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Joonktolle Tea & Industries Ltd.

BSE: 538092 Sector: Agri and agri inputs
NSE: N.A. ISIN Code: INE574G01013
BSE 00:00 | 20 Jan 137.10 2.05
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NSE 05:30 | 01 Jan Joonktolle Tea & Industries Ltd
OPEN 139.30
PREVIOUS CLOSE 135.05
VOLUME 2163
52-Week high 146.78
52-Week low 66.38
P/E
Mkt Cap.(Rs cr) 114
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 139.30
CLOSE 135.05
VOLUME 2163
52-Week high 146.78
52-Week low 66.38
P/E
Mkt Cap.(Rs cr) 114
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Joonktolle Tea & Industries Ltd. (JOONKTOLLETEA) - Auditors Report

Company auditors report

TO THE MEMBERS OF JOONKTOLLEE TEA & INDUSTRIES LIMITED

Report on the Audit of the Standalone Financial Statements Opinion

We have audited the accompanying Standalone Financial Statements ofJoonktollee Tea & Industries Limited (“the Company”) