TO THE MEMBERS OF JAGSONPAL PHARMACEUTICALS LIMITED
Report on the Audit of the Indian Accounting Standards (Ind AS) Financial Statements
We have audited the accompanying Ind AS financial statements of JagsonpalPharmaceuticals Limited (the Company) which comprise the Balance Sheet as at March31 2022 and the Statement of Profit and Loss (including Other Comprehensive Income)statement of cash flows and the statement for changes in Equity for the year then endedand notes to the financial statements including a summary of significant accountingpolicies and other explanatory information.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Ind AS financial statements give the information required bythe Companies Act 2013 (Act) in the manner so required and give a true andfair view in conformity with the Indian Accounting Standards prescribed under section 133of the Act read with the Companies (Indian Accounting Standards) Rules 2015as amended(Ind As) and other accounting principles generally accepted in India of the state ofaffairs of the Company as at March 31 2022 its profit total Comprehensive Income thechanges in Equity its cash flows including a summary of significant accounting policiesand other explanatory information for the year ended on that date.
Basis for opinion
We conducted our audit in accordance with the Standards on Auditing specified undersection 143 (10) of the Companies Act 2013 (SAs). Our responsibilities under thoseStandards are further described in the Auditors Responsibilities for the Audit ofthe Financial Statements section of our report. We are independent of the Company inaccordance with the code of Ethics issued by the Institute of Chartered Accountants ofIndia together with the ethical requirements that are relevant to our audit of thefinancial statements under the provisions of the Act and the Rules there under and we havefulfilled our other ethical responsibilities in accordance with these requirements and theICAIs code of ethics. We believe that the audit evidence we have obtained issufficient and appropriate to provide a basis for our audit opinion on the financialstatements.
Information other than the Financial Statements and Auditors Report thereon
The Companys Board of Directors is responsible for the preparation of the otherinformation. The other information comprises the information included in the ManagementDiscussion and Analysis Boards Report including Annexures to Boards ReportBusiness Responsibility Report Corporate Governance and Shareholders Informationbut does not include the financial statements and our auditors report thereon.
Our opinion on the financial statements does not cover the other information and we donot express any form of assurance conclusion thereon.
In connection with our audit of the financial statements our responsibility is to readthe other information and in doing so consider whether the other information ismaterially inconsistent with the financial statements or our knowledge obtained during thecourse of our audit or otherwise appears to be materially misstated.
If based on the work we have performed we conclude that there is a materialmisstatement of this other information; we are required to communicate the matter to thosecharged with governance and take necessary action as applicable under the relevant lawsand regulations.
Responsibility of Management for the Financial Statements
The Companys Board of Directors is responsible for the matters stated in section134(5) of the Companies Act 2013 (the Act) with respect to the preparation of thesefinancial statements that give a true and fair view of the financial position financialperformance including other comprehensive income cash flows and changes in equity of theCompany in accordance with the Indian Accounting Standards (Ind AS) prescribed undersection 133 of the Act read with Companies (Indian Accounting Standards) Rules2015 asamended and other accounted principles generally accepted in India.
This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding of the assets of the Companyand for preventing and detecting frauds and other irregularities; selection andapplication of appropriate implementation and maintenance of 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 financial statement that give a true and fair view andare free from material misstatement whether due to fraud or error.
In preparing the financial statements management is responsible for assessing theCompanys ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or have no realisticalternative but to do so.
The Board of Directors is also responsible for overseeing the companys financialreporting process.
Auditors Responsibility for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financialstatements as a whole are free from material misstatement whether due to fraud or errorand to issue an auditors report that includes our opinion. Reasonable assurance is ahigh level of assurance but is not a guarantee that an audit conducted in accordance withSAs will always detect a material misstatement when it exists. Misstatements can arisefrom fraud or error and are considered material if individually or in the aggregate theycould reasonably be expected to influence the economic decisions of users taken on thebasis of these financial statements.
As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financialstatements whether due to fraud or error design and perform audit procedures responsiveto those risks and obtain audit evidence that is sufficient and appropriate to provide abasis for our opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error as fraud may involve collusionforgery intentional omissions misrepresentations or the override of internal control.
