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Tantia Constructions Ltd.

BSE: 532738 Sector: Infrastructure
NSE: TANTIACONS ISIN Code: INE388G01018
BSE 00:00 | 22 May 9.75 -0.51
(-4.97%)
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9.75

HIGH

9.75

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9.75

NSE 00:00 | 22 May 8.90 -0.45
(-4.81%)
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9.50

HIGH

9.75

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OPEN 9.75
PREVIOUS CLOSE 10.26
VOLUME 400
52-Week high 22.20
52-Week low 9.61
P/E
Mkt Cap.(Rs cr) 28
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 9.75
CLOSE 10.26
VOLUME 400
52-Week high 22.20
52-Week low 9.61
P/E
Mkt Cap.(Rs cr) 28
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Tantia Constructions Ltd. (TANTIACONS) - Auditors Report

Company auditors report

To

The Members of

Tantia Constructions Limited

1. Report on the Standalone Financial Statements

We have audited the accompanying standalone financial Statements of TantiaConstructions Limited ("the Company") which comprises the Balance Sheet as at31st March 2017 the Statement of Profit and Loss the Cash Flow Statement for the yearthen ended and a summary of the significant Accounting Policies and other explanatoryinformation.

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 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 financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

3. 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 there under.

We conducted our audit in accordance with the Standards on Auditing issued by theInstitute of Chartered Accountant of India 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 misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the financial statements. The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of thefinancial statements whether due to fraud or error. In making those risk assessments theauditor considers internal financial control relevant to the Company's preparation of thefinancial statements that give

a true and fair view in order to design audit procedures that are appropriate in thecircumstances. An audit also includes evaluating the appropriateness of 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.

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.

4. 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 2017 and its loss and its cash flows for the year ended on that date.

5. Emphasis of Matters

We draw attention to

a) Note 42 to the Financial Statement in relation to excess payment of RS.42 lacsManagerial Remuneration for the Financial Year 2013-14 for which the Management is in theprocess of taking approval of the Central Government.

b) Note 8 and Note 38c to the Financial Statement regarding nonpayment of short termloan from Vijaya Bank against which the Bank has issued notice under the SARFAESI Act(2002) and has taken symbolic possession of land belonging to third party mortgaged withthem for the said loan.

c) Note 4 to the Financial Statement regarding default in repayment of loans from bankstowards principal and interest amounting to RS.2 723 lacs and H5061 lacs respectively.

d) Note 51 to the Financial Statement in regard to an amount of RS.604.02 lacsrecoverable from Tantia Raxaultollway Pvt Ltd was taken over by Tantia Infrastructure PvtLtd which remain grouped under sundry debtors.

e) Para (I) of Note 40 to the Financial Statement regarding Fixed Assets taken over byTata Capital Ltd against their dues of H50.00 lacs.

f) Para (II) of Note 40 to the Financial Statement for assets sold by the Company at aconsideration of H90.48 Lakhs.

g) Note - 52 to the Financial Statement regarding unsecured loans from Bodies Corporatemany of whom had filed winding up petition at High Court when some of the creditorsapproached High Court for winding up of the Company as per earlier order the ConsortiumBanks through State Bank of India filed a petition in the High Court stating that thestake of unsecured creditors are rather low vis-a-vis the stake of secured creditors i.e.various Banks (Under CDR Packages). The matter is subjudice and awaiting final judgment.

Our opinion is not qualified in respect of the above matters.

6. Report on Other Legal and Regulatory Requirements

i. As required by the Companies (Auditor's Report) Order 2016 issued by the CentralGovernment of India in terms of sub-section (11) of section 143 of the Act (hereinafterreferred to as the 'Order') and on the basis of such checks of the books and records ofthe Company as we considered appropriate and according to the information and explanationsgiven to us we give in the 'Annexure A' a statement on the matters specified inparagraphs 3 and 4 of the Order.

11 .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 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. On the basis of the written representations received from the directors as on 31stMarch 2017 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.

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'.

g. With respect to the other matters to be included in the Auditors' 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 as at 31st March 2017on its financial position in its standalone financial statements in accordance with thegenerally accepted accounting practice - Refer Note 30 to the Standalone FinancialStatements.

