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Supreme Tex Mart Ltd.

BSE: 531934 Sector: Industrials
NSE: SUPREMETEX ISIN Code: INE651G01027
BSE LIVE 13:09 | 15 Dec 2.01 -0.07
(-3.37%)
OPEN

2.05

HIGH

2.07

LOW

2.01

NSE 12:40 | 15 Dec 2.05 0
(0.00%)
OPEN

2.15

HIGH

2.15

LOW

2.00

OPEN 2.05
PREVIOUS CLOSE 2.08
VOLUME 16307
52-Week high 7.07
52-Week low 1.81
P/E
Mkt Cap.(Rs cr) 14
Buy Price 2.01
Buy Qty 9100.00
Sell Price 2.16
Sell Qty 8000.00
OPEN 2.05
CLOSE 2.08
VOLUME 16307
52-Week high 7.07
52-Week low 1.81
P/E
Mkt Cap.(Rs cr) 14
Buy Price 2.01
Buy Qty 9100.00
Sell Price 2.16
Sell Qty 8000.00

Supreme Tex Mart Ltd. (SUPREMETEX) - Auditors Report

Company auditors report

1. REPORT ON THE STANDALONE FINANCIAL STATEMENTS

We have audited the accompanying standalone financial statements of Supreme Tex MartLimited ("the Company") which comprise the Balance Sheet as at March 31 2016the Profit and Loss Statement the Cash Flow Statement for the year then ended and asummary of significant accounting policies and other explanatory information.

2. 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 ofthese standalone financial statements that give a true and fair view of the financialposition financial performance and cash flows of the Company in accordance with theaccounting principles generally accepted in India including the Accounting Standardsspecified under Section 133 of the Act read with Rule 7 of the Companies (Accounts)Rules 2014. This responsibility also includes maintenance of adequate accounting recordsin accordance with the provisions of the Act for safeguarding the assets of the Companyand for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

3. 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. We conducted our audit inaccordance 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 theaudit to obtain reasonable assurance about whether the financial statements are free frommaterial misstatements. An audit involves performing procedures to obtain auditevidence about the amounts and disclosures in the financial statements. The proceduresselected depend on the auditor's judgment including the assessment of the risks ofmaterial misstatement of the financial statements whether due to fraud or error. Inmaking those risk assessments the auditor considers internal financial control relevantto the Company's preparation of the financial statements that give a true and fair view inorder to design audit procedures that are appropriate in the circumstances but not forthe purpose of expressing an opinion on whether the Company has in place an adequateinternal financial controls system over financial reporting and the operatingeffectiveness of such controls. An audit also includes evaluating the appropriateness ofaccounting policies used and the reasonableness of the accounting estimates made by theCompany's directors as well as evaluating the overall presentation of the financialstatements. We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the standalone financialstatements

4. Emphasis on matter

The Company has incurred a net loss of Rs. 17884.09 lacs during the year ended 31stMarch 2016 which exceeds the net worth of the company and as on that date thecompany's current liabilities exceeded its current assets by Rs. 15297.67 lacs and itstotal liabilities exceeded its total assets by Rs. 18653.78 lacs. The lead bank (SBI) andmember banks i.e. Central Bank of India Union Bank of India SBER Bank Allahabad Bank& IDBI Bank have classified the accounts of the company as non performing assets.These events cast significant doubt on the Company's ability to continue as a goingconcern. The appropriateness of the going concern assumption is dependent on the company sability to establish consistent profitable operations and generate positive cash flows aswell as raising adequate finance to meet its short term and long term obligations.

5. BASIS FOR QUALIFIED OPINION

Further we report that

I. The Company has not provided for the Interest on borrowings from banks which havenot charged interest on account of accounts classified as non-performing assets. Thisnotional amount of interest as calculated by taking last rate of interest charged by thebanks comes to Rs. 3525.28 lacs. II. The earnings (loss) per sharefor the year ended March 312016 would have been Rs. (31.38) against reportedearnings (loss) per share of Rs. (26.21) III. Provision for Gratuity andleave encashment is made on an estimated basis without Actuarial valuation which is notin accordance with Accounting Standard -15 on Employee Benefits.

6. QUALIFIED OPINION

In our opinion and to the best of our information and according to the explanationsgiven to us subject to our comments in paragraph 5 above the aforesaidstandalone financial statements give the information required by the Act in the manner sorequired and give a true and fair view in conformity with the accounting principlesgenerally accepted in India of the state of affairs of the Company as at March 31 2016and its loss and its cash flows for the year ended on that date.

7. REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

As required by the Companies (Auditor's Report) Order 2016 issued by the CentralGovernment of India in terms of subsection (11) of Section 143 of the Act we give in theAnnexure A a statement on the matters specified in Paragraphs 3 and 4 of the order tothe extent applicable.

8. 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 thebest 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 theCompany so far as it appears from our examination of those books

c) The Balance Sheet the Profit and Loss Statement and the Cash Flow Statementdealt with by this Report are in agreement with the books of account.

d) In our opinion the aforesaid standalone financial statements comply with theAccounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014 except with the requirement of Accounting Standard(AS)-15 on Employee Benefits notified by the Companies (Accounts) Rules 2014;

e) On the basis of the written representations received from the directors as onMarch 31 2016 taken on record by the Board of Directors none of the directors isdisqualified as on March 31 2016 from being appointed as a director in terms of Section164 (2) of the 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 B ; 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 explanations given to us:

(i) The Company has disclosed the impact of pending litigations on its financialposition in its financial statements as referred to in Note 26 to the financialstatements.

(ii) The Company has made provision as required under the applicable law oraccounting standards for material foreseeable losses if any and as required on longterm contracts including derivative contracts. The company is not required to transfer anyamount to the Investor Education and Protection Fund.

For NANDA & BHATIA
Chartered Accountants
F.R.N. : 004342N
Sd/-
Place: Ludhiana P.C.S. VIRDI
Dated: 30th May 2016 Partner
M. No. 017056

ANNEXURE TO THE AUDITOR S REPORT

The Annexure referred to in our independent Auditors Report to the members of thecompany on the financial statements for the year ended 31st March 2016 wereport that (i)

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

(b) Fixed assets have been physically verified by the management during the year and nomaterial discrepancies were indentified on such verification.

In our opinion company does not have any reasonable program having regardto the size of the company and the nature of its fixed assets.

(c) According to the information and explanations given to us and based on ourexamination of the records of the company title deeds of immovable properties are held inthe name of the company.

(ii) (a) The Management has conducted physical verification of inventory at reasonableintervals during the year. However the Scope and coverage of physical verificationneeds to enhanced to make it commensurate with the size and nature of the business of thecompany.

(b) The procedures of physical verification of inventory followed by the management needsto be strengthened to make it reasonable and adequate in relation to the size ofthe company.

(c) The company is maintaining proper records of inventory and material discrepancieswere noticed on physical verification which have been properly dealt with in the books ofaccount

(iii) The company has not granted any loans secured or unsecured to companies firmsor other parties covered in the register maintained under section 189 of the CompaniesAct 2013.

(iv) In our opinion and according to information & explanation given to us theCompany has complied with the provisions of section 185 & 186 of the Act with respectto the loans & investments made.

(v) In our opinion and according to information & explanation given to us thecompany has not accepted any deposits for which directives issued by Reserve Bank of Indiaand the provisions of section 73 to 76 or any other relevant provisions of the CompaniesAct 2013 and rules framed there under are applicable for compliance.

(vi) According to the information and explanation given to us maintenance of costrecords has been specified by the Central Government under sub section (1) of section 148of the Companies Act 2013.

(vii) (a) The company has not been regular in depositing undisputed statutory duesincluding provident fund employees state insurance income-tax sales-tax wealth taxservice tax duty of customs duty of excise value added tax cess and any otherstatutory dues with the appropriate authorities.

In our opinion and according to the information and explanation given to us undisputeddues in respect of provident fund employees state insurance and income tax which wereoutstanding at the year end for a period of more than six months from the date they becomepayable are as follow:

Nature of Statue Nature of Dues Amount ( Rs. In lacs) Period to which the amounts relate Due date Date of Payment
Income Tax Act 1961 Income Tax 480.12 FY 2012-13 30/11/2013 Not yet paid
Employees State Insurance Act 1948 Employee State Insurance 1.57 July 2015 21/08/2015 Not yet paid
Employees State Insurance Act 1948 Employee State Insurance 1.54 August 2015 21/09/2015 Not yet paid
Employees State Insurance Act 1948 Employee State Insurance 1.46 September 2015 21/10/2015 Not yet paid
Employees Provident Fund and Miscellaneous Provision Act 1952 Provident Fund 2.19 May 2015 20/06/2015 16/04/2016
Employees Provident Fund and Miscellaneous Provision Act 1952 Provident Fund 0.70 June 2015 20/07/2015 16/04/2016
Employees Provident Fund and Miscellaneous Provision Act 1952 Provident Fund 3.52 July 2015 20/08/2015 11/04/2016 & 19/04/2016
Employees Provident Fund and Miscellaneous Provision Act 1952 Provident Fund 3.48 August 2015 20/09/2015 11/04/2016 & 19/04/2016
Employees Provident Fund and Miscellaneous Provision Act 1952 Provident Fund 1.36 September 2015 20/10/2015 11/04/2016
Employees Provident Fund and Miscellaneous Provision Act 1952 Provident Fund 1.99 September 2015 20/10/2015 Not yet paid

