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Sejal Glass Ltd.

BSE: 532993 Sector: Industrials
NSE: SEZAL ISIN Code: INE955I01036
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NSE 12:54 | 23 Oct 4.45 -0.15
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OPEN 5.08
PREVIOUS CLOSE 4.90
VOLUME 53
52-Week high 11.25
52-Week low 3.95
P/E
Mkt Cap.(Rs cr) 17
Buy Price 4.66
Buy Qty 10000.00
Sell Price 5.08
Sell Qty 47.00
OPEN 5.08
CLOSE 4.90
VOLUME 53
52-Week high 11.25
52-Week low 3.95
P/E
Mkt Cap.(Rs cr) 17
Buy Price 4.66
Buy Qty 10000.00
Sell Price 5.08
Sell Qty 47.00

Sejal Glass Ltd. (SEZAL) - Auditors Report

Company auditors report

To

The Members of Sejal Glass Limited

Report on Financial Statements

We have audited the accompanying financial statements of SEJAL GLASS LIMITED ('the Company') which comprise the balance sheet as at 31st March 2016 the statement of profit and loss and the cash flow statement for the year then ended and 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 Section 134(5) of the Companies Act 2013 (the Act) with respect to the preparation and presentation of these standalone financial statements that give a true and fair view of the financial position financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India including the Accounting Standards specified under Section 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the accuracy and completeness of the accounting records relevant to the preparation and presentation of the financial statements that give a true 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 financial statements based on our audit. We have taken into account the provisions of the Act the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under. We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor's judgment including the assessment of the risks of material misstatement of the financial statements whether due to fraud or error. In making those risk assessments the auditor considers internal financial control relevant to the Company's preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial control system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the financial statements. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment including the assessment of the risks of material misstatement of the financial statements whether due to fraud or error. In making those risk assessments the auditor considers internal control relevant to the Company's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion

Opinion

In our opinion and to the best of our information and according to the explanations given to us the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India

(a) In the case of the Balance Sheet of the state of affairs of the Company as at 31st March 2016:

(b) In the case of the Statement of Profit and Loss of the Loss for the year ended on that date; and

(c) In the case of the Cash Flow Statement of the cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. 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 best of our knowledge and belief were necessary for the purposes of our audit.

(b) In our opinion proper books of account as required by law have been kept by the Company 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 Statement dealt with by this Report are in agreement with the books of account;

(d) In our opinion the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014;

(e) There is no matters paragraph above in our opinion may have an adverse effect on the functioning of the company

(f) On the basis of the written representations received from the directors as on 31st March 2016 taken on record by the Board of Directors none of the directors is disqualified as on 31st March 2016 from being appointed as a director in terms of Section 164 (2) of the Act;

(g) With respect to the adequacy of the Internal Financial Controls over financial reporting of the company and operating effectiveness of such controls refer to our separate report in Annexure 'A'. Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the company's internal financial controls over financial reporting.

(h) With respect to the other matters to be included in the Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinion and to the best of our information and according to the explanations given to us:

a. the Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note 26.2 to the financial statements;

b. the Company has made provision as required under the applicable law or accounting standards for material foreseeable losses.

c. There has been delay in transferring amounts required to be transferred to the Investor Education and Protection Fund.

2 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 of the Act. we give in the Annexure B a statement on the matters specified in the paragraph 3 and 4 of the order

For D.D. Mehta & Co.
Chartered Accountants
FRN : 119679W
CA Deven Mehta
Proprietor
M.No: 107667
Place : Mumbai
Date: 30/05/2016

Annexure - A to the Auditors' Report

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act 2013 (the Act)

We have audited the internal financial controls over financial reporting of SEJAL GLASS LIMITED (the Company) as of 31st March 2016 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India ('ICAI'). These responsibilities include the design implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business including adherence to company's policies the safeguarding of its assets the prevention and detection of frauds and errors the accuracy and completeness of the accounting records and the timely preparation of reliable financial information as required under the Companies Act 2013.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the Guidance Note) and the Standards on Auditing issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act 2013 to the extent applicable to an audit of internal financial controls both applicable to an audit of Internal Financial Controls and both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting assessing the risk that a material weakness exists and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor's judgment including the assessment of the risks of material misstatement of the financial statements whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company's internal financial controls system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A company's internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition use or disposition of the company'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 financial reporting including the possibility of collusion or improper management override of controls material misstatements due to error or fraud may occur and not be detected. Also projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion the Company has in all material respects an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31st March 2016 based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

