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Fortis Healthcare Ltd.

BSE: 532843 Sector: Health care
NSE: FORTIS ISIN Code: INE061F01013
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OPEN 135.70
PREVIOUS CLOSE 136.55
VOLUME 268232
52-Week high 161.75
52-Week low 120.60
P/E
Mkt Cap.(Rs cr) 10,365
Buy Price 136.45
Buy Qty 224.00
Sell Price 137.00
Sell Qty 389.00
OPEN 135.70
CLOSE 136.55
VOLUME 268232
52-Week high 161.75
52-Week low 120.60
P/E
Mkt Cap.(Rs cr) 10,365
Buy Price 136.45
Buy Qty 224.00
Sell Price 137.00
Sell Qty 389.00

Fortis Healthcare Ltd. (FORTIS) - Auditors Report

Company auditors report

TO THE MEMBERS OFFORTIS HEALTHCARE LIMITED

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying Standalone Ind AS Financial Statementsof FORTIS HEALTHCARE LIMITED ("the Company") which comprise the Balance Sheetas at March 31 2018 and the Statement of Profit and Loss (including Other ComprehensiveIncome) the Cash Flow Statement the Statement of Changes in Equity for the year thenended and a summary of the significant accounting policies and other explanatoryinformation.

Management's Responsibility for the Standalone Ind AS FinancialStatements

The Company's Board of Directors is responsible for the mattersstated in Section 134(5) of the Companies Act 2013 ("the Act") with respect tothe preparation of theseStandalone Ind AS Financial Statements that give a true and fairview of the financial position financial performance including other comprehensiveincome cash flows and changes in equity of the Company in accordance with the IndianAccounting Standards (Ind AS) prescribed under section 133 of the Act read with theCompanies (Indian Accounting Standards) Rules 2015 as amended and other accountingprinciples generally accepted in India.

This responsibility also includes maintenance of adequate accountingrecords in accordance with the provisions of the Act for safeguarding the assets of theCompany and 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 Standalone Ind AS Financial Statements that give a true and fair view and are freefrom material misstatement whether due to fraud or error.

Also refer to the matters described in the Basis for Qualified Opinionparagraphs below.

Auditor's Responsibility

Our responsibility is to express an opinion on these Standalone Ind ASFinancial Statements based on our audit.

In conducting our audit we have taken into account the provisions ofthe Act the accounting and auditing standards and matters which are required to beincluded in the audit report under the provisions of the Act and the Rules made thereunderand the Order issued under section 143(11) of the Act.

We conducted our audit of the Standalone Ind AS Financial Statements inaccordance with the Standards on Auditing specified under Section 143(10) of the Act.Those Standards require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether the Standalone Ind AS FinancialStatements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence aboutthe amounts and the disclosures in the Standalone Ind AS Financial Statements. Theprocedures selected depend on the auditor's judgment including the assessment of therisks of material misstatement of the Standalone Ind AS Financial Statements whether dueto fraud or error. In making those risk assessments the auditor considers internalfinancial control relevant to the Company's preparation of the Standalone Ind ASFinancial Statements that give a true and fair view in order to design audit proceduresthat are appropriate in the circumstances. An audit also includes evaluating theappropriateness of the accounting policies used and the reasonableness of the accountingestimates made by the Company's Directors as well as evaluating the overallpresentation of the Standalone Ind AS Financial Statements.

We have considered the material weaknesses identified and reported inour separate Report on the Internal Financial Controls Over Financial Reporting indetermining the nature timing and extent of audit tests applied in our audit of theStandalone Ind AS Financial Statements for the year ended March 31 2018.

Except as indicated in the Basis for Qualified Opinion paragraphsbelow we believe that the audit evidence obtained by us (including the writtenrepresentations by the Management which was taken on record by the Board of Directors) issufficient and appropriate to provide a basis for our qualified audit opinion on theStandalone Ind AS Financial Statements.

