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Sujana Universal Industries Ltd.

BSE: 517224 Sector: Consumer
NSE: SUJANAUNI ISIN Code: INE216G01011
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VOLUME 73116
52-Week high 2.23
52-Week low 0.81
P/E
Mkt Cap.(Rs cr) 16
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 0.95
CLOSE 0.94
VOLUME 73116
52-Week high 2.23
52-Week low 0.81
P/E
Mkt Cap.(Rs cr) 16
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Sujana Universal Industries Ltd. (SUJANAUNI) - Auditors Report

Company auditors report

To the Members of SUJANA UNIVERSAL INDUSTRIES LIMITED Report on the StandaloneFinancial Statements

We have audited the accompanying standalone financial statements of Sujana UniversalIndustries Limited ('the Company') which comprise the Balance Sheet as at March 312016 the Statement of Profit and Loss and the Cash Flow Statement for the year thenended and a summary of the significant accounting policies and other explanatoryinformation.

Management's Responsibility for the Standalone 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 of thesestandalone 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 as applicable. This responsibility also includes maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets of the Company and for preventing and detecting frauds and otherirregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of these standalone financial statements that give a true andfair view and are free from material misstatement whether due to fraud or error.

Auditors' Responsibility

Our responsibility is to express an opinion on these standalone financial statementsbased on our audit. We have taken into account the provisions of the Act the accountingand auditing standards and matters which are required to be included in the audit reportunder the provisions of the Act and the Rules made there under and the Order under Section143(11) of the Act. We conducted our audit in accordance with the Standards on Auditingspecified under Section 143(10) of the Act. Those Standards require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether the standalone financial statements are free from material misstatement. An auditinvolves performing procedures to obtain audit evidence about the amounts and thedisclosures in the standalone financial statements. The procedures selected depend on theauditors' judgment including the assessment of the risks of material misstatement of thestandalone financial statements 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 financial statements 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 the accountingpolicies used and the reasonableness of the accounting estimates made by the Company'sDirectors 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 standalone 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 March 31 2016 and its profit and its cash flows for the year ended on that date.

Emphasis of Matters

We draw attention to the following matters in the Notes to the financial statements:

a) Note 2.13 and 2.15 forming part of the financial statements regarding the TradeReceivables to the extent of Rs.169.57 and 2488.43 lakhs of advances are long overdue andthe company considers them as good and recoverable and estimates that provision fordoubtful debts is not necessary.

b) Note 2.32 to the financial statements which describes the uncertainty related tothe outcome of the lawsuit filed against the Company by the Mauritius Commercial Bankwhich has financed to one of its subsidiary - Hestia Holdings Limited for which theCompany has given a Corporate Guarantee.

c) Note 2.32 to the financial statements which describes the uncertainty related tothe outcome of the Bank Debt recalled by the Standard Bank which has financed to one ofits step down subsidiary - Selene Holdings Limited for which the Company has given aCorporate Guarantee.

Our opinion is not modified in respect of these matters.

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

(b) In our opinion proper books of account as required by law relating to preparationof the standalone financial statements have been kept by the Company so far as it appearsfrom our examination of those books.

(c) The Balance Sheet the Statement of Profit and Loss and the Cash Flow Statementdealt with by this Report are in agreement with the books of account maintained for thepurpose of preparation of these standalone financial statements.

(d) In our opinion the aforesaid standalone financial statements comply with theAccounting Standards specified under Section 133 of the Act as applicable.

(e) On the basis of the written representations received from the Directors as on March31 2016 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'. Our report expresses an unmodified opinion on theadequacy and operating effectiveness of the Company's internal financial controls overfinancial reporting.

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

i) The Company has not disclosed the impact of pending litigations on its financialposition in its standalone financial statements.

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

iii) There have been no amounts required to be transferred to the Investor Educationand Protection Fund by the Company.

2. As required by the Companies (Auditor's Report) Order 2016 ('the Order') issued bythe Central Government in terms of Section 143(11) of the Act we give in 'Annexure B' astatement on the matters specified in paragraphs 3 and 4 of the Order.

For T. Raghavendra & Associates
Chartered Accountants
(Firm Regn No: 003329S)
T. Raghavendra
Date: 30-05-2016 Proprietor
Place: Hyderabad Mem No. 023806

ANNEXURE 'A' TO THE INDEPENDENT AUDITORS' REPORT

(Referred to in paragraph 1(f) under 'Report on Other Legal and RegulatoryRequirements' section of our report of even date)

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) ofSubsection 3 of Section 143 of the Companies Act 2013 ('the Act')

We have audited the internal financial controls over financial reporting of SujanaUniversal Industries Limited ('the Company') as of March 31 2016 in conjunction withour audit of the standalone financial statements of the Company for the year ended and ason that date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal control 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 Reportingissued by the Institute of Chartered Accountants of India (the 'Guidance Note'). 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 safeguarding ofits 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

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 Standards on Auditing prescribed under Section 143(10) of the Act and theGuidance Note to the extent applicable to an audit of internal financial controls. ThoseStandards and the Guidance Note require that we comply with the ethical requirements andplan and perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls over financial reporting was established and maintained and if suchcontrols operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe 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 auditors' judgment including the assessment of the risks ofmaterial misstatement of the standalone financial statements whether due to fraud orerror.

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 controls systemover financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generallyaccepted 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 fairlyreflect the transactions and dispositions of the assets of the company; (2) providereasonable assurance that transactions are recorded as necessary to permit preparation offinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorisations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorised acquisition use ordisposition of the company's assets that could have a material effect on the financialstatements.

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 projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlsover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at March 31 2016 based on the internal controlover financial reporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note.

For T. Raghavendra & Associates
Chartered Accountants
(Firm Regn No: 003329S)
T. Raghavendra
Date: 30-05-2016 Proprietor
Place: Hyderabad Mem No. 023806

ANNEXURE 'B' TO THE INDEPENDENT AUDITORS' REPORT

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

Report 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 SujanaUniversal Industries Limited ('the Company')

1. In respect of the Company's fixed assets:

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

(b) The fixed assets were physically verified during the year by the Management inaccordance with a regular programme of verification which in our opinion provides forphysical verification of all the fixed assets at reasonable intervals. According to theinformation and explanations given to us no material discrepancies were noticed on suchverification.

(c) According to the information and explanations given to us and the records examinedby us and based on the examination of the conveyance deed provided to us we report thatthe title deeds comprising all the immovable properties of land and buildings which arefreehold are held in the name of the Company as at the balance sheet date.

2. As explained to us the inventories were physically verified during the year by theManagement at reasonable intervals and no material discrepancies were noticed on physicalverification.

3. The Company has not granted any loans secured or unsecured to companies firmslimited liability partnerships or other parties covered in the register maintained underSection 189 of the Act.

4. In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Sections 185 and 186 of the Act in respect ofgrant of loans making investments and providing guarantees and securities as applicable.

5. The Company has not accepted deposits during the year and does not have anyunclaimed deposits as at March 31 2016 and therefore the provisions of the clause 3 (v)of the Order are not applicable to the Company.

6. The Maintenance of Cost Records has been specified by the Central Government undersection 148(1) of the Companies Act 2013. We have relied on the Cost audit reportsubmitted by the Cost Auditors of the Company and according to the said report the Companyhas complied with the Companies (Cost Records and Audit) Rules 2014.

7. According to the information and explanations given to us in respect of statutorydues:

a. The Company has generally been regular in depositing undisputed statutory duesincluding Provident Fund Employees' State Insurance Income Tax Sales Tax Service TaxValue Added Tax duty of Customs duty of Excise Cess and other material statutory duesapplicable to it with the appropriate authorities.

b. There are no undisputed amounts payable in respect of Provident Fund Employees'State Insurance Income Tax Sales Tax Service Tax Value Added Tax duty of Customsduty of Excise Cess and other material statutory dues in arrears as at March 31 2016 fora period of more than six months from the date they became payable except as detailedbelow:

Nature of dues Amount in Rs.
Tax Deducted at Source (TDS) 154694
Professional Tax (PT) 21900
Sales Tax Deferment 88800
Income Tax (Corporate Dividend Tax) 1119770

(c) Details of dues of Income Tax Sales Tax Customs & Excise Duty and Value AddedTax which have not been deposited as at March 31 2016 on account of dispute are givenbelow:

Disputed Statutory dues as on 31.03.2016
Name of the Statute Amount Rs. in Lakhs Period to which the amount relates (FY) Forum where dispute is pending
Income Tax Act 1961 542.35 2005-06 DCIT
Income Tax Act 1961 1509.81 2010-11 CIT (Appeals)
TNGST Act 1959 338.40 2000-01 Hon'ble High Court of Chennai
TNGST Act 1959 2344.55 2004-05 Hon'ble High Court of Chennai
TNGST Act 1959 4629.36 2005-06 Hon'ble High Court of Chennai
TNGST Act 1959 2732.34 2006-07 Hon'ble High Court of Chennai
TNVAT Act 2006 3235.21 2007-08 Hon'ble High Court of Chennai
TNVAT Act 2006 393.79 2008-09 Hon'ble High Court of Chennai
TNVAT Act 2006 1109.53 2009-10 Hon'ble High Court of Chennai
TNVAT Act 2006 2847.91 2010-11 Hon'ble High Court of Chennai
TNVAT Act 2006 18616.51 2011-12 Hon'ble High Court of Chennai
TNVAT Act 2006 21877.04 2012-13 Hon'ble High Court of Chennai
TNVAT Act 2006 4875.80 2013-14 Hon'ble High Court of Chennai
Customs & Excise 316.61 2000-01 CESTAT Bangalore & Chennai
Customs & Excise 263.75 1995-96 CESTAT Chennai
Customs & Excise 151.96 2007- 08 2008- 09 CESTAT Bangalore
Customs & Excise 37.15 2008-09 Add. Commissioner of Customs & Excise Hyderabad - I
Workmen Compensation 4.65 2007-08 Interim Stay granted by Hon'ble High Court as against the order passed by the Hon'ble Labour Commissioner.

8. In our opinion and according to the information and explanations given to us theCompany has defaulted in the repayment of loans or borrowings to banks. The details of thedefault are given below:

Details of over dues to Banks / Financial Institutions as on 31.03.2016 Rs. in Lakhs
Name of the Bank Nature of default Amount of Default Period of Default
Term Loans
IDBI Bank Ltd Principle & Interest on Term Loans 4349.68 January 2015 to March 2016
Redemption of Preference Share Capital
IDBI Bank Ltd 969.59 January 2015 to March 2016
Working Capital Loans
A) Cash Credits
Bank of Baroda Monthly Interest 792.13 Feb. 2015 to March 2016
Bank of India Monthly Interest 1604.18 Oct. 2015 to March 2016
Central Bank of India Monthly Interest 401.97 Sept. 2015 to March 2016
IDBI Bank Ltd Monthly Interest 490.99 April 2015 to March 2016
Indian Overseas Bank Monthly Interest 2320.46 Sept 2015 to March 2016
Oriental Bank of Commerce Monthly Interest 760.38 May 2015 to March 2016
UCO Bank Monthly Interest 1548.75 April 2015 to March 2016
B) Letter of Credits
Bank of India LC devolvement 6250.00 Oct. 2015 to March 2016
Central Bank of India LC devolvement 10780.55 Oct. 2015 to March 2016
Indian Overseas Bank LC devolvement 14144.74 May 2015 to March 2016
UCO Bank LC devolvement 8000.00 June 2015 to March 2016

9. The Company has not raised moneys by way of initial public offer or further publicoffer (including debt instruments) or term loans and hence reporting under clause 3 (ix)of the Order is not applicable.

10. To the best of our knowledge and according to the information and explanationsgiven to us no fraud by the Company and no fraud on the Company by its officers oremployees has been noticed or reported during the year.

11. In our opinion and according to the information and explanations given to us theCompany has paid / provided managerial remuneration in accordance with the requisiteapprovals mandated by the provisions of Section 197 read with Schedule V to the Act.

12. The Company is not a Nidhi Company and hence reporting under clause 3(xii) of theOrder is not applicable.

13. In our opinion and according to the information and explanations given to us theCompany is in compliance with Section 177 and 188 of the Act where applicable for alltransactions with the related parties and the details of related party transactions havebeen disclosed in the standalone financial statements as required by the applicableaccounting standards.

14. During the year the Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures and hence reporting underclause 3(xiv) of the Order is not applicable to the Company.

15. In our opinion and according to the information and explanations given to usduring the year the Company has not entered into any non-cash transactions with itsDirectors or persons connected to its Directors and hence provisions of Section 192 of theAct are not applicable.

16. The Company is not required to be registered under Section 45-I of the Reserve Bankof India Act 1934.

For T. Raghavendra & Associates
Chartered Accountants
(Firm Regn No: 003329S)
T. Raghavendra
Date: 30-05-2016 Proprietor
Place: Hyderabad Mem No. 023806