TO THE MEMBERS OF ASIT C. MEHTA FINANCIAL SERVICES LIMITED
Report on the Standalone Ind AS Financial Statements
We have audited the standalone Ind AS financial statements of ASIT C. Mehta FINANCIALSERVICES Limited (the Company) which comprise the Balance Sheet as at 31stMarch 2019 and the Statement of Profit and Loss (including other comprehensive income)statement of changes in Equity and statement of cash flows for the year then ended andnotes to the standalone Ind As financial statements including a summary of significantaccounting policies and other explanatory information (hereinafter referred to asthe standalone Ind As financial statements).
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone Ind As financial statements give the informationrequired by the Companies Act 2013 (the Act) in the manner so required andgive a true and fair view in conformity with the accounting principles generally acceptedin India of the state of affairs of the Company as at 31st March 2019 and profit(including other comprehensive income) changes in Equity and its cash flows for the yearended on that date.
Basis for Opinion
we conducted our audit in accordance with the standards on Auditing (sAs) specifiedunder section 143(10) of the Act. Our responsibilities under those standards are furtherdescribed in the Auditor's Responsibilities for the Audit of the Standalone Ind ASFinancial Statements section of our report. we are independent of the Company inaccordance with the Code of Ethics issued by the Institute of Chartered Accountants ofIndia together with the ethical requirements that are relevant to our audit of thestandalone Ind As financial statements under the provisions of the Act and the Rulesthereunder and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the Code of Ethics. we believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our audit opinion on thestandalone Ind As financial statements.
Key Audit Matters
Key audit matters (KAM) are those matters that in our professionaljudgment were of most significance in our audit of the standalone Ind As financialstatements of the current period. we based on our professional judgement have determinedthat there are no key audit matters to communicate in our report.
Information Other than the standalone Ind AS financial statements and auditors' reportthereon (other information)
The Company's management and Board of Directors are responsible for the preparation ofother information. The other information comprises the information included in themanagement Discussion and Analysis Board's report including annexures thereto Businessresponsibility report Corporate Governance report but does not include the standaloneInd As financial statements and our auditor's report thereon.
Our opinion on the standalone Ind As financial statements does not cover the otherinformation and we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone Ind As financial statements ourresponsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the standalone Ind As financialstatements or our knowledge obtained during the course of our audit or otherwise appearsto be materially misstated.
If based on the work we have performed we conclude that there is a materialmisstatement of this other information we are required to report that fact. wehavenothing to report in this regard.
Management's Responsibility for the Standalone ind AS Financial Statements
The Company's management and Board of Directors are responsible for the matters statedin section 134(5) of the Act with respect to the preparation of these standalone Ind Asfinancial statements that give a true and fair view of the financial position financialperformance total comprehensive income changes in equity and cash flows of the Companyin accordance with the accounting principles generally accepted in India including theIndian Accounting standards (Ind As) specified under section 133 of the Act. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgements and estimates that are reasonable and prudent; anddesign implementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the standalone Ind As financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.
In preparing the standalone Ind As financial statements the management and Board ofDirectors are responsible for assessing the Company's ability to continue as a goingconcern disclosing as applicable matters related to going concern and using the goingconcern basis of accounting unless the management either intends to liquidate the Companyor to cease operations or has no realistic alternative but to do so.
The Board of Directors is also responsible for overseeing the Company's financialreporting process. auditor's Responsibilities for the audit of the standalone ind AsFinancial statements
Our objectives are to obtain reasonable assurance about whether the standalone Ind Asfinancial statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith sAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these standalone Ind As financial statements.
As part of an audit in accordance with sAs we exercise professional judgment andmaintain professional skepticism throughout the audit. we also:
Identify and assess the risks of material misstatement of the standalone Ind Asfinancial statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.
Obtain an understanding of internal controls relevant to the audit in order todesign audit procedures that are appropriate in the circumstances. under section 143(3)(i)of the Act we are also responsible for expressing our opinion on whether the company hasadequate internal financial controls system with reference to standalone Ind As financialstatements in place and the operating effectiveness of such controls.
Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made by the management.
Conclude on the appropriateness of the management's use of the going concernbasis of accounting and based on the audit evidence obtained whether a materialuncertainty exists related to events or conditions that may cast significant doubt on theCompany's ability to continue as a going concern. If we conclude that a materialuncertainty exists we are required to draw attention in our auditor's report to therelated disclosures in the standalone Ind As financial statements or if such disclosuresare inadequate to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditor's report. However future events or conditions maycause the Company to cease to continue as a going concern.
Evaluate the overall presentation structure and content of the standalone IndAs financial statements including the disclosures and whether the standalone Ind Asfinancial statements represent the underlying transactions and events in a manner thatachieves fair presentation.
Materiality is the magnitude of misstatements in the standalone Ind AS financialstatements that individually or in aggregate makes it probable that the economicdecisions of a reasonably knowledgeable user of the financial statements may beinfluenced. we consider quantitative materiality and qualitative factors in (i) planningthe scope of our audit work and in evaluating the results of our work; and (ii) toevaluate the effect of any identified misstatements in the financial statements.
we communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.
we also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and to communicate with themall relationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards.
From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the standalone Ind As financialstatements of the current period and are therefore the key audit matters. we describethese matters if there is any key audit matters determined as per our professionaljudgement to be communicated in our auditor's report unless law or regulation precludespublic disclosure about the matter or when in extremely rare circumstances we determinethat a matter should not be communicated in our report because the adverse consequences ofdoing so would reasonably be expected to outweigh the public interest benefits of suchcommunication.
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 section 143(11) of the Act and onthe basis of the information and explanations given to us and on the basis of such checksas we considered appropriate we give in the Annexure A a statement on the mattersspecified in paragraphs 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 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 (including other comprehensiveincome) the statement of changes in Equity and the Cash FIows statement dealt with bythis report are in agreement with the books of account.
(d) In our opinion the aforesaid standalone Ind As financial statements comply withthe Ind As specified under section 133 of the Act read with rule 7 of the Companies(Accounts) rules 2014.
(e) On the basis of the written representations received from the directors as on31stmarch 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 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. Our report expresses an unmodified opinion on the adequacyand operating effectiveness of the Company's internal financial controls over financialreporting.
(g) with respect to the other matters to be included in the Auditor's report inaccordance with the requirements of section 197(16) of the Act as amended:
As per the records and based on the further information and explanations the Company'sBoard consists of nonexecutive directors and independent directors only. These directorsare paid only sitting fees for attending the Board meetings and Committees meetings plusreimbursement for actual travel expenses incurred to attend the said meetings. In ouropinionsuch payments by the Company to the said directors during the year are inaccordance with the provisions of section 197 of the Act.
(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 as amended inour opinion and to the best of our information and according to the explanations given tous:
(i) The Company has disclosed the impact of pending litigations on its financialposition in its standalone financial statements - Refer Note 33 to the standalone Ind ASfinancial statements;
(ii) The Company did not have any long-term contracts including derivative contractsfor which there were any material foreseeable losses; and
(iii) There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company.
For CHANDRAKANT & SEVANTILAL & J. K. SHAH & Co.