Basis for Qualified Opinion

1. As explained in Note 30 of the Standalone Ind AS FinancialStatements pursuant to certain events/transactions the erstwhile Audit and RiskManagement Committee (the ‘ARMC') of the Company decided to carry out anindependent investigation by an external legal firm on certain matters more fullydescribed in the said Note. The terms of reference for the investigation the significantfindings of the external legal firm (including identification of certain systemic lapsesand override of internal controls) which are subject to the limitations on theinformation available to the external legal firm and their qualifications and disclaimersas described in their Investigation Report are summarised in the said Note.

Also as explained in the said note:

a) As per the assessment of the Board based on the investigationcarried out through the external legal firm and the information available at this stageall identified/required adjustments/ disclosures arising from the findings in theInvestigation Report have been made in these Standalone Ind AS Financial Statements.

b) With respect to the other matters identified in the InvestigationReport the Board intends to appoint an external agency of repute to undertake a scrutinyof the internal controls and compliance framework in order to strengthen processes andbuild a robust governance framework. They will also assess the additional requisite stepsto be taken in relation to the significant matters identified in the Investigation Reportincluding inter alia initiating an internal enquiry.

c) At this juncture the Board is unable to make a determination onwhether a fraud has occurred on the Company in respect of the matters covered in theinvestigation by the external legal firm considering the limitations on the informationavailable to the external legal firm and their qualifications and disclaimers as describedin their Investigation Report.

1 d) Various regulatory authorities are currently undertaking theirown investigation (refer Note 31 of the Standalone Ind AS Financial Statements) and it islikely that they may make a determination on whether any fraud or any othernon-compliance/ illegalities have occurred in relation to the matters addressed in theInvestigation Report.

e) Any further adjustments/disclosures if required would be made inthe books of account pursuant to the above actions to be taken by the Board / regulatoryinvestigationsas and when the outcome of the above is known.

In view of the above we are unable to comment on the regulatorynon-compliances if any and the adjustments / disclosures which may become necessary as aresult of further findings of the ongoing or future regulatory / internal investigationsand the consequential impact if any on these Standalone Ind AS Financial Statements.

2. As explained in Note 12 of the Standalone Ind AS FinancialStatements a Civil Suit has been filed by a third party (to whom the ICDs granted byFortis Hospitals Limited a subsidiary of the Company were assigned - refer Note 30 ofthe Standalone Ind AS Financial Statements)(‘Assignee' or ‘Claimant')against various entities including the Company (together "the Defendants")before the District Court Delhi and have inter alia claimed implied ownership of brands"Fortis" "SRL" and "La-Femme" in addition to certainfinancial claims and for passing a decree that consequent to a Term Sheet dated December6 2017 (‘Term Sheet') with a certain party the Company is liable for claimsowed by the Claimant to the certain party.

The Company has filed written statement denying all allegations madeagainst it and prayed for dismissal of the Civil Suit on various legal and factualgrounds. The Company has in its written statement also stated that it has not signed thealleged binding Term Sheet with the said certain party.

Whilst this matter was included as part of the investigation carriedout by the external legal firm referred to in paragraph 1 above the external legal firmdid not report on the merits of the case since the matter was sub judice.

In addition to the above the Company has also received four noticesfrom the Claimant claiming (i) Rs 1800.00 lacs as per notices dated 31 May 2018 and 1June 2018 (ii) Rs 21582.00 lacs as per notice dated 4 June 2018; and (iii) and Rs1962.00 lacs as per notice dated 4 June 2018. All these notices have been responded toby the Company denying any liability whatsoever.

Separately the certain party has also alleged rights to invest in theCompany. It has also alleged failure on part of the Company to abide by the aforementionedTerm Sheet and has claimed ownership over the brands as well.

Since the Civil Suitis sub-judice the outcome of which is notdeterminable at this stage we are unable to comment on the consequential impact if anyof the above matters on these Standalone Ind AS Financial Statements.

