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Taneja Aerospace & Aviation Ltd.

BSE: 522229 Sector: Engineering
NSE: TANEJAERO ISIN Code: INE692C01020
BSE LIVE 15:40 | 12 Dec 59.70 -0.70
(-1.16%)
OPEN

61.00

HIGH

62.00

LOW

59.00

NSE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 61.00
PREVIOUS CLOSE 60.40
VOLUME 20355
52-Week high 76.40
52-Week low 41.05
P/E
Mkt Cap.(Rs cr) 149
Buy Price 59.70
Buy Qty 100.00
Sell Price 0.00
Sell Qty 0.00
OPEN 61.00
CLOSE 60.40
VOLUME 20355
52-Week high 76.40
52-Week low 41.05
P/E
Mkt Cap.(Rs cr) 149
Buy Price 59.70
Buy Qty 100.00
Sell Price 0.00
Sell Qty 0.00

Taneja Aerospace & Aviation Ltd. (TANEJAERO) - Auditors Report

Company auditors report

To the Members of Taneja Aerospace and Aviation Limited

Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements of Taneja Aerospaceand Aviation Limited (“the Company”) which comprises the Balance Sheet asat 31st March 2016 the Statement of Profit and Loss and the Cash FlowStatement for the year then ended and a summary of significant accounting policies andother explanatory information.

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 withaccounting 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 of 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 standalone financial statements that give a true and fair view and are free frommaterial misstatement whether due to fraud or error.

Auditor’s 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 accounting and auditingstandards and matters which are required to be included in the audit report under theprovisions of the Act and the Rules made thereunder.

We conducted our audit in accordance with the Standards on Auditing specified underSection 143(10) of the Act. Those Standards require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetherthe standalone financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the standalone financial statements. The procedures selected depend onthe auditor’s judgment including the assessment of the risks of materialmisstatement of the standalone 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 standalone financial statements that give a trueand 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 theCompany’s Directors as well as evaluating the overall presentation of the standalonefinancial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a 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 31st March 2016 and its loss and its cash flows for the year ended on that date.

Emphasis of Matter

We draw attention to Note no 13 to the standalone financial statements which statesthat the Company has an outstanding MAT Credit Entitlement of Rs. 146.38 Lakhs as on March31 2016 (Previous Year Rs. 134.69 Lakhs). Based on future projections the management isof the view that the MAT Credit Entitlement will be utilized within the time limitprescribed as per the provisions of Income Tax Act 1961. However we are unable tocomment on the above projections and the recoverability thereon.

Our opinion is not qualified in respect of this matter.

This matter was also emphasised in the report of the predecessor auditors on thestandalone financial statements for the year ended 31st March 2015.

Other Matter

The standalone financial statements of the Company for the year ended 31stMarch 2015 were audited by another auditor. They had qualified their report dated August14 2015 with respect to:

a. Certain advertisement and travelling expenses being reimbursement to a group companyfor which no evidence/ supporting is provided.;

b. Recoverability of the inter corporate deposit and trade receivable from LightOTechnologies Private Limited (a related party);

c. Impact of the Scheme of Arrangement between the Company and TAAL Enterprises Limitedon the standalone financial statements as the impact of the same was not provided in thefinancial statements even though the appointed date of the Scheme was from October 12014; and

d. Need to strengthen policies procedures and overall controls over recoverability ofdebtors valuation of work in progress and accounting for direct and indirect taxesincluding statutory compliances.

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 have been kept by theCompany 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 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.

(e) In our opinion there are no matters that may have an adverse effect on thefunctioning of the Company.

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

(g) 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’

(h) 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 financial statements - Refer Note 26 to the standalonefinancial statements.

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

iii. There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company.

2. As required by the Companies (Auditor’s Report) Order 2016 (“theOrder”) issued by the Central Government in terms of sub-section 11 of section 143 ofthe Act we give in the ‘Annexure B’a statement on the matters specified inparagraphs 3 and 4 of the Order.

