To the Members of Mahaan Foods Limited
Report on the Standalone Financial Statements
We have audited the accompanying standalone financial statements of Mahaan FoodsLimited ('the Company') which comprise the Balance sheet as at 31 March 2017 thestatement of profit and loss and the cash flow statement for the year then ended and asummary of significant accounting policies and other 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 preparationand presentation of these standalone financial statements that give a true and fair viewof the financial position financial performance and cash flows of the company inaccordance with the accounting principles generally accepted in India including theAccounting Standards specified under section 133 of the Act read with Rule 7 of thecompanies (Accounts) Rules 2014. This responsibility also includes maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets of the Company and for preventing and detecting frauds and otherirregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the financial statements that give a true and fair viewand are free from material misstatement whether due to fraud or error.
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 and the order under section 143(11) ofthe Act.
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 of thefinancial statements whether due to fraud or error. In making those risk assessments theauditor considers 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 but not for the purpose of expressing anopinion on whether the Company has in place an adequate internal financial controls systemover financial reporting and the operating effectiveness of such controls. An audit alsoincludes evaluating the appropriateness of the accounting policies used and thereasonableness of the accounting estimates made by the Company's Directors as well asevaluating 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.
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 March 2017 and its profit and its cash flows for the year ended on that date.
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 have given in the Annexure 'A' a statement on the matters specified in theparagraph 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 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 2016 from being appointed as a director in terms of Section164 (2) of the Act; and
(f) With respect to adequacy of the internal financial controls over financialreporting and the operating effectiveness of such controls refer to our report in"Annexure B" which is based on the Auditors' Report of the Company . Our reportexpresses an unmodified opinion on the adequacy and operating effectiveness of theinternal financial controls over financial reporting of the Company.
(g) Attention is invited to Note No.23 stating that some of balance of debtorscreditors and loan and advances are subject to confirmation from respective parties. Wehave relied on the representation of the management that no significant impact is expectedon the working results of the company on this account.
(h) 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 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 in financial statements; 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 its standalone financialstatement as to holding as well as dealings in specified bank notes (SBN) during theperiod from 8th November 2016 to 30th December 2016 and these are in accordance with thebooks of accounts maintained by the company
| ||For D.D.Nagpal & Co |
| ||Chartered Accountants |
| ||Firm's registration number: 006413N |
| ||DevDharNagpal |
|New Delhi ||Partner |
|30th May 2017 ||Membership number: 085366 |
Annexure - A to the Independent Auditors' Report
The Annexure referred to in our Independent Auditors' Report to the members of theCompany on the standalone financial statements for the year ended 31 March 2017 we reportthat:
(a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
(b) The Company has a regular program of physical verification of its fixed assets bywhich fixed assets are verified in a phased manner over a period of three years. Inaccordance with this program certain fixed assets were verified during the year and nomaterial discrepancies were noticed on such verification.
(c) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the title deeds of immovable properties areheld in the name of the Company.
(a) The inventories have been physically verified during the year by the management. Inour opinion the frequency of verification is reasonable.
(b) The procedures of physical verification of inventories followed by the managementare reasonable and adequate in relation to the size of the company and the nature of itsbusiness
(c) The Company is maintaining proper records of inventory. The discrepancies noticedon verification between the physical stocks and the book records were not material.
(iii) The Company has granted loans to one company of Rs.55850000 (P.Y Rs.558500000)covered in the register maintainedunder section 189 of the Companies Act 2013 ('theAct').
(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 with respectto the loans and investments made.
(v) The Company has not accepted any deposits from the public covered under Section 73to 76 of the Companies Act 2013.
(vi) We have broadly reviewed the Cost Records maintained by the company as prescribedby the Central Government under section 148 sub section (1) of the Companies Act 2013 andare of the opinion that prima facie the prescribed accounts and records have beenmaintained.We have however not made a detailed examination of the cost records with aview to determine whether they are accurate or complete.