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

iii. Unpaid/Unclaimed dividend of Equity shareholders for the year 2008-09 amounting toH0.70 lakhs were required to be transferred to the Investor Education and Protection Fundhave been transferred by the Company during the year under review but the said transferwas effected after the due date.

iv. The Company has provided requisite disclosures in Note 54 in its standalonefinancial statements as to the holding of Specified Bank Notes on 8th November 2016 and30th December 2016 as well as dealings in Specified Bank Notes during the period from 8thNovember 2016 and 30th December 2016. Based on audit procedures performed and therepresentation to us by the management we report that the disclosures are in accordancewith the books of accounts maintained by the Company and as produced to us by themanagement.

For KONAR MUSTAPHI & ASSOCIATES
Chartered Accountants
FRN 314125E
CA S. K. Mustaphi
Place Kolkata Partner
Date 30th May 2017 Membership No 051842

"Annexure A" to the Independent Auditor's Report

Referred to in paragraph 6(i) with the heading 'Report on Other Legal & RegulatoryRequirements' of our report of even date to the members of Tantia Constructions Limited onthe Standalone Financial Statements for the year ended 31st March 2017

i. a) Fixed Assets register showing full particulars including quantitative detailsand situation thereof are yet to be updated.

b) The Company has a regular programme of physical verification of its Fixed Assets bywhich the same is verified on rotational basis over a period of 3 years which in ouropinion is reasonable having regard to the size of the Company and nature of its assets.During the current financial year the process of verification was initiated but could notbe completed hence reconciliation with physical balance could not be made.

c) Title deeds of immovable properties as explained to us are lying with the Bank aspart of collateral security provided to them against loans availed from the Bank.

ii. The Management has conducted physical verification of inventory in phased mannerduring the year and no material discrepancies between physical inventory and book recordswere noticed on physical verification.

iii. The Company has not granted any loans secured or unsecured to companies firmsLLPs or other parties covered in the register maintained under Section 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 186 of the Act in respect ofthe loans and investment made and guarantees and security provided by it.

v. The Company has not accepted any deposits from the public within the meaning ofSections 73 to 76 of the Act and Rules framed there under to the extent notified.Accordingly the provisions of clause 3(v) of the Order are not applicable to the Company.

vi. We have broadly reviewed the books of accounts maintained by the Company pursuantto the Rules made by the Central Government for the maintenance of cost records undersection 148(1) of the Act and are of the opinion that prima facie the prescribedaccounts and records have been maintained. We have however not made a detailedexamination of the records with a view to determine whether they are accurate or complete.

vii.a) According to the information and explanations given to us and on the basis ofour examination of the records of the Company amount deducted/accrued in the books ofaccount in respect of undisputed statutory dues including Provident Fund Employees StateInsurance Income Tax Sales Tax Service Tax Customs Duty Value Added Tax Cess andother material statutory dues have generally not been regularly deposited during the yearby the Company with the appropriate authorities.

According to the information and explanations given to us undisputed amounts payable inrespect of Provident Fund Income Tax Sales Tax Wealth Tax Service Tax Customs DutyValue Added Tax and other material statutory dues as at 31st March 2017 for a period ofmore than 6 months from the date they became payable are as under:

Nature of Dues Amount (Rs. in lacs)
Provident Fund 51.02
Tax Deducted at Source 286.57
Service Tax 93.66
STDS 93.10

b) According to the information and explanations given to us details of dues of IncomeTax Sales Tax Service Tax Custom Duty Excise Duty Cess and other material statutorydues which has not been deposited on account of any dispute are given below