3. As explained in Note 6(5) of the Standalone Ind AS FinancialStatements related party relationships as required under Ind AS 24 - Related PartyDisclosures and the Companies Act 2013 are as identified by the Management taking intoaccount the findings and limitations in the Investigation Report (Refer Notes 30 (d) (iv)(ix) and (x) of the Standalone Ind AS Financial Statements) and the information availablewith the Management. In this regard in the absence of specific declarations from theerstwhile directors on their compliance with disclosures of related parties especiallyconsidering the substance of the relationship rather than the legal form the relatedparties have been identified based on the declarations by the erstwhile directors and theinformation available through the known shareholding pattern in the entities. Thereforethere may be additional related parties whose relationship may not have been disclosed tothe Company and hence not known to the Management.

In the absence of all required information we are unable to comment onthe completeness/accuracy of the related party disclosures/details in these Standalone IndAS Financial Statements and the compliance with the applicable regulations and theconsequential impact if any of the same on these Standalone Ind AS Financial Statements.

4. As explained in Note 35 of the Standalone Ind AS FinancialStatements the Company having considered all necessary facts and taking into accountexternal legal advice has decided to treat as non-Est the Letter of Appointment datedSeptember 27 2016 as amended ("LoA") issued to the erstwhile ExecutiveChairman in relation to his role as ‘Lead: Strategic Initiatives' in theStrategy Function. The external legal counsel has also advised that the payments made tohim under this LOA would be considered to be covered under the limits of section 197 ofthe Companies Act 2013. The Company is in the process of taking suitable legal measuresto recover the payments made to him under the LoA as also to recover all theCompany's assets in his possession. The Company has sent a letter to the erstwhileExecutive Chairman seeking refund of the excess amounts paid to him.

In view of the above the amounts paid to him under the aforesaid LoAand certain additional amounts reimbursed in relation to expenses incurred (in excess ofthe amounts approved by the Central Government under section 197 of the Companies Act 2013for remuneration & other reimbursements) aggregating to Rs 2002.39 lacs is shown asrecoverable in the Standalone Ind AS Financial Statements of the Company for the yearended March 31 2018. However considering the uncertainty involved on recoverability ofthe said amounts a provision of Rs 2002.39 lacs has been made which has been shown as anexceptional item.

As stated above due the nature of dispute and uncertainty involved weare unable to comment on the tenability of the refund claim the provision made for theuncertainty in recovery of the amounts the recovery of the assets in possession of theerstwhile Director and other non-compliances if any with the applicable regulations andthe consequential impact if any of the same on these Standalone Ind AS FinancialStatements.

Qualified Opinion

In our opinion and to the best of our information and according to theexplanations given to us except for the effects / possible effects of the mattersdescribed in the Basis for Qualified Opinion paragraphs above the aforesaid StandaloneInd AS Financial Statements give the information required by the Act in the manner sorequired and give a true and fair view in conformity with the Ind AS and other accountingprinciples generally accepted in India of the state of affairs of the Company as at March31 2018 and its loss total comprehensive loss its cash flows and statement of changesin equity for the year ended on that date.

Emphasis of Matter

We draw attention to Note 33 of the Standalone Ind AS FinancialStatements wherein it has been explained that the Standalone Ind AS Financial Statementshave been prepared on a going concern basis for the reasons stated in the said Note.

Our opinion is not modified in respect of this matter. Report on OtherLegal and Regulatory Requirements

1. As required by Section 143(3) of the Act based on our audit wereport to the extent applicable that:

a) We have sought and except for the matters described in the Basis forQualified Opinion paragraphs above obtained all the information and explanations which tothe best of our knowledge and belief were necessary for the purposes of our audit of theaforesaid Standalone Ind AS Financial Statements.

b) Except for the effects / possible effects of the matters describedin the Basis for Qualified Opinion paragraphs above in our opinion proper books ofaccount as required by law relating to preparation of the aforesaid Standalone Ind ASFinancial Statements have been kept so far as it appears from our examination of thosebooks.

c) The Standalone Balance Sheet the Standalone Statement of Profit andLoss (including Other Comprehensive Income) the Standalone Cash

