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Nitta Gelatin India Ltd.

BSE: 506532 Sector: Industrials
NSE: KERALACHEM ISIN Code: INE265B01019
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NSE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 214.00
PREVIOUS CLOSE 216.55
VOLUME 7183
52-Week high 239.00
52-Week low 170.90
P/E 19.56
Mkt Cap.(Rs cr) 197
Buy Price 0.00
Buy Qty 0.00
Sell Price 216.00
Sell Qty 25.00
OPEN 214.00
CLOSE 216.55
VOLUME 7183
52-Week high 239.00
52-Week low 170.90
P/E 19.56
Mkt Cap.(Rs cr) 197
Buy Price 0.00
Buy Qty 0.00
Sell Price 216.00
Sell Qty 25.00

Nitta Gelatin India Ltd. (KERALACHEM) - Auditors Report

Company auditors report

To the Members of Nitta Gelatin India Limited Kochi

Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements of Nitta Gelatin IndiaLimited ("the Company") which comprise the Balance Sheet as at 31st March2017 the Statement of Profit and Loss the Cash Flow Statement for the year then endedand a summary of the 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 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 recordsin accordance with the provisions of the Act for safeguarding of the assets of the Companyand for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe financial statements that give a true and fair view and are free from materialmisstatement whether due 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 thereunder.

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. An audit also includes evaluating theappropriateness of the 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 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 2017 and its profit and its cash flows for the year ended on that date.

Emphasis of Matter

We draw attention to Note no. 2.11.2 to the standalone financial statements whichstates that in view of the business plans of the subsidiary company Reva ProteinsLimited which is expected to bring in positive cash flows in the near future themanagement is of the opinion that no permanent diminution in value of investments in thesubsidiary company is anticipated at this stage and hence no provision is made.

Our opinion is not modified in respect of this matter.

Report on Other Legal & 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 give in the Annexure a statement on the matters specified in paragraphs 3 and4 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 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 31stMarch 2017 taken on record by the Board of Directors none of the directors isdisqualified as on 31st 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 A".

(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. TheCompany has disclosed the impact of pending litigations on its financial position in itsfinancial statements – Refer Note 2.17.2 Note 2.28.1 Note 2.28.2(1) and Note 2.28.3to the standalone financial statements. ii. The Company did not have any long-termcontracts including derivative contracts for which there were any material foreseeablelosses. iii. There has been no delay in transferring amounts required to be transferredto the Investor Education and Protection Fund by the Company iv. The Company has providedrequisite disclosures in the financial statements as to holdings as well as dealings inSpecified Bank Notes during the period from 8th November 2016 to 30th December 2016.Based on audit procedures and relying on the management representation we report that thedisclosures are in accordance with books of account maintained by the Company and asproduced to us by the Management -Refer Note 2.15.4 to the standalone financialstatements

For VARMA & VARMA
(FRN : 004532S)
(VIJAY NARAYAN GOVIND)
Partner
Place: Kochi - 19 CHARTERED ACCOUNTANTS
Date: 09.05.2017 Membership No. 203094

ANNEXURE REFERRED TO IN PARAGRAPH 1 UNDER THE HEADING "REPORT ON OTHER LEGAL ANDREGULATORY REQUIREMENTS" OF OUR INDEPENDENT AUDIT REPORT OF EVEN DATE ON THESTANDALONE FINANCIAL STATEMENTS OF NITTA GELATIN INDIA LIMITED FOR THE YEAR ENDED 31STMARCH 2017

1. (a) The company is maintaining proper records showing full particulars includingquantitative details and situation of fixed assets.

(b) We are informed that fixed assets have been physically verified by the managementat reasonable intervals and that no material discrepancies were noticed on suchverification.

(c) According to the information and explanations given to us the records of thecompany examined by us and the confirmation from financial lenders in respect of titledeeds/ lease deeds deposited with them and based on the details of land and buildingsfurnished to us by the companythe title deeds/ lease deeds of immovable properties areheld in the name of the Company.

2. We are informed that the physical verification of inventory has been conducted atreasonable intervals by the management having regard to the size of the Company and natureof it's business and that no material discrepancies were noticed on such verification.

3. According to the information and explanations given to us and the records of thecompany examined by us 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 the reporting requirements underclauses (iii) (a) to (c) of paragraph 3 of the Order are not applicable.

4. According to the information and explanations given to us and the records of thecompany examined by us the company has complied with the provisions of sections 185 and186 of the Act in respect of investments and guarantees. The company has not granted anyloans or given any security for which the provisions of sections 185 and 186 of the Actare applicable.

5. The Company has not accepted any deposits from the public during the year and hencethe directives issued by the Reserve Bank of India and the provisions of Sections 73 to 76or any other relevant provisions of the Act and the rules framed thereunder are notapplicable.

6. To the best of our knowledge and according to the information and explanations givento us the Central Government has not prescribed the maintenance of cost records underSection 148 (1) of the Act for the company at this stage.

7. (a) As per the information and explanations furnished to us and according to ourexamination of the records of the Company the Company has been generally regular indepositing undisputed statutory dues including Provident Fund Employee's State InsuranceIncome Tax Sales Tax Service Tax Duty of customs Duty of excise Value Added Tax Cessand other statutory dues as applicable to the Company to the appropriate authoritiesduring the year.

As at the year end the following amounts of arrears of undisputed statutory dues areoutstanding for a period of more than six months from the date they became payable

Nature of dues Amount (Rs in lakhs) Period to which the amount relates
Water cess 63.95 25.07.2009 to 31.12.2010 and 2011-12

b) According to the information and explanations given to us and the records of theCompany examined by us there are no disputed amounts due to be deposited under Duty ofCustoms (the show cause cum demand notice issued by the customs authorities as referred toin Note No 2.28.3 of the standalone financial statements has not been considered as adisputed amount for reporting under this clause pending adjudication of the notice).

