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Caprihans India Ltd.

BSE: 509486 Sector: Industrials
NSE: CAPRIHANS ISIN Code: INE479A01018
BSE 00:00 | 24 Jun 116.45 2.25
(1.97%)
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NSE 05:30 | 01 Jan Caprihans India Ltd
OPEN 118.50
PREVIOUS CLOSE 114.20
VOLUME 1769
52-Week high 179.00
52-Week low 101.05
P/E 9.10
Mkt Cap.(Rs cr) 153
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 118.50
CLOSE 114.20
VOLUME 1769
52-Week high 179.00
52-Week low 101.05
P/E 9.10
Mkt Cap.(Rs cr) 153
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Caprihans India Ltd. (CAPRIHANS) - Auditors Report

Company auditors report

TO THE MEMBERS OF CAPRIHANS INDIA LIMITED

Report on the Audit of the Ind AS Financial Statements Opinion

We have audited the accompanying Ind AS financial statements of Caprihans India Limited("the Company") which comprise the Balance sheet as at March 31 2021 theStatement of Profit and Loss including the Other Comprehensive Income the Statement ofCash Flows and the Statement of Changes in Equity for the year then ended and Notes tothe Ind AS financial statements including a Summary of significant accounting policiesand other explanatory information.

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Ind AS financial statements give the information required bythe Companies Act 2013 as amended ("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 March 31 2021 its profitincluding other comprehensive income its cash flows and the changes in equity for theyear ended on that date.

Basis for Opinion

We conducted our audit of the Ind AS financial statements in accordance with theStandards on Auditing (SAs) as specified under section 143(10) of the Act. Ourresponsibilities under those Standards are further described in the ‘Auditor'sResponsibilities for the Audit of the Ind AS Financial Statements' section of our report.We are independent of the Company in accordance with the ‘Code of Ethics' issued bythe Institute of Chartered Accountants of India together with the ethical requirementsthat are relevant to our audit of the financial statements under the provisions of the Actand the Rules thereunder and we have fulfilled our other ethical responsibilities inaccordance with these requirements and the Code of Ethics. We believe that the auditevidence we have obtained is sufficient and appropriate to provide a basis for our auditopinion on the Ind AS financial statements.

Emphasis of Matter

We draw your attention to Note 38 of the accompanying financial statements whichdescribes the management's evaluation of impact of uncertainties related to COVID-19 andtheir assessment of liquidity for next one year and of the recoverability and carryingvalue of its assets comprising of tangible assets inventories and other current assets asat the Balance sheet date. Our opinion is not modified in respect of this matter.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the Ind AS financial statements for the financial year endedMarch 312021. These matters were addressed in the context of our audit of the Ind ASfinancial statements as a whole and in forming our opinion thereon and we do not providea separate opinion on these matters. For each matter below our description of how ouraudit addressed the matter is provided in that context. We have determined the mattersdescribed below to be the key audit matters to be communicated in our report. We havefulfilled the responsibilities described in the Auditor's responsibilities for the auditof the Ind AS financial statements section of our report including in relation to thesematters. Accordingly our audit included the performance of procedures designed to respondto our assessment of the risks of material misstatement of the Ind AS financialstatements. The results of our audit procedures including the procedures performed toaddress the matters below provide the basis for our audit opinion on the accompanying IndAS financial statements.

