To the Members of THE GAEKWAR MILLS LIMITED.
Report on the Standalone Financial Statements
We have audited the accompanying financial statements of THE GAEKWAR MILLS LIMITEDwhich comprises of Balance Sheet as at 31st March 2017 and the Statement of Profit andLoss and the Cash Flow Statement for the year ended on that date and a summary ofsignificant accounting policies and other explanatory information.
Management's Responsibility for the 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 preparationand presentation of these standalone financial statements that give a true and fair viewof the financial position financial performance and cash flows of the Company inaccordance with the accounting principles generally accepted in India including theAccounting Standards specified under Section 133 of the Act as applicable.
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 financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.
Our responsibility is to express an opinion on these financial statements based on ouraudit.
We have taken into account the provisions of the Act the accounting and auditingstandards and matters which are required to be included in the audit report under theprovisions of the Act and the Rules made thereunder and the Order under section 143(11) ofthe Act.
We conducted our audit of the standalone financial statements in accordance with theStandards on Auditing specified under Section 143(10) of the Act. Those Standards requirethat we comply with requirements and plan and perform the audit to obtain reasonableassurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the financial statements. The procedures selected depend on the auditor'sjudgment including the assessment of the risks of material misstatement of the financialstatements whether due to fraud or error. In making those risk assessments the auditorconsiders internal financial control relevant to the Company's preparation of thefinancial statements that give true and fair view in order to design audit procedures thatare appropriate in the circumstances. An audit also includes evaluating theappropriateness of accounting policies used and the reasonableness of the accountingestimates made by the Company's Directors as well as evaluating the overall presentationof the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the standalone financial statements.
I n our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the Act in the manner so required and give a true and fair view inconformitywith the accounting principles generally acceptedin India of the state ofaffairs of the Company as at 31st March 2017 and its loss and its cash flow for the yearended on that date.
Emphasis of matter
1. The accounts of the Companyhave been prepared on the basis of the assumptionofgoingconcern:
a. Though at the year end losses of the Company have exceeded its net worth.
Our opinion is not qualified in respect of this matter.
Report on Other Legal and Regulatory Requirements
1. 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 and the Cash Flow Statementdealt with by this Report are in agreement with the books of account.
d) In our opinion the aforesaid standalone financial statements comply with theAccounting Standards prescribed under section 133 of the Act as applicable.
e) On the basis of the written representations received from the directors as on March31 2017 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2016 from being appointed as a director in terms of Section 164 (2) of theAct.
f ) With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls we refer to ourseparate Report ni "Annexure A". Our report expresses an unmodified opinion onthe adequacy and operating effectiveness of the Company's internal financial controls overfinancial reporting.
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. TheCompany has disclosed the impact of pending litigations on its financial position in itsfinancial statements as referred to in Note No. 18 and 19 to the financial statements ii.The Company did not have any long term contracts including derivatives contracts for whichthere were any material foreseeable losses on account of such contracts ill. There was noamount which was required to be transferred to the Investor Education and Protection Fundby the Company iv. The Company did not hold or had any dealings in Specified Bank Notesduring the period from 8t h November 2016 to 30th December 2016.
2. 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 of theAct we give in the "Annexure B" a statement on the matters specified inparagraphs 3 and 4 of the Order.
For M D PANDYA & ASSOCIATES
Chartered Accountants Reg. No. 107325 W
M. D. PANDYA
Date: - 30th May 2017.
Annexure A to the Independent Auditor's report of even date on the Standalone FinancialStatements of The Gaekwar Mills Limited.
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 TheGaekwarMills Limited ("the Company") as of 31st March 2017 in conjunction with ouraudit of the financial statements of the Company for the year ended on that date.
Management's Responsibility for Internal Financial Controls
The Company's management is responsible for establishing and maintaining internalfinancial controls based on the essential components of internal control stated in theGuidance Note on Audit of Internal Financial Controls over Financial Reporting issued byThe Institute of Chartered Accountants of India. These responsibilities include thedesign implementation and maintenance of adequate internal financial controls that wereoperating 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 CompaniesAct 2013.