Obtain an understanding of internal financial controls relevant to the audit inorder to design audit procedures that are appropriate in the circumstances. Under section143(3)(i) of the Act we are also responsible for expressing our opinion on whether theCompany has adequate internal financial controls system in place and the operatingeffectiveness 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 managements use of the going concernbasis of accounting and based on the audit evidence obtained whether a materialuncertainty exists related to events or conditions that may cast significant doubt on theCompanys ability to continue as a going concern. If we conclude that a materialuncertainty exists we are required to draw attention in our auditors report to therelated disclosures in the financial statements or if such disclosures are inadequate tomodify our opinion. Our conclusions are based on the audit evidence obtained up to thedate of our auditors report. However future events or conditions may cause theCompany to cease to continue as a going concern.
Evaluate the overall presentation structure and content of the financialstatements including the disclosures and whether the financial statements represent theunderlying transactions and events in a manner that achieves fair presentation.
Materiality is the magnitude of misstatements in the financial statements thatindividually or in aggregate makes it probable that the economic decisions of areasonably knowledgeable user of the financial statements may be influenced. We considerquantitative materiality and qualitative factors in (i) planning the scope of our auditwork and in evaluating the results of our work; and (ii) to evaluate the effect of anyidentified misstatements in the financial statements.
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.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors Report) Order 2020 (CARO 202) (theOrder) issued by the Central Government of India in terms of sub-section (11) of section143 of the Companies Act 2013 we give in the Annexure Astatement on the mattersspecified in paragraphs 3 and 4 of the Order to the extent applicable.
2. As required by Section 143(3) of the Act based on our audit 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 including other comprehensiveincome the Cash Flow Statement and statement for changes in equity dealt with by thisReport are in agreement with the books of account;
d. In our opinion the aforesaid financial statements comply with the Indian AccountingStandards prescribed under Section 133 of the Act
e. On the basis of the written representations received from the directors as on 31stMarch 2022 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2022 from being appointed as a director in terms of Section164 (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. Our report expresses an unmodified opinion on the adequacyand operating effectiveness of the Companys internal financial controls overfinancial reporting; and
g. With respect to the other matters to be included in the Auditors Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 as amended inour opinion and to the best of our information and according to the explanations given tous :
i. The Company has disclosed the impact if any of pending litigations as at March31 2022 on its financial position in its Ind AS financial statements - Refer Note 35
ii. The Company did not have any long-term contracts including derivative contractsas at 31st March 2022 for which there were any material foreseeable losses ; and
iii. There has been no delay in transferring amount required to be transferred tothe Investor Education and Protection Fund by the Company during the year ended March 312022.
iv. (i) The Management has represented that to the best of its knowledge andbelief no funds have been advanced or loaned or invested (either from borrowed funds orshare premium or any other sources or kind of funds) by the Company to or in any otherpersons or entities including foreign entities (Intermediaries) with the understandingwhether recorded in writing or otherwise that the Intermediary shall directly orindirectly lend or invest in other persons or entities identified in any manner whatsoever(Ultimate Beneficiaries) by or on behalf of the Company or provide any guarantee securityor the like on behalf of the Ultimate Beneficiaries.
(ii) The Management has represented that to the best of its knowledge and belief nofunds have been received by the Company from any persons or entities including foreignentities (Funding Parties) with the understanding whether recorded in writing orotherwise that the Company shall directly or indirectly lend or invest in other personsor entities identified in any manner whatsoever (Ultimate Beneficiaries) by or on behalfof the Funding Parties or provide any guarantee security or the like on behalf of theUltimate Beneficiaries.
(iii) Based on the audit procedures performed that has been considered reasonable andappropriate in the circumstances nothing has come to our notice that has caused us tobelieve that the representations under subclause (i) and (ii) of Rule 11(e) contain anymaterial misstatement.
v. The final dividend paid by the Company during the current year in respect of thesame declared for the previous year is in accordance with section 123 of the Companies Act2013 to the extent it applies to payment of dividend. The Company has declared and paid anInterim dividend for the current year in accordance with the provisions of section 123 ofthe Act to the extent it applies to declaration and payment of dividend.
h. With respect to the matter to be included in the Auditors Report under section197(16) of the Act: In our opinion and according to the information and explanations givento us the remuneration paid by the Company to its directors during the current year is inaccordance with the provisions of section 197 of the Act. The remuneration paid to anydirector is not in excess of the limits laid down under section 197 of the Act. TheMinistry of Corporate Affairs has not prescribed other details under section 197(16) ofthe Act which are required to be commented upon by us.
