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Swaraj Engines Ltd.

BSE: 500407 Sector: Engineering
NSE: SWARAJENG ISIN Code: INE277A01016
BSE LIVE 15:40 | 21 Nov 1880.80 -23.95
(-1.26%)
OPEN

1897.10

HIGH

1902.00

LOW

1870.00

NSE 15:47 | 21 Nov 1886.80 -19.15
(-1.00%)
OPEN

1934.50

HIGH

1960.00

LOW

1870.55

OPEN 1897.10
PREVIOUS CLOSE 1904.75
VOLUME 242
52-Week high 2545.00
52-Week low 1262.00
P/E 30.91
Mkt Cap.(Rs cr) 2,336
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 1897.10
CLOSE 1904.75
VOLUME 242
52-Week high 2545.00
52-Week low 1262.00
P/E 30.91
Mkt Cap.(Rs cr) 2,336
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Swaraj Engines Ltd. (SWARAJENG) - Auditors Report

Company auditors report

To the Shareholders of Swaraj Engines Limited Report on the Ind AS Financial Statements

We have audited the accompanying Ind AS financial statements of Swaraj Engines Limited("the Company") which comprise the Balance Sheet as at 31st March 2017 theStatement of Profit and Loss (Including Other Comprehensive income) the Cash FlowStatement and the statement for change in Equity for the year then ended and a summary ofthe significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

The Management and Board of Directors of the Company is responsible for the mattersstated in Section 134(5) of the Companies Act 2013 ("The Act") with respect tothe preparation of these Ind AS financial statements that give a true and fair view of thestate of affairs (financial position) profit or loss (including other comprehensiveincome) cash flows and change in Equity of the Company in accordance with the accountingprinciples generally accepted in India including the Indian Accounting Standards (Ind AS)prescribed under section 133 of the Act read with relevant rules issued there under.

This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the Ind ASfinancial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these Ind AS financial statements basedon our audit.

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 of Ind AS financial statements in accordance with the Standardson Auditing specified under Section 143(10) of the Act. Those Standards require that wecomply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether the Ind AS financial statements are free from materialmisstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the Ind AS financial statements. The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of theInd AS financial statements whether due to fraud or error. In making those riskassessments the auditor considers internal financial control relevant to the Company'spreparation of the Ind AS financial statements that give a true and fair view in order todesign audit procedures that are appropriate in the circumstances.

An audit also includes evaluating the appropriateness of the accounting policies usedand the reasonableness of the accounting estimates made by the Management and Board ofDirectors of the Company as well as evaluating the overall presentation of the Ind ASfinancial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Ind AS financial statements give the information required bythe Act in the manner so required and give a true and fair view in conformity with theaccounting principles generally accepted in India including the Ind AS of the state ofaffairs (financial position) of the Company as at 31st March 2017 its profit (financialperformance including other comprehensive income) its cash flows and the changes inEquity for the year ended on that date.

Report on Other Legal and Regulatory Requirements

As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government in terms of Section 143(11) of the Act we give in"Annexure A" a statement on the matters specified in paragraphs 3 and 4 of theOrder.

As required by section 143(3) of the Act we report that:

i. 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; ii. In ouropinion proper books of account as required by law have been kept by the Company so faras appears from our examination of those books;

iii. The Balance Sheet Statement of Profit and Loss Cash Flow Statement and statementof changes in Equity dealt with by this report are in agreement with the books of account;

iv. In our opinion the aforesaid Ind AS financial statements comply with the IndianAccounting Standards prescribed under Section 133 of the Act read with relevant rulesissued there under.

v. On the basis of written representations received from the Directors as on 31stMarch 2017 and taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2017 from being appointed as a director in terms of Section164(2) of the Act.

vi. 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". vii. With respect to the other matters to beincluded in the Auditor's Report in accordance with Rule 11 of the Companies (Audit andAuditors) Rules 2014 in our opinion and to the best of our information and according tothe explanations given to us:

a) The Company has disclosed the impact of pending litigations on its financialposition in its Ind AS financial statements - Refer note 2.30 to the financial statements;

b) The Company did not have any long term contracts including derivative contracts forwhich there were any material foreseeable losses;

c) There was no delay in transferring amounts required to be transferred to theInvestor Education and Protection Fund by the Company during the year.

d) The Company has provided requisite disclosure in its Ind AS financial statements asto holdings as well as dealings in Specified Bank Notes during the period from November 82016 to December 30 2016 and these are in accordance with the books of accountsmaintained by the Company. Refer note 2.40 to the financial statements;

For DAVINDER S. JAAJ & CO.
Chartered Accountants
(FRN – 000969N)
SUMEET SINGH DHIR
Place : Mumbai Partner
Date : 25th April 2017 Membership No. 094370

ANNEXURE TO THE AUDITORS' REPORT

The annexure referred to in our report to the members of Swaraj Engines Limited ('thecompany') for the year ended 31st March 2017. We report that

(i) Regarding Fixed Assets:

a. The Company has maintained proper records to show full particulars includingquantitative details and situation of Fixed Assets;

b. The fixed assets have not been physically verified by the management during the yearbut the company has a system of periodic verification of fixed assets. In our opinion thefrequency of verification is at reasonable intervals considering the size of the company.

c. The title deeds of immovable properties are held in the name of the company.

(ii) Regarding Inventory:

a. The stocks of finished goods stores spare parts and raw materials of the Companyin its possession have been physically verified by the management at reasonable period.Stock-in-transit as on 31st March 2017 has been verified by the management on subsequentreceipt of the goods.

b. In our opinion the procedures of physical verification of stocks followed by themanagement were reasonable and adequate in relation to the size of the Company and natureof its business.

c. The company is maintaining proper records for inventory and discrepancies betweenthe physical stocks and the book stocks which have been properly dealt with in the booksof account were not material.

(iii) Company has not granted any loan secured or unsecured to companies firmsLimited Liability Partnerships or other parties listed in the register maintained underSection 189 of the Act.

(iv) In our opinion and according to the information and explanations given to us thecompany has complied with the provisions of section 185 and I86 of the Companies Act 2013in respect of loans investments guarantees and security.

(v) The Company has not accepted any deposits from the public and hence the directivesissued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any otherrelevant provisions of the Act and the Companies (Acceptance of Deposit) Rules 2015 withregard to the deposits accepted from the public are not applicable.

(vi) On the basis of information given to us we are of the opinion that prima faciethe cost records and accounts prescribed by the Central Government of India under subsection (1) of section 148 of the Companies Act 2013 have been maintained.

However we are not required to and have not carried out any detailed examination ofsuch accounts and records.

(vii) Regarding Statutory Dues:

a) The Company has been regular during the year in depositing undisputed dues withProvident Fund Employees' State Insurance Income Tax Sales Tax Service Tax Excise& Custom duty and other statutory dues with the appropriate authorities. According tothe information given to us there were no undisputed unpaid statutory dues outstanding asat 31st March 2017 for a period of more than six months from the date they became payable.

b) Details of dues of Income-tax & Excise Duty which have not been deposited as on31st March 2017 on account of disputes are given below : (Rs. in lacs)

Statute Nature Forum where dispute is pending Amount involved
Central Excise Act 1944 Excise Duty Appellate Authority - Tribunal Level 25.59
Income Tax Act 1961 Income Tax High Court 113.83
Assessing Officer 35.11

(viii) In our opinion and on the basis of records produced before us the Company hasnot defaulted in the repayment of dues to Banks Financial Institutions Government ordebenture holders.

(ix) The company has not raised moneys by way of initial public offer or further publicoffer including debt instruments and term Loans. Hence the provisions of clause 3 (ix) ofthe Order are not applicable to the Company and not commented upon.

(x) Based upon the audit procedures performed and the information and explanationsgiven by the management we report that no fraud by the Company or on the company by itsofficers or employees has been noticed or reported during the year.

(xi) Based upon the audit procedures performed and the information and explanationsgiven by the management the managerial remuneration has been paid or provided inaccordance with the requisite approvals mandated by the provisions of section 197 readwith Schedule V to the Companies Act; (xii) In our opinion the Company is not a NidhiCompany. Therefore the provisions of clause 3 (xii) of the Order are not applicable tothe Company.

(xiii) In our opinion all transactions with the related parties are in compliance withsection 177 and 188 of Companies Act 2013 and the details have been disclosed in the IndAS Financial Statements as required by the applicable Indian Accounting Standards.

(xiv) The company has not made any preferential allotment or private placement ofshares or fully or partly convertible debentures during the year under review. Hence theprovisions of clause 3 (xiv) of the Order are not applicable to the Company and notcommented upon.

(xv) Based upon the audit procedures performed and the information and explanationsgiven by the management the company has not entered into any non-cash transactions withdirectors or persons connected with him. Accordingly the provisions of clause 3 (xv) ofthe Order are not applicable to the Company and hence not commented upon.

(xvi) In our opinion the company is not required to be registered under section 45 IAof the Reserve Bank of India Act 1934 and accordingly the provisions of clause 3 (xvi)of the Order are not applicable to the Company and hence not commented upon.

For DAVINDER S. JAAJ & CO.
Chartered Accountants
(FRN – 000969N)
SUMEET SINGH DHIR
Place : Mumbai Partner
Date : 25th April 2017 Membership No. 094370

ANNEXURE: B TO AUDITORS REPORT

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013

We have audited the internal financial controls over financial reporting of SWARAJENGINES LIMITED ("the Company") as on March 31 2017 in conjunction with ouraudit of the Ind AS 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 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". These responsibilitiesinclude the design implementation and maintenance of adequate internal financial controlsthat were operating effectively for ensuring the orderly and efficient conduct of itsbusiness including adherence to company's policies the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Companies Act 2013.

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 accordance with the Guidance Note on Audit of InternalFinancial Controls Over Financial Reporting (the "Guidance Note") and theStandards on Auditing issued by ICAI and deemed to be prescribed under section 143(10) ofthe Companies Act 2013 to the extent applicable to an audit of internal financialcontrols both applicable to an audit of Internal Financial Controls and both issued bythe Institute of Chartered Accountants of India. Those Standards and the Guidance Noterequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls over financialreporting was established and maintained and if such controls operated effectively in allmaterial 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 auditor's judgement including the assessment of the risks ofmaterial misstatement of the financial statements whether due to fraud or error.

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 financialreporting includes those policies and procedures that (1) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures 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 acquisition use or disposition of thecompany'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 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 controlover 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 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"the internal control over financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls Over Financial Reporting issued by the Institute ofChartered Accountants of India".

For DAVINDER S. JAAJ & CO.
Chartered Accountants
(FRN – 000969N)
SUMEET SINGH DHIR
Place : Mumbai Partner
Date : 25th April 2017 Membership No. 094370