1 Flow Statement and Standalone Statement of Changes in Equitydealt with by this Report are in agreement with the relevant books of account maintainedfor the purpose of preparation of the Standalone Ind AS financial statements.

d) Except for the effects/ possible effects of the matters described inthe Basis for Qualified Opinion paragraphs above in our opinion the aforesaid StandaloneInd AS Financial Statements comply with the Indian Accounting Standards prescribed underSection 133 of the Act

e) The matters described in the Basis for Qualified Opinion paragraphsand the Emphasis of Matter paragraph above in our opinion may have an adverse effect onthe functioning of the Company.

f) On the basis of the written representations received from thedirectors of the Company as on March 31 2018and taken on record by the Board ofDirectors none of the directors is disqualified as on March 31 2018 from being appointedas a director in terms of Section 164(2) of the Act.

g) The qualification relating to maintenance of accounts and othermatters connected therewith are as stated in the Basis for Qualified Opinion paragraphabove.

h) With respect to the adequacy of the Internal Financial Controls overFinancial Reporting of the Company and the operating effectiveness of such controls referto our separate Report in "Annexure A". Our report expresses an adverse opinionon the Internal Financial Controls over Financial Reporting of the Company for thereasons stated therein.

i) With respect to the other matters to be included in theAuditor's Report in accordance with Rule 11 of the Companies (Audit andAuditor's) Rules 2014 as amended in our opinion and to the best of our informationand according to the explanations given to us:

a. Except for the possible effects of the matters described inparagraph 2 of the Basis for Qualified Opinion above the Standalone Ind AS FinancialStatements disclose the impact of pending litigations on the financial position of theCompany. Refer Note 11 and 12 of the Standalone Financial Statements

b. Except for the p ossible effects of the matters described inparagraph 4 of the Basis for Qualified Opinion above the Company did not have anylong-term contracts including derivative contracts for which there were any materialforeseeable losses. Refer Note 9(e) of the Standalone Ind AS Financial Statements

c. There were no amounts which were required to be transferred to theInvestor Education and Protection Fund by the Company. Refer Note 9(f) of the StandaloneFinancial Statements

2. As required by the Companies (Auditor's Report) Order 2016("the Order") issued by the Central Government in terms of Section 143(11) ofthe Act we give in "Annexure B" a statement on the matters specified inparagraphs 3 and 4 of the Order which is subject to the possible effect of the mattersdescribed in the Basis for Qualified Opinion paragraphs of our Audit Report and thematerial weakness described in Basis of Adverse Opinion in our separate Report on theInternal Financial Controls over Financial Reporting.

For DELOITTE HASKINS & SELLS LLP
Chartered Accountants
(Firm‘s Registration No. 117366 W/W-100018)
Gurugram RASHIM TANDON
July 07 2018 Partner
RT/YK/2018 (Membership No. 095540)

"ANNEXURE A" TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 1(h) under ‘Report on Other Legal andRegulatory Requirements' section of our Audit Report of even date)

Report on the Internal Financial Controls Over Financial Reportingunder Clause (i) of Sub-section 3 of Section 143 of the Companies Act 2013 ("theAct")

We have audited the internal financial controls over financialreporting of FORTIS HEALTHCARE LIMITED ("the Company") as of March 31 2018 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 Company's Board of Directors is responsible for establishingand maintaining internal financial controls based on the internal control over financialreporting criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note on Audit of Internal Financial Controls overFinancial Reporting issued by the Institute of Chartered Accountants of India. Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to company's policies the safeguardingof its assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required under the Companies Act 2013.

Also refer to the matters described in the Basis for Qualified Opinionparagraphs of our Audit Report.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company'sinternal financial controls over financial reporting based on our audit. We conducted ouraudit in accordance with the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting (the "Guidance Note") issued by the Institute of CharteredAccountants of India and the Standards on Auditing prescribed under Section 143(10) of theCompanies Act 2013 to the extent applicable to an audit of internal financial controls.Those Standards and the Guidance Note require that we comply with ethical requirements andplan and perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls over financial reporting was established and maintained and if suchcontrols operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence aboutthe adequacy of the internal financial controls system over financial reporting and theiroperating effectiveness. Our audit of internal financial controls over financial reportingincluded obtaining an understanding of internal financial controls over financialreporting assessing the risk that a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal control based on the assessed risk. Theprocedures selected depend on the auditor's judgement including the assessment ofthe risks of material misstatement of the financial statements whether due to fraud orerror.