For H.L. Bansal & Co.
Firm Registration No. : 008563N
H L Bansal
Membership No.: 086990
Place: New Delhi
UDIN : 22086990AJWLHJ4735
Annexure - A to the Independent Auditors Report
The Annexure referred to in Independent Auditors Report to the members of theCompany on the financial statements for the year ended 31 March 2022.
As per the books and records produced before us and as per the information andexplanations given to us and based on such audit checks that we considered necessary andappropriate we report that:
i. (a) A. The Company is maintaining proper records showing full particulars includingquantitative details and situation of Property Plant and Equipment.
B. The Company is maintaining proper record showing full particulars of Intangibleassets.
(b) The Property Plant and Equipment and intangible assets are physically verified bythe Management according to a phased programme designed to cover all the items over aperiod of three years which in our opinion is reasonable having regard to the size ofthe Company and the nature of its assets. Pursuant to the programme a portion of theProperty Plant and Equipment has been physically verified by the Management during theyear and no material discrepancies have been noticed on such verification.
(c) The title deeds of immovable properties as disclosed in Note 3 on Property Plantand Equipment to the Ind AS financial statements are held in the name of the Company.
(d) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the Company has not revalued its propertyplant and equipment (including right of use assets) or intangible assets or both duringthe year
(e) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company there are no proceedings initiated or pendingagainst the Company for holding any benami property under the Prohibition of BenamiProperty Transactions Act 1988 and rules made there under.
ii. (a). The Inventory except for goods in transit has been physically verified by themanagement at reasonable intervals during the year .In respect of inventory lying withthird parties to the extent such inventories have not been physically verified by themanagement such inventories have been substantially confirmed by the third parties. Andin our opinion the coverage and procedure of such verification by the management isappropriate. The discrepancies noticed on physical verification of inventory as comparedto book records were not material and less than 10% in the aggregate for each class ofinventory and have been appropriately dealt with in the books of accounts.
(b) The company has not been sanctioned working capital limits in excess of five croreRupees in aggregate at any point of time during the year from banks or financialInstitutions on the basis of security of current assets of the company hence reportingunder clause 3(ii)(b) of the Order is not applicable.
iii. As per information and explanation give to us the Company has not granted anyloans or advances in the nature of loans secured or unsecured or stood guarantees orprovided security to the companies firms or Limited Liability partnerships. The Companyhas made investments in companies firms limited liability partnerships or any otherparties during the year and the terms and conditions of the investments areprima facienot prejudicial to the interest of the Company. Reporting under sub clause a and c to f ofclause 3(iii) of the Order is not applicable.
iv. According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the Company has neither made any investmentsnor has it given loans or provided guarantee or security as specified under Section 185 ofthe Companies Act 2013 (the Act) and the Company has not provided any security asspecified under Section 186 of the Act. Further in our opinion the Company has compliedwith the provisions of Section 186 of the Act in relation to investments made.
v. The Company has not accepted any deposits or amount deemed to be deposits from thepublic within the meaning of Sections 73 74 75 and 76 of the Act and the Rules framedthere under to the extent notified. Hence reporting under clause 3(v) of the Order is notapplicable.
vi. Pursuant to the rules made by the Central Government of India the Company isrequired to maintain cost records as specified under Section 148(1) of the Act in respectof its products. We have broadly reviewed the same and are of the opinion that primafacie the prescribed accounts and records have been made and maintained. We have nothowever made a detailed examination of the records with a view to determine whether theyare accurate or complete.
vii. (a) According to the information and explanations given to us and the records ofthe Company examined by us in our opinion the Company is generally regular in depositingthe undisputed statutory dues including Goods and Service Tax provident fundemployees state insurance income tax sales tax service tax customs duty exciseduty value added tax Goods and Service Tax cess and other material Statutory dues asapplicable with the appropriate authorities.
