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Sadbhav Infrastructure Projects Ltd.

BSE: 539346 Sector: Infrastructure
NSE: SADBHIN ISIN Code: INE764L01010
BSE LIVE 15:40 | 22 Nov 137.00 -1.15
(-0.83%)
OPEN

132.50

HIGH

138.95

LOW

132.50

NSE 15:58 | 22 Nov 137.00 -0.95
(-0.69%)
OPEN

138.10

HIGH

138.95

LOW

134.10

OPEN 132.50
PREVIOUS CLOSE 138.15
VOLUME 15148
52-Week high 146.95
52-Week low 83.20
P/E 72.11
Mkt Cap.(Rs cr) 4,826
Buy Price 0.00
Buy Qty 0.00
Sell Price 137.00
Sell Qty 3.00
OPEN 132.50
CLOSE 138.15
VOLUME 15148
52-Week high 146.95
52-Week low 83.20
P/E 72.11
Mkt Cap.(Rs cr) 4,826
Buy Price 0.00
Buy Qty 0.00
Sell Price 137.00
Sell Qty 3.00

Sadbhav Infrastructure Projects Ltd. (SADBHIN) - Auditors Report

Company auditors report

To the Members of

Sadbhav Infrastructure Project Limited

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS financial statements of SadbhavInfrastructure Project Limited ("the Company") which comprise the Balance Sheetas at March 31 2017 the Statement of Profit and Loss including the statement of OtherComprehensive Income the Cash Flow Statement and the Statement of Changes in Equity forthe year then ended and a summary of significant accounting policies and otherexplanatory information ( herein referred to as ‘Ind AS financial statements).

Management’s Responsibility for the Standalone Ind AS 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 Ind AS financialstatements that give a true and fair view of thefinancial financial performance including other comprehensive income cash flows andchanges in equity of the Company in accordance with accounting principles generallyaccepted in India including the Indian AccountingStandards (Ind AS) specified undersection 133 of the Act read with rules 7 of the Companies (Accounts) rules 2014 and theCompanies (Indian AccountingStandards) Rules 2015 as amended. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; and application of appropriate accountingpolicies; makingjudgments and estimates that are reasonable and prudent; and the design implementationand maintenance of adequate internal financialcontrol that were operatingeffectively forensuring the accuracy and completeness of the accountingrecords relevant to thepreparation and presentation of the standalone Ind AS financial statements that give atrue and fair view and are free from material misstatement whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on these standalone Ind AS financialstatements based on our audit. We have taken into account the provisions of the Act theaccounting and auditing standards and matters which are required to be included in theaudit report under the provisions of the Act and the Rules made thereunder. We conductedour audit of the standalone Ind AS financial statements in accordance with the Standardson Auditing issued by the Institute of Chartered Accountants of India as 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 anddisclosures in the standalone Ind As financial statements. The procedures selected dependon the auditor’s judgment including the assessment of the risks of materialmisstatement of the standalone Ind AS financialstatements whether due to fraud or error.In making those risk assessments the auditor considers internal financial controlrelevant to the Company’s preparation of the standalone Ind AS financial that give atrue 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 theCompany’s Directors as well as evaluating the overall presentation of the standaloneInd AS financial statements. We believe that the audit evidence we have obtained issufficient and appropriate to provide a basis for our audit opinion on the standalone IndAS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the standalone statements give the information required by the Act in themanner so accounting principles generally accepted in India of the state of affairs ofthe Company as at March 31 2017 its profit including other comprehensive income itscash flows and the changes in equity 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 ("theOrder") issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Act we give in the "Annexure 1" a statement on themattersspecifiedin paragraphs 3 and 4 of 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 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 including the Statement of OtherComprehensive Income the Cash Flow Statement and Statement of Changes in Equity dealtwith by this Report are in agreement with the books of account;

(d) In our opinion the aforesaid standalone Ind AS financial statements comply withthe Accounting section 133 of the Act read with rules 7 of the Companies (Accounts) rules2014 and Companies (Indian Accounting Standards) Rules 2015 as amended;

(e) On the basis of written representations received from the directors as on March 312017 and taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2017 from being appointed as a director in terms of section 164 (2) ofthe 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 2" to this report; and

(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

i. The Company has disclosed the impact of pending litigations on its financialposition in its standalone statements Refer Note 41 to the standalone Ind AS financialstatements;

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

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 Note 49 to these standalone IndAS financial statements as to the holding of Specified Bank Notes on November 8 2016 andDecember 30 2016 as well as dealings in Specified Bank Notes during the period fromNovember 8 2016 to December 30 2016. Based on our audit procedures and relying on themanagement representation regarding the holding and nature of cash transactions includingSpecified Bank Notes we report that these disclosures are in accordance with the books ofaccounts maintained by the Company and as produced to us by the Management.