For MZSK & Associates
Chartered Accountants
Firm Registration No. 105047W
Abuali Darukhanawala
Place: Mumbai Partner
Date: May 30 2016 Membership No. 108053

ANNEXURE A TO THE INDEPENDENT AUDITOR’S REPORT OF EVEN DATE ON THE STANDALONEFINANCIAL STATEMENTS OF TANEJA AEROSPACE AND AVIATION LIMITED

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

To the Members of Taneja Aerospace and Aviation Limited

We have audited the internal financial controls over financial reporting of TanejaAerospace and Aviation Limited (“the Company”) as of March 31 2016 inconjunction with our audit of the standalone financial statements of the Company for theyear 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 responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding 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 Act.

Auditors’ Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting based on our audit conducted in accordance with theGuidance Note on Audit of Internal Financial Controls Over Financial Reporting (the“Guidance Note”) and the Standards on Auditing to the extent applicable to anaudit of internal financial controls both issued by the Institute of CharteredAccountants of India.

Because of the matter described in Disclaimer of Opinion paragraph below we were notable to obtain sufficient appropriate audit evidence to provide a basis for an auditopinion on internal financial controls system over financial reporting of the Company.

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 authorizations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorized 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.

Disclaimer of Opinion

The system of internal financial controls over financial reporting with regard to theCompany were not made available to us to enable us to determine if the Company hasestablished adequate internal financial control over financial reporting and whether suchinternal financial controls were operating effectively as at March 31 2016.

We have considered the disclaimer reported above in determining the nature timing andextent of audit tests applied in our audit of the financial statements of the Company andthe disclaimer does not affect our opinion on the financial statements of the Company.

Explanatory paragraph

We also have audited in accordance with the Standards on Auditing issued by theInstitute of Chartered Accountants of India as specified under section 143(10) of theAct the standalone financial statements of the Company which comprise the Balance Sheetas at March 312016 and the related Statement of Profit and Loss and Cash Flow Statementfor the year then ended and a summary of significant accounting policies and otherexplanatory information. This material weakness was considered in determining the naturetiming and extent of audit tests applied in our audit of the March 31 2016 standalonefinancial statements of the Company and this report does not affect our report dated May30 2016 which expressed an unqualified opinion on those financial statements.

For MZSK & Associates
Chartered Accountants
Firm Registration No. 105047W
Abuali Darukhanawala
Place: Mumbai Partner
Date: May 30 2016 Membership No. 108053

ANNEXURE B TO INDEPENDENT AUDITORS’ REPORT

[Referred to in paragraph 2 under ‘Report on Other Legal and RegulatoryRequirements’ in the Independent Auditors’ Report of even date to the members ofTaneja Aerospace and Aviation Limited on the financial statements for the year ended 31stMarch 2016]

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

(b) All the fixed assets have not been physically verified by the management during theyear but there is a regular program of verification which in our opinion is reasonablehaving regard to the size of the company and the nature of its assets. No materialdiscrepancies were noticed on such verification.

(c) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the title deeds of immovable properties areheld in the name of the Company.

ii. The inventory has been physically verified during the year by the management. Inour opinion the frequency of verification is reasonable. No material discrepancies werenoticed on verification between the physical stocks and the book records.

iii. The Company has granted loans to three Companies covered in the registermaintained under section 189 of the Companies Act 2013.

(a) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the rate of interest and other terms andconditions on which the loans have been granted to the Company listed in the registermaintained under Section 189 of the Act are not prima facie prejudicial to the interestof the Company.

(b) In the case of the loans granted to the Company listed in the register maintainedunder section 189 of the Act schedule of repayment of principal and payment of interesthave not been stipulated and also the parties have not repaid the principal amounts andhave also not been regular in the payment of interest to the Company.