Key audit matters How our audit addressed the key audit matter
Revenue recognition (as described in Note 2.2(xi) of the Ind AS financial statements)
Revenue from sale of goods is recognized at the point in time when control of the asset is transferred to the customer in accordance with the delivery terms agreed with the customer. Our audit procedures included the following:
The Company has a variety of delivery terms with customers which impact the timing of revenue recognition. • Obtained understanding of the Company's process and design of the controls to recognize revenue in appropriate period and tested the operating effectiveness of the controls on a sample basis.
Ascertainment of timing of revenue recognition is a key audit consideration for sales transactions occurring near to the year end. • Read and assessed the Company's accounting policy for recognition of revenue to assess compliance with relevant Accounting Standards.
• Performed following substantive procedures on a sample of revenue contracts entered by the Company:
- Read and identified the distinct performance obligations
- In these contracts and compared these performance obligations with those identified and recorded by the Company.
- Read the terms of the contracts and tested the basis used by the management for recognition of revenue at a point of time as per the requirements of Ind AS 115.
- Tested the basis used by the management to measure revenue recognised at a point in time as per the requirements of Ind AS 115.
- Tested on a sample basis that revenue has been recognised in the appropriate accounting period.
Receivables from related parties (as described in Note 33 of the Ind AS financial statements)
The Company has significant outstanding receivables from related parties. These include: Our audit procedures included the following:
a. Receivables from Kalpataru Limited (formerly known as Kalpataru Homes Limited) • Read the documents underlying these transactions to understand the contract and approval of the Board of Directors for transaction with Bilcare Limited.
The Company has outstanding receivables of Rs. 245.74 lacs pertaining to certain non-core assets which were underwritten by Kalpataru Limited. Specific performance of such underwriting by Kalpataru Limited has been guaranteed by Mr. Mofatraj P. Munot Director of the Kalpataru Group Companies and by others. • Assessed and tested the management basis for making the provision against these receivables.
b. Receivables from Bilcare Limited (the Ultimate Holdina Company) ("Bilcare") • Read the documents relating to guarantee for receivables from Kalpataru Limited to understand the terms of the Guarantee.
The Company has outstanding receivables of Rs. 540.31 lacs pertaining to trade receivables inter corporate deposits and interest on inter corporate deposit. The above receivables are pertaining to transactions entered prior to 2015. Considering the age of these receivables from related parties the above was determined as a key audit matter. • Traced the amounts as disclosed in these financial statements to the underlying books of account and to the confirmations.
• Read and assessed the disclosure made in the financial statements for assessing compliance with disclosure requirements.

Other Information

The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the Directors' Report but does notinclude the Ind AS financial statements and our auditor's report thereon. Our opinion onthe Ind AS financial statements does not cover the other information and we do not expressany form of assurance conclusion thereon.

In connection with our audit of the Ind AS financial statements our responsibility isto read the other information and in doing so consider whether such other information ismaterially inconsistent with the financial statements or our knowledge obtained in theaudit or otherwise appears to be materially misstated. If based on the work we haveperformed we conclude that there is a material misstatement of this other information; weare required to report that fact. We have nothing to report in this regard.

Responsibilities of Management for the Ind AS Financial Statements

The Company's Board of Directors is responsible for the matters stated in section134(5) of the Act with respect to the preparation of these Ind AS financial statementsthat give a true and fair view of the financial position financial performance includingother comprehensive income cash flows and changes in equity of the Company in accordancewith the accounting principles generally accepted in India including the IndianAccounting Standards (Ind AS) specified under section 133 of the Act read with theCompanies (Indian Accounting Standards) Rules 2015 as amended. This responsibility alsoincludes 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 irregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and the 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 Ind AS financial statementsthat give a true and fair view and are free from material misstatement whether due tofraud or error.

In preparing the Ind AS financial statements management is responsible for assessingthe Company'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 so.

Those Board of Directors are also responsible for overseeing the Company's financialreporting process.

Auditor's Responsibilities for the Audit of the Ind AS Financial Statements

Our objectives are to obtain reasonable assurance about whether the Ind AS 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 misstatement when it exists. Misstatements can arise fromfraud or error and are considered material if individually or in the aggregate theycould reasonably be expected to influence the economic decisions of users taken on thebasis of these 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 Ind AS financialstatements whether due to fraud or error design and perform audit procedures responsiveto those risks and obtain audit evidence that is sufficient and appropriate to provide abasis for our opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error as fraud may involve collusionforgery intentional omissions misrepresentations or the override of internal control.

• Obtain an understanding of internal control 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 with reference to financial statements in place andthe operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management's use of the going concern basisof accounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe financial statements or if such disclosures are inadequate to modify our opinion.Our conclusions are based on the audit evidence obtained up to the date of our auditor'sreport. However future events or conditions may cause the Company to cease to continue asa going concern.

• Evaluate the overall presentation structure and content of the Ind AS financialstatements including the disclosures and whether the Ind AS financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.

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 Ind AS financial statements forthe financial year ended March 31 2021 and are therefore the key audit matters.

We describe these matters 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 sub-section (11) of section 143 ofthe Act based on our audit we give in the "Annexure 1" a statement on thematters specified in paragraphs 3 and 4 of the Order.