For D.D. Mehta & Co.
Chartered Accountants
FRN : 119679W
CA Deven Mehta
Proprietor
M.No: 107667
Place : Mumbai
Date: 30/05/2016

REFLECTING VALUES

ANNEXURE B' TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 2 under 'Report on Other Legal and Regulatory Requirments' section of our report of even date)

Reports on Companies (Auditor's Report) Order 2016('the Order') issued by the Central Government in terms of Section 143(11) of the Companies Act 2013 ('the Act') of Sejal Glass Limited:

1. (a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets. The fixed assets register needs to be updated to reconcile with the general ledger.

(b) As explained to us the assets have been physically verified by the management during the year. According to the information and explanations given to us no material discrepancies were noticed on such verification.

(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company the title deeds of immovable properties are held in the name of the Company.

2. As explained to us the inventories have been Physically verified during the year by management. In our opinion the frequency of physical verification is reasonable. the discrepancies noticed on verification between the physical stocks and the book records were not material.

3. (a) The company has granted unsecured loans to companies firms and other parties covered in the register maintained under section 189 of the Companies Act 2013. Interest charged on these loan is considered in the revenue.

(b) In the absence of specific stipulation as to the terms of repayment the loans are repayable on demand. Accordingly paragraph (iii)(b) of the Order is not applicable to the company in respect of repayment of the principal amount.

4. In our opinion and according to the information and explanations given to us the Company has complied with the provisions of section 185 and 186 of the Act with respect to the loans and investments made.

5. In our opinion and according to the information and explanations given to us the Company has not complied with the provisions of section 73 to 76 of the Companies Act 2013 with regard to the Deposits accepted from public. According to the information and explanations given to us no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal on the Company except for Order passed by Company Law Board on 29.02.2016 for reschedulement of repayment of Principle & Interest to the Depositors.

The Company has defaulted in payment of interest.

 The Balance in Fixed Deposit account is not reconciled.

 The Company has also failed to repay matured fixed deposits amounting to '84304832/-

 The requirement of keeping not less than 15% of the amount of deposits maturing during the financial year as well as in the following year in a scheduled bank in a separate bank account titled Deposit Repayment Reserve Account has not been complied with.

 The Company has not filed the return of Deposits for the past four years including the year under audit.

6. We have broadly reviewed the books of accounts and records maintained by the company pursuant to the rules prescribed under section 148(1) of the Act for maintenance of cost records in respect of manufacture of products and are of the opinion that prima facie the prescribed accounts and records have been made and maintained. We have not however made a detailed examination of the records with a view to determine whether they are accurate or complete.

7. (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company the Company has generally defaulted in timely payment of undisputed statutory dues including Provident Fund Employees' State Insurance Income-Tax (TDS) Sales Tax Value Added Tax Excise Duty duty of Customs Service Tax Cess and other material statutory dues as applicable to it. There have been delays in payment of following statutory liabilities. The outstanding balance in these accounts as at 31st March 2016 is as follows.

Nature of Statutory DuesAmount in Rupees
Provident Fund3052797
Income Tax i.e. Tax Deducted at source (TDS)38177769
Central Sales Tax34200596
Maharashtra Value Added Tax (MVAT)9503915
Dadra Value Added Tax (DVAT)199597
Service Tax4205121
ESIC149189
Profession Tax132475
Excise Duty14082081
Property Tax10450953
Advance License-Duty Saved & Interest16244476
EPCG- Duty Saved & Interest213387591

In our opinion and according to the information and explanations given to us no undisputed amounts payable in respect of income tax Sales tax Value Added Tax duty of customs Service Tax Excise Duty and Cess were in arrears as at 31st March 2016 for a period of more than six months from the date they became payable except the following.

