Bengal Steel Industries Ltd.
|BSE: 512404||Sector: Metals & Mining|
|NSE: N.A.||ISIN Code: INE523W01017|
|BSE 05:30 | 01 Jan||Bengal Steel Industries Ltd|
|NSE 05:30 | 01 Jan||Bengal Steel Industries Ltd|
|BSE: 512404||Sector: Metals & Mining|
|NSE: N.A.||ISIN Code: INE523W01017|
|BSE 05:30 | 01 Jan||Bengal Steel Industries Ltd|
|NSE 05:30 | 01 Jan||Bengal Steel Industries Ltd|
To the Members of Bengal Steel Industries Limited Report on the Audit of the StandaloneFinancial Statements
We have audited the standalone financial statements of Bengal Steel Industries Limited("the Company") which comprise the balance sheet as at 31st March2020 the statement of Profit and Loss statement of changes in equity and statement ofcash flows for the year then ended and notes to the financial statements including asummary of significant accounting policies and other explanatory information.
In our opinion and to the best of our Information and accord ig co the explanationsgiven to us the aforesaid standalone financial statements give the information requhed bythe Act in the manner so required and give a true and Sair view in conformity with theaccounting principles generally accepted in India of the state of affairs of the Companyas at March 31 2020 and profit/loss 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 Companies .Act 2013. Our responsibilities under thoseStandards are further described in the Auditor's Responsibilities for the Audit of theFinancial 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 thefinancial statements under the provisions of the Companies Act 2013 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 opinion.
Emphasis of Matters:
Without qualifying our opinion we draw attention to the following :
1. Income Tax advance of Rs. 6820302/- remams unad Listed - Refer Note 28
2. Charge of depreciation on the composite cost of Land & Building and In absenceof useful life
of assets depreciation is being charged by reducing balance method - Refernote 29
3. Non recognition of impairment loss - Refer note no. 31
4. In the absence of adequate data reasonable accuracy could not be ascertained inrespect of fair
value of the financial assets liabilities as certified by the management - Refer note26
5. Book balance of accounts of Rs. 18506.21/- (with UCO Bank) Rs 145762.45 (withUBI) and Rs.59 939.19/- (with Bank of India) could not be confirmed Refer note 25
Key Audit Mattel s
There are no serious Audit observations and no Key Audit Matters to communicate in ourreport.
Management's Responsibility for the Standalone Financial Statements
The Company's Board of Directors is responsible for the matters seated in section134(5) of the Companies Act 2013 ("the Act") witn respect to the preparation ofthese standalone financial statements that give a true and fair view of the financialposition financial performance changes in equity and cash flows of the Company inaccordance with the accounting principles generally accepted in India including theAccounting Standards specified under section 133 of the Act. This respoiisibility alscincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other hregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and designimplementation 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 financial statement that givea true and fair view and are free from material misstatement whether due to fraud orerror.
In preparing the financial statements management is responsible for assessing theCompany's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or has no realisticalternative but to do
Those Board of Directors are also responsible for overseeing the Company's financialreporting process.
Auditor's Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financialstatements as a whole are free from material misstatement whether due to fraud or errorand to issue an auditor's report that includes our opinion. Reasonable assurance is a highlevel of assurance but is not a guarantee that an audit conducted in accordance with SAswill always detect a material rr isstatement when it exists Misstatements can arise Comfraud or error and are considered mater-al if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these financial statements.
Report on Other Legal and Regulatory Requirements
As required by the Companies (Auditor's Ropori) Order 2016 ("the Order")issued by the Central Government of Incfiu in terms of sub-section (11) of section 143 ofthe Companies Act 2013 we give in the Annexure a statement on the matters soecified inparagraphs 3 and 4 of the Order to the extent applicable.
As required by Section 143(3) of the Act we report that:
(a) We have sought and obtained ail 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 requirea by law have been kept by theCompany so far as it appears frcm our examination of those books.
(c) The Balance Sheet the Statement of Profit and Loss and the Cash Flow Statementdealt wdh by this Report are in agreement with the books of account.
(d) In our opinion the aforesaid scandalcne 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 2020 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2020 from being appointed as a director in termsof Section 164 (2) of the Act
(f) With respect to the adequacy of the internal financial controls ovei financialreporting of the
Company and the operating effectiveness of such controls refer to our separate Reportin "Annexure A".
(g) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of Rs.296790/-on its financial position inrespect of its pending litigation - Refer Note 18 to the 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 requi rd to be transferred io the InvestorEducat'or and
Annexure - A to the Independent Auditors' Repoi t
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 BengalSteel Industries Ltd as of 31 March 2020 in conjunction with our audit of the standalonefinancial 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 essenual components of internal control statedin the Guidance Note on Audit of Internal Financial Controls over Financial Report'ngissued by the institute of Chartered Accountants of India (TCAT). These responsibilitiesinclude the design implementation and maintenance of adequate internal financial controlsthat were operating etfectively for ensuing 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 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 oui 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 deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an aud't of internal financial controls both applicable to an audit ofInternal Financial Controls and both .ssued by the Institute of Chaptered Accountants ofIndia. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established and ma:ntained and if such controls operated effectively in all material respects.