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 to the extent applicable toan audit of internal financial controls both issued by the Institute of CharteredAccountants of India. Those Standards and the Guidance Note require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether adequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material respects. Our auditinvolves performing procedures to obtain audit evidence about the adequacy of the internalfinancial controls system over financial reporting and their operating effectiveness.
Our audit of internal financial controls over financial reporting included obtaining anunderstanding of internal financial controls over financial reporting assessing the riskthat a material weakness exists and testing and evaluating the design and operatingeffectiveness of internal control based on the assessed risk. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the financial statements whether due to fraud or error. We believe thatthe audit evidence we have obtained is sufficient and appropriate to provide a basis forour audit opinion on the Company's internal financial controls system over financialreporting.
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 financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal financial control over financialreporting includes those policies and procedures that (1) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the company are being made only in accordance with authorizations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorized acquisition use or disposition of thecompany's assetsthat could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not 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.
In our opinion the Company has in all material respects an adequate internal.financial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at March 31 2016 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.
Annexure B to the Independent Auditors' Report
The Annexure referred to in our Independent Auditors' Report to the Members of theCompany on the financial statements for the year ended 31 March 2017 and on such checks aswe considered appropriate and according to the information and explanations given to uswe state that:
i. The Company has only Fixed Asset in form of Land. The Company has maintained properrecords to show full particulars including quantitative details and situation of the land.The Company has not disposed off any Fixed Asset during the year. Title deeds of the landare in the name of the Company.
ii. The company did not carry any inventories during the year. In view of the aboveclauses 3 (ii) (a) and (b) of the Order are not applicable.
in The Company has granted loans of Rs. 47300000 (previous year Rs.47300000) toPlatinum Square Private Limited a company covered in the register maintained undersection 189 of the Companies Act 2013. The terms of grant of such loans are notprejudicial to the Company's interests. The schedule of repayment has been stipulated andthere are no overdue.
iv. In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Section 185 of the Companies Act 2013. TheCompany has been advised that the provisions of section 186 of the Companies Act 2013 arenot applicable to it as it is engaged in the business of providing infrastructuralfacilities.
v. In our opinion and according to the information and explanations given to us thecompany has not accepted any deposit from the public.
vi. The Central Government has not prescribed the maintenance of cost records undersection 148(1) of the Act. Accordingly the provisions of clause 3 (vi) of the Order is notapplicable to the Company.
vii. (a) According to the information and explanation given to us and according to therecords of the Company as examined by us undisputed statutory dues including income taxcustom duty excise duty service tax cess and other statutory dues have been regularlydeposited during the year with the appropriate authorities. No undisputed amounts payablewere outstanding as at 31st March 2017 for a period of more than six months from the dateon which they become payable (b) According to the information and explanation given to usand based on the records of the Company examined by us there are no dues of income taxVAT and other statutory dues outstanding as on 31st March 2017 which have not beendeposited on account of any dispute.
viii. According to the information and explanations given to us and based on theverification of records of the company examined by us the company has neither taken anyloan or borrowings from financial institutions banks or Government. The Company has notdefaulted in payment to debenture holders.
ix. According to the information and explanations provided to us and as per the recordsof the company examined by us company has not raised funds by way of public issue/follow-on offer (including debt instruments) and term loans during the year under review.
x. To the best of our knowledge and belief and according to the information andexplanation given to us no fraud by the company or any fraud on the Company by itsofficers/ employees has been noticed or reported during the year.
xi. No managerial remuneration has been paid / provided and therefore clause no 3(xi)of the Order is not applicable to the Company.
xii. In our opinion and according to information and explanations given to us Companyis not a Nidhi Company.
xiii. All transactions with the related parties are in compliance with Section 188 and177 of Companies Act 2013 where applicable and the details of the same have beendisclosed in the Financial Statements as required by the accounting standards andCompanies Act 2013.
xiv. During the year under review the company has not made any preferential allotment /private placement of shares or fully or partly convertible debentures.
xv. During the year under review the company has not entered into any non-cashtransactions with directors or persons connected with him.
xvi. The company is not required to be registered under section 45-IA of Reserve Bankof India Act 1934.
For M D PANDYA & ASSOCIATES
Chartered Accountants Reg. No. 107325 W
M. D. PANDYA
Membership no. 33184
Date: 30th May 2017.