Name of the Statute Name of the State Nature of dues Amount (H in lacs) Period to which the amount relates Forum where dispute is pending
Sales Tax West Bengal Appeal Demand 210.32 2005-06 Revisionary Board
Sales Tax West Bengal Appeal Demand 343.31 2006-07 Revisionary Board
Sales Tax West Bengal Appeal Demand 276.87 2007-08 Revisionary Board
Sales Tax West Bengal Appeal Demand 853.13 2008-09 Revisionary Board
Sales Tax West Bengal Appeal Demand 1084.50 2009-10 Revisionary Board
Sales Tax West Bengal Assessment Demand 706.11 2010-11 Revisionary Board
Sales Tax West Bengal Assessment Demand 949.73 2011-12 Revisionary Board
Sales Tax West Bengal Assessment Demand 1512.86 2012-13 High Court
Sales Tax West Bengal Assessment Demand 1175.93 2013-14 High Court
Sales Tax West Bengal Penalty Notice (for wrong input tax credit) 306.84 2009-10 Revisionary Board
Sales Tax West Bengal Penalty Notice (for wrong input tax credit) 222.35 2010-11 Revisionary Board
Sales Tax West Bengal Penalty Notice (for wrong input tax credit) 259.98 2011-12 Revisionary Board
Sales Tax West Bengal Penalty Notice (for wrong input tax credit) 258.82 2012-13 Revisionary Board
Income Tax Demand 2036.75 2009-10 to 2012-13 Appeal before ITAT
Income Tax Demand 1288.87 2013-14 and 2014-15 CIT Appeal

viii. According to the records of the Company as examined by us and the information andexplanations given to us the Company has defaulted in payment of interest as well asrepayment of loans/borrowings from banks. The details of default are given below:

(Rs. in lakhs)
Period of Default (In days) Principal Interest
0 - 120 1350 2179
121 - 240 618 1740
241 - 365 755 1142
Total 2723 5061

There were no loans or borrowings payable to the Government or debenture holders.

ix. According to the records of the Company as examined by us and as per theinformation and explanations given to us the Company has not made any public issue/followon public offer (including debt instruments) during the year.

The Company has not availed term loan during the year. Accordingly the provision ofClause 3(xiv) of the Order is not applicable to the Company.

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 employeesnoticed or reported during the year nor have we been informed of any such case by theManagement.

xi. Managerial Remuneration has been paid for the Financial Year 2013-14 in excess byRS.42 lacs for which the Company is taking steps to obtain necessary approval from theconcerned authorities failing which the same should be recovered from the Chairman andManaging Director. Till date the said approval has not been received.

xii. In our opinion and according to the information and explanations given to us theCompany is not a Nidhi Company. Accordingly the provisions of clause 3 (xii) of the Orderare not applicable to the Company.

xiii. According to information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with Section 177 and 188 of the Act where applicable and the requisite detailsof such transactions have been disclosed in the Financial Statements as required by theapplicable accounting standards.

xiv. The Company has made allotment of 9919032 Equity Shares on preferential basis tothe promoters and a promoter Group Company as per terms of CDR packages during the yearunder review.

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 any noncashtransactions with any director or persons connected with him. Accordingly the provisionsof clause 3 (xv) of the Order are not applicable to the Company.

xvi. The company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934. Accordingly the provisions of clause 3 (xvi) of the Order arenot applicable to the Company.

For KONAR MUSTAPHI & ASSOCIATES
Chartered Accountants
FRN 314125E
CA S. K. Mustaphi
Place Kolkata Partner
Date 30th May 2017 Membership No 051842

"Annexure B" to the Independent Auditor's Report

Referred to in paragraph 6(f) of the Independent Auditor's Report to the members of theTantia Constructions Ltd on the Standalone Financial Statements for the year ended 31stMarch 2017

Report on the Internal Financial Controls under Clause (i) of Subsection 3 of Section143 of the Act

We have audited the internal financial controls over financial reporting of TantiaConstructions Limited ("the Company") as of 31st March 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 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 (ICAI). 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 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 Guidance Note on Audit of Internal Financial Controls Over Financial Reporting(the "Guidance Note") and the Standards on Auditing prescribed under section143(10) of the Act to the extent applicable to an audit of internal financial controlsboth applicable to an audit of Internal Financial Controls and both issued by the ICAI.Those Standards and the Guidance Note require that we comply with 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 auditor's judgment 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 of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company

(2) Provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorizations of management and directors of the company and

(3) Provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the company's assets that could have amaterial 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 31st March 2017 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.

For KONAR MUSTAPHI & ASSOCIATES
Chartered Accountants
FRN 314125E
CA S.K. Mustaphi
Place Kolkata Partner
Date 30th May 2017 Membership No 051842