According to the information and explanations given to us the following disputedamounts of income tax sales tax service taxduty of excise and value added tax have notbeen deposited with the authorities as at March 31 2017.

Nature of dues Statute Amount (Rs in Lakhs) Period to which the amount relates Forum where the dispute is pending
Income Tax Income Tax Act1961 85.13 (Net of Rs 11.61 lakhs paid under protest) 2010-11 (AY 2011-12) and 2012-13 (AY 2013-14) Commissioner of Income Tax
Central Sales Tax Central Sales Tax Act 1956 310.49 (Net of Rs 5.11 lakhs paid under protest) 2009-10 Maharashtra Sales Tax Tribunal #
Central Sales Tax Central Sales Tax Act 1956 20.12 (Net of Rs 8.62 lakhs paid under protest) 2010-11 Deputy Commissioner of Sales Tax (Appeals)
Central Sales Tax Central Sales Tax Act 1956 15.41 (Net of Rs 6.60 lakhs paid under protest) 2011-12 Deputy Commissioner of Sales Tax (Appeals)
Value Added Tax Kerala Value Added Tax Act 2003 33.38 (Net of Rs 14.31 lakhs paid under protest) 2010-11 Deputy Commissioner of Sales Tax (Appeals)
Excise duty and penalty Central Excise Act 1944 10.42 (Net of Rs 0.36 lakhs paid under protest) April 2010 to August 2013 Customs Excise and Service Tax Appellate Tribunal Bangalore
Cenvat credit and penalty Central Excise Act 1944 41.91 2010-11 to 2012-13 Commissioner (Appeals) #
Cenvat credit and penalty Central Excise Act 1944 14.22 (Net of Rs 0.35 lakhs paid under protest) 2010-11 to 2012-13 Commissioner (Appeals)

# The appeals were filed after 31.03.2017

8. In our opinion and according to the information and explanations given to us and therecords of the Company examined by us the Company has not defaulted in repayment of loansor borrowings to the banks. The company has not taken any loans or borrowings fromfinancial institution and government or raised any money by way of issue of debenture.

9. According to the information and explanations given to us and the records of theCompany examined by us no moneys were raised by way of initial public offer or furtherpublic offer (including debt instruments) and the term loans availed by the company havebeen applied for the purpose for which the loans were obtained.

10. During the course of our examination of the books and records of the companycarried out in accordance with generally accepted auditing practices in India andaccording to the information and explanations given to us we have neither come across anyinstances 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.

11. According to the information and explanations given to us and the records of theCompany examined by us managerial remuneration has been paid or provided in accordancewith the requisite approvals mandated by the provisions of section 197 read with ScheduleV to the Act.

12. The company is not a Nidhi Company. Accordingly the reporting requirements underclause (xii) of paragraph 3 of the Order are not applicable.

13. According to the information and explanations given to us and the records of theCompany examined by us all transactions with the related parties are in compliance withsections 177 and 188 of the Act where applicable and the details have been disclosed inNote 2.26 to the standalone financial statements as required by the applicable accountingstandard.

14. The company has not made any preferential allotment or private placement of sharesor fully or partly convertible debentures during the year under review. Accordingly thereporting requirements under clause (xiv) of paragraph 3 of the Order are not applicable.

15. The company has not entered into any non-cash transactions with directors orpersons connected with the directors. Accordingly the reporting requirement under clause(xv) of paragraph 3 of the Order is not applicable.

16. According to the information and explanations given to us and the records of theCompany examined by us the company is not required to be registered under section 45-IAof the Reserve Bank of India Act 1934. Accordingly the reporting requirement underclause (xvi) of paragraph 3 of the Order is not applicable.

For VARMA & VARMA
(FRN : 004532S)
(VIJAY NARAYAN GOVIND)
Partner
Place: Kochi - 19 CHARTERED ACCOUNTANTS
Date: 09.05.2017 Membership No. 203094

ANNEXURE A REFERRED TO IN PARAGRAPH 2(F) UNDER THE HEADING "REPORT ON OTHER LEGALAND REGULATORY REQUIREMENTS" OF OUR INDEPENDENT AUDIT REPORT OF EVEN DATE ON THESTANDALONE FINANCIAL STATEMENTS OF NITTA GELATIN INDIA LIMITED FOR THE YEAR ENDED 31STMARCH 2017

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

We have audited the internal financial controls over financial reporting of NittaGelatin India Limited ("the Company") as of March 31 2017 in conjunction withour audit of the standalone financial statements of the Company for the year ended on thatdate.

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 Reportingissued by the Institute of Chartered AccountantsofIndia.Theseresponsibilitiesinclude thedesign implementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe Companies Act 2013.

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 on Audit of Internal Financial Controls Over Financial Reporting(the "Guidance Note") and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controlsboth applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate 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 judgement 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 financialreportingincluding thepossibilityofcollusionorimpropermanagement override of controlsmaterial misstatements due to error or fraud may occur and not be detected. Alsoprojections of any evaluation of the internal financial controls over financial reportingto future periods are subject to the risk that the internal financial control overfinancial reporting may become inadequate because of changes in the 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 internalfinancialcontrols 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 Institute of CharteredAccountants of India.

For VARMA & VARMA
(FRN : 004532S)
(VIJAY NARAYAN GOVIND)
Partner
Place: Kochi - 19 CHARTERED ACCOUNTANTS
Date: 09.05.2017 Membership No. 203094