Firm Registration No. 101676W
(Kiran C. shah) Partner
membership No.: 032187
Dated: 29th May 2019
ANNEXURE A TO THE INDEPENDENT AUDITORS' REPORT
(Referred to in paragraph 1 under Report on Other Legal and RegulatoryRequirements section of our report of even date)
|Matters specified in paragraphs 3 and 4 of the Order ||Auditors' Statements on the matters |
|(i) (a) whether the company is maintaining proper records showing full particulars including quantitative details and situation of fixed assets; ||Yes. |
|(b) whether these fixed assets have been physically verified by the management at reasonable intervals; ||Yes. |
|whether any material discrepancies were noticed on such verification and if so whether the same have been properly dealt with in the books of account; ||Discrepancy noticed was not material and has been properly dealt with. |
|(c) whether the title deeds of immovable properties are held in the name of the company. If not provide the details thereof; ||Yes |
|(ii) whether physical verification of inventory has been conducted at reasonable intervals by the management and whether any material discrepancies were noticed and if so whether they have been properly dealt with in the books of account; ||Not Applicable as the Company is engaged in providing services. |
|(iii) whether the Company has granted any loans secured or unsecured to companies firms limited liability partnerships or other parties covered in the register maintained under section 189 of the Companies Act 2013. If so ||As per the information and explanations there are no entities covered to be entered in register required to be maintained under section 189 of the Companies Act 2013 hence no entries in the said register were made by the Company. Hence question of reporting of granting such loans to the specified entities does not arise. |
|(a) whether the terms and conditions of the grant of such loans are not prejudicial to the Company's interest; ||In view of above this clause is not applicable. |
|(b) whether the schedule of repayment of principal and payment of interest has been stipulated and whether the repayments or receipts are regular; ||In view of above this clause is not applicable. |
|(c) if the amount is overdue state the total amount overdue for more than ninety days and whether reasonable steps have been taken by the Company for recovery of the principal and interest; ||In view of above this clause is not applicable. |
|(iv) In respect of loans investments guarantees and security whether provisions of section 185 and 186 of the Companies Act 2013 have been complied with. If not provide the details thereof; ||yes. |
|(v) In case the company has accepted deposits whether the directives issued by the reserve Bank of India and the provisions of sections 73 to 76 or any other relevant provisions of the Companies Act 2013 and the rules framed thereunder where applicable have been complied with? If not the nature of such contraventions be stated; If an order has been passed by Company law Board or National Company law Tribunal or reserve Bank of India or any Court or any other Tribunal whether the same has been complied with or not? ||No such deposits were accepted during the year. No such Orders were passed by any of these authorities. |
|(vi) Whether maintenance of cost records has been specified by the Central Government under sub-section (1) of section 148 of the Companies Act 2013 and whether such accounts and records have been so made and maintained; ||No; Not applicable |
|(vii) (a) whether the company is regular in depositing undisputed statutory dues including Provident Fund Employees' state Insurance Income-tax sales-tax service tax duty of Customs duty of Excise Value added tax cess and any other statutory dues to the appropriate authorities and if not the extent of the arrears of outstanding statutory dues as at the last day of the financial year concerned for a period of more than six months from the date they became payable shall be indicated; ||Yes the Company is generally regular in depositing the undisputed statutory dues as applicable to it excepting unpaid statutory dues on last date of the financial year payable to local municipal authorities Rs. 2703812/- which remained unpaid for a period of more than six months from the date it became payable. |
|(b) where dues of Income-tax or sales-tax or service tax or duty of Customs or duty of Excise or value added tax have not been deposited on account of any dispute then the amounts involved and the forum where dispute is pending shall be mentioned. (A mere representation to the concerned Department shall not be treated as a dispute.); ||Disputed dues not deposited as per details hereunder: |
|Name of statute ||Nature of dues ||Amount in Rs. ||Period to which it relates ||Forum where dispute is pending |
|Foreign Exchange regulation Act 1973 ||Contravention of FERA regulations ||13500000/- and 2686000/- ||1994-95 ||Appellate Tribunal foreign Exchange and Bombay High Court. |
|finance Act 1994 Chapter V- service tax ||service tax & penalties on certain income ||10197579/- ||1996-2000 ||Customs Excise & service tax Appellate Tribunal Mumbai |
|The Income tax Act 1961 ||Tax demand ||19910/- ||A.y 2010-11 ||rectification u/s 154 pending with Assessing Officer |
|The Income tax Act 1961 ||Tax demand ||589874/- ||A.Y 2016-17 ||Commissioner of Income-tax (Appeals) |
