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Chemtech Industrial Valves Ltd.

BSE: 537326 Sector: Others
NSE: N.A. ISIN Code: INE212P01011
BSE 00:00 | 10 Aug 13.00 0.15
(1.17%)
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NSE 05:30 | 01 Jan Chemtech Industrial Valves Ltd
OPEN 12.75
PREVIOUS CLOSE 12.85
VOLUME 32590
52-Week high 20.00
52-Week low 7.85
P/E
Mkt Cap.(Rs cr) 15
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 12.75
CLOSE 12.85
VOLUME 32590
52-Week high 20.00
52-Week low 7.85
P/E
Mkt Cap.(Rs cr) 15
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Chemtech Industrial Valves Ltd. (CHEMTECHINDUST) - Auditors Report

Company auditors report

TO THE MEMBERS OF

CHEMTECH INDUSTRIAL VALVES LIMITED

Report on the Ind AS financial statements

Opinion

We have audited the accompanying Ind AS financial statements of CHEMTECH INDUSTRIALVALVES LIMITED ("the Company") which comprise the Balance Sheet as at 31stMarch 2022 the Statement of Profit and Loss the Cash Flow Statement the Statement ofChanges in Equity and notes to financial statements including a summary of the significantaccounting policies and other explanatory information for the year then ended.

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by theCompanies Act 2013("the Act") in the manner so required and give a true andfair view in conformity with the accounting principles generally accepted in India of thestate of affairs of the Company as at March 31 2022 and its Profit changes in equityand its Cash Flows for the year ended 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.

Key Audit Matters

This section of our auditors' report is intended to describe the matters selected fromthose communicated with those charged with governance that in our professional judgmentwere of most significance in our audit of the financial statements.

a) Revenue recognition (IND AS 115)

The application of the new standard on recognition of revenue involves significantjudgement and estimates made by the management which includes identification ofperformance obligations contained in contracts determination of the most appropriatemethod for recognition of revenue relating to the identified performance obligationsassessment of transaction price and allocation of the assessed price to the individualperformance obligations. Audit procedure involved review of the company's IND AS 115implementation process and key judgments made by management evaluation of customercontracts in light of IND AS 115 on sample basis and comparison of the same withmanagement's evaluation and assessment of design and operating effectiveness of internalcontrols relating to revenue recognition.

Also the Company was granted certificate of entitlement for availing sales taxincentive under package Part-I of the 1993 package scheme of incentive (PSI) of Govt. ofMaharashtra by way of deferment of sales Tax liability pertaining to period from01.09.1999 to 30.04.2006 up to the maximum ceiling of Rs.3728000/-. The liabilitydeferred for the period of 10 years from the year of collection of sales tax. As per theterm of payment the sales Tax liability of each Financial Year is payable in five equalinstallments. The same will be paid once order for payment is received by respectiveauthority.

Based on the procedures performed it is concluded that management's judgments withrespect to recognition and measurement of revenue in light of IND AS 115 is appropriate.

Emphasis of Matter

Attention is drawn to Contingent Liability shown as a foot note to the Annual FinancialResults CKP bank's license is withdrawn by RBI and RBI has declared that Rs.500000/-will be confirm given to depositors which has been received by the company and adjustedagainst the current account balance that was held with the bank the remaining amount willbe given to deposit holders and shareholders if reserves are available.

It is still recorded as an asset in financials which will be reversed as and whenconfirmation comes from RBI about non-payment to depositors and shareholders.

Other Matters

The audit of the Financial Statements has been conducted after considering the impactof COVID-19 on the business and appropriate disclosures wherever applicable have beenmade in the Notes annexed to the Financial Statements.

Responsibility of Management for the Standalone Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section134(5) of the Companies Act 2013 ("the Act") with respect to the preparation ofthese (Standalone) Ind AS financial statements that give a true and fair view of thefinancial position financial performance and cash flows of the Company in accordance withthe accounting principles generally accepted in India including the Accounting Standardsspecified under Section 133 of the Act read with Rule 7 of the Companies (Accounts)Rules 2014. This responsibility also includes maintenance of adequate accounting recordsin accordance with the provisions of the Act for safeguarding the assets of the Companyand for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe Ind AS financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

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 so.

The Board of Directors is also responsible for overseeing the company's financialreporting process.

Auditors' Responsibility

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 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 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 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.

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

• Conclude on the appropriateness management's use of the going concern basis ofaccounting 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 standalone financial statements or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor's report. However future events or conditions may cause the Company to cease tocontinue as a going concern.