A) According to the information and explanation given to us the disputed statutorydues aggregating to Rs. 4.15 lacs that has not been deposited on account on matterspending before the appropriate authority in respect of Service tax and central Sales Taxare given below: -

Name of the Statute Nature of Dues Disputed Amount ( Rs. In lacs) Period to which the amounts relates Forum Where Dispute is pending
Central Sales Tax Penalty 1.20 2012-13 Joint director cum Deputy Excise and Taxation Commissioner (Appeal)
Central Sales Tax Penalty 1.13 2013-14 Joint director cum Deputy Excise and Taxation Commissioner (Appeal)
Service Tax Service Tax interest & Penalty 1.82 2004-05 2005-06 Commissioner of Customs (Appeal)

(viii) According to information and explanation given to us the company has default inrepayment of dues to banks and financial institutions. The detail of default are as under:

Sr. No. Particulars Amount ( Rs. in Lacs) Nature of dues Period of default of repayment
596.57 Interest (Term loan) 01.08.2014 to 31.03.2015
1. State Bank of India 784.00 Principal (8 months)
1071.12 Interest (Term loan) 01.04.2015 to 31.03.2016
1250.64 Principal (12 months)
179.63 Interest (Term loan) 01.07.2014 to 31.03.2015
423.00 Principal (9 months)
2. Central Bank of India
570.72 Interest (Term loan) 01.04.2015 to 31.03.2016
564.00 Principal (12 months)
661.95 Interest (working capital) 01.07.2014 to 31.03.2015
(9 months)
3. State Bank of India
1029.49 Interest (working capital) 01.04.2015 to 31.03.2016
(12 months)
19.10 Interest (working capital) 01.03.2015 to 31.03.2015
(1 month)
4. Union Bank of India
249.48 Interest ( working capital) 01.04.2015 to 31.03.2016
(12 months)
56.46 Interest (working capital) 01.07.2014 to 31.03.2015
(9 months)
5. Central Bank of India
208.63 Interest (working capital) 01.04.2015 to 31.03.2016
(12 months)
157.07 Interest (working capital) 01.09.2014 to 31.03.2015
(7 months)
6. SABER Bank
299.06 Interest (working capital) 01.04.2015 to 31.03.2016
(12 months)
96.78 Interest (working capital) 01.10.2015 to 31.03.2016
(6 months)
7. Allahabad Bank
35.33 Principal 01.04.2015 to 31.03.2016
(12 months)

A) Interest includes interest accrued on long term and short term borrowing notprovided in the statement of profit and loss.

(ix) The company did not raise any money by way of initial public offer or furtherpublic offer (including debt instruments). Company has raised vehicles loans amounting toRs. 49.84 lacs & they were applied for the purposed for which they are raised.

(x) According to the information and explanations given to us no fraud by the companyor any fraud on the company by its officers or employees has been noticed or reportedduring the period covered by our audit.

(xi) According to the information and explanations given to us and based on ourexamination of the records of the company the company has paid or provided the managerialremuneration in accordance with the requisite approvals mandated by the provisions ofsection 197 read with Schedule V to the Companies Act.

(xii) In our opinion and according to the information and explanations given to us thecompany is not a nidhi company. Accordingly paragraph 3(xii) of the Order is notapplicable.

(xiii) According to the information and explanations given to us and based on ourexamination of the records of the company all transactions with the related parties arein compliance with section 177 & 188 of Companies Act 2013 and the details of suchtransactions have been disclosed in the Financial Statements as required by the applicableaccounting standards.

(xiv) According to the information and explanations given to us and based on ourexamination of the records of the company company has not made any preferential allotmentor private placement of shares or fully or partly convertible debentures during the year.

(xv) According to the information and explanations given to us and based on ourexamination of the records of the company company has not entered into any non-cashtransactions with directors or persons connected with them.

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

For NANDA & BHATIA
Chartered Accountants
F.R.N. : 004342N
Sd/-
Place: Ludhiana P.C.S. VIRDI
Dated: 30th May 2016 Partner
M. No. 017056