Nature of Statutory DuesUndisputed Tax /Duty Liability in arrears over 6 months period
(Amount in Rs)
Provident Fund2502872
Income Tax i.e. Tax Deducted at source (TDS)23385672
Central Sales Tax22543136
Maharashtra Value Added Tax (MVAT)9503915
Dadra Value Added Tax (DVAT)59109
Service Tax3547676
ESIC92240
Profession Tax87575
Excise Duty13630099
Property Tax9182546
Advance License -Duty Saved & Interest15369607
EPCG -Duty Saved & Interest201314221

(b) According to the information and explanations given to us following are dues outstanding of Sales Tax Custom Duty Excise Duty or cess applicable to it which have not been deposited on account of dispute.

Name of StatuteNature of duesAmount (Rs)Period to which it relatesForum where dispute is pending
Income Tax ActPenalty3696564/-A.Y.2006-07ITAT
Income Tax ActPenalty4900913/-A.Y.2007-08ITAT
Income Tax ActTax & Interest3686271/-A.Y.2007-08CIT(A)
Income Tax ActTax & Interest7156769/-A.Y.2007-08CIT(A)
Income Tax ActPenalty4087154/-A.Y.2008-09CIT(A)
Income Tax ActIncome Tax5936154/-A.Y.2008-09ITAT
Central ExcisePenalty4500000/-CESTAT
Service TaxTax Interest & Penalty2882970/-F.Y.2007-08 & F.Y. 2008-09Commissioner Central Excise (Appeals)
Service TaxTax Interest & Penalty9982702/-F.Y.2007-08 & F.Y. 2008-09Commissioner Central Excise (Appeals)
CST ActTax & Interest112789/-F.Y.2009-10Dy Comm of Sales Tax Appeals
CST ActPenalty657768/-F.Y.2006-07Dy Comm of Sales Tax Appeals
CST ActTax & Interest3661595/-F.Y.2008-09Dy Comm of Sales Tax Appeals
CST ActPenalty441898/-F.Y.2008-09Dy Comm of Sales Tax Appeals
MVAT ActPenalty53212/-F.Y.2009-10Dy Comm of Sales Tax Appeals
MVAT ActTax & Interest4102858/-F.Y.2008-09Dy Comm of Sales Tax Appeals
MVAT ActPenalty2519127/-F.Y.2008-09Dy Comm of Sales Tax Appeals
MVAT ActTax & Interest3534779/-F.Y.2008-09Dy Comm of Sales Tax Appeals
MVAT ActPenalty470103/-F.Y.2008-09Dy Comm of Sales Tax Appeals
MVAT ActTax & Interest15428608/-F.Y.2007-08Dy Comm of Sales Tax Appeals
MVAT ActPenalty8339788/-F.Y.2007-08Dy Comm of Sales Tax Appeals
MVAT ActPenalty744317/-F.Y.2006-07Dy Comm of Sales Tax Appeals

8. The Company has defaulted in payment of loans taken from Banks & Financial Insititutions. Also the Company's Loan accounts have been classified as Non-Performing Assets by the lending bankers & Financial Insititutions.. The Banks have issued Securitization Notice to the Company for recovery of its advances. The Company has defaulted to the tune of '18.27 crores.

9. The Company did not raise any money by way of initial public offer or further public offer (including debt instruments) and term loans during the year.

10. According to the information and explanations given to us no material fraud by the Company or on the Company by its officers or employees has been noticed or reported during the course of our audit.

11. According to the information and explanations give to us and based on our examination of the records of the Company the Executive Directors have not taken the Remuneration during the year and hence the Company has not provided for the same Hence para 3(xi) of Companies (Auditor's Report) Order 2016 is not applicable

12. In our opinion and according to the information and explanations given to us the Company is not a Nidhi company. Accordingly paragraph 3(xii) of the Order is not applicable.

13. According to the information and explanations given to us and based on our examination of the records of the Company transactions with the related parties are in compliance with sections 177 and 188 of the Act where applicable and details of such transactions have been disclosed in the financial statements as required by the applicable accounting standards.

14. According to the information and explanations give to us and based on our examination of the records of the Company the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.

15. According to the information and explanations given to us and based on our examination of the records of the Company the Company has not entered into non-cash transactions with directors or persons connected with him. Accordingly paragraph 3(xv) of the Order is not applicable.

16. The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act 1934.

For D.D. Mehta & Co.
Chartered Accountants
FRN : 119679W
CA Deven Mehta
Proprietor
M.No: 107667
Place : Mumbai
Date: 30/05/2016