For S R B C & CO LLP For Manubhai & Shah LLP
Chartered Accountants Chartered Accountants
ICAI Firm Registration Number : 324982E/E300003 ICAI Firm Registration Number : 106041W/W100136
per Sukrut Mehta per K. B. Solanki
Partner Partner
Membership Number : 101974 Membership Number : 110299
Place of Signature : Ahmedabad Place of Signature : Ahmedabad
Date : May 18 2017 Date : May 18 2017

Annexure 1 referred to in Paragraph 1 of Report on Other Legal and RegulatoryRequirements of our report of even date of Sadbhav Infrastructure Project Limited for theyear ended March 31 2017

(i) a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets;

b) The fixed assets have been physically verified by the management during the year. Inour opinion this periodicity is reasonable having regards to the size of the Company andnature of its assets. No material discrepancies were noticed on such verification;

c) As per the Company’s records there are no immovablepropertiesheld as fixedassets by the Company during the year. Accordingly the provisions of clause 3(i)(c) ofthe order are not applicable to the Company and hence not commented upon.

(ii) The management has conducted physical verification of inventories in the natureof project inventory at reasonable interval . duringtheyearandnomaterialdiscrepancieswerenoticed verification such physical

(iii) a) The Company has granted loan to fifteen Companies covered in the registermaintained under section 189 of the Act including interest free subordinate debt of INR17651.82 million of the nature of Project Sponsor Contribution as per Sponsor Support andEquity Contribution Agreement entered with the lenders of each special purpose entities asper service concession arrangement of each project. In our opinion and according to theinformation and explanations given to us conditions of the loans are not prejudicial tothe Company’s interest.

b) The loans granted by the Company includes loans of INR 3645.25 million re-payableon demand to companies covered in the register maintained under section 189 of the Act.The loans granted which are subordinate debts in the nature of Sponsor contribution arerecoverableonachievementofcertainfinancial . respectiveinvesteeentities performanceof Weare informed that the Company has not demanded repayment of any such loan during the yearand thus there has been no default on the part of the parties to whom the money has beenlent. The payment of interest has been regular except forcertainloantransactionaggregatingof INR 1779.42 million granted by the Company to asubsidiaries Company.

c) There is no overdue amount of loans granted to companies firms or other partieslisted in the register maintained under section 189 of the Act which are outstanding formore than ninety days except interest of INR 209.18 million on demand loan which isoverdue for more than ninety days from a Company covered in the register maintained undersection 189 of the Act and in our opinion at the year end reasonable steps have beentaken by the Company for recovery of the interest.

(iv) In our opinion and according to the information and explanations given to us andbased on legal opinion taken by on applicability of section 185 of Act in respect ofloans to subsidiary entities in the nature of interest free subordinate debt as a projectsponsor contribution the Company has complied with the provisions of section 185 of theCompanies Act 2013. Further based on the information and explanations given to us beingan Infrastructure Company provision of the Act is not applicable to the Company and hencenot commented upon.

(v) The Company has not accepted any deposits within the meaning of section 73 to 76 ofthe Act and the Companies (Acceptance of deposits) rules 2014 (as amended). Accordinglythe provision of clause 3(v) of the order are not applicable and hence not commented upon.

(vi) We have broadly reviewed the books of account maintained by the Company pursuantto the rules made by the Central Government for the maintenance of cost records undersection 148(1) of the Act related to road and other infrastructure projects relatedservices and are of the opinion that prima facie the specified accounts and records havebeen made and maintained. We have not however made a detailed examination of the same.

(vii) a) Undisputed statutory dues including provident fund income-tax sales-taxservice tax value added tax employee’s state Insurance cess and other materialstatutory dues have generally been regularly deposited with the appropriate authorities.

According to the information and explanationgiven to us there are no dues payable onaccount of customs duty excise duty wealth tax and cess during the year.

b) According to the information and explanations given to us no undisputed amountspayable in respect of provident fund employee’s state Insurance income-tax servicetax sales-tax value added tax cess and other material statutory dues were outstandingat the year end for a period of more than six months from the date they became payable.

c) According to the information explanation and records of the Company the duesoutstanding of service tax values added tax and cess on account of any dispute asfollows:

Name of the statute Nature of dues Amount (INR in million) Period to which the amount relates Forum where dispute is pending
The Finance Act 1994 Service Tax 40.98 FY 2009-10 and FY 2010-11 CESTAT Ahmedabad

(viii) In our opinion and according to information and explanations given by themanagement we are of the Company has not defaulted in repayment of loans or borrowingsfrom banks and debenture holders. The Company has not .takenanyloanorborrowingfromfinancialinstitutions government and

(ix) According to the information and explanations given by the management the Companyhas not raised any public offer (including debt instruments) and term loans during theyear and hence reportinginitial under clause 3(ix) is not applicable to the Company andhence not commented upon.

