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Gujarat Mineral Development Corporation Ltd.

BSE: 532181 Sector: Metals & Mining
NSE: GMDCLTD ISIN Code: INE131A01031
BSE 00:00 | 18 Mar 82.10 -0.50
(-0.61%)
OPEN

83.40

HIGH

83.80

LOW

82.00

NSE 00:00 | 18 Mar 82.10 -0.45
(-0.55%)
OPEN

83.30

HIGH

83.50

LOW

81.60

OPEN 83.40
PREVIOUS CLOSE 82.60
VOLUME 15326
52-Week high 147.00
52-Week low 69.00
P/E 6.77
Mkt Cap.(Rs cr) 2,611
Buy Price 82.00
Buy Qty 228.00
Sell Price 82.10
Sell Qty 1.00
OPEN 83.40
CLOSE 82.60
VOLUME 15326
52-Week high 147.00
52-Week low 69.00
P/E 6.77
Mkt Cap.(Rs cr) 2,611
Buy Price 82.00
Buy Qty 228.00
Sell Price 82.10
Sell Qty 1.00

Gujarat Mineral Development Corporation Ltd. (GMDCLTD) - Auditors Report

Company auditors report

To

The Members of

Gujarat Mineral Development Corporation Limited Report on the Standalone Ind ASFinancial Statements

We have audited the accompanying standalone Ind AS financial statements of GujaratMineral Development Corporation Limited ("the Company”) which comprise theBalance Sheet as at 31st March 2018 and the Statement of Profit and Loss (includingOther Comprehensive Income) the Cash Flow Statement and the Statement of Changes inEquity for the year then ended and a summary of the significant accounting policies andother explanatory information (herein after referred to as "standalone Ind ASfinancial statements”).

Management's Responsibility for the Standalone Ind AS 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 including other comprehensive income cash flowsand changes in equity of the Company in accordance with the accounting principlesgenerally accepted in India including the Indian Accounting Standards (Ind AS) prescribedunder section 133 of the Act read with relevant rules issued there under.

This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the standalone IndAS financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

Auditors' Responsibility

Our responsibility is to express an opinion on these standalone Ind AS financialstatements based on our audit. We have taken into account the provisions of the Act theaccounting and auditing standards and matters which are required to be included in theaudit report under the provisions of the Act and the Rules made there under. We conductedour audit of the standalone Ind AS financial statements in accordance with the Standardson Auditing specified under Section 143(10) of the Act. Those Standards require that wecomply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether the standalone Ind AS financial statements are free from materialmisstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the standalone Ind AS financial statements. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the standalone Ind AS financial statements whether due to fraud or error.In making those risk assessments the auditor considers internal financial controlrelevant to the Company's preparation of the standalone Ind AS financial statements thatgive a true and fair view in order to design audit procedures that are appropriate in thecircumstances. An audit also includes evaluating the appropriateness of the accountingpolicies used and the reasonableness of the accounting estimates made by the Company'sDirectors as well as evaluating the overall presentation of the standalone Ind ASfinancial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the standalone Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone Ind AS financial statements give the informationrequired by the Act in the manner so required and give a true and fair view in conformitywith the accounting principles generally accepted in India including the Ind AS of thefinancial position of the Company as at 31st March 2018 and its financial performanceincluding other comprehensive income its cash flows and the changes in equity for theyear ended on that date.

Emphasis of Matter

We draw attention to note no. 2.49 of the standalone financial statements wherein thecompany was using CERC (Terms & Conditions of Tariff) Regulations for depreciating itsWind Solar and Thermal power plant assets. For all other assets depreciation was beingcalculated as per Schedule II of the Companies Act 2013. From 1st April 2017 thecompany has discontinued to follow CERC regulations for depreciating the power plantassets and has charged deprecation based on useful life as prescribed in Schedule II ofthe Companies Act2013 and accordingly has estimated the useful life of the power plantassets.

The said change of estimate has resulted in decrease in total depreciation to the tuneof Rs. 6225.37 lakhs for the year ended 31st March 2018 and increase in profit before taxfor the year ended that date by the same amount.

