To the Members of
PARTANI APPLIANCES LIMITED
Report on the Financial Statements
I have audited the accompanying financial statements of PARTANI APPLIANCESLIMITED ("the Company") which comprise the Balance Sheet as at March 312016 the Statement of Profit and Loss. Cash Flow Statement for the year then endedand a summary of significant accounting 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 the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; anddesign implementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring 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.
My responsibility is to express an opinion on these financial statements based on myaudit.
I 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.
I conducted my audit in accordance with the Standards on Auditing specified underSection 143(10) of the Act. Those Standards require that me 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 dieauditor 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.
I believe that the audit evidence I have obtained is sufficient and appropriate toprovide a basis for my audit opinion on the financial statements
Basis for Qualification
During the Financial year the Company has not received the interest on Loans &Advances of Rs. 1.73 crores outstanding in the books of accounts as on 31.03.2016. if thecompany has provided the interest @9% on loans & advances of Rs.l.73Crores the loss isreduced an amount of 1556640/- i.e. from Rs.5066658/- to Rs.35IOOI8/-.The Managementexplained such that the party to whom the Inter Corporate Deposit is extended has writtento company stating its inability to pay Interest on ICD outstanding for F.Y 2015-16.However the said party has assured to return the outstanding ICD of Rs.l.73crore duringthe current F.Y 2016-17. Hence the company thought it appropriate not to provide intereston the said ICD.
In my opinion and to the best of my information and according to the explanations givento me subject to the matter mentioned in Basis for Qualification the aforesaid financialstatements give the information required by the Act in the manner so required and give atrue and fair view in conformity with the accounting principles generally accepted inIndia of the state of affairs of the Company as at March 31 2016 and its Profit and itsCash Flow 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")as amended issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Act we give in the "Annexure A" a statement on thematters specified in paragraphs 3 and 4 of the Order.
2. As required by section 143 (3) of the Act we report that:
a. I have sought and obtained all the information and explanations which to the best ofmy knowledge and belief w'ere necessary for the purpose of my audit;
b. I n m y opinion proper books of account as required by law have been kept by theCompany so far as it appears from my examination of those books;
c. T he Balance Sheet the Statement of Profit and Loss and the Cash Flow Statementdealt with by this Report are in agreement w ith the books of account
d. In my opinion the aforesaid financial statements comply with the AccountingStandards specified under section 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 taken on record by the Board of Directors none of the directors is disqualified ason 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 toseparate Report given by M/s Jeedigunta & Co in "Annexure B". I reliedon the said report.
g. With respect to the other matters to be included in the Auditor's Report inaccordance with Rule II of the Companies (Audit and Auditors) Rules 2014 in my opinionand to the best of my information and according to the explanations given to me:
i. The Company does not have any pending litigations which would impact its financialposition.
ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.
iii. There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company.
For and on behalf of
M MAHENDER KUMAR
"Annexure A" to the Independent Auditors' Report
(Referred to in paragraph I under Report on Other Legal & Regulators'Requirements' of our report of even date)
i) The Company does not have any Fixed Assets except Intangible Assets hence clause3(i)(a)(b)(c) are not applicable to the Company for the year under review.
ii) According to the information and explanations given to us the inventories havebeen physically verified during the year by the management. In our opinion the frequencyof such verification is reasonable. The discrepancies noticed on physical verification ofinventories as compare to the book records which in our opinion were not material havebeen properly dealt w ith.
iii) The Company has granted unsecured loans to various parties from time time whichincludes long outstanding advances to the tune of Rs 50 lacs wherein no proper recordsare maintained by the company and no proper explanations were provided to us for ourreview hence the same is considered as prejudicial to the interest of the company.Further no interest is provided by the company on the advance amount of Rs 1.73 crores forthe current financial year and hence considered to be the prejudicial to the interest ofthe company for the year under review.
iv) According to the information and explanations furnished to us there being no suchloans and investments guarantees and security by the company and hence the clause 3(iv)is not applicable to the company for the year under review.
