The Members of M/s AJEL LIMITED Mumbai.
Report on the Financial Statements:
We have audited the accompanying financial statements of M/s AJELLIMITED ("theCompany") Mumbai which comprise of the Balance Sheet as at 31st March 2019 theStatement of Profit & Loss and the Cash Flow Statement for the year then ended and asummary of the significant accounting policies and other explanatory information.
Management's Responsibility for the Financial Statements:
The Company's Management is responsible for the matters stated in section 134(5) of theCompanies Act 2013 ("the Act") with respect to the preparation of these Ind ASStandalone financial statements that give a true and fair view of the financial positionfinancial performance and cash flows of the Company in accordance with the Accountingprinciples generally accepted in India including the Indian Accounting Standardsspecified under Section 133 of the Act read with Rule 7 of the Companies (Accounts)Rules 2014 and the Companies (Indian Accounting Standards) Rules 2015. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provision of the Act for safeguarding the assets of the company and for preventing anddetecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; anddesign implementation and maintenance of internal financial control that were operatingeffectively for ensuring the accuracy and completeness of accounting records relevant tothe preparation and presentation of the Ind AS financial statements that give a true andfair view and are free from material misstatement whether due to fraud or error.
Our responsibility is to express an opinion on these Ind AS Standalone financialstatements based on our audit. We have taken into account the provisions of the Act theaccounting and auditing standards and matters which are required to be included in theaudit report under the provision of the Act and the Rules thereunder.
We have conducted our audit in accordance with the Standards on Auditing under Section143(10) of the Act. Those Standards require that we comply with the ethical requirementsand plan and perform the audit to obtain reasonable assurance about whether the financialstatements are free from material 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 theInd AS financial statements whether due to fraud or error. In making those riskassessments the auditor considers the internal financial control relevant to theCompany's preparation and fair presentation of the Ind AS financial statements in order todesign audit procedures that are appropriate in the circumstances but not for the purposeof expressing an opinion on the effectiveness of the entity's internal control.
An audit also includes evaluating the appropriateness of accounting policies used andthe reasonableness of the accounting estimates made by the Company's Directors as well asevaluating the overall presentation of the Ind AS financial statements. We believe thatthe audit evidence we have obtained is sufficient and appropriate to provide a basis forour audit opinion on the Ind AS Standalone financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for qualified opinion on the financial statements.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Ind AS Standalone financial statements give the informationrequired by the Act in the manner so required and give a true and fair view in conformitywith the accounting principles generally accepted in India except in the case ofqualifications as mentioned in the Point No. 2.01 & 2.02 as mentioned below:
in the case of the Balance Sheet of the state of affairs of the Company as at31st March 2019;
in the case of the Statement of Profit and Loss of the profit of the Companyfor the year ended on that date and
in the case of the Cash Flow Statement of the cash flows of the Company for theyear ended on that date.
In respect of written off of un-reconciled balances representing the following heads:
|Sl. No. ||Account Head ||Amount Rs. |
|1 ||Sundry Debtors ||6914580.39 |
|2 ||Sundry Creditors ||(92944.63) |
|3 ||TDS Receivable ||731516.00 |
|4 ||Service Tax Receivable ||1234956.00 |
|5 ||Provisions ||(3625266.00) |
The total of which amounting to Rs.5162842/- which were pending due from previousyears where no documentation/information is available with the management of the companyexcept an oral reply stating them as un-reconciled and long standing balances.
In respect of partial write back of investments amounting to Rs.3346595/- (MarketValue as on 31.03.2019 Rs.5719754/-) which were written off in the books of accountsduring the Financial Year 2000-2001 as Investments written off' for a value ofRs.5839367/- though the company holds the title of such investments:
we are unable to find any explanations/information as to why these investmentshave been written off during the said financial year;
the value of investments written back is as per the management's estimationbasis without any substantial evidence;
The company does not have any explanation/information as to the residuary value of theInvestments (the difference between actual amount written off during the financial year2000-2001 and the amount written back in the books of accounts). However as explained bymanagement they are in the process of getting information. Had all the investmentswritten off during the FY 2000-2001 been written back the profit would have been increasedby Rs.2492772/-.