|(viii) whether the company has defaulted in repayment of loans or borrowing to a financial institution bank Government or dues to debenture holders? If yes the period and the amount of default to be reported. (In case of defaults to banks financial institutions and Government lender wise details to be provided.); ||No default. There were no borrowings from Government and no dues on account of debentures. |
|(ix) whether moneys raised by way of initial public offer (including debt instruments) and term loans were applied for which those are raised. If not the details together with delays or default and subsequent ratification if any as may be applicable be reported; ||During the year no moneys were raised by way of initial public offer &term loans. |
|(x) whether any fraud by the Company or any fraud on the Company by its officers or employees has been noticed or reported during the year. If yes the nature and the amount involved is to be indicated; ||Neither came across nor we were informed by the management of any instance of fraud by the Company or any fraud on the Company by its officers or employees. |
|(xi) whether managerial remuneration has been paid or provided in accordance with the requisite approvals mandated by the provisions of section 197 read with schedule V to the Companies Act 2013? If not state the amount involved and steps taken by the Company for securing refund of the same; ||yes. |
|(xii) whether the Nidhi Company has complied with the Net Owned funds to Deposits in the ratio of 1:20 to meet out the liability and whether the Nidhi Company is maintaining ten percent unencumbered term deposits as specified in the Nidhi rules 2014 to meet out the liability. ||Not applicable. |
|(xiii) whether all transactions with the related parties are in compliance with sections 177 and 188 of the Companies Act 2013 where applicable and the details have been disclosed in the financial statements etc. as required by the applicable accounting standards; ||Yes. The requisite details have been disclosed in the standalone Ind As financial statements as required by the applicable accounting standards. |
|(xiv) whether the Company has made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review and if so as to whether the requirement of section 42 of the Companies Act 2013 have been complied with and the amount raised have been used for the purposes for which the funds were raised. If not provide the details in respect of the amount involved and nature of non-compliance; ||No such allotment or placement during the year hence this clause is not applicable. |
|(xv) whether the Company has entered into any non-cash transactions with directors or persons connected with him and if so whether the provisions of sections 192 of the Companies Act 2013 have been complied with. ||No; not applicable. |
|(xvi) whether the Company is required to be registered under section 45-IA of the reserve Bank of India Act 1934 and if so whether the registration has been obtained. ||No. |
| ||For CHANDRAKANT & SEVANTILAL & J. K. SHAH & Co. |
| ||Chartered Accountants |
| ||Firm Registration No. 101676W |
|Mumbai: ||(Kiran C. Shah) Partner |
|Dated: 29th May 2019 ||Membership No. 032187 |
ANNEXURE B TO THE INDEPENDENT AUDITORS' REPORT OF EVEN DATE ON THESTANDALONE IND AS FINANCIAL STATEMENTS OF ASIT C. MEHTA FINANCIAL SERVICES LIMITED
[Referred to in clause (f) of paragraph 2 under Report on Other Legal andRegulatory Requirements section of our report of even date]
Report on the Internal Financial Controls over Financial Reporting under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 (the Act)
we have audited the internal financial controls over financial reporting of ASIT C.Mehta Financial SERVICES Limited (the Company) as of 31st March 2019 inconjunction with our audit of the standalone Ind As financial statements of the Companyfor the year ended on that date.
Management's Responsibility for Internal Financial Controls
The Board of Directors of the Company is responsible for establishing and maintaininginternal financial controls based on the internal control over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls OverFinancial reporting (the Guidance Note) issued by the Institute ofChartered Accountants of India (ICAI). These responsibilities include thedesign implementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe 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 and the standards on Auditing issued by ICAI and deemed to beprescribed under section 143(10) of the Companies Act 2013 to the extent applicable toan audit of internal financial controls both applicable to an audit of Internal FinancialControls and both issued by the ICAI. Those standards and the Guidance Note require thatwe comply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether adequate internal financial controls over financial reporting wasestablished and maintained and if such controls operated effectively in all materialrespects.
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 auditors' 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.
In our opinion considering nature of activities size of operation and organizationalstructure of the entity and exercise of controls through personal supervision by themanagement the Company has maintained in all material respects adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at 31st march 2019 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 CHANDRAKANT & SEVANTiLAL & J. K. sHAH & Co. |
| ||Chartered Accountants |
| ||Firm Registration No. 101676W |
|mumbai: ||(Kiran C. shah) Partner |
|Dated: 29th may 2019 ||membership No. 032187 |