Our aud't involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness. Our audu of internal financial controls over financial reporting includedobtaining an understand mg 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 rel ability 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 companv; (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 onlv in accordance with autho rs aliens ofmanagement and d*rectors of the company; and (3) provde 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 he detected.Also projections of any evaluation of the internal Snancial controls over finanr'alreporting to future periods are subject to the tisk 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 fmanc.al reporting were operating effective1)' as at 31 March 2020 basedon the internal control over financial reporting criteria established by the Companyconsiderng the essential components of internal conffol stated in the Guidance Note onAudit of Internal Financial Controls Over Financial Reporting issued by the Institute ofChartered Accountants of India.
Anne vure-B to the Independent Auditor's Report (Referred to in our report of evendate attached)
Referred to in paragraph 1 under the heading Reporl on Other Legal &Regulatory Requirement' of our report of even date:
1) (a) The Company had not maintained proper records showing ful1particulars including quantitative details and situation of fixed assets;
(h) The Fixed Assets have not been physically verified by the management during theyear under Audit and therefore the question of discrepancy between the books records andthe physical fixed assets could not be determined.
(c) The title deeds of immovable properties are not available for verification.
2) The company does not have inventory.
3) As per information and explanations given to us the Company has not granted anyloans secured or unsecured to company firms limited liability padnership or otherparties covered in
the Register maintained under section 189 of the Companies Act 2013. Howeverthe Company has granted interest free advance of Rs. 33590000/- to M/s V. N.Enterprises Ltd. And Rs. 3188401/- to M/s Tamilnadu Alkaline Batteries Ltd. havingcommon directors and shown under Non Current Assets - Loans and Deposits. Other interestfree advance given to other Companies having common directors has been squared off duringthe year.
. 4) According to the information and explanations given to us the company has notgiven loans guarantees made investments and / or purchased securities in respect ofwhich provisions of section 185 and 18fc of the Companies Act 2013 are applicable.However the Company has granted interest free advance of Rs. 33590000/- to M/s V. N.Enterprises Ltd. and Rs. 3188401/- to M/s Tamil ladu Alkaline Batteries Ltd. havingcommon directors and shown under Non Current Assets - Loans and Deposits. Other interestfree advance given to other Companies having common directors has been squared off duringthe year.
5) According to the information and explanations given to us the Company has notaccepted any deposits from the public and hence the direefives issued by the Reserve Bankof India ana the provisions of Sections 73 to 76 or any other relevant provisions of theAct and the Conpai es (Acceptance of Deposit) Rules 2015 with regard to the depositsaccepted from the pub he arc not applicable.
6) As informed to us the maintenance of Cost Records has not been specified by theCentral Government under sub-section (1) of Section 148 of the Act in respect of thpacuvities carried on by the company.
7) (a) According to information and explanations given to us and on the basis of ourexamination of the books of account and records the Company has been generally regularin depositing undisputed statutory dues including Income-Tax GST and any other statutorydues with the appropriate authorities. According to information and explanations given tous no undisputed amount payable which were outstanding at the year end for a period ofmore dian six months from the date they became payable.
b) According to the information and explanation gi ven to us there are no dues ofservice tax Sales Tax duty of customs and duty of excise on account of any dispute.However as informed by the management Disputed Income Tax dues for A.Y. 2012-13 of Rs.296790/- pending in appeal before CIT (A) -4 Kolkata.
8) According to the information and explanations given to us the Company has not takenany loan either from financial institutions or from the government and has not issued anydebentures.
9) Based upon the informadon and explanations given by the management the company hasnot raised moneys bv way of initial public offer or further public offer including debtinstruments and term Loans. Accordingly the provisions of clause 3 (ix) of CARO are notapplicable to the Company.
10) Based upon the audit procedures performed and according to the information andexp'anaiions given by the management no fraud by the Company or on the company by itsofficers or employees has been noticed or reported during the year.
11) Based upen the information and explanations given by the management the companyhas not paid any manager al remuneration except sitting fees of Directors.
12) As per information and explanations given to us the Company is not a Nidh;Company. Therefore the provisions of clause 4 (xii) of the Order are not applicable tothe Company.
13) As per information and explanations given to us transactions w h the relatedparties are in compliance with section 177 and 138 of Companies Act 2013 and the detailshave been disclosed in the Note No 23 of Financial Statements as required by theapplicable accounting standards.
14) Based upon the audit procedures performed and according to the information andexplanations given by the management the company has not made any preferential allotmentor private placement of shares or fullv or partly convertible debentures during the yearunder review. Accordingly the prov isions of clause 3 (xiv) of die Order are notapplicable to the Company and hence not commented upon.
15) Based upon the audit procedures performed and according to the information andexplanadons given by the management the company has not entered into any non-cashtransactions with directors 01 persons connected with him. Accordingly the provisions ofclause 3 (xv) of CARO are not appncable to the Company and hence not commented upon.
16) In our opinion and according to the information and explanations given to us thecompany is not required tc be registered under section 45 IA of the Reserve Bank of IndiaAct 1934 and accordingly the provisions of clause 3 (xvi) of the Order are notapplicable to the Company and hence not commented upon.
For S. Ghose & Co LLP