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Permanent Magnets Ltd.

BSE: 504132 Sector: Engineering
NSE: PERMAGNET ISIN Code: INE418E01018
BSE LIVE 15:28 | 17 Nov 51.30 -2.65
(-4.91%)
OPEN

56.55

HIGH

56.55

LOW

51.30

NSE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 56.55
PREVIOUS CLOSE 53.95
VOLUME 6466
52-Week high 74.95
52-Week low 18.80
P/E 28.34
Mkt Cap.(Rs cr) 44
Buy Price 0.00
Buy Qty 0.00
Sell Price 51.30
Sell Qty 743.00
OPEN 56.55
CLOSE 53.95
VOLUME 6466
52-Week high 74.95
52-Week low 18.80
P/E 28.34
Mkt Cap.(Rs cr) 44
Buy Price 0.00
Buy Qty 0.00
Sell Price 51.30
Sell Qty 743.00

Permanent Magnets Ltd. (PERMAGNET) - Auditors Report

Company auditors report

TO THE MEMBERS OF

PERMANENT MAGNETS LIMITED

Report on the Financial Statements

We have audited the accompanying financial statements of PERMANENT MAGNETS LIMITED (‘theCompany’) which comprise the Balance Sheet as at March 31 2016 the Statement ofProfit and Loss and the Cash Flow Statement for the year then ended and a summary ofsignificant 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 preparationand presentation of these financial statements that give a true and fair view of thefinancial position financial performance and cash flows of the Company in accordance withthe Accounting principles generally accepted in India including the Accounting Standardsspecified under section 133 of the Act read with rule 7 of the Companies (Accounts) Thisresponsibility also includes the maintenance of adequate accounting records in accordancewith the provisions of the act for safeguarding the assets of the company and forpreventing and detecting the frauds and other irregularities; selection and application ofappropriate accounting policies; making judgment and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrol that were operating effectively for ensuring the accuracy and completeness of theaccounting records relevant to the preparation and presentation of financialstatementsthat give a true and fair view and are free from material misstatement whether due tofraud or error.

Auditors 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 there under.

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 performingprocedures to obtain audit evidence about the amounts and disclosures in the financialstatements. The procedures selected depend on the auditor’s judgment including theassessment of the risks of material misstatement of the financial statements whether dueto fraud or error. In making those risk assessments the auditor considers internalcontrol relevant to the Company’s preparation of the financial statements that givetrue and fair view in order to design audit procedures that are appropriate in thecircumstances. An audit also includes evaluating the appropriateness of accountingpolicies used and the reasonableness of the accounting estimates made by companies’directors 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 on the 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 31 March 2016 and its profit and its cash flows for the year ended on that date.

Emphasis of Matters

a. We draw attention to Note no. 3 of notes to accounts which states that HonorableBombay High Court has given interim stay order against the winding up order passed againstthe Company dated 15/04/2015. b. Honorable High Court of Bombay had passed winding uporder dated 15/04/2015 for Winding up of the company on petition filed by M/s. Savino DelBene Freight Forwarders (I) Pvt. Ltd. and court had issued direction for appointment ofofficial liquidator in winding up order. On the appeal against this order made by thecompany before Honorable Bombay High Court Honorable Bombay High Court has given interimstay order against the winding up order passed (against the Company) dated 15/04/2015.Company has deposited Rs. 1905179/- Lac with interest as per direction of honorableBombay High Court. Matter is pending before Bombay High Court. The financial statements ofthe company have been prepared on Going Concern Basis on reasons mentioned in the note no.3 of notes of accounts.

Our opinion is not modified in respect of above 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 of theAct We give in the Annexure A statement on the matters specified in paragraphs 3 & 4of the order.