(a) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company amounts deducted/ accrued in the books ofaccount in respect of undisputed statutory dues including provident fund income taxsales tax wealth tax service tax duty of customs value added tax cess and othermaterial statutory dues have been regularly deposited during the year.
However there are certain delay observed in deposition of dues by the Company with theappropriate authorities in India .The Arrear as on 31st March 2017on theaforesaid dues were as below.
|1 Sales Tax ||Rs.39238.00 |
|2 Service tax ||Rs.44775.00 |
|3 TDS ||Rs.69332.00 |
|4 CST Payable ||Rs.32782 |
According to information and explanation given to us following undisputed amountspayable in respect of statutory dues were outstanding as at 31st March 2017 for a periodof more then six months from the date they become payable
|Name of Statute ||Nature of the Dues ||Amount (Rs. In Lacs) ||Period to which the amount relates |
|Himachal Pradesh Value Added Tax Act 2005 ||Value Added Tax ||48.22 ||01.01.2007 to 30.11.2008 |
|Income tax Act 1961 ||Fringe Benefit Tax ||3.88 ||01.04.2008 to 31.03.2009 |
|Income tax Act 1961 ||Fringe Benefit Tax ||1.04 ||01.04.2006 to 31.03.2007 |
(b) According to the information and explanations given to us there are no materialdues of wealth tax duty of customs and cess which have not been deposited with theappropriate authorities on account of any dispute.
|Name of Statute ||Nature of the Dues ||Amount (Rs. In Lacs) ||Period to which the amount relates ||Forum where dispute is pending |
|Delhi Sales Tax Act 1975 ||Sales Tax demand ||40.40 ||2003-04 ||Dy. Commissioner (Appeals) New Delhi (Demand order has been stayed by Hon'ble Dy. Commissioner) |
|Punjab Value Added Tax Act 2005 ||Penalty ||2.91 ||2005-06 ||Asstt. Excise & Taxation Commissioner cum Deputy Director (Inv.) Patiala for review. |
|Rajasthan Value Added Tax Act 2003 ||Penalty ||8.49 ||2008-09 ||Rajasthan Tax Board Ajmer |
|Orissa value Added Tax Act 2004 ||Value added tax ||0.46 ||01-04-2005 to 30-11-2008 ||Joint Commissioner of Sales tax Bhubaneswar |
| ||Penalty ||0.91 || || |
|Orissa entry Tax Act 1999 ||Entry tax ||1.77 ||01-04-2005 to 30-11-2008 ||Joint Commissioner of Sales tax Bhubaneswar |
| ||Penalty ||3.54 || || |
(viii) The Company has not defaulted in repayment of dues to financial institutionsbanks or debenture holders during the year.
(ix) The Company did not raise any money by way of initial public offer or furtherpublic offer (including debt instruments) and term loans during the year.Accordinglyparagraph 3 (ix) of the Order is not applicable. Based on the information &explanation given to us by the management term loans were applied for the purpose forwhich the loans were obtained.
(x) According to the information and explanations given to us no material fraud by theCompany or on the Company by its officers or employees has been noticed or reported duringthe course of our audit.
(xi) According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has not paid/provided formanagerial remuneration in accordance with the requisite approvals mandated by theprovisions of section 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. Accordingly paragraph 3(xii) of the Order is notapplicable.
(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 where applicable and details of suchtransactions have been disclosed in the financial statements as required by the applicableaccounting standards.
(xiv) Company has not made preferential allotment during the year. Paragraph 3(ix) ofthe order is not applicable.
(xv) According to the information and explanations given to us and based on ourexamination of therecords of the Company the Company has not entered into non-cashtransactions with directors or persons connected with him. Accordingly paragraph 3(xv) ofthe Order is not applicable.
(xvi) The Company is not required to be registered under section 45-IA of theReserveBank of India Act 1934.
| ||For D.D. Nagpal & Co |
| ||Chartered Accountants |
| ||Firm's registration number: 006413N |
| ||Dev Dhar Nagpal |
|New Delhi ||Partner |
|30th May 2017 ||Membership number: 085366 |