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Indsil Hydro Power & Manganese Ltd.

BSE: 522165 Sector: Metals & Mining
NSE: N.A. ISIN Code: INE867D01018
BSE 00:00 | 23 Jul 20.05 0.15
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NSE 05:30 | 01 Jan Indsil Hydro Power & Manganese Ltd
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VOLUME 6825
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OPEN 20.00
CLOSE 19.90
VOLUME 6825
52-Week high 22.45
52-Week low 9.21
P/E
Mkt Cap.(Rs cr) 56
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Indsil Hydro Power & Manganese Ltd. (INDSILHYDRO) - Auditors Report

Company auditors report

TO THE MEMBERS OF INDSIL HYDRO POWER AND MANGANESE LIMITED

REPORT ON THE AUDIT OF THE STANDALONE FINANCIAL STATEMENTS

OPINION

We have audited the standalone financial statements of INDSIL HYDRO POWER ANDMANGANESE LIMITED ("the Company") which comprise the standalone balancesheet as at March 312020 the standalone Statement of Profit and Loss (including othercomprehensive income) the standalone statement of changes in equity and standalonestatement of cash flows for the year then ended and notes to the financial statementsincluding a summary of significant accounting policies and other explanatory information(hereinafter referred to as the "SFS").

In 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 Companies Act 2013 ("the Act") in the manner so required and givea true and fair view in conformity with the accounting principles generally accepted inIndia of the state of affairs of the Company as at March 31 2020 and totalcomprehensive income (comprising of profit and other comprehensive income) changes inequity and its cash flows for the year ended on that date.

BASIS FOR OPINION

We conducted our audit in accordance with the standards on auditing (SA's) specifiedunder section 143 (10) of the Act. Our responsibilities under those SA's are furtherdescribed in the auditor's responsibilities for the audit of the standalone financialstatements section of our report. We are independent of the Company in accordance with thecode of ethics issued by the Institute of Chartered Accountants of India together with theethical requirements that are relevant to our audit of the standalone financial statementsunder the provisions of the Act and the rules thereunder and we have fulfilled our otherethical responsibilities in accordance with these requirements and the code of ethics.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our opinion.

KEY AUDIT MATTERS

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the standalone financial statements of the current period.These matters were addressed in the context of our audit of the standalone financialstatements as a whole and in forming our opinion thereon and we do not provide aseparate opinion on these matters.

OTHER MATTERS

IND AS 105 (Non-current Assets Held for Sale and Discontinued Operations) require theresults of discontinued operations to be presented separately in the statement of profitand loss. IND AS 105 inter alia provides that an operation shall be classified as adiscontinued operation only if the immediate sale of the operations is highly probable inits present condition.

It has already been approved by the Board to sell or dispose off the Unit III of thecompany situated at Raipur by way of a special resolution. However the appropriate levelof management is of the view that the sale is unlikely to occur due to the present COVIDscenario.

Consequently on account of the condition of "the sale being highlyprobable" not being satisfied unit III of the company is shown along with thecontinuing operations. Hence no separate disclosure for Discontinued operations is beingmade.

INFORMATION OTHER THAN THE FINANCIAL STATEMENTS AND AUDITORS' REPORT THEREON

The Company's board of directors is responsible for other information. The otherinformation comprises the information included in the Director's Report to theshareholders but does not include the standalone financial statements and our auditor'sreport thereon. The director's report to the shareholder is expected to be made availableto us after the date of this Auditor's Report.

Our opinion on the standalone financial statements does not cover the other informationand we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements our responsibilityis to read the other information identified above when it becomes available and in doingso consider whether the other information is materially inconsistent with the standalonefinancial statements or our knowledge obtained in the audit or otherwise appears to bematerially misstated. When we read the Director's Report to the shareholders if based onthe work we have performed we conclude that there is a material misstatement therein weare required to communicate the matter to those charged with governance.

RESPONSIBILITIES OF MANAGEMENT AND THOSE CHARGES WITH GOVERNANCE FOR THE STANDALONEFINANCIAL STATEMENTS

The Company's board of directors are responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these standalone financial statementsthat give a true and fair view of the State of Affairs Profit and Other ComprehensiveIncome changes in equity and cash flows of the Company in accordance with the accountingprinciples generally accepted in India including the Indian Accounting Standardsspecified under section 133 of the Act. This responsibility also includes maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingof the assets of the Company and for preventing and detecting frauds and otherirregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the standalone financial statement that give a true andfair view and are free from material misstatement whether due to fraud or error.

In preparing the standalone financial statements the Board of Directors is responsiblefor assessing the Company's ability to continue as a going concern disclosing asapplicable matters related to going concern and using the going concern basis ofaccounting unless the Board of Directors either intends to liquidate the Company or tocease operations or has no realistic alternative but to do so. The board of directors arealso responsible for overseeing the Company's financial reporting process. .