• We communicate with those charged with governance regarding among othermatters the planned scope and timing of the audit and significant audit findingsincluding any significant deficiencies in internal control that we identify during ouraudit.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order 2020 ("the Order")as amended issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Act we give in the "Annexure A" a statement on the mattersspecified in paragraphs 3 and 4 of the Order.

2. A) As required by Section 143 (3 the Act) of 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 and the Cash Flow Statementdealt with by this Report are in agreement with the books of account.

(d) In our opinion the aforesaid Ind AS 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 2022 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2022 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 over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in "Annexure B".

(g) With respect to the other matters to be included in the 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 pending litigations on its financialposition in its Ind AS financial statements - refer Notes 34.1 and 34.3 to the Ind ASfinancial statements.

ii. The Company has long term contract but does not have any derivative contracts forwhich there were any material foreseeable losses.

iii. There were no amounts which were required to be transfer to the InvestorEducation and Protection Fund by the Company during the year ended 31.03.2022.

B) With respect to the matter to be included in the Auditors' Report under Section197(16) of the Act:

In our opinion and according to the information and explanations given to us theremuneration paid by the Company to its directors during the current year is in accordancewith the provisions of Section 197 of the Act. The remuneration paid to any director isnot in excess of the limit laid down under Section 197 of the Act. The Ministry ofCorporate Affairs has not prescribed other details under Section 197(16) which arerequired to be commented upon by us.

ANNEXURE A TO THE INDEPENDENT AUDITORS' REPORT

Referred to in Paragraph 1 under the heading "Report on other legal and regulatoryrequirements" of our Independent Auditor's Report of even date to the members ofCHEMTECH INDUSTRIAL VALVES LIMITED On the Ind AS financial statements as of and for theyear ended 31.03.2022

On the basis of such checks as we considered appropriate and according to theinformation and explanations given to us during the course of our audit we report that

(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of Property Plant & Equipment.

(b) As explained to us Property Plant & Equipment have been physically verified bythe management during the year and no material discrepancies were noticed on suchverification.

(c) According to information and explanations given to us and on the basis of ourexamination of records the title deeds of immovable properties are held in the name of thecompany.

(ii) The management has conducted the physical verification of inventory at reasonableintervals and no material discrepancies have noticed on physical verification of theinventory as compared to books records.

(iii) The Company has not granted any loans secured or unsecured to companies firmsLimited Liability partnerships or other parties covered in the Register maintained undersection 189 of the Act. Accordingly the provisions of clause 3 (iii) (a) to (c) of theOrder are not applicable to the Company and hence not commented upon.

(iv) In our opinion and according to the information and explanations given to us thecompany has not granted loans guarantees and security investments covered u/s 185 and186 the investment made by the company is in compliance with the provisions of section 186of the Companies Act 2013.

(v) The Company has not accepted any deposits from the public and hence the directivesissued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any otherrelevant provisions of the Act and the Companies (Acceptance of Deposit) Rules 2015 withregard to the deposits accepted from the public are not applicable.

(vi) We have broadly reviewed the accounts and records maintained by the Company inrespect of products where pursuant to the rules made by the Central Government of Indiathe maintenance of cost records has been prescribed under sub-section (1) of section 148of the Act and are of the Opinion that prima facie the prescribed accounts and recordshave been made and maintained. We have not however made a detailed examination of thesame.

(vii) (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 Provident Fund Employees StateInsurance Income-Tax Sales tax Service Tax Duty of Customs Duty of Excise Valueadded Tax Cess and any other statutory dues wherever applicable and any otherapplicable statutory dues with the appropriate authorities. According to the informationand explanations given to us no undisputed amounts payable in respect of the above werein arrears as at March 31 2022 for a period of more than six months from the date on whenthey become payable except the following:

STATUTES NATURE OF DUES AMOUNT (Rs.) PERIOD DUE DATE DATE OF PAYMENT
Sales tax Deferment Installment 3622791 1999-00 to 2004- OS. Annual installments Outstanding

(b) According to the information and explanation given to us there are no dues ofincome tax sales tax service tax duty of customs duty of excise value added taxoutstanding on account of any dispute except as mentioned below:

Sr. No. Name of Statute Nature of Dues Forum where Dispute is pending Financial Year Amount in Rs.
1 Central Sales tax CST Comm. of sales Tax 2006-07 270979
2 Central Sales tax CST Comm. of sales Tax 2009-10 4259201
3 Income tax IT Income tax officer 2018-19 71732

(viii) In our opinion and according to the information and explanations given to usthe Company has not defaulted in the repayment of Loans or borrowing to financialinstitution and to banks. The Company did not have any outstanding loans or borrowingsfrom financial institution or government and there are no dues to debenture holders duringthe year.