(x) Based upon the audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to the information and explanationsgiven by the management we report that no fraud by the fraud on the Company by theofficers and employees of the Company has been noticed or reported during the year.

(xi) According to the information and explanations given by the management we reportthat the managerial been paid / provided in accordance with the requisite approvalsmandated by the provisions of section 197 read with Schedule V to the Act.

(xii) In our opinion the Company is not a nidhi Company. Therefore the provisions ofclause 3(xii) of the order are not applicable to the Company and hence not commented upon.

(xiii) According to the information and explanations given by the managementtransactions with the related parties with section 177 and 188 of the Act where applicableand the details have been disclosed in the notes to the financial statements as requiredby the applicable accounting standards.

(xiv) According to the information and explanationsgiven to us and on an overallexamination of the balance sheet the Company has not made any preferentialallotment orprivate placement of shares or fully or partly convertible debentures year under reviewand hence reporting requirement under clause 3(xiv) are not applicable to the Company andnot commented upon.

(xv) According to the information and explanationsgiven by the management the Companyhas not entered into transactions with directors or persons connected with him as referredto in section 192 of the

(xvi) According to the information and explanations given to us the company is notrequired to be registered under section 45IA of Reserve Bank of India Act 1934.

For S R B C & CO LLP For Manubhai & Shah LLP
Chartered Accountants Chartered Accountants
ICAI Firm Registration Number : 324982E/E300003 ICAI Firm Registration Number : 106041W/W100136
per Sukrut Mehta per K. B. Solanki
Partner Partner
Membership Number : 101974 Membership Number : 110299
Place of Signature : Ahmedabad Place of Signature : Ahmedabad
Date : May 18 2017 Date : May 18 2017

Annexure 2 of the Independent Auditor’s Report of even date on the Standalone IndAS Financial Statements of Sadbhav Infrastructure Project Limited

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section

To the Members of Sadbhav Infrastructure Project Limited

We have audited the internal financial controls over financial reporting of SadbhavInfrastructure Project Limited ("the Company") as of March 31 2017 inconjunction with our audit of the standalone Ind AS financial statements of the Companyfor the year ended on that date.

Management’s Responsibility for Internal Financial Controls

The Company’s Management isresponsibleforestablishingandmaintaininginternalfinancial controls based on the internalcontrol over financial reporting criteria established by the Company considering theessential components of internal control stated in the Guidance Note on Audit of InternalFinancial Controls over Financial Reporting issued by the of India. These responsibilitiesinclude the design implementation and maintenance of adequate ectively for ensuring theorderly and efficient conduct of its business including adherence to the Company’seff wereoperating policies the safeguarding of its assets the prevention and detectionof frauds and errors the accuracy and completeness of the accounting records and thetimely preparation of reliable financial information as required under the Act.

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 section143(10) of the Act to the extentapplicable to Auditingasspecifiedunder an audit of internal financial controls bothapplicable to an audit of Internal Financial Controls and both issued by the Institute ofChartered Accountants of India. Those Standards and the Guidance Note require that wecomply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether adequate internal financial controls over financial reporting wasestablished and maintained and if such controls operated effectively in all materialrespects.

Our audit involves performing procedures to obtain audit evidence about theadequacyoftheinternalfinancialcontrols system over financial reporting and their operatingfinancialreportingincluded effectiveness.Ourauditofinternalfinancialcontrolsover obtainingan understanding of internal financial controls over financial reporting assessing therisk that 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 includingtheassessmentoftherisksofmaterialmisstatementofthefinancial statements whether due tofraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the internal financial controls system overfinancial 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 financialstatements for external purposes in accordance withgenerally accepted accounting principles. A Company’s internalfinancialcontroloverfinancial reporting includes those policies and procedures that (1)pertain to the maintenance of records that in reasonable detail accurately and fairlyreflect the transactions and 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 acquisitionuse or disposition of assetsthat could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over FinancialReporting

Because of the inherent limitations of internal financial controlsoverfinancialreporting including the possibility of collusion improper managementoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projections of any evaluation of the internal financial controls overfinancial reporting to future periods are subject to the risk that the internal financialcontrol over financial reporting may become inadequate because of changes in conditionsorthat the degree of compliance with the policies or procedures may deteriorate.

Opinion

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 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 S R B C & CO LLP For Manubhai & Shah LLP
Chartered Accountants Chartered Accountants
ICAI Firm Registration Number : 324982E/E300003 ICAI Firm Registration Number : 106041W/W100136
per Sukrut Mehta per K. B. Solanki
Partner Partner
Membership Number : 101974 Membership Number : 110299
Place of Signature : Ahmedabad Place of Signature : Ahmedabad
Date : May 18 2017 Date : May 18 2017