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Kesar Enterprises Ltd.

BSE: 507180 Sector: Agri and agri inputs
NSE: KESARENT ISIN Code: INE133B01019
BSE LIVE 15:40 | 17 Nov 61.20 -1.50
(-2.39%)
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62.00

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63.00

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61.00

NSE 15:31 | 17 Nov 61.00 -0.95
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62.50

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OPEN 62.00
PREVIOUS CLOSE 62.70
VOLUME 265
52-Week high 139.80
52-Week low 31.10
P/E 10.93
Mkt Cap.(Rs cr) 62
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 62.00
CLOSE 62.70
VOLUME 265
52-Week high 139.80
52-Week low 31.10
P/E 10.93
Mkt Cap.(Rs cr) 62
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Kesar Enterprises Ltd. (KESARENT) - Auditors Report

Company auditors report

To the Members of Kesar Enterprises Limited Report on the Financial Statements

We have audited the accompanying financial statements of Kesar Enterprises Limited("the Company") which comprise the Balance Sheet as at March 31 2017 theStatement of Profit and Loss the Cash Flow Statement ended and a summary of significantaccounting policies and other explanatory information.

Management's Responsibility for the 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 financial statements that give a true and fair view of the financial positionfinancial performance and cash flows of the Company in accordance with the accountingprinciples generally accepted in India including the Accounting Standards specified underSection 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding of the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgements and estimates that are reasonable and prudent; anddesign implementation and maintenance of adequate internal financial controls andensuring their operating effectiveness and the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror.

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on ouraudit.

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 accordancewith the 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 financial statements are free from materialmisstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the financial statements. The procedures selected depend on the auditors'judgment including the assessment of the risks of material misstatement of the financialstatements whether due to fraud or error. In making those risk assessments the auditorconsiders internal financial control relevant to the Company's preparation of thefinancial statements that give a true and fair view in order to design audit proceduresthat are appropriate in the circumstances. An audit also includes evaluating theappropriateness of accounting policies used and the reasonableness of the accountingestimates made by the Company's Directors as well as evaluating the overall presentationof 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 financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by the Actin the manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at March31 2017 its profit and its cash flows for the year ended on .thatdate

Emphasis of Matter

We draw attention to Note No.41 to the financial statements. For the reason stated inthe said note the financial statements have been prepared on the assumption of goingconcern despite accumulated losses resulting in erosion of its net worth. Our opinion isnot modified in respect of this matter.

Report on Other Legal and Regulatory Requirements

(1) As required by the Companies (Auditors' 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 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 ofaccount as required by law have been kept by the Company so far as it appears from ourexamination of those books; c. The Balance Sheet the Statement of Profit and Loss andthe Cash Flow Statement dealt with by this Report are in agreement with the books ofaccount; d. In our opinion the aforesaid financial statements comply with the AccountingStandards Section 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014;e. The matter described under the Emphasis of Matter paragraph above in our opinion mayhave an adverse effect on the functioning of the Company; f. On the basis of writtenrepresentations received from the directors as on March 31 2017 and taken on record bythe Board of Directors none of the directors is disqualified as on March 31 2017 frombeing appointed as a director in terms of Section 164 (2) of the Act; g. With respect tothe adequacy of the internal financial controls over financial reporting of the Companyand the operating effectiveness of such controls we give our separate Report in"Annexure 2". h. With respect to the other matters to be included in theAuditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules2014 in our opinion and to the best of our information and according to the explanationsgiven to us: (i) The Company has disclosed the impact of pending litigations onitsfinancialposition in its financial statements Refer Note 28 on Contingent Liabilitiesto the financial statements; (ii) The Company did not have any long-term contractsincluding derivative contracts. Hence the question of any material foreseeable lossesdoes not arise; (iii) There has been no delay in transferring amounts required to betransferred to the Investor Education and Protection Fund by the Company.

(iv) The company has provided requisite disclosures in the financial statements as toholdings as well as dealings in Specified Bank Notes during the period from 8th November2016 to 30th December 2016. Based on audit procedures and relying on the managementrepresentation we report that the disclosures are in accordance with the books of accountmaintained by the company and as produced to us by the Management (Refer Note No. 37 tothe financial statements);

For Haribhakti & Co. LLP
Chartered Accountants
ICAI Firm Registration No.103523W / W100048
Sumant Sakhardande
Partner
Membership No. 034828
Place: Mumbai
Date: May 19 2017

ANNEXURE 1 TO THE INDEPENDENT AUDITOR'S REPORT

[Referred to in paragraph 1 under ‘Report on Other Legal and RegulatoryRequirements' in the Independent Auditor's

Report of even date to the members of Kesar Enterprises Limited on the financialstatements for the year ended March

31 2017]

(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets. (b) During the year fixed assets havebeen physically verified by the management as per the regular programme of verificationwhich in our opinion is reasonable having regard to the size of the Company and thenature of its assets. As informed material discrepancies identified on such verificationhave been properly dealt with in the books of account.

(c) The title deeds of immovable properties recorded as fixed assets in the books ofaccount of the Company are held in the name of the Company except for the details givenbelow:

Land/ Building Total number of cases Leasehold/ Freehold Gross Block as on March 31 2017 Net Block as on March 31 2017 Remarks
(` in lac) (` in lac)
Land 19 Freehold 626.60 626.60 Mutation Pending with Local Authority

(ii) The inventory has been physically verified by the management during the year. Inour opinion the frequency of verification is reasonable. As informed no materialdiscrepancies were noticed on physical verification carried out during the year.

(iii) As informed the Company has not granted any loans secured or unsecured tocompanies firms Limited Liability Partnerships or other parties covered in the registermaintained under Section 189 of the Act. Accordingly paragraph 3 (iii)(a) 3 (iii)(b) and3 (iii)(c) of the Order are not applicable to the Company.

(iv) Based on information and explanation given to us the provisions of Section 185 ofthe Act are not applicable to the Company. Further the Company has complied with theprovisions of the Section 186 of the Act. (v) In our opinion and according to theinformation and explanations given to us the Company has complied with the directivesissued by Reserve Bank of India and the provisions of Sections 73 to 76 of the Act and therules framed there under with regard to the acceptance of deposits. Further as informedno Order has been passed by the Company Law Board or National Company Law Tribunal orReserve Bank of India or any Court or any other Tribunal on the Company in respect of theaforesaid deposits.

(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. We have not however made a detailed examination of the recordswith a view to determine whether they are accurate or complete.

(vii) (a) The Company is generally regular in depositing with appropriate authoritiesundisputed statutory dues including provident fund employees' state insurance incometax sales tax service tax value added tax excise duty cess and any other materialstatutory dues applicable to it however there have been slight delay in few cases.

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 excise duty cess and any other material statutory duesapplicable to it were outstanding at the year end for a period of more than six monthsfrom the date they became payable.

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

Name of the statute Nature of dues Amount ` in lac Period to which the amount relates Forum where dispute is pending
Central Sales Tax Act 1956 Central Sales 48.84 1989-90 2002-03 & 2004-05 High Court Allahabad
U.P. Trade Tax Act 1948 U.P. Trade Tax 42.77 1989-90 1993-94 to 1996-97 & 1999-2000 High Court Allahabad
Central Excise Act 1944 Excise Duty Spirits 1.08 2005-06 Supreme Court
Central Excise Act 1944 Cenvat Credit on Steel Material 10.46 2012-13 Joint Commissioner CEX Meerut
Central Excise Act 1944 Arrears of Overtime of Excise Personnel 15.72 2006-07 2007-08 & 2008-09 High Court Allahabad
Central Excise Act 1944 Wrong Reversal of Cenvat Credit 24.14 2004-05 CESTAT New Delhi
Central Excise Act 1944 Excise Duty Cenvat on Molasses and Baggase 2103.70 2003-04 to 2009-10 CESTAT New Delhi
Central Excise Act 1944 Excise Duty & Wrong Reversal of Cenvat Credit 43.48 2006-07 to 2008-09 & 2010-11 to 2012-13 A.E.C. (U.P.)
Central Excise Act 1944 License Fee Payable 0.48 2007-08 A.E.C. (U.P.)
U.P. Tax on Entry of Goods into Local Area 2007 Entry Tax Sugar Sales 1004.49 2000-01 to 2007-08 D.C. (A) Bareily
Central Excise Act 1944 Cenvat Credit Reversal 1.44 2012-13 to 2013-14 AC AEX Bareily
Central Excise Act 1944 Cenvat Credit on Steel Materials 5.13 2012-13 AC AEX Hapur
Central Excise Act 1944 Cenvat Credit on Molasses 4028.52 2012-13 to 2013-14 Commissioner CEX Meerut
Central Excise Act 1944 Cenvat Credit on Steel 6.67 2011-12 Add Commissioner CEX Meerut
U.P. Tax on Entry of Goods into Local Area 2007 Entry Tax 119.35 2008-09 to 2010-11 A.C. (A) Bareily
Central Sales Tax Act 1956 Central Sales Tax Distillery 7.20 1997-98 High Court Allahabad
Central Excise Act 1944 Cenvat Credit on Sale of Electricity 2.30 2012-2013 Commissioner CEX Meerut
Central Excise Act 1944 Cenvat Credit on Steel 3.35 2014-15 AC AEX Barailly
Central Excise Act 1944 Demand of reversal of Cenvat Credit Steel materials 7.20 2008-2009 Dy Comm CEX Bareilly
Central Excise Act 1944 Demand on Service Tax on Commission 148.15 2014-15 AC AEX Hapur
Central Excise Act 1944 Denial of Cenvat on MOLASSES Received 273.85 2015-2016 AC AEX Barailly
Central Excise Act 1944 Disallow of Molasses Storage Loss 16.71 2009-10 A.E.C. (U.P.)
Central Excise Act 1944 Excise Duty - Sale of Bagasse & Press Mud 17.04 2007-08 A.E.C. (U.P.)
Central Excise Act 1944 Wrong Reversal Of CENVAT Credit 16.10 2007-08 & 2008-09 & 2010-2011 & 2012-2013 A.E.C. (U.P.)
Central Excise Act 1944 Loss of Molasses sobatage 18.79 2016-17 AC AEX Barailly
Central Excise Act 1944 Service Tax Credit Manpower Services etc. 13.01 2013-14 Commissioner (Appeals) Meerut
Central Excise Act 1944 Service Tax on Selling Commission to Agents etc. 32.12 2011-12 to Joint Commissioner CEX Meerut
2014-15
Central Excise Act 1944 Service Tax on Suger Export Quota 43.89 2011-12 Addl. Commissioner CEX Meerut

