regard to the size of the company and nature of fixedassets. As informed no material discrepancies between book records and physical inventoryhave been noticed in respect of the fixed assets physically verified during the year.

2.

(a) As informed the inventory of the company (except stocks lying with third partiesin transit) part of the stores and spares have been physically verified by themanagement either at the end of the year or after the year end and in respect of storesand spares there is perpetual inventory system and a substantial portion of the stockshave been verified during the year (Read with Note no.51). In our opinion the frequencyof verification is reasonable.

(b) According to the information and explanations given to us the procedures ofphysical verification of inventory followed by the management are reasonable and adequatein relation to the size of the company and the nature of its business.

(c) In our opinion and according to the information and explanations given to us thecompany is maintaining proper records of inventory; in respect of process stock therecords are updated as and when physical verification has been carried out. Thediscrepancies noticed on such physical verification of inventory as compared to bookrecords were not material.

3. The company has not granted any loans secured or unsecured to companies firms orother parties covered in the register maintained under section189 of the Companies Act2013. Accordingly the provisions of Clause 3(iii) (a) & (b) of the Order are notapplicable (refer note no.45(c) of notes to accounts).

4. In our opinion and according to the information and explanations given to us havingregard to the explanations that certain items purchased/sold are of special nature forwhich as explained suitable alternatives sources do not exist for obtaining comparativequotations taking into consideration the quality usage and such other factors there areadequate internal control systems commensurate with the size of the company and nature ofits business with regard to purchase of inventory fixed assets and for the sale of goodsand services. Further on the basis of examination of the books and records of thecompany carried out in accordance with the generally accepted auditing practices inIndia and according to the information and explanations given we have neither comeacross nor have we been informed of any instance of major weaknesses in aforesaid internalcontrol systems.

5. In our opinion and according to the information and explanations given to us theCompany has complied with the directive issued by the Reserve Bank of India and theprovisions of Section 73to76 of the Act or any other relevant provisions of the Act andthe rules framed there under with regard to deposits accepted from the public. Accordingto the information and explanations given to us no order has been passed by the CompanyLaw Board (however on the application of the Company for extension of time {refer noteno.4(e)} an Order has been passed by the Company Law Board) or National Company LawTribunal or Reserve Bank of India or any Court or other tribunal in this regard.

6. We have broadly reviewed the books of account maintained by the company pursuant tothe rules made by the Central Government for the maintenance of cost records under section148(1) of the Act in respect of the company’s products to which the said rules aremade applicable and are of the opinion that prima facie the prescribed records have beenmade and maintained. We are however not required to make a detailed examination of suchbooks and records.

7.

(a) According to the records of the Company the Company is generally regular indepositing undisputed statutory dues including provident fund employees’ stateinsurance income-tax sales-tax wealth tax service tax duty of customs duty ofexcise value added tax and cess and other material statutory dues with the appropriateauthorities to the extent applicable and there were no undisputed statutory dues payablefor a period of more than six months from the date they became payable as at 31st March2015.

(b) According to the records and information & explanations given to us there areno dues in respect of Wealth Tax andCess that have not been deposited with the appropriateauthorities to the extent applicable on account of any dispute and the dues in respect ofIncome tax Sales tax Service Tax Duty of Custom Duty of Excise and VAT that have notbeen deposited with the appropriate authorities on account of dispute and the forum wherethe dispute is pending are given below:-

Name of the statue Nature of the Dues Amount (` in lacs) Period to which the amount relates Forum where dispute is pending
Central Excise Act Excise Duty 3251.18 2005-11 Commissioner Central Excise Bhubaneshwar-1 Odisha
31.84 April 06- March 12 Commissioner Central Excise Bhubaneshwar-1 Odisha
The Central Sales Tax 1956 Sales Tax 2479.44 2005-06 to 2007-08 High Court Odisha Cuttack
Income Tax Act Income Tax 525.60 2004-05 2005-06 2006-07 & 2009-10 Commissioner of Income Tax (Appeals) Delhi
517.52 2002-03 & 2003-04 High Court New Delhi
2604.06 2004-05 2005-06 2006-07 & 2007-08 ITAT Delhi
Entry Tax Act 1999 Entry Tax 5703.11 2006-07 to 2012-13 H’ble Supreme Court
8210.13 2006-11 High Court Odisha Cuttack

Above does not include show cause notice.

(c) According to the records of the Company and information and explanations given tous the amount required to be transferred to investor education and protection fund inaccordance with the relevant provisions of the Companies Act 1956 (1 of 1956) and rulesmade thereunder has been transferred to such fund within time.

8. The company has accumulated losses at the end of the financial year and also its networth has been eroded more than 50% read with Note no. 36 to the financial statements.Further company has not incurred cash losses in the current financial year and hasincurred cash losses in the immediately preceding financial year.

9. In our opinion and according to information and explanations given to us thecompany had defaulted in repayment of dues (including interest installment & letterof credits payments) to banks at various days during the year (read with note No. 27).There is no default in repayment of dues to financial institutions/ debenture holdersduring the year. The maximum amount of default on a particular date was Rs. 79675.68 lacsand maximum delay (no. of days) noticed was 85 days (refer foot note to Note no. 10 &Note no. 35 for continue default and read with Note no. 34).

10. In our opinion and according to the information and explanations given to us theCompany has not given any guarantee for loans taken by others from banks or financialinstitutions. (Read with Note no. 28(C)).

11. In our opinion and on the basis of information and explanations given to us theterm loans raised during the year by the Company were applied at the close of thefinancial year for the purposes for which the loans were obtained where such end use hasbeen stipulated by the lender.

12. 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 we haveneither come across any instance of material fraud on or by the company noticed orreported during the year nor have we been informed of such case by the management.

For LODHA & CO. For S.S. KOTHARI MEHTA &CO.
Chartered Accountants Chartered Accountants
FRN 301051E FRN 000756N
(N.K. LODHA) (ARUN K. TULSIAN)
Partner Partner
Membership No. 85155 Membership No. 89907
Place : New Delhi
Date : 6th November 2015