The above change in estimate would also have impact on future accounting periods forwhich estimation is currently impracticable. Our opinion on the standalone Ind ASfinancial statements and our Report on Other Legal and Regulatory Requirements below isnot modified in respect of the above matters.

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 we give in the Annexure ‘A' a statement on the matters specified inparagraphs 3 and 4 of the Order to the extent applicable.

2. In terms of Section 143(5) of the Act we give in Annexure ‘2(i) & 2(ii)' astatement on the directions issued under the aforesaid section by the Comptroller andAuditor General of India.

3. 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 the Cash Flow Statement and theStatement of Changes in Equity dealt with by this Report are in agreement with the booksof account.

d) In our opinion the aforesaid standalone Ind AS financial statements comply with theAccounting Standards specified under Section 133 of the Act read with relevant rule issuedthere under.

e) On the basis of the written representations received from the directors as on 31stMarch 2018 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2018 from being appointed as a director in terms ofSection 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 standalone Ind AS financial statements- Refer Note 2.37 to the StandaloneInd AS financial statements.

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

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

For S.C. Ajmera & Co.
Chartered Accountants
FRN 002908C
Place:- Ahmedabad Arun Sarupria - Partner
Date:- 09.05.2018 M. No.078398

ANNEXURE ‘A' TO THE AUDITORS' REPORT

(Referred to Para (1) our Report of even date)

The Annexure referred to in Independent Auditors' Report to the members of GujaratMineral Development Corporation Limited (“the Company”) on the standalone Ind ASfinancial statements for the year ended 31 March 2018.

We report that:

i. In respect of Fixed Assets

a. The company has maintained proper records showing full particulars includingquantitative details and situation of its fixed assets.

b. The Company has a program of physical verification of its fixed assets by whichfixed assets are verified at reasonable intervals. In accordance with this program fixedassets were verified during the year and discrepancies which were noticed on suchverification were properly dealt with in the books of accounts.

c. According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the title deeds of immovable properties areheld in the name of the company.

ii. In respect of Inventory

a. The physical verification of inventory has been conducted at reasonable intervals bythe Management.

b. The procedure of physical verification of inventory followed by the management isreasonable and adequate in relation to the size of company and the nature of its business.

c. The company has maintained proper records of inventory. The discrepancies noticed onsuch verification between the physical stock and book stock were not material and the samehave been properly dealt with in the books of accounts.

iii. The company has not granted any loans secured or unsecured to companies firms orother parties covered in the register maintained under section 189 of the Companies Act2013. Therefore requirement of clauses (iii) of the paragraph 3 of the order is notapplicable to the company.

iv. In respect of loans investments guarantees and security provisions of section185 and 186 of the Companies Act 2013 have been complied with.

v. The company has not accepted any deposits during the year as per the directivesissued by the Reserve Bank of India and within the meaning of the provisions of sections73 to 76 and other relevant provisions of the Companies Act and the rules framed thereunder where applicable. Thus the clause (v) of paragraph 3 of the order is notapplicable to the company.

vi. In pursuant to the order made by the Central Government for the maintenance of costrecords under sub section (1) of section 148 of the Companies Act 2013 the company hasmade and maintained the prescribed accounts and records.

vii. In respect of statutory dues

a. According to the information and explanations given to us and on the basis of ourexamination the company is generally regular in depositing undisputed statutory duesincluding provident fund Investor Education and Protection Fund Employee's StateInsurance Income Tax Goods and Service Tax Sales Tax Wealth Tax Service Tax Duty ofExcise Value Added Tax and Cess and any other statutory dues with appropriateauthorities.

b. The details of excise duty service tax income tax and sales tax/VAT not depositedon account of dispute are as under:

Name of Statue Nature of the Dues Period to which the amount relates Amount (Rs. In Lakh) Forum where dispute is pending
Commercial tax Sales tax/VAT 1995-96 98.92 Appellate Tribunal
Commercial tax Sales tax/VAT 1997-98 2.45 Appellate Tribunal
Commercial tax CST 1997-98 4.26 Appellate Tribunal
Service Tax Service Tax Jan-14 Nov-15 0.65 Appellate Tribunal
Service Tax Service Tax Dec-15 to Aug 16 0.39 Appellate Tribunal
Central Excise Act 1944 Excise Jan 14-Dec 14 16.03 Appellate Tribunal
Central Excise Act 1944 Excise May 15-Jan 16 1.23 Appellate Tribunal
Central Excise Act 1944 Excise Mar 11-April 15 38.77 Appellate Tribunal
Central Excise Act 1944 Excise 2015-16 450.58 Appellate Tribunal

viii. The Company does not have any loans or borrowings from any financial institutionbanks government or debenture holders during the year.

ix. The company has not raised any money by way of initial public offer or furtherpublic offer (including debt instruments) or taken any term loan during the year.

x. According to the information and explanations given to us no material fraud by theCompany or on the Company by its officers or employees has been noticed or reported duringthe course of our audit.

xi. According to the information and explanations give to us the Company haspaid/provided for managerial remuneration in accordance with the requisite approvalsmandated by the provisions of section 197 read with Schedule V to the Act.

xii. In our opinion and according to the information and explanations given to us theCompany is not a Nidhi Company.

xiii. According to the information and explanations given to us all transactions withthe related parties are in compliance with sections 177 and 188 of Companies Act 2013where ever applicable and the details have been disclosed in the standalone Ind ASFinancial Statements etc. as required by the applicable Indian Accounting Standards.

xiv. According to the information and explanations give to us and based on ourexamination of the records of the Company the company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year under review.

xv. According to the information and explanations give to us and based on ourexamination of the records of the Company the company has not entered into non-cashtransactions with directors or persons connected with them during the year.

xvi. The company is not required to be registered under Section 45-IA of the ReserveBank of India Act 1934.

For S.C. Ajmera & Co.
Chartered Accountants
FRN 002908C
Place:- Ahmedabad Arun Sarupria - Partner
Date:- 09.05.2018 M. No.078398

ANNEXURE ‘B' TO THE AUDITORS' REPORT

Report on Internal Financial Controls over Financial Reporting

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

We have audited the internal financial controls over financial reporting of GujaratDevelopment Mineral Corporation Limited (“the Company”) as of March 312018 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 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 were 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 auditors' judgment including the assessment of the risks ofmaterial misstatement of the standalone Ind AS financial statements whether due to fraudor 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 standalone Ind AS financial statements for external purposes in accordancewith generally accepted accounting principles. A company's internal financial control overfinancial reporting 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 standalone Ind AS financial statements in accordance with generallyaccepted accounting principles and that receipts and expenditures of the company arebeing made only in accordance with authorisations of management and directors of thecompany; and

3. provide reasonable assurance regarding prevention or timely detection ofunauthorized 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

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.

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 312018 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 S.C. Ajmera & Co.
Chartered Accountants
FRN 002908C
Place:- Ahmedabad Arun Sarupria - Partner
Date:- 09.05.2018 M.No.078398

ANNEXURE TO THE INDEPENDENT AUDITORS' REPORT OF GUJARAT MINERAL DEVELOPMENT CORPORATIONLTD

To

The Members

Gujarat Mineral Development Corporation Ltd.

In continuation of our Independent Audit Report on Standalone Ind AS FinancialStatement of Gujarat Mineral Development Corporation Ltd. (“The Company”) dated09.05.2018 we have reported on Directions and Sub-direction under section 143(5) of theCompanies Act 2013 applicable for the year 2017-18 as under:

ANNEXURE-2(i)

Directions under Section 143(5) of Companies Act 2013 Applicable for the year 2017-18