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 (1) of section 143 ofthe Act we give in the "Annexure A" a statement on the matters specified inparagraphs 3 and 4 of the Order to the extent applicable.
2. As required by Section 143(3) of the Act we report that:
a. we have obtained all the information and explanations which to the best of ourknowledge and belief were necessary for the purposes of our audit except to the extent asmentioned in Point No. 2.01 & 2.02 as mentioned above.
b. in our opinion proper books of account as required by law above have been kept bythe Company except in respect of Point No. 2.01 & 2.02 as mentioned above so far asit appears from our examination of those books.
c. the Balance Sheet Statement of Profit and Loss and the Cash Flow Statement dealtwith by this Report are in agreement with the books of account.
d. in our opinion the aforesaid standalone Balance Sheet Statement of Profit andLoss and the Cash Flow Statement comply with the Accounting Standards specified underSection 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014 and theCompanies (Indian Accounting Standards) Rules 2015 as amended;
e. on the basis of the written representations received from the directors as on 31stMarch 2019 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2019 from being appointed as a director in terms ofsub-section (2) of section 164 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 reference 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 explanation given to us:
i. The Company does not have any pending litigations which would impact its financialposition in its financial 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.
For RAMESH ATHASNIYA & CO
CA. RAMESH ATHASNIYA
M. No. 204976
Firm Registration No. 007480S
Dated : 14th August 2019
Place : Hyderabad.
ANNEXURE A TO THE AUDITOR'S REPORT
(Referred to in Paragraph (3) of our Report of even date to the members of M/s AJELLIMITED
1. (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
(b) The fixed assets have been verified by the management during the year. An amount ofRs.306160/- representing the assets discarded has been written off to the Profit &Loss Account (Refer Note No. 2.33 in Notes to Accounts). Further an amount ofRs.518400/- representing the Intangible Asset (Software) has been written off to theProfit & Loss Account on account of being obsolete. (c) According to the informationand explanations given to us and on the basis of our examination of the records of theCompany the title deeds of immovable properties are held in the name of the company.
2. The company is a service company primarily rendering consulting and softwareservices. Accordingly it does not hold any physical inventories. 3. (a) In our opinionand according to the information and explanations given to us the company has grantedloans to One body corporate covered in the register maintained under section 189 of theAct. (b) There are no overdue amounts in respect of the loan granted to a body corporatelisted in the register maintained under Section 189 of the Act.
4. In our opinion and according to the information and explanation given to us theCompany has complied with the provisions of Section 185 and 186 of the Companies Act 2013in respect of loans investments guarantees and security.
5. In our opinion and according to the information and explanations given to us duringthe course of our audit the company has not accepted deposits as per the directivesissued by the Reserve Bank of India and the provisions of sections 73 to 76 or any otherrelevant provisions of the Companies Act and the rules framed there under. Therefore theprovision of Clause (v) of paragraph 3 of the CARO 2016 is not applicable to the Company.
6.We have been informed that the Central Government has not prescribed for themaintenance of Cost records under Section 148(1) of the Companies Act 2013 in respect ofthe activities carried on by the company.
7. According to the information and explanations given to us and on the basis of ourexamination of books of accounts and records the Company has been generally regular indepositing undisputed statutory dues including Provident Fund Employees State InsuranceIncome Tax Goods & Services Tax Duty of Customs Cess and any other statutory dueswith the appropriate authorities except in the case of statutory dues as mentioned in thetable given below which are due payable for more than six months from the date on whichthey become payable.
|Sl. No. ||Name of The Statute ||Nature of Dues ||Amount Rs. ||Period for which the amount relates |
|1 ||TDS ||Statutory ||668819 ||2013-14 |
|2 ||TDS ||Statutory ||690819 ||2015-16 |
|3 ||Provident Fund ||Statutory ||396680 ||2013-14 |
|4 ||Provident Fund ||Statutory ||12047 ||2014-15 |
|5 ||ESI ||Statutory ||414867 ||2013-14 |
|6 ||Service Tax ||Statutory ||5965837 ||2013-14 |
|7 ||*Provision for Tax ||Statutory ||2267626 ||- |
|8 ||**Other Statutory Dues ||Statutory ||311181 ||- |
| ||Total:- || ||10727876 || |
* The year to which the Provision for Tax belongs to is not available in the books toreport in detail.