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 purpose 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 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 comply with the Accounting Standards referred to in section 133 of the CompaniesAct 2013 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 to ourseparate report in ‘Annexure B’; and

g. with respect to the other matters to be included in the Auditors’ 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 litigation on its financial positionin its financial statements - Refer to Note 2 of notes to accounts

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

III. The provisions relating to transferring any amounts to the investor’seducation and protection fund is not applicable to the Company during the year.

For Jayesh Sanghrajka & Co. LLP
Chartered Accountants
ICAI Firm Registration No. 104184W/ W100075
Hemant Agrawal
Designated Partner
M. No. 403143
Place: Mumbai
Date: 28th May 2016

Annexure ‘A’ to the Independent Auditors’ Report

The referred to in Independent Auditors’ Report to the members of the Company onthe standalone financial statements for the year ended 31 March 2016 we report that:

I. (a) The company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.

(b) Company has a regular programme of physical verification of its fixed assets bywhich fixed assets are verified in a phased manner over a period of two years. Inaccordance with this programme certain fixed assets were verified during the year and nomaterial discrepancies were noticed on such verification. In our opinion this periodicityof physical verification is reasonable having regard to the size of the Company and thenature of its assets

(c) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company Company did not have any immovable propertyexcept 15% share of Borivali (Mumbai) property sold to Builder.

II. According to the information and explanations given to us management has conductedphysical verification of inventory at reasonable intervals during the year. In ouropinion the frequency of verification is reasonable. No material discrepancies werenoticed on such physical verification.

III. According to information and explanations given to us the Company has not grantedany loans secured or unsecured to companies firms limited liability partnerships orother parties covered in the register maintained under Section 189 of the Companies Act2013 during the year. Accordingly clause 3 (iii) of the Order is not applicable to theCompany.

IV. According to information and explanations given to us the Company has compliedwith the provisions of section 185 and 186 of the Companies Act 2013 in respect of loansinvestments guarantees and security.

V. According to information and explanations given to us the company has not acceptedany deposits from the public in accordance with the provisions of section 73 to 76 andrules framed thereunder during the year. Accordingly clause 3 (v) of the Order is notapplicable to the Company.

VI. According to the information and explanations given to us the Central Governmenthas not prescribed maintenance of cost records under sub-section (1) of section 148 of theCompanies Act’2013.

VII. According to the information and explanations given to us in respect of statutorydues: a. According to the information and explanations given to us and the records of theCompany examined by us in our opinion the Company is regular in depositing theundisputed statutory dues including provident fund employees state insurance income taxsales tax service tax duty of customs duty of excise value added tax cessprofessional tax and other material statutory dues as applicable with the appropriateauthorities.

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 duty of customs duty of excise value added tax cess professional tax andother material statutory dues were in arrears as at 31March 2016 for a period of more thansix months from the date they became payable except the following:

Nature of Dues Amount (INR in Lakhs) Due date
Income Tax 00.54 30th Oct 2007
Income Tax 16.08 19th March 2012
Sales Tax (06-07) 06.84 26th March 2014
Sales Tax (07-08) 11.40 30th March 2015

b. According to the information and explanations given to us there are no dues ofIncome tax Sales tax Value added tax Service tax duty of customs duty of excise whichhave not been deposited with the appropriate authorities on account of any dispute exceptthe following: c.

Nature of Dues Amount Period to which the amount relates Forum where dispute is pending
(INR in Lakhs)
Excise Duty 63.18 F.Y. 2003-04 CESTAT Mumbai
Income Tax 02.06 F.Y. 2006-07 CIT (A) Mumbai
Income Tax 03.94 F.Y. 2008-09 CIT(A) 21 Mumbai

VIII. According to the records of the Company examined by us and the information andexplanation given to us we are of the opinion that the company has not defaulted inrepayment of dues to Financial Institutions or Banks except following payments.

Bank Nature Amount ( INR in Lakhs) Due on Paid on
ICICI Central Excise Loan 222.43* Between October 2002 to October 2004 Not yet paid

*including simple interest @ 12%

IX. The Company has not raised any money by way of initial public offer further publicoffer (including debt instruments). The company has applied funds from term loans raisedduring the year only for the purpose for which those term loans were raised.