(c) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the details of amount overdue for more thanninety days are as follows:

No. of Cases Principal amount overdue Rs. In Lakhs Interest overdue Rs. In Lakhs Total overdue Rs. In Lakhs Remarks
One Nil 4.91 4.91 Reasonable steps have been taken by the Company for recovery of interest amount

iv. In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of section 185 and 186 of the Act in respect ofloans investments guarantees and security made.

v. In our opinion and according to the information and explanations given to us thereare no amounts outstanding which are in the nature of deposits as on 31st March 2016 andthe Company has not accepted any deposits during the year.

vi. The provisions of sub-section (1) of section 148 of the Act are not applicable tothe Company. Accordingly the provisions stated in paragraph 3 (vi) of the order are notapplicable to the Company.

vii. (a) Undisputed statutory dues including provident fund employees' stateinsurance income-tax sales-tax service tax duty of customs duty of excise valueadded tax cess and any other statutory dues have not been regularly deposited with theappropriate authorities and there has been a delay in few cases.

According to the information and explanations given to us undisputed dues in respectof provident fund employees' state insurance income-tax sales-tax service tax duty ofcustoms duty of excise value added tax cess and any other statutory dues which wereoutstanding as at 31st March 2016 for a period of more than six months from the datethey became payable are as follows:

Name of the statute Nature of the dues Amount Rs in Lakhs Period to which the amount relates Due Date Date of Payment Remarks if any
Employees’ Provident Funds and Miscellaneous Provisions Act 1952 Employers Contribution Employees Contribution 4.50 Apr-15 to Aug-15 20th of subsequent Month Amount not yet paid. Not applicable

(b) According to the records of the Company the dues outstanding of income-taxsales-tax wealth-tax service tax customs duty excise duty value added tax cess andany other statutory dues on account of any dispute are as follows:

Name of the statute Nature of dues Amount Rs. In Lakhs Period to which the amount relates Forum where dispute is pending
Customs Act 1962 Customs Duty 622.67 F.Y. 2007-08 CESTAT
Finance Act 1994 Service tax 80.24* F.Y. 2005-06 to F.Y. 2009- 10 CESTAT
Central Excise Act 1944 Excise Duty 23.73 F.Y. 2012- 2013 CESTAT
Central Excise Act 1944 Excise Duty 57.50 F.Y. 2013-14 to F.Y. 2014- 15 Adjudicating Authority
Central Excise Act 1944 Excise Duty 80.24 F.Y. 2008-09 to F.Y. 2011- 12 CESTAT
Finance Act 1994 Service Tax 124.37 F.Y. 2008-09 to F.Y. 2012- 13 CESTAT
Sales tax Sales Tax 44.00 F.Y. 2012-13 F.Y. 2013-14 Adjudicating Authority

* Net of amounts paid under protest.

viii. In our opinion and according to the information and explanations given to us theCompany has not defaulted in repayment of dues to the financial institution bank ordebenture holders.

ix. In our opinion money raised by way of term loans during the year have been appliedfor the purpose for which they were raised. The company has not raised any money initialpublic offer or further public offer (including debt instruments) during the year.

x. During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing practices in India andaccording to the information and explanations given to us we have neither come across anyinstance of material fraud by the Company or on the Company by its officers or employeesduring the course of 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 the following amounts formanagerial remuneration which is in excess of the amount as mandated under section 197read with Schedule V to the Act. The amount involved was refunded to the Company on 31stMarch 2016 and the same is realised in bank on May 3 2016.

Payment made to: Director/ WTD/ MD/ Manager Amount paid/ provided in excess of the limits prescribed - Rs. In Lakhs Amount due for recovery as at 31s March 2016 Steps taken to secure the recovery of the amount
Director 6.00 Nil Not applicable as the amount has been subsequently received.

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 transactions with the related parties are incompliance with sections 177 and 188 of the Act where applicable and 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 the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year. Accordingly the provisions of clause 3 (xiv) of the Order are not applicable tothe Company.

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

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.

For MZSK & Associates
Chartered Accountants
FirmRegistrationNo. 105047W
Abuali Darukhanawala
Place: Mumbai Partner
Date: May 30 2016 Membership No. 108053