We believe that the audit evidence we have obtained(including thewritten representations by the Management which was taken on record by the Board ofDirectors) is sufficient and appropriate to provide a basis for our adverse audit opinionon the Company's internal financial controls system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A company's internal financial control over financial reporting isa process designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles. A company's internal financial controlover financial 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 reasonable

1 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) providereasonable assurance regarding prevention or timely detection of unauthorised acquisitionuse or disposition of the company's assets that could have a material effect on thefinancial statements.

Inherent Limitations of Internal Financial Controls Over FinancialReporting

Because of the inherent limitations of internal financial controls overfinancial reporting including the possibility of collusion or improper managementoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projections of any evaluation of the internal financial controls overfinancial reporting to future periods are subject to the risk that the internal financialcontrol over financial reporting may become inadequate because of changes in conditionsor that the degree of compliance with the policies or procedures may deteriorate.

Basis for Adverse opinion

The matters described in the Basis for Qualified Opinion paragraphs ofour Audit Report on the Standalone Ind AS Financial Statements for the year ended March31 2018 and the control weaknesses observed in the Company's financial closing andreporting process in regard to assessment of the impairment of goodwill and investmentswhere the Company did not have adequate internal controls for identifying impairmentindicators selection and application of various inputs to be used in testing review andmaintaining documentation for workings used in testing and concluding whether there is anyimpairment have resulted in material weaknesses in the internal financial controls overfinancial reporting as the Company have not(a) adhered to their internal control policies(b) safeguarded their assets (c) prevented and detected possible frauds and errors (d)ensured the accuracy and completeness of the accounting records and (e) prepared reliablefinancial information on a timely basis.

A ‘material weakness' is a deficiency or a combination ofdeficiencies in internal financial control over financial reporting such that there is areasonable possibility that a material misstatement of the company's annual orinterim financial statements will not be prevented or detected on a timely basis.

Adverse Opinion

In our opinion to the best of our information and according to theexplanations given to us because of the effect/possible effect of the material weaknessesdescribed in the Basis for Adverse Opinion paragraph above on the achievement of theobjectives of the control criteria the Company has not maintained adequate internalfinancial controls over financial reporting and the internal controls were also notoperating effectively as of March 31 2018 based on the internal financial control overfinancial 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.

We have considered the material weaknesses identified and reportedabove in determining the nature timing and extent of audit tests applied in our audit ofthe Standalone Ind AS Financial Statements of the Company for the year ended March 312018 and these material weaknesses have inter alia affected our opinion on the saidStandalone Ind AS Financial Statements and we have issued a qualified opinion on the saidStandalone Ind AS Financial Statements.

For DELOITTE HASKINS & SELLS LLP
Chartered Accountants
(Firm‘s Registration No. 117366 W/W-100018)
Gurugram RASHIM TANDON
July07 2018 Partner
RT/YK/2018 (Membership No. 095540)

ANNEXURE B" TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 2 under ‘Report on Other Legal andRegulatory Requirements' section of our Audit

Report of even date and except for the effects/possible effects of thematters described in the Basis for Qualified

Opinion paragraphs of our Audit Report and the material weaknessesdescribed in the Basis of Adverse Opinion

in our separate Report on the Internal Financial Controls OverFinancial Reporting)

(i) In respect of its fixed assets:

(a) The Company has maintained proper records showing full particularsincluding quantitative details and situation of fixed assets.

(b) The fixed assets were physically verified during the year by theManagement in accordance with a regular programme of verification which in our opinionprovides for physical verification of all the fixed assets at reasonable intervals.According to the information and explanation given to us no material discrepancies werenoticed on such verification.