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 the Company has paid/ provided for managerial remuneration inaccordance with the requisite approvals mandated by the provisions of section 197 readwith Schedule V to the Act. XII. In our opinion and according to the information andexplanations given to us the Company is not a nidhi company. Accordingly paragraph3(xii) of the Order is not applicable.

XIII. According to the information and explanations given to us and based on ourexaminations of the records of the Company transactions with the related parties are incompliance with sections 177 and 188 of the Act where applicable. The details of suchrelated party transactions have been disclosed in the financial statements as requiredunder Accounting Standard (AS) 18 Related Party Disclosures specified under Section 133of the Act read with Rule 7 of the Companies (Accounts) Rules 2014.

XIV. According to the information and explanations give to us and based on ourexamination of the records the Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures during the year.Accordingly paragraph 3(xiv) of the Order is not applicable to the Company.

XV. According to the information and explanations given to us and based on ourexamination of the records the Company has not entered into non-cash transactions withdirectors or persons connected with him. Accordingly paragraph 3(xv) of the Order is notapplicable.

XVI. The Company is not required to be registered under Section 45-IA of the ReserveBank of India Act 1934. Accordingly paragraph 3(xvi) of the Order is not applicable tothe Company.

For Jayesh Sanghrajka & Co. LLP
Chartered Accountants
ICAI Firm Registration No. 104184W/ W100075
Hemant Agrawal
Designated Partner
M. No. 403143
Place: Mumbai
Date: 28th May 2016

ANNEXURE "B" TO THE INDEPENDENT AUDITOR’S REPORT

Referred to in Para 2 (f) ‘Report on Other Legal and Regulatory Requirements’in our Independent Auditor’s Report to the members of the Company for the year endedMarch 31 2016

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 PERMANENT MAGNETS LIMITED controls overfinancial reporting of ("the Company") as of March 31 2016 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 maintainingcontrolsbased on the internal control financial 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 Reporting (the"Guidance Note") issued by the Institute of Chartered Accountants of India(ICAI). These responsibilities include the design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theorderly and efficient conduct of its business including adherence to company’spolicies the safeguarding of its assets the prevention and detection of frauds anderrors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Act.

Auditors’ Responsibility

Our responsibility is to express an opinion on the Company’s internal financialcontrols over financial reporting based on We conducted our audit in accordance with theGuidance Note and the Standards on Auditing issued by ICAI and 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. Our auditinvolves performing procedures to obtain audit evidence about the adequacy of the internalfinancial controls system over financial reporting and their operating effectiveness. Ouraudit 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 judgment including the assessment of the risks of materialmisstatement of the Standalone Financial Statements whether due to fraud or error. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea 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 processdesigned to provide reasonable assurance regarding the reliability of financial reportingand the preparation of Standalone Financial Statements for external purposes in accordancewith generally accepted accounting principles. A company’s internal financial controlover financial 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 StandaloneFinancial Statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the Company are being made only in accordance withauthorizations of management and directors of the Company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorized acquisition use ordisposition of the company’s assets that could have a material effect on theStandalone 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 controls over financial to the risk projections of any evaluation of the internalfinancial that the internal financial control over financial reporting may becomeinadequate because of changes in conditions or that the degree of compliance with thepolicies or procedures may deteriorate.

Opinion

In our opinion the Company has in all material respects an adequate internalfinancial controls system over financial reporting and on the such internal financialcontrol over financial Company considering the essential components of internal controlstated in the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting issued by "the Institute of Chartered Accountants of India"

For Jayesh Sanghrajka & Co. LLP
Chartered Accountants
ICAI Firm Registration No. 104184W/ W100075
Hemant Agrawal
Designated Partner
M. No. 403143
Place: Mumbai
Date: 28th May 2016