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 Cash Flows and the Statement of Changes in Equity dealt with bythis Report are in agreement with the books of account;

d) In our opinion the aforesaid Ind AS financial statements comply with the IndianAccounting Standards specified under Section 133 of the Act read with Companies (IndianAccounting Standards) Rules 2015 as amended;

e) The matter described in Emphasis of Matter para above in our opinion may have anadverse effect on the functioning of the Company;

f) On the basis of the written representations received from the directors as on March312021 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2021 from being appointed as a director in terms of Section 164 (2) of theAct;

g) With respect to the adequacy of the internal financial controls over financialreporting of the Company with reference to these Ind AS financial statements and theoperating effectiveness of such controls refer to our separate Report in "Annexure2" to this report;

h) In our opinion the managerial remuneration for the year ended March 312021 hasbeen paid / provided by the Company to its directors in accordance with the provisions ofsection 197 read with Schedule V to the Act;

i) 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 Ind AS financial statements - Refer Note 32 to the Ind AS financialstatements;

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

iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.

Annexure ‘1' to The Independent Auditor's Report

(Referred to in paragraph 1 under "Report on Other Legal and RegulatoryRequirements" section of our report to the members of Caprihans India Limited of evendate)

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

(b) All fixed assets were physically verified by the management during the year inaccordance with a planned programme of verifying them once in three years which in ouropinion is reasonable having regard to the size of the Company and the nature of itsassets. No material discrepancies were noticed on such verification.

(c) According to the information and explanations given by the management the titledeeds of immovable properties included in property plant and equipment/ investmentproperty are held in the name of the Company.

(ii) The inventory has been physically verified by the management during the year. Inour opinion the frequency of verification is reasonable. No material discrepancies werenoticed on such physical verification. Inventories lying with third parties have beenconfirmed by them as at March 312021 and no material discrepancies were noticed inrespect of such confirmations.

(iii) (a) According to the information and explanations given to us the Company hasnot granted any loans secured or unsecured to companies firms Limited LiabilityPartnerships or other parties covered in the register maintained under section 189 of theCompanies Act 2013 ("the Act") during the year. Accordingly the provisions ofclause 3(iii) (a) of the Order are not applicable to the Company and hence not commentedupon.

(b) In respect of loan granted in earlier years to a Company covered in the registermaintained under section 189 of the Act the repayment of principal amount was not made asstipulated and the payment of interest was not due as at the year end in accordance withthe revised repayment schedule.

(c) As per the revised repayment schedule there are no amounts which are overdue formore than ninety days in respect of loans granted to a company covered under section 189of the Act. Also refer note 33 of the financial statements.

(iv) In our opinion and according to the information and explanations given to usthere are no loans investments guarantees and securities given in respect of which theprovisions of section 185 and 186 of the Act are applicable. Accordingly the provisionsof clause 3 (iv) of the Order are not applicable to the Company and hence not commentedupon.

(v) The Company has not accepted any deposits within the meaning of Sections 73 to 76of the Act and the Companies (Acceptance of Deposits) Rules 2014 (as amended).Accordingly the provisions of clause 3 (v) of the Order are not applicable to the Companyand hence not commented upon.

(vi) We have broadly reviewed the books of account maintained by the Company pursuantto the rules made by the Central Government for the maintenance of cost records undersection 148(1) of the Act related to the manufacture of PVC films and are of the opinionthat prima facie the specified accounts and records have been made and maintained. Wehave not however made a detailed examination of the same.

(vii) (a) The Company is regular in depositing with appropriate authorities undisputedstatutory dues including provident fund employees' state insurance income-tax customsduty goods and service tax cess and other statutory dues wherever applicable to it.

(b) According to the information and explanations given to us no undisputed amountspayable in respect of provident fund employees' state insurance income-tax custom dutygoods and service tax cess and other statutory dues were outstanding at the year endfor a period of more than six months from the date they became payable.

(c) According to the records of the Company the dues of income-tax customs dutyexcise duty goods and service tax and cess on account of any dispute are as follows:

Name of the statute Nature of the dues Amount (In Rs.) Period to which the amount relates Forum where dispute is pending
Central Excise Act 1944 Excise duty including penalty 119.62* 2004 to 2005 CESTAT

Note: * The amounts disclosed above are net of the payments made to the respectiveauthorities where the dispute is pending.

(viii) The Company did not have any outstanding loans or borrowing dues in respect of afinancial institution or bank or to government or dues to debenture holders during theyear. Accordingly the provisions of clause 3 (viii) of the Order are not applicable tothe Company and hence not commented upon.