(c) In respect of freehold land amounting to Rs 10.09 lacs the Companyhas not been able to provide us with original title deed in order for us to verify if suchimmovable property is held in the name of the Company.

In respect of immovable properties of land and buildings that have beentaken on lease and disclosed as fixed assets in the financial statements the leaseagreements are in the name of the Company where the Company is the lessee in theagreement.

(ii) As explained to us the inventories were physically verifiedduring the year by the Management at reasonable intervals and no material discrepancieswere noticed on physical verification.

(iii) Except for the effects / possible effects of the mattersdescribed in paragraph 3 of the Basis for Qualified Opinion section on which we are unableto comment the Company has granted loans secured or unsecured to companies firmscovered in the register maintained under section 189 of the Companies Act 2013 inrespect of which:

(a) The terms and conditions of the grant of such loans are in ouropinion prima facie not prejudicial to the Company's interest.

(b) The schedule of repayment of principal and payment of interest hasbeen stipulated and repayments or receipts of principal amounts and interest have been asper stipulations.

(c) There is no overdue amount remaining outstanding as at theyear-end.

(iv) Except for the effects / possible effects of the matters describedin paragraph 3 of the Basis for Qualified Opinion section on which we are unable tocomment the Company has complied with the provisions of Sections 185 and 186 of theCompanies Act 2013 in respect of grant of loans making investments and providingguarantees and securities as applicable.

(v) According to the information and explanations given to us theCompany has not accepted any deposits during the year. The Company does not have anyunclaimed deposits and accordingly the provisions of Sections 73 to 76 or any otherrelevant provisions of the Companies Act 2013 are not applicable to the Company.

(vi) The maintenance of cost records has been specified by the CentralGovernment under section 148(1) of the Companies Act 2013. We have broadly reviewed thecost records maintained by the Company pursuant to the Companies (Cost Records and Audit)Rules 2014 as amended prescribed by the Central Government under subsection (1) ofSection 148 of the Companies Act 2013 and are of the opinion that prima facie theprescribed cost records have been made and maintained. We have however not made adetailed examination of the cost records with a view to determine whether they areaccurate or complete.

(vii) According to the information and explanations given to us inrespect of statutory dues:

(a) The Company has generally been regular in depositing undisputedstatutory dues including Provident Fund Employees' State Insurance Income TaxService Tax Works Contract Tax Customs Duty Value Added Tax Goods and Services Tax andCess with the appropriate authorities during the year and that there are no undisputedamounts in respect of these dues which have remained outstanding as at March 31 2018 fora period of more than six months from the date they became payable.

1 We are informed that the operations of the Company during theperiod did not give rise to any liability for Excise Duty.

(b) Details of dues of Income-tax and Service Tax which have not beendeposited as on March 31 2018 on account of disputes are given below:-

Name of Statute Nature of dues Forum where dispute is pending Period to which the amount relates (Assessment year) Amount Involved (Rs Lacs) Amount Unpaid (Rs Lacs)
Income Tax Act Income Tax and Interest thereon Commissioner of Income Tax (Appeals) Delhi 2012-13 334.18
Income Tax Act Tax deducted at source Commissioner of Income Tax (Appeals) 2016-17 to 2017-18 1252.00 1252.00
Central Excise Act 1944 Value Added Tax Supreme Court 2009-10 1412.35 1412.35
Central Excise Act 1944 Value Added Tax Supreme Court 2010-11 2208.81 2208.81
Finance Tax 1994 Service Tax and penalty Custom Excise & Service Tax Appellate Tribunal 2007-08 to 2012-13 265.47 265.47
Finance Tax 1994 Service Tax and penalty Custom Excise & Service Tax Appellate Tribunal 2008-09 to 2012-13 294.35 294.35
The Customs Act 1962 Custom duty and penalty Appellate Authority 2013-14 12.00 12.00
TOTAL 5779.17 4192.98

We are informed that there are no dues in respect of Customs Duty andWorks Contract Tax as at 31 March 2018 which have not been deposited on account of anydispute.