 

Name of the statute Nature of dues Amount ` in lac Period to which the amount relates Forum where dispute is pending
U.P. Value Added Tax Act 2008 U.P. Vat-Sugar 5.09 2013-14 Addl. Commissioner (Appeals) Commercial Tax BLY
Central Excise Act 1944 Wrong Reversal Cenvat Credit-Iron & Steel Welding Electrodes 5.49 2005-06 Supreme Court SLP No. 24645

(viii) The Company has not taken any loan or borrowing from financial institutionGovernment or through debenture holders. According to the information and explanationsgiven to us the Company has defaulted in repayment of loans or borrowings to banksexcept for details given below:

Particulars Amount of default as at March 31 2017 (` in lac) (More than 12 months) Amount of default as at March 31 2017 (` in lac) (Less than 12 months)
Banks 2760.50 1769.70
Others 794.96 636.49

(ix) The Company has neither raised money by way of public issue offer nor has obtainedany term loans. Therefore paragraph 3(ix) of the Order is not applicable to the Company.

(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 fraud by the Company or any fraud 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 the Company has notmade provision for managerial remuneration during the year. Therefore paragraph 3(xi) ofthe Order is not applicable to the Company. (xii) In our opinion and according to theinformation and explanations given to us the Company is not a Nidhi Company. Thereforeparagraph 3(xii) of the Order is not applicable to the Company.

(xiii) According to the information and explanation given to us all transactionsentered into by the Company with the related parties are in compliance with Sections 177and 188 of Act where applicable and the details have been disclosed in the FinancialStatements etc. as required by the applicable accounting standards.

(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 isnot required to be registered under Section 45-IA of the Reserve Bank of India Act 1934.

For Haribhakti & Co. LLP
Chartered Accountants
ICAI Firm Registration No.103523W / W100048
Sumant Sakhardande
Partner
Membership No. 034828
Place: Mumbai
Date: May 19 2017

ANNEXURE 2 TO THE INDEPENDENT AUDITOR'S REPORT

[Referred to in paragraph 2 under ‘Report on Other Legal and RegulatoryRequirements' in the Independent Auditor's

Report of even date to the members of Kesar Enterprises Limited on the financialstatements for

31 2017]

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 Kesar as ofMarch 31 2017 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 and maintaining internalfinancial controls internal control over financial reporting criteria established by theCompany considering the essential internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India ("ICAI"). These responsibilities include the designimplementation and maintenance of adequate internal financial controls that were operatingeffectively for ensuring the orderly and efficient conduct of its business includingadherence to company's policies the safeguarding of its assets the prevention anddetection of frauds and errors the accuracy and completeness of the accounting recordsand the timely preparation of reliable financial information as required under theCompanies Act 2013.

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 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. Guidance Note require that we comply with ethical requirementsand plan and perform the audit to obtain reasonable assurance about whether adequateinternal financial controls over financial reporting was established and maintained and ifsuch 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 auditor's 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

Acompany'sinternalfinancial reporting is a process designed to provide reasonableassurance regarding the reliability of financial reporting and the preparation offinancial statements accordance with generally accepted accounting principles. A company'sinternal financial control over financial reporting includes those policies and proceduresthat (1) pertain to the maintenance of records that in reasonable detailaccuratelyandfairlyreflectthe transactions and dispositions of the assets of thecompany;(2) provide reasonable assurance that transactions are recorded as necessary topermit preparation of financial statements in accordance with generally acceptedaccounting principles and that receipts and expenditures of the company are being madeonly in accordance with authorisations of management and directors of the company; and (3)provide reasonable assurance regarding prevention or timely detection of unauthorisedacquisition use or disposition of the company's assets that could have a material effecton 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 because of changes in conditions or that the degreeof 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 Haribhakti & Co. LLP

Chartered Accountants

ICAI Firm Registration No.103523W / W100048

Sumant Sakhardande

Partner

Membership No. 034828

Place: Mumbai

Date:May 19 2017