There are no any transactions not recorded in the books of account have beensurrendered or disclosed as income during the year in the tax assessments under the IncomeTax Act 1961.

(ix) The company has not defaulted in repayment of loans or other borrowings or in thepayment of interest thereon to any lender. The company is not declared willful defaulterby any bank or financial institution or other lender. The term loans were applied for thepurpose for which the loans were obtained. The company has not taken any funds from anyentity or person on account of or to meet the obligations of its subsidiaries associatesor joint venture. The company has not raised loans during the year on the pledge ofsecurities held in its subsidiaries joint ventures or associate companies.

(x) The company has not raised moneys by way of initial public offer or further publicoffer including debt instruments during the year. Further the term loan taken during theyear was applied for the purpose for which it is raised.The company has not made anypreferential allotment or private placement of shares or convertible debentures (fullypartially or optionally convertible) during the year.

(xi) During the course of our examination of the books and records of the companycarried in accordance with auditing standard generally accepted in India we have neithercome across any instance of fraud on the Company by its officers or employees noticed orreported during the course of our audit nor have we been informed of any such instance bythe management. No report under sub-section (12) of section 143 of the Companies Act hasbeen filed by the auditors in Form ADT-4 as prescribed under rule 13 of Companies (Auditand Auditors) Rules 2014 with the Central Government. The auditor has consideredwhistle-blower complaints if any received during the year by the company.

(xii) In our opinion the Company is not a Nidhi Company. Therefore the provisions ofclause 3 (xii) of the Order are not applicable to the Company.

(xiii) In our opinion all transactions with the related parties are in compliance withsection 177 and 188 of Companies Act 2013 and the details have been disclosed in the IndAS financial statements as required by the applicable accounting standards.

(xiv) All the reports of the Internal Auditors for the period under audit wereconsidered.

(xv) Based upon the audit procedures performed and the information and explanationsgiven by the management the company has not entered into any non-cash transactions withdirectors or persons connected with him. Accordingly the provisions of clause 3 (xv) ofthe Order are not applicable to the Company.

(xvi) In our opinion the company is not required to be registered under section 45 IAof the Reserve Bank of India Act 1934 and accordingly the provisions of clause 3 (xvi)of the Order are not applicable to the Company.

The company has not conducted any Non-Banking Financial or Housing Finance activitieswithout a valid certificate of Registration (CoR) from the Reserve Bank of India as perthe Reserve Bank of India Act 1934. The company is not a Core Investment Company (CIC) asdefined in the regulations made by the Reserve Bank of India.The Group has no CIC as partof the Group.

(xvii) The Company has not incurred cash losses in the FY 21-22 and also in FY 20-21.

(xviii) There has not been any resignation of the statutory auditors during the year.

(xix) We have opinion that no material uncertainty exists as on the date of the auditreport that company is capable of meeting its liabilities existing at the date of balancesheet as and when they fall due within a period of one year from the balance sheet date.

(xx) No amount remaining unspent under section (5) of section 135 of Companies Act.

(xxi) No qualifications or adverse remarks by the respective auditors in the Companies(Auditor's Report) Order (CARO) reports of the companies included in the consolidatedfinancial statements.

ANNEXURE B TO THE INDEPENDENT AUDITORS' REPORT

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act") of even date on the Standalone Ind ASfinancial statements of CHEMTECH INDUSTRIAL VALVES LIMITED

Opinion

We have audited the internal financial controls over financial reporting of CHEMTECHINDUSTRIAL VALVES LIMITED ("the Company") as of March 31 2022 in conjunctionwith our audit of the standalone Ind AS financial statements of the Company for the yearended 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. 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 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.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting(the "Guidance Note") and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered 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 andmaintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor's judgment including the assessment of the risks ofmaterial misstatement of the Ind AS 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 Ind AS financial statements for external purposes in accordance withgenerally accepted accounting principles. A company's internal financial control overfinancial reporting includes those policies and procedures that (1) pertain to themaintenance of records that in reasonable detail accurately and fairly reflect thetransactions and dispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of Ind ASfinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorisations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorised acquisition use ordisposition of the company's assets that could have a material effect on the Ind ASfinancial 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 or for otherreasons.

Opinion

In our opinion the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at March 31 2022 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 Raju & Prasad Chartered Accountants Place: Mumbai
FRN No. 003475S Date: 19.05.2022
Sd/-
Avinash T Jain
Partner
Membership No. 041689
UDIN: 22041689AJGBQD9703

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