AUDITOR'S RESPONSIBILITIES FOR THE AUDIT OF THE STANDALONE FINANCIAL STATEMENTS

Our objectives are to obtain reasonable assurance about whether the standalonefinancial statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these standalone 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 standalonefinancial statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.

• Obtain an understanding of internal control relevant to the audit in order todesign audit procedures that are appropriate in the circumstances. Under section143(3)(I)of the Companies Act 2013 we are also responsible for expressing our opinion onwhether the company has adequate internal financial controls system in place and theoperating effectiveness of such controls

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

• Conclude on the appropriateness of management's use of the going concern basisof accounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe 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.

• Evaluate the overall presentation structure and content of the standalonefinancial statements including the disclosures and whether the standalone financialstatements represent the underlying transactions and events in a manner that achieves fairpresentation.

We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and to communicate with themall relationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards. From the matters communicated withthose charged with governance we determine those matters that were of most significancein the audit of the standalone financial statements of the current period and aretherefore the key audit matters. We describe these matters in our auditor's report unlesslaw or regulation precludes public disclosure about the matter or when in extremely rarecircumstances we determine that a matter should not be communicated in our report becausethe adverse consequences of doing so would reasonably be expected to outweigh the publicinterest benefits of such communication.

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. 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 and proper returnsadequate for the purpose of our audit of the branches have been received.

c) The standalone balance sheet the standalone statement of profit and loss (includingother comprehensive income) the standalone statement of changes in equity and thestandalone statement of cash flow dealt with by this report are in agreement with thebooks of account;

d) In our opinion the aforesaid standalone financial statements comply with the Indianaccounting standards specified under section 133 of the Act read with rule 7 of the Companies(Accounts) Rules 2014;

e) On the basis of the written representations received from the directors as on March31 2020 taken on record by the board of directors none of the directors is disqualifiedas on March 31 2020 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 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;

a. The Company has disclosed the impact of pending litigations on its financialposition in its standalone financial statements - Refer Note 7 of Annexure A to theIndependent Auditor's report.

b. The Company does have long-term contracts including derivative contracts for whichthere were any material foreseeable losses - Refer 2.45 of the Notes to the Financialstatements; and

c. There were no amounts which were required to be transferred to the InvestorEducation and Protection Fund by the Company.

3. With respect to the matter to be included in the Auditor's report under section 197(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 is not in excess ofthe limit laid down under section 197 of the act.

Date : 30.07.2020 For RAJA & RAMAN Chartered Accountants (Firm's Registration No. 003382S)
Place : Coimbatore K.R. RAMAN FCA Partner (Membership No. 19715) UDIN No. 20019715AAAABJ4479

ANNEXURE- A TO THE INDEPENDENT AUDITOR'S REPORT

The Annexure referred to in Independent Auditor's report to the Members of M/s INDSILHYDRO POWER AND MANGANESE LIMITED for the year ended 31st March 2020. We report that

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

b) The fixed assets are physically verified by the Management during the year which inour opinion is reasonable having regard to the size of the company and the nature of itsassets. No material discrepancies as compared to the book records were noticed on suchverification.

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 are held in the name of theCompany.

2. The inventory has been physically verified by the management during the year. In ouropinion the frequency of such verification is reasonable the discrepancies noticed onrectification between the physical stock and the book stocks were not material and havebeen properly dealt within the books of accounts.

3. According to information and explanation given to us the company has not grantedany loan secured or unsecured to companies firms limited liability partnerships orother parties covered in the register required under section 189 of the Companies Act2013 Accordingly the provision of clause (iii) (a) (b) and (c) of paragraph 3 of theorder are not applicable.

4. In our opinion and according to information and explanation given to us the Companyhas complied with the provisions of sections 185 and section 186 of the Act in respect ofloans investments guarantees and security as applicable.

5. In our opinion and according to the information and explanations given to us thecompany has not accepted any deposits from the public. Therefore the provisions of clause(v) of the para 3 of the order are not applicable to the company.

6. We have broadly reviewed the books of accounts maintained by the company pursuant tothe Rules made by the Central Government for the maintenance of Cost records under Section148 of the Companies Act 2013 and are of the opinion that prima facie the prescribedaccounts and records have been made and maintained. We have however not made a detailedexamination of the cost records with a view to determine whether they are accurate orcomplete.

7. (a) According to the information and explanations given to us and on the basis ofour examination of the records of the Company in our opinion the company is regular indepositing the undisputed statutory dues including provident fund employees' stateinsurance income-tax goods and service tax duty of customs and other materialstatutory dues as applicable with the appropriate authorities.

According to the information and explanations given to us there are undisputed amountspayable in respect of provident fund employees' state insurance goods and service taxand other material statutory dues were in arrears as at March 31 2020.

(b) Details of dues of Income tax as on 31st March 2020 on account of disputes aregiven below:

Name of the Statute Nature of dues forum where the dispute is pending Period to which the amount relates Amount Involved
Income Tax Act1961 Income Tax Commissioner of Income Tax (appeals) Coimbatore 2005-06 Rs. 40572
Income Tax Act1961 Income Tax Commissioner of Income Tax (appeals) Coimbatore 2007-08 22460
Income Tax Act1961 Income Tax Commissioner of Income Tax (appeals) Coimbatore 2014-15 62730
Income Tax Act1961 Income Tax Commissioner of Income Tax (appeals) Coimbatore 2015-16 2659080
Income Tax Act1961 Income Tax Commissioner of Income Tax (appeals) Coimbatore 2016-17 1422098
The Central Excise Act 1944 Service Tax Deputy Commissioner 2015-16 2352590
The Central Excise Act 1944 Service Tax Deputy Commissioner 2017-18 529900

(b) Details of undisputed Statutory dues as on 31st March 2020 are asfollows:

(i) GST

S.No Particulars GST Due as on 31.03.2020
1 UNIT-I** 38093685.11
2 UNIT-II 4324652.00
3 UNIT-III* 17484272.45
4 SMS (merged with Indsil)* 12608977.40
Total Amount 72511586.95

* received monthly installment order from the department

** planning to approach the department for monthly installment

(ii) Other Statutory Dues

Name of the Statute Period to which the amount relates Amount Involved
Employee State Insurance Feb 2020 to Mar 2020 262447
Provident Fund Oct 2019 to Mar 2020 3423111

8. In our opinion and according to the information and explanations given to us thecompany has no outstanding dues to any financial institutions or banks or any governmentor any debenture holders during the year. Accordingly paragraph 3 (viii) of the order isnot applicable. The company has availed the moratorium issued by the RBI on account of theongoing COVID situation in respect of the dues payable to banks.

9. The Company has not raised any money by way of initial public offer or furtherpublic offer (including debt instruments) and has not taken any term loans during theyear. Accordingly paragraph 3 (ix) of the order is not applicable.

10. During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing practices in India andaccording to the information and explanations given to us we have neither come across anyinstance of material fraud by the Company or on the Company by its officers or employeesnoticed or reported during the year nor have we been informed of any such case by theManagement.

11. The Company has paid/ provided for managerial remuneration in accordance with therequisite approvals mandated by the provisions of Section 197 read with Schedule V to theAct..

12 The Company is not a Nidhi Company and accordingly paragraph 3 (xii) of the orderis not applicable to the Company

13 According to the information and explanations given to us and based on ourexamination of the records of the company transactions with the related parties are incompliance with section 177 and 188 of the Act. Where applicable the details of suchtransactions have been disclosed in the standalone financial statements as required by theapplicable accounting standards.

14 According to the information and explanations given 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. Accordingly paragraph 3(xiv) of the order is not applicable.

15 According to the information and explanations given 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. Accordingly paragraph 3(xv)of the order is not applicable.

16 The company is not required to be registered under section 45-IA of the Reserve Bankof India Act 1934

Date : 30.07.2020 For RAJA & RAMAN Chartered Accountants (Firm's Registration No. 003382S)
Place : Coimbatore K.R. RAMAN FCA Partner (Membership No. 19715) UDIN No. 20019715AAAABJ4479

ANNEXURE - B TO THE INDEPENDENT AUDITORS' REPORT

Report on the Internal Financial Controls over Financial Reporting under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls over financial reporting INDSIL HYDROPOWER AND MANGANESE LIMITED ("the Company") as of 31st March 2020 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 board of directors of the Company's Management is responsible for establishing andmaintaining 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 the adherence to the company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Companies Act 2013.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting of the Company based on our audit. We conducted ouraudit in accordance with the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting (the "Guidance Note") and the Standards on Auditing issuedby the Institute of Chartered Accountants of India and deemed to be prescribed underSection 143(10) of the Companies Act2013 to the extent applicable to an audit ofinternal financial controls both issued by ICAI. Those standards and the guidance noterequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls over financialreporting were established and maintained and if such controls operated effectively in allmaterial 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 judgement including the assessment of the risks ofmaterial misstatement in the financial statements whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company's internal financial control 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 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 (i) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; (ii) 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 authorisations ofmanagement and directors of the company; and (iii) provide reasonable assurance regardingprevention or timely detection of unauthorised acquisition use or disposition of thecompany's assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls our Financial Statements Reporting

Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management of 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 control system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at March 31 2020 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 of Internal Financial Controls Over Financial Reporting issued by theInstitute of Chartered Accountants of India.

Date : 30.07.2020 For RAJA & RAMAN Chartered Accountants (Firm's Registration No. 003382S)
Place : Coimbatore K.R. RAMAN FCA Partner (Membership No. 19715) UDIN No. 20019715AAAABJ4479

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