(ix) According to the information and explanations given by the management the Companyhas not raised any money by way of initial public offer / further public offer (includingdebt instruments) and term loans. Accordingly the provisions of clause 3 (ix) of theOrder are not applicable to the Company and hence not commented upon.

(x) Based on the audit procedures performed for the purpose of reporting the true andfair view of the financial statements and as per the information and explanations given bythe management we report that no fraud by the Company or no fraud on the Company by itsofficers or employees has been noticed or reported during the year.

(xi) According to the information and explanations given by the management themanagerial remuneration has been paid / provided in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the Act.

(xii) In our opinion the Company is not a Nidhi company and accordingly the provisionsof clause 3(xii) of the Order are not applicable to the Company and hence not commentedupon.

(xiii) According to the information and explanations given by the managementtransactions with the related parties are in compliance with sections 177 and 188 of theAct where applicable and the details have been disclosed in the notes to the financialstatements as required by the applicable Accounting Standards except for transactionswith Bilcare Limited aggregating to Rs. 161.00 lacs where the recoveries are not as perstipulated terms.

(xiv) According to the information and explanations given to us and on an overallexamination of the balance sheet the Company has not made any preferential allotment orprivate placement of shares or fully or partly convertible debentures during the yearunder review and hence the provisions of clause 3(xiv) of the Order are not applicable tothe Company and hence not commented upon.

(xv) According to the information and explanations given by the management the Companyhas not entered into any non-cash transactions with directors or persons connected withhim as referred to in section 192 of the Act.

(xvi) According to the information and explanations given to us the provisions ofsection 45-IA of the Reserve Bank of India Act 1934 are not applicable to the Company andhence not commented upon.

Annexure 2 to The Independent Auditor's Report of even date on the Financial Statementsof Caprihans India Limited

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

Referred to in paragraph 2 (g) under ‘Report on Other Legal and RegulatoryRequirements' section of our report of even date Opinion

We have audited the internal financial controls over financial reporting with referenceto the financial statements of Caprihans India Limited ("the Company") as ofMarch 31 2021 in conjunction with our audit of the financial statements of the Companyfor the year ended on that date.

In our opinion the Company has in all material respects adequate internal financialcontrols over financial reporting with reference to these financial statements and suchinternal financial controls over financial reporting with reference to these financialstatements were operating effectively as at March 31 2021 based on the internal controlover financial reporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting issued by the Institute of Chartered Accountants ofIndia.

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 the 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.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting with reference to these financial statements based onour audit. We conducted our audit in accordance with the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting (the "Guidance Note") andthe Standards on Auditing as specified under section 143(10) of the Companies Act 2013to the extent applicable to an audit of internal financial controls and both issued bythe Institute of Chartered Accountants of India. Those Standards and the Guidance Noterequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls over financialreporting with reference to these financial statements was established and maintained andif such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls over financial reporting with reference to these financialstatements and their operating effectiveness. Our audit of internal financial controlsover financial reporting included obtaining an understanding of internal financialcontrols over financial reporting with reference to these financial statements assessingthe risk that a material weakness exists and testing and evaluating the design andoperating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor's 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 internal financial controls over financialreporting with reference to these financial statements.

Meaning of Internal Financial Controls Over Financial Reporting With Reference to theseFinancial Statements.

A Company's internal financial control over financial reporting with reference to thesefinancial statements is a process designed to provide reasonable assurance regarding thereliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles. A Company'sinternal financial control over financial reporting with reference to these financialstatements 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 authorisations of management and directors of the Company; and

(3) provide reasonable assurance regarding prevention or timely detection ofunauthorised 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 WithReference to these Financial Statements

Because of the inherent limitations of internal financial controls over financialreporting with reference to these financial statements including the possibility ofcollusion or improper management override of controls material misstatements due to erroror fraud may occur and not be detected. Also projections of any evaluation of theinternal financial controls over financial reporting with reference to these financialstatements to future periods are subject to the risk that the internal financial controlover financial reporting with reference to these financial statements may becomeinadequate because of changes in conditions or that the degree of compliance with thepolicies or procedures may deteriorate.

For Batliboi & Purohit
Chartered Accountants
ICAI Firm Reg. No.: 101048W
Kaushal Mehta
Partner
Place: Mumbai Membership Number: 111749
Date: June 25 2021 ICAI UDIN: 21111749AAAAEJ3787

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