Sr. No. Directions/Questions u/s 143(5) Action Taken Impact on Accounts and Financials
1 Whether the Company has clear title/lease deeds for freehold and leasehold land respectively? If not please state the area of freehold and leasehold land for which title/lease deeds are not available? Yes the Company has clear title/lease deeds for freehold and leasehold land respectively. No impact
2 Whether there are any cases of waiver/ write off of debts/loans/interest etc. If yes the reasons there for and the amount involved. As informed to us the company has written off Debit Balances of Rs. 23.52 Lakhs in the books of accounts. In the opinion of the management such amounts are no longer receivable. No impact
3 Whether proper records are maintained for inventories lying with third parties and assets received as gift/grant(s) from the Government or other authorities. Yes proper records are maintained by the company for inventory lying with third parties and no asset is received as gift from Government or other authority as informed to us. No impact

 

For S.C. Ajmera & Co.
Chartered Accountants
FRN 002908C
Place:- Ahmedabad Arun Sarupria - Partner
Date:- 09.05.2018 M.No.078398

ANNEXURE-2(i)

Sector Specific Sub-directions under section 143(5) of Companies Act 2013

Sr. No. Sub Directions issued/Questions u/s 143(5) Action Taken Impact on Financials
Manufacturing Sector
Mining
1 Whether the company has taken adequate measures to reduce the adverse affect on environment as per established norms and taken up adequate measures for the relief and rehabilitation of displaced people. According to the information and explanation given to us the Company is obtaining environmental pollution monitoring report periodically from outside agency for each project to reduce/monitor the adverse effect on environment. No impact
No Displacement/Rehabilitation has been taken at any project of the Company for the year 2017-18. (Please note that we are not technical expert)
2 Whether the Company had obtained the requisite statutory compliances that was required under mining and environmental rules and regulations? As per information and explanation given to us the Company has obtained necessary consents from GPCB for mining projects. No impact
3 Whether overburden removal from mines and backfilling of mines are commensurate with the mining activity? As informed to us in respect of lignite projects overburden removal from mines and backfilling of mines are commensurate with the mining activity as per submitted/ approved/ prepared mine closure plan. (Please note that we are not technical expert) No impact
4 Whether the Company has disbanded and discontinued mines if so the payment of corresponding dead rent there against may be verified. As informed to us the Company has not disbanded nor discontinued any of its mines. Not Applicable
5 Whether the Company's financial statements had properly accounted for the effect of Rehabilitation Activity and Mine Closure Plan? The expenditure on Rehabilitation Activity' and for Mine Closure is properly accounted in the books of account of the Company as per the policy adopted in this behalf. No impact
Power Sector
Generation
1 In the cases of Thermal Power Projects compliance of the various Pollution Control Acts and the impact thereof including utilization and disposal of ash and the policy As per information and explanation provided to us the Company has made compliance of various pollution control Acts. No impact
of the company in this regard may be checked and commented upon. In respect of utilization and disposal of ash generally the Company is using it in backfilling of mine in Panandhro project.
2 Has the company entered into revenue sharing agreements with private parties for extraction of coal at pitheads and it adequately protects the financial interest of the Company? As informed to us the Company has not entered into revenue sharing agreements with private parties for extraction of coal at pitheads. Not Applicable
3 Does the company have a proper system for reconciliation of quantity/ quality of coal ordered and received and whether grade of coal/ moisture and demurrage etc. are properly recorded in the books of accounts? Company does not purchase coal from the outside parties. However as informed to us the Company is having a system in ERP for reconciliation of quantity ordered and received and Grade of coal/ moisture and demurrage etc. are recorded in the books of accounts on the basis of Test Certificate received from the laboratory. (Please note that we are not technical experts). No impact
4 How much share of free power was due to the State Government and whether the same was calculated as per the agreed terms and depicted in the accounts as per accepted accounting norms? The power is sold to Government controlled entity and the same is calculated as per terms agreed in PPA (Power Purchase Agreement). No impact
5 In the case of Hydroelectric Projects the water discharge is as per policy /guidelines issued by the State Government to maintain biodiversity. For not maintaining it penalty paid/payable may be reported. As informed to us no hydroelectric Project is carried out by Company. Not Applicable

 

For S.C. Ajmera & Co.
Chartered Accountants
FRN 002908C
Place:- Ahmedabad Arun Sarupria - Partner
Date:- 09.05.2018 M.No.078398