ANNEXURE OF CASE PENDING WITH VARIOUS AUTHORITIES
|Nature of the statute ||Nature of dues ||Amount ||Period to which the amount relates ||Forum where the dispute is pending |
|Vat/Sale Tax Pune ||Demand ||17953179 ||2014 15 ||Sale Tax Authority |
|Vat/Sale Tax Pune ||Demand ||34329747 ||2015 16 ||Sale Tax Authority |
|Vat/Sale Tax Pune ||do ||936720 ||2016-17 ||do |
|Vat/Sale Tax Kolkata ||do ||2904851 ||2008-2009 ||do |
|do ||do ||1670707 ||2009-2010 ||Honble High court |
|Vat/Sale Tax Patna ||do ||135000 ||2016-17 and 2017-18 ||do |
|Vat/Sale Tax Haryana ||do ||66275 ||2016-17 ||do |
|Vat/Sale Tax Haryana ||do ||686862 ||2017-18 ||do |
|Income Tax ||do ||2328930 ||2015-16 ||CPC Income Tax |
|Income Tax ||do ||741330 ||2016-17 ||CPC Income Tax |
|Goods & Service Tax ||SLP filled by Union of India related to Transitional Credit of Vat/Cenvat into GST Regime ||17888138 ||2017-18 ||Honble Supreme Court |
|Total ||79641739 || |
(b) According to the information and explanations given to us no undisputed amountspayable in respect of Goods and Service Tax provident fund employees stateinsurance income tax sales tax Service tax customs duty excise duty value added taxcess and other material statutory dues were in arrears as at 31 March 2022 for a period ofmore than six months from the date they became payable. The following statutory dues havenot been deposited on account of dispute:
viii. According to the information and explanations given to us and the records of theCompany examined by us no unrecorded transactions in the books of accounts were foundwhich have been surrendered or disclosed as income during the year in the tax assessmentsunder the Income Tax Act 1961. Hence reporting under clause 3(viii) of the Order is notapplicable.
ix. The Company has not taken any fund or loans or other borrowings from any lender.
Hence reporting under clause 3(ix) of the Order is not applicable.
x a). The Company has not raised any moneys by way of initial public offer or furtherPublic offer (including debt instruments). Accordingly reporting under Clause 3(x)(a) ofthe Order is not applicable.
(b). The Company has not made any preferential allotment or private placement of Sharesor fully or partly convertible debentures during the year under review. Accordinglyreporting under clause 3(x)(b) of the Order is not applicable.
xi. (a) During the course of our examination of the books and records of theCompanycarried out in accordance with the generally accepted auditing practices in Indiaand according to the information and explanations given to us we have neither come acrossany instance of material fraud by the Company or on the Company by its officers oremployees noticed or reported during the year nor have we been Informed of any such caseby the Management.
(b) No report under sub-Section (12) of Section 143 of the Companies Act has been filedby the auditors in Form ADT- 4 as prescribed under Rule 13 of Companies (Audit andAuditors) Rules 2014 with the Central Government during the year and up to the date of theaudit.
(c) . According to the information and explanations given to us we have not comeacross any instance of any whistle-blower complaints received during the year by theCompany.
xii. As the Company is not a Nidhi Company and the Nidhi Rules 2014 are not applicableto it reporting under Clause 3(xii) of the Order is not applicable.
xiii. The Company has entered into transactions with related parties in compliance withthe provisions of Sections 177 and 188 of the Act. The details of such related partytransactions have been disclosed in the Ind AS financial statements as required underIndian Accounting Standard (Ind AS) Note 37 Related Party Disclosures specified underSection 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014.
xiv. (a) Based on information and explanations provided to us and our audit proceduresin our opinion the Company has an internal audit system commensurate with the size andnature of its business.
