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Paramount Printpackaging Ltd.

BSE: 533399 Sector: Industrials
NSE: PARAPRINT ISIN Code: INE702L01010
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OPEN 0.82
PREVIOUS CLOSE 0.86
VOLUME 27500
52-Week high 0.90
52-Week low 0.82
P/E
Mkt Cap.(Rs cr) 2
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 0.82
CLOSE 0.86
VOLUME 27500
52-Week high 0.90
52-Week low 0.82
P/E
Mkt Cap.(Rs cr) 2
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Paramount Printpackaging Ltd. (PARAPRINT) - Auditors Report

Company auditors report

TO THE MEMBERS OF PARAMOUNT PRINTPACKAGING LIMITED

Report on financial statements

We have audited the accompanying financial statements of PARAMOUNT PRINTPACKAGINGLIMITED ("the Company") which comprise the Balance Sheet as at March 312016 and the Statement of Profit and Loss and Cash Flow Statement for the year thenended and a summary of significant accounting policies and other explanatory information.

Management’s Responsibility for the Financial Statement

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 Companies Act 2013 read with Rule 7 of the Companies (Accounts) Rules2014. This responsibility also includes maintenance of adequate accounting records inaccordance 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 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 theamounts and 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 control relevant to the Company’s preparation and fairpresentation of the financial statements in order to design audit procedures that areappropriate in the circumstances. An audit also includes evaluating the appropriateness ofaccounting policies used and the reasonableness of the accounting estimates made bymanagement as well as evaluating the overall presentation of the financial statements. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our audit opinion.

Basis for Qualified Opinion

The Opinion has been qualified on the following basis:

(a) Non provision of depreciation in the financial year amounting to Rs.229.92 lacs dueto closure of the factory unit. As a result of which the loss stated for the quarter/yearended is also understated to the same extent.

(b) Non provision of interest on loans from the banks and NBFCs as either the accountshave been classified as NPA and/or Company's request for restructuring / one timesettlement of loans is pending.

(c) Non provision of labour charges as company's operations have been suspended/closed as a result labour charges have been accounted to the extent of payments made.

(d) Regarding non reconciliation of Balances of Excise/Cenvat receivable account andnon confirmation of some of of bank balances sundry debtors sundry creditors and loans& advances.

Qualified Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the accompanying financial statements give the information required by theAct except for the effects of the matter described in the "Basis for QualifiedOpinion" paragraph in the manner so required and give a true and fair view inconformity with the accounting principles generally accepted in India: a) in thecase of the Balance Sheet of the state of affairs of the Company as at March 31 2016; b)in the case of the Statement of Profit and Loss Account of the loss for the yearended on that date; and c) in the case of the Cash Flow Statement of the cash flows forthe year ended on that date.

Report on Other Legal and Regulatory Requirements

As required by the Companies (Auditor’s Report) Order 2016 issued by the CentralGovernment of India in terms of sub-section (11) of section 143 of the Act (hereinafterreferred to as the Order) 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 we give in the Annexure B a statement on the matters specified in paragraphs3 and 4 of the Order.

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 purpose of our audit;

b) In our opinion proper books of account as required by law have been kept by theCompany so far as appears from our examination of those books;

c) The Balance Sheet Statement of Profit and Loss and Cash Flow Statement dealt withby this Report are in agreement with the books of account.

d) In our opinion the Balance Sheet Statement of Profit and Loss and Cash FlowStatement dealt with by this report comply with the Accounting Standards specified underSection 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014;

e) On the basis of written representations received from the directors as on March 312016 and taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2016 from being appointed as a director in terms of section 164(2) of theAct.

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:

a. the Company did not have any pending litigations;

b. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.

c. There were no amounts which were required to be transferred to Investor Educationand Protection

Fund by the Company.

For Laxmikant Kabra & Co.

Chartered Accountants

Firm Registration No: 117183W

Sd/-

Laxmikant Kabra

(Partner)

Membership No : 101839

Date: 30th May 2016

Annexure A to Independent Auditor’s Report

Referred to the Independent Auditors’ Report of even date to the members ofParamount Printpackaging Limited on the financial statements as of and for the year ended31 March 2016

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

(b) Due to closure of the factory unit the fixed assets are not physically verified bythe Management according to a phased programme designed to cover all the items over aperiod of three years and hence any material discrepancies if any present could not bedetermined.

(c) There are no immovable properties held by the Company.

2. The Company does not hold any inventory. Therefore the provisions of clause 3(ii)of the said Order are not applicable to the Company.

3. In respect of the loans secured or unsecured granted by the Company to companiesfirms or other parties covered in the register maintained under section 189 of theCompanies Act 2013.

a) The company has granted unsecured loan covered in the register maintained undersection 189 of the Act. The company has not received any principal amount and interestfrom these parties during the year.

 

b) In our opinion and according to the information and explanation given to usreasonable steps have not been taken by the company for recovery of the principal andinterest amounts from the parties.

4. The Company has not granted any loans or provided any guarantees or security to theparties covered under section 185 and has not made any investments under section 186 ofthe Act.

5. The Company has not accepted any deposits from the public within the meaning ofsections 73 74 75 and 76 of the Act and the Rules framed there under to the extentnotified.

6. The Central Government of India has not specified the maintenance of cost recordsunder sub-section (1) of section 148 of the Act for any of the products of the Company.

 

1. (a) Based on verification of the records of the company we are of theopinion that the company is not regular in depositing undisputed statutory dues includingProvident fund Employees’ State Insurance Income tax Sales tax Wealth taxService tax Custom Duty Excise Duty Cess and other statutory dues with the appropriateauthorities. According to the information and explanation given to us there are noundisputed amounts payable in respect of such statutory dues which have remainedoutstanding as on 31st March 2016 for a period of more than six months fromthe day they became payable except as referred below:-

Nature of Dues

Amount (in `)

Provident Fund

6678183

Profession Tax

388675

Maharashtra Value Added Tax

282248

Central Sales Tax

5633530

Service Tax

957216

Wealth Tax F.Y.2010-2011

45000

Wealth Tax F.Y.2011-12

38000

Tax Deducted at Source

7368828

Income Tax( F.Y. 2011-2012) – as per Assessment Order

1036980

Income Tax(F.Y. 2008-2009) – as per Assessment Order

54820

ESIC

1069276

Excise Duty

20647775

 

b)According to information and explanation given to us the details of disputed salestax demand that have not been deposited on account of disputes are given below:-

Name of Statute Nature of dues Amount Period to which amount relates Forum where dispute pending
Central Sales Tax Act Sales Tax 2841171 2006-2007
Maharashtra Value Added Tax Act Sales Tax 1867876 2007-2008
Central Sales Tax Act Sales Tax 7578883 2007-2008
Maharashtra Value Added Tax Act Sales Tax 14940978 2008-2009
Central Sales Tax Act Sales Tax 3051163 2008-2009 Vide order dated 18.05.2016 Recovery Proceedings have been initiated however no appeal is filed as in the opinion of the management the amounts are disputed.
Maharashtra Value Added Tax Act Sales Tax 5870471 2009-2010
Central Sales Tax Act Sales Tax 3612175 2009-2010
Maharashtra Value Added Tax Act Sales Tax 13188853 2011-2012
Central Sales Tax Act Sales Tax 1638099 2011-2012
Maharashtra Value Added Tax Act Sales Tax 894452 Other sales tax dues
Central Sales Tax Act Sales Tax 2163124 Other sales tax dues

 

c) According to the information and explanations given to us there are no suchamounts which were required to be transferred to the investor education and protectionfund in accordance with the relevant provisions of the Companies Act 1956 (1 of 1956) andrules there under has been transferred to such fund within time.

2. On the basis of audit procedures performed by us and according to theinformation explanation and representation given to us by the management we state thatthe company had defaulted in certain repayment of dues (including interest) of domesticfinancial institutions and banks. The default in principal amount and the interest to theextent provided for aggregates to `.182838350/- . However upto the date of approval ofthe accounts the company has not paid the principal amount and the interest aggregateswith respect to above stated dues and the Company has not issued any debentures as atthe Balance Sheet date the provisions of clause 3(viii) of the Order are not applicableto the Company.

9. The Company has not raised any moneys by way of initial public offer further publicoffer (including debt instruments) and term loans. Accordingly the provisions of clause3(ix) of the Order are not applicable to the Company.

10. 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 material fraud by the Company or on the Company by its officers or employeesnoticed or reported during the year nor have we been informed of any such case by theManagement.

11. The Company has not paid/provided for managerial remuneration.

12. As the Company is not a Nidhi Company and the Nidhi Rules 2014 are not applicableto itthe provisions of clause 3(xii) of the Order are not applicable to the Company.

13. In our opinion all transactions with the related parties are in compliance withsections 177 and 188 of the Act where applicable and the requisite details have beendisclosed in the financial statements etc. as required by the applicable accountingstandards.

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 theprovisions of clause 3(xiv) of the Order are not applicable to the Company.

15. The Company has not entered into any non cash transactions with its directors orpersons connected with him. Accordingly the provisions of clause 3(xv) of the Order arenot applicable to the Company.

16. The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934 as Non–Deposit accepting NBFC and hence the provisions ofclause 3(xvi) of the Order are not applicable to the Company.

Annexure B to Independent Auditor’s Report

Referred to the Independent Auditors’ Report of even date to the members ofParamount Printpackaging Limited on the financial statements for the year ended 31 March2016

Report on the internal financial controls under clause (i) of sub-section 3 of section143 of the Act

1. We have audited the internal financial controls over financial reporting ofParamount Limited. (‘the Company’) as of 31 March 2016 in conjunction with ouraudit of the financial statements of the Company for the year ended on that date.

Management’s responsibility for internal financial controls

2. The Company’s Management is responsible for establishing and maintaininginternal financial controls based on the internal control over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting issued by the Institute of Chartered Accountants of India (ICAI). Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to Company’s policies the safeguardingof its assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required under the Act.

Auditors’ responsibility

3. 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 deemed to be prescribedunder section 143(10) of the Act to the extent applicable to an audit of internalfinancial controls both applicable to an audit of internal financial controls and bothissued by the ICAI. 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.

4. Our audit involves performing procedures to obtain audit evidence about the adequacyof the 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 financial statements whether due to fraud or error.

5. 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 controlssystem over financial reporting.

Meaning of internal financial controls over financial reporting

6. A company's internal financial control over financial reporting is a processdesigned to provide reasonable assurance regarding the reliability of financial reportingand the preparation of financial statements for external purposes in accordance withgenerally accepted accounting principles. A company's internal financial control overfinancial reporting includes those policies and procedures that (1) pertain to themaintenance of records that in reasonable detail accurately and fairly reflect thetransactions and dispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of financialstatements in accordance with generally accepted accounting principles and that receiptsand expenditures 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

7. 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

8. 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 31 March 2016based 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 Laxmikant Kabra & Co.

Chartered Accountants

Firm Registration No: 117183W

Sd/-

Laxmikant Kabra

(Partner)

Membership No.:101839

Place: Thane

Date: 30th May 2016.