(viii) In our opinion and according to the information and explanationsgiven to us the Company has not defaulted in the repayment of dues to a bank or to anyfinancial institution except that in case of loanof Rs 10000 lacs due to a financialinstitution which was repayable on November 9 2017 but was fully repaid in multipletranches till January 5 2018. The Company did not have any outstanding debentures duringthe year.

(ix) As indicated in the Investigation Report referred to in Paragraph1 of ‘Basis for Qualified Opinion'section on our Audit Report and as explainedin Note 30 to the Standalone Ind AS Financial Statements certain funds were diverted fromthe Company to effect the roll over of ICDs by a subsidiary company. Such diversions mayindicate application of term loans for purposes other than for which they were raised.

Subject to above in our opinion and according to the information andexplanations given to us the loans taken by the Company and applied during the year werefor the purpose for which they were raised.

The Company has not raised moneys by way of initial public offer orfurther public offer (including debt instruments).

(x) As explained in Note 30 (i) of theStandalone Ind AS FinancialStatements:

a) At this juncture the Board is unable to make a determination onwhether a fraud has occurred on the Company in respect of the matters covered in theinvestigation by the external legal firm considering the limitations on the informationavailable to the external legal firm and their qualifications and disclaimers as describedin their Investigation Report.

b) Various regulatory authorities are currently undertaking their owninvestigation (refer Note 31 of the Standalone Ind AS Financial Statements) and it islikely that they may make a determination on whether any fraud or any othernon-compliance/ illegalities have occurred in relation to the matters addressed in theInvestigation Report.

Subject to the above and according to the information and explanationsgiven to us no fraud by the Company and no material fraud on the Company by its officersor employees has been noticed or reported during the year.

(xi) According to the information and explanations given to us and asexplained in Note 35 of the Standalone Ind AS Financial Statement the Company has nowbeen advised by an external legal counsel that the payments made to the erstwhileExecutive Chairman under the Letter of Appointment dated September 27 2016 as amended("LoA") issued to him in relation to his role as ‘Lead: StrategicInitiatives' in the Strategy Function would be considered to be covered under thelimits of section 197 of the Companies Act 2013. Consequently the Company has determinedthat it has paid/provided managerial remuneration to the erstwhile Executive Chairman inexcess of the limits approved by the Central Government as given below:

Managerial Position Excess amount of (Rs in Lacs) remuneration paid / provided Financial year ending Treatment of the excess remuneration in the respective year financial statements Steps taken by the Company for securing refund
Executive Chairman (Upto February 13 2018) 2002.39 Year ended 31 March 2017 and 2018 Recoverable in books of account and subsequent provision made. The Company has sent a letter to the erstwhile Executive Chairman seeking refund of the excess amounts paid to him.

(xii) The Company is not a Nidhi Company and hence reporting underclause (xii) of the CARO 2016 is not applicable.

(xiii) Except for the effects / possible effects of the mattersdescribed in paragraph 3 of the Basis for Qualified Opinion section on which we are unableto comment the Companyis in compliance with Section 177 and 188 of the Companies Act2013 where applicable for all transactions with the related parties and thecompleteness/ correctness of the disclosures/details of related party transactions in thefinancial statements as required by the applicable accounting standards.

(xiv) During the year the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures andhence reporting under clause (xiv) of CARO 2016 is not applicable to the Company.

(xv) In our opinion and according to the information and explanationsgiven to us during the year the Company has not entered into any non-cash transactionswith its directors or directors of its holding subsidiary or associate company or personsconnected with them and hence provisions of section 192 of the Companies Act 2013 are notapplicable.

(xvi) The Company is not required to be registered under section 45-IAof the Reserve Bank of India Act 1934.

For DELOITTE HASKINS & SELLS LLP
Chartered Accountants
(Firm‘s Registration No. 117366 W/W-100018)
Gurugram RASHIM TANDON
July 07 2018 Partner
RT/YK/2018 (Membership No. 095540)