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Swelect Energy Systems Ltd.

BSE: 532051 Sector: Engineering
NSE: SWELECTES ISIN Code: INE409B01013
BSE LIVE 15:40 | 21 Nov 456.65 -5.05
(-1.09%)
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451.00

HIGH

461.10

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451.00

NSE 15:31 | 21 Nov 457.50 -4.50
(-0.97%)
OPEN

458.00

HIGH

463.95

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OPEN 451.00
PREVIOUS CLOSE 461.70
VOLUME 2273
52-Week high 633.00
52-Week low 295.00
P/E 16.07
Mkt Cap.(Rs cr) 462
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 451.00
CLOSE 461.70
VOLUME 2273
52-Week high 633.00
52-Week low 295.00
P/E 16.07
Mkt Cap.(Rs cr) 462
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Swelect Energy Systems Ltd. (SWELECTES) - Auditors Report

Company auditors report

To the Members of Swelect Energy Systems Limited

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS financial statements of SwelectEnergy Systems Limited ("the Company") which comprise the Balance Sheet as atMarch 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.

Management's Responsibility for the 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 financial statements that give a true and fair view of thefinancial position financial performance including other comprehensive income cash flowsand changes in equity of the Company in accordance with accounting principles generallyaccepted in India including the Indian Accounting Standards (Ind AS)specified undersection 133 of the Act. read with the Companies (Indian Accounting Standards) Rules2015 as amended. This responsibility also includes maintenance of adequate accountingrecords in accordance with the provisions of the Act for safeguarding of the assets of theCompany and for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and the design implementation and maintenance of adequateinternal financial control that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe Ind AS financial statements that view and are free from material misstatement whetherdue to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these standalone Ind AS financialstatements based on our audit into account the provisions of the Act the accounting andauditing standards and matters which are required to be included in the audit report underthe provisions of the Act and the Rules made there under. We conducted our audit of thestandalone Ind

AS financial statements in accordance with the Standards on Auditing issued by theInstitute of Chartered Accountants of India as specified under Section 143(10) of theAct. Those Standards require that we comply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whether the financial statements are freefrom material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the financial statements.

The procedures selected depend on the auditor's judgment including the assessment ofthe risks of material misstatement of the standalone Ind AS financial statements whetherdue to fraud or error. In making those risk assessments the auditor considers internalfinancial control relevant to the Company's preparation of the standalone Ind AS financialstatements that give a true and fair view in order to design audit procedures that areappropriate in the circumstances. 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 standalone Ind ASfinancial audit evidence we have obtained is sufficient and appropriate to provide a basisfor our audit opinion on the standalone Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the standalone 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 of the state of affairs of the Companyas at March 31 2017 its profit including other comprehensive income its cash flows andthe 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("the Order")issued by the Central Government of India in terms of sub-section (11) of section 143 ofthe Act we give in the Annexure 1 a statement on the matters specified in paragraphs 3and 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 were 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 dealt with by this Report are inagreement with the books of account;

(d) In our opinion the aforesaid standalone Ind AS financial statements comply withthe Accounting Standards specified under section 133 of the Act read with 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;

(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 standalone Ind AS financial statements Refer Note 38 to the standalone IndAS financial statements;

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 42 to these standalone IndAS financial statements Bank Notes on November 8 2016 and December 30 2016 as well asdealings as to the holding of Specified 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. Batliboi & Associates LLP

Chartered Accountants

ICAI Firm Registration Number: 101049W/E300004

Sd/-

per Subramanian Suresh

Partner

Membership Number: 083673

Place of Signature: Chennai

Date: May 25 2017

Annexure 1 referred to in our report of even date

Re: SWELECT ENERGY SYSTEMS LIMITED (‘the Company')

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 identified on such verification.

(c) According to the information and explanations given by the management the titledeeds of immovable properties included in fixed assets are held in the name .company ofthe(ii) The management has conducted physical verification of inventory at reasonableintervals during the year and no material discrepancies were noticed on such physicalverification.

(iii) (a) The Company has granted loans to firms covered in the register maintainedunder section 189 of the Companies Act 2013. In our opinion and according to theinformation and explanations given to us the terms and conditions of the grants and loansare not prejudicial to the company's interest.

(b) The Company has granted loans that are re-payable on demand to firms covered inthe register maintained under section 189 of the Companies Act 2013. The loans grantedare re-payable on demand. There has been no default on the part of the parties to whom themoney has been lent. The payment of interest has been regular.

(c) There firms or other parties listed in the register maintained under are no amountsof loans granted to companies section 189 of the Companies Act 2013 which areoutstanding for more than ninety days.

(iv) In our opinion and according to the information and explanations given to usprovisions of section 185 and 186 of the Companies Act 2013 in respect of loans todirectors including entities in which they are interested and in respect of loans andadvances given investments made and guarantees and securities given have been compliedwith by the company.

(v) The Company has not accepted any deposits from the public.

(vi) To the best of our knowledge and as explained the Central Government has notspecified the maintenance of cost records under clause 148(1) of the Companies Act 2013for the products/services of the Company.

(vii) (a) Undisputed statutory dues including provident fund income-tax sales-taxservice tax value added tax employees' state insurance cess duty of customs duty ofexcise and other material statutory dues have generally been regularly deposited with theappropriate authorities though there have been delays in remittance of provident fund andemployee state insurance for two months and income tax for four months.

(b) According to the information and explanations given to us no undisputed amountspayable in respect of provident fund employees' state insurance income-tax wealth-taxservice tax sales-tax customs duty excise duty value added tax cess and othermaterial statutory dues were outstanding at the year end for a period of more than sixmonths from the date they became payable.