v) According to the information and explanations given to us the Company has notaccepted any deposits from public within the meaning of Sections 73 to 76 of the Act andthe Companies (Acceptance of Deposits) Rules. 2014 (as amended). Accordingly theprovisions of clause (v) of paragraph 3 of the Order are not applicable to the Company forthe year under review'
vi) As informed to me the maintenance of Cost Records has not been specified by theCentral Government under sub-section (1) of Section 148 of the Act in respect of theactivities carried on by the company and hence clause 3(vi) is not applicable to thecompany for the year under review.
vii) In respect of statutory dues:
a. According to information and explanations given to m e and on the basis of m yexamination of the books of accounts and records the Company has t been generally regularin depositing undisputed statutory dues including Provident Fund. Employees StateInsurance Income-Tax Sales tax. Service Tax Duty of Customs Duty of Excise Valueadded Tax Cess and any other statutory dues with the appropriate authorities. Accordingto the information and explanations given to me following are undisputed amounts payablein respect of the above were in arrears as at March 31 2016 for a period of more than sixmonths from the date on when they become payable.
|Name of the Statute ||Name of the tax dues ||Amount(Rs.) ||Period to which the amount relates |
|1 Income Tax Act-1961 ||Income Tax ||18452/- ||2011-12 |
|2 Income Tax Act-1961 ||Income Tax ||1.03019/- ||2012-13 |
|3 Income Tax Act-1961 ||Income Tax ||78.438/- ||2013-14 |
|4 Income Tax Act-1961 ||Income Tax ||4.88.330/- ||2014-15 |
|5 Central sales tax act 1956 and sales tax acts of various states ||Sales Tax/VAT ||1.07.634/- ||2012-13 |
|5 Central sales tax act. 1956 and sales tax acts of various states ||Sales Tax/VAT ||94.114/- ||2013-14 |
|7 Central sales tax act. 1956 and sales tax acts of various states ||Sales Tax/VAT ||1.17.055/- ||2014-15 |
|g Central sales tax act 1956 and sales tax acts of various states ||Sales Tax/VAT ||525021/- ||2015-16 |
b. According to the information and explanation given to me there are no dues ofincome tax sales tax service tax duty of customs duty of excise value added tax andCess which have not been deposited as on 31'1 March 2016 on account of anydispute.
viii) According to the information and explanations given to us the Company has notobtained any loans or borrowings from any financial institution or banks or by way ofdebentures during the year hence clause 3(viii) is not applicable to the company for theyear under review
ix) Based upon the audit procedures performed and the information and explanationsgiven by the management the company has not raised moneys by way of initial public offeror further public offer including debt instruments and term Loans. Accordingly theprovisions of clause 3 (ix) of the Order are not applicable to the Company for the yearunder review.
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 explanations given to us we have neither come across any instance ofmaterial fraud by the company or on the company by its officers or employees noticed orreported during the year nor we have been informed of any such case by the management.
xi) Based upon the audit procedures performed and the information and explanationsgiven by the management the managerial remuneration has been paid or provided inaccordance with the requisite approvals mandated by the provisions of section 197 readwith Schedule V to the Companies Act;
xii) As the company is not a Nidhi Company and Nidhi Rules 2014 are not applicable toit the provisions of Clause 3 (xii) of the Order are not applicable to the Company.
xiii) In my opinion all transactions with the related parties are in compliance withsection
177 and 188 of Companies Act 2013 and the details of such related party transactionshave been disclosed in the Financial Statements as required under Accounting Standard -18 Related Party Disclosures specified under section 133 of the Act read with Rule 7 ofthe Companies (Accounts) Rules 2014.
xiv) Based upon the audit procedures performed and the information and explanationsgiven by the management the company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures during the year underreview. Accordingly the provisions of clause 3 (xiv) of the Order are not applicable tothe Company and hence not commented upon.
xv) Based upon the audit procedures performed and the information and explanationsgiven by the management the company has not entered into any non-cash transactions withdirectors or persons connected with them and accordingly the provisions of clause 3 (xv)of the Order are not applicable to the Company and hence not commented upon.
xvi) In my opinion the company is not required to be registered under section 45 IA ofthe Reserve Bank of India Act 1934 and accordingly the provisions of clause 3 (xvi) ofthe Order are not applicable to the Company and hence not commented upon.
For and on behalf of
M MAIIENDER KUMAR