** The breakup of Other Statutory Dues is not available in the books to report indetail. According to the information and explanations given to us there are no dues ofProvident Fund Employees State Insurance Central Excise Sales Tax Income Tax or anyother Statutory Dues not been deposited on account of any dispute except the following:
|Sl.No. ||Assessment Year ||Against the Order of Amount (Rs) |
|1 ||2012-13 ||Rs. 10097200/- |
8. In our opinion and according to the information and explanations given to us theCompany has not defaulted in repayment of dues to the Banks. The Company has not taken anyloan either from financial institutions or from the Government and has not issued anydebentures.
9. Based upon the audit procedures performed and the information and explanations givenby the management the Company has not raised moneys by way of initial public offer orfurther public offer including debt instruments and term loans. Accordingly theprovisions of clause 3 (ix) of the Order are not applicable to the Company and hence notcommented upon.
10. Based upon the audit procedures performed and the information and explanationsgiven by the management we report that no material fraud by the Company or on the Companyby its officers or employees has been noticed or reported during the year under audit.
11.Based upon the audit procedures performed and the information and explanations givenby the management the managerial remuneration has been paid or provided in accordancewith the requisite approvals mandated by the provisions of Section 197 read with ScheduleV of the Companies Act 2013.
12. In our opinion and according to the information and explanations given to us theCompany is not a Nidhi Company. Therefore the provisions of clause 3(xii) of the Orderare not applicable to the Company.
13. In our opinion all transactions with related parties are in compliance withSection 177 and 188 of Companies Act 2013 and the details of such transactions have beendisclosed in the Financial Statements as required by the applicable accounting standards.
14. 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 under review. Accordingly the provisions of clause 3 (xiv) of the Order are notapplicable to the Company and hence not commented upon.
15. 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 as referred to in section 192 ofCompanies Act 2013. Accordingly the provisions of clause 3(xv) of the Order are notapplicable to the Company and hence not commented upon. 16. In our opinion the company isnot required to be registered under section 45-IA of the Reserve Bank of India Act 1934and accordingly the provisions of clause 3(xvi) of the Order are not applicable to theCompany and hence not commented upon.
For RAMESH ATHASNIYA & CO.
CA. RAMESH ATHASNIYA
Firm Regn No.: 007480S
Dated : 14th August 2019
Place : Hyderabad.
"Annexure - B" to the Independent Auditors' Report of even date on theStandalone Financial Statements of M/s AJEL 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 M/s AJELLIMITED ("the Company") as of March 31 2019 in conjunction with our audit ofthe standalone 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 (ICAI'). Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to company's policies the safeguarding ofits assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required under the Companies Act 2013.
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 issued by ICAI and deemed to be prescribed under Section 143(10) of theCompanies Act 2013 to the extent applicable to an audit of internal financial controlsboth applicable to an audit of Internal Financial Controls and both issued by theInstitute of Chartered Accountants of India. Those Standards and the Guidance Note requirethat 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 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 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.
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 2019 except in thecase of Point No. 2.01 & 2.02 as mentioned in Qualified Opinion para of our AuditReport based on the internal control over financial reporting criteria established by theCompany considering the essential components of internal control stated in the GuidanceNote on Audit of Internal Financial Controls Over Financial Reporting issued by theInstitute of Chartered Accountants of India.
For RAMESH ATHASNIYA & COMPANY
CA. RAMESH ATHASNIYA
Partner. M.No. 204976
Firm Reg No.007480S
Place : Hyderabad
Date : 14th August 2019.