(c) According to the information and explanations given to us there are no dues ofincome tax sales-tax service tax customs duty value added tax and cess which have notbeen deposited on account of any dispute.

Name of the statute Nature of dues Amount Period to which the amount relates Forum where dispute is pending
Kerala Sales Tax Act1963 * Penalty 666665 2000-2001 Deputy Commissioner Commercial Taxes
Delhi Vat Act2004 Disputed turnover 1200684 2006-2007 Commissioner Appeals
The Central Tax ( Assam) Rules 1957 Non submission of F-Forms & C-Forms to the Department 1376701 2011-2012 & 2012-2013 Asst. Commissioner Appeals.
The Central Sales tax Act1956 ( Haryana) Ex-parte order 2159861 2010-2011 Joint Excise & Taxation Commissioner Appeals Haryana
TN VAT Act ** Differential tax payment 19217174 2012-2013 Madras High Court
TN VAT Act Penalty u/s 27(4)(i) 62571 2012-2013 Madras High Court
TN VAT Act Penalty u/s 27(3) ( c ) 27879905 2012-2013 Madras High Court
Service tax Act # Differential tax and Interest 292336 2011-2012 CESTAT
Central Excise Act ## Demand of duty against denial of cenvat credit 216119 2009-2013 Commissioner of Central Excise
Central Excise Act ## Levy of CVD and SAD on imports 61211974 2009-2015 2009 - 2012 –The Excise Appellate Tribunal
2012-2013 –Commissioner of Central Excise
2013-2015 – The Excise Appellate Tribunal
Direct Taxes @ Disallowances of items 2009-2010 / CIT Appeals
116565540 2012-2013 and 2013-2014
** Excludes amounts paid under protest amounting to Rs. 333335
** Excludes amounts paid under protest amounting to Rs. 2135242
# Excludes amounts paid under protest amounting to Rs. 303210
@ Excludes amounts paid under protest amounting to Rs. 14075600
## Excludes amount paid under protest amounting to Rs. 6481124

viii) Based on our audit procedures and as per the information and explanations givenby the management we are of the opinion that the Company has not defaulted in repaymentof dues to a bank. The Company did not have any outstanding loans or borrowing dues inrespect of a financial institution or to government or dues to debenture holders duringthe year.

(ix) According to the information and explanations given by the management the Companyhas not raised any money way of initial public offer / further public offer / debtinstruments) and term loans hence reporting under clause (ix) is not applicable to theCompany and hence 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 company or no fraud on the companyby the officers and employees of the Company has been noticed or reported during the year.

(xi) According to the information and explanations given by the management themanagerial remuneration has been paid / provided in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the CompaniesAct 2013.

(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 are in compliance with section 177 and 188 ofCompanies Act 2013 wherever applicable and the details have been disclosed in the notesto the financial statements as required by the applicable accounting standards.

(xiv) According to the information and explanations given to us and on an overallexamination of the balance sheet the company has not made any preferential allotment orprivate placement of shares or fully or partly convertible debentures during the yearunder review and hence reporting requirements under clause 3(xiv) are not applicable tothe company and not commented upon.

(xv) According to the information and explanations given by the management the Companyhas not entered into any non-cash transactions with directors or persons connected withhim as referred to in section 192 of Companies Act 2013.

(xvi) According to the information and explanations given to us the provisions ofsection 45-IA of the Reserve Bank of India Act 1934 are not applicable to the Company.

For S.R. Batliboi & Associates LLP

Chartered Accountants

ICAI Firm Registration Number: 101049W/E300004 Sd/-

per Subramanian Suresh

Partner

Membership Number: 083673

Place of Signature: Chennai

Date: May 25 2017

ANNEXURE 2 TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THE STANDALONE FINANCIALSTATEMENTS OF SWELECT ENERGY SYSTEMS LIMITED

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

We have audited the internal financial controls over financial reporting of SwelectEnergy Systems Limited ("the Company") as of March 31 2017 in conjunction withour audit of the standalone financial statements of the Company for the year ended on thatdate.

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 stated in the Guidance Note on Audit of InternalFinancial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India. These responsibilities include the design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the orderly and efficient conduct of its business including adherence to theCompany's policies the safeguarding of its assets the prevention and detection of fraudsand errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Companies Act 2013.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company's internal financial audit.We conducted our audit in accordance with the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting (the "Guidance Note") and the Standards onAuditing as specified under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls and both issued India. ThoseStandards and the Guidance Note require that we comply with ethical requirements and planand 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 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 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 process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial accepted accounting principles. A company's internal financialcontrol over financial reporting includes those policies and procedures that (1) pertainto the maintenance of records that in reasonable detail accurately and fairly reflectthe transactions and dispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of financialstatements in accordance with and expenditures of the company are being made only inaccordance with authorisations of management and directors of the company; and (3) providereasonable assurance regarding prevention or timely detection of unauthorised acquisitionuse or disposition of the company's assets that could have a material effect on thefinancial 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 control overfinancial reporting criteria established by the Company considering the essentialcomponents of internal stated in the Guidance Note on Audit of Internal Financial ControlsOver Financial Reporting issued by the Institute of Chartered Accountants of India

For S.R. Batliboi & Associates LLP

Chartered Accountants

ICAI Firm Registration Number: 101049W/E300004

Sd/-per Subramanian Suresh

Partner

Membership Number: 083673

Place of Signature: Chennai

Date: May 25 2017