(b) We have considered the internal audit reports of the Company issued till date forthe period under audit.
xv. As per the information and explanations given to us the Company has not enteredinto any non-cash transactions with its directors or persons connected with them. Henceprovisions of section 192 of the companies Act 2013 is not applicable to the Company.
xvi The Company is not required to be registered under Section 45-IA of the ReserveBank of India Act 1934 and also is not a core Investment Company (as defined in the CoreInvestment Companies (Reserve Bank) Directions 2016). Hence reporting under clause 3(xvi)(a) (b)(c) and (d) of the order is not applicable.
xvii. The Company has not incurred cash losses during the financial year covered by ouraudit and the immediately preceding financial year.
xviii. There has been no resignation of the Statutory auditors of the company duringthe Year and hence clause 3 (xviii) is not applicable to the company.
xix. On the basis of the financial ratios ageing and expected dates of realization offinancial assets and payment of financial liabilities other information accompanying thefinancial statements and our knowledge of the Board of Directors and management plans andbased on our examination of the evidence supporting the assumptions nothing has come toour attention which causes us to believe that any material uncertainty exists as on thedate of the audit report indicating that Company is not capable of meeting its liabilitiesexisting at the date of Balance Sheet as and when they fall due within a period of oneyear from the balance sheet date. We however state that this is not an assurance as to thefuture viability of the company. We further state that our reporting is based on the factsup to the date of audit report and we neither give any guarantee nor any assurance thatall liabilities falling due within a period of one year from the balance sheet date willget discharged by the company as and when they fall due.
xx. (a) According to the information and explanations given to us and the records ofthe Company examined by us unspent amount towards Corporate Social Responsibility (CSR)on other than ongoing projects has not been transferred to a fund specified in ScheduleVII to the companies Act 2013 in compliance with second proviso to sub section (5) ofSection 135 of the said Act till the date of our audit report since the time period forsuch transfer i.e. 180 days from the end of the financial year has not elapsed.
(b) According to the information and explanations given to us and the records of theCompany examined by us there are no unspent amounts towards Corporate SocialResponsibility (CSR) on ongoing projects requiring a transfer to a fund specified inSchedule VII to the companies Act 2013 in compliance with provisions of sub section (6)of Section 135 of the said Act .
xxi. The company does not has any Subsidiary and does not require to prepare anyconsolidated accounts. Accordingly the provisions of Clause 3(xxi) of the Order are notapplicable to the Company.
For H.L. Bansal & Co.
Chartered Accountants Firm Registration No. : 008563N
H L Bansal (Partner.)
Place: New Delhi Membership No.: 086990
Date: 30.05.2022 UDIN : 22086990AJLHJ4735
Annexure - B to the Independent Auditors Report
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 (the Act)
(Referred to in paragraph 1(f) under Report on Other Legal and RegulatoryRequirements section of our report to the members of Jagsonpal PharmaceuticalsLimited of even date)
We have audited the internal financial controls over financial reporting of JagsonpalPharmaceuticals Limited (the Company) as of 31 March 2022 in conjunction with our audit ofthe financial statements of the Company for the year ended on that date.
Managements Responsibility for Internal Financial Controls
The Companys 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 (ICAI). 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 companys 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.
Our responsibility is to express an opinion on the Companys 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 deemed to beprescribed under section 143(10) of the Companies Act 2013 to the extent applicable toan audit of internal financial controls. Those Standards and the Guidance Note requirethat we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls over financialreporting was 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 auditors judgment including the assessment of the risks ofmaterial misstatement of 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 Companys internal financial controlssystem over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A companys internal financial control over financial reporting is a processdesigned to provide reasonable assurance regarding the reliability of financial reportingand the preparation of financial statements for external purposes in accordance withgenerally accepted accounting principles. A companys internal financial control overfinancial reporting includes those policies and procedures that (1) pertain to themaintenance of records that in reasonable detail accurately and fairly reflect thetransactions and dispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of financialstatements in accordance with generally accepted accounting principles and that receiptsand expenditures 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 thecompanys assets that 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 internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at 31 March 2022 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls over Financial Reporting issued by the Institute of CharteredAccountants of India.
For H.L. Bansal & Co. Chartered Accountants
Firm Registration No. : 008563N
H L Bansal (Partner.)
Place: New Delhi
Membership No.: 086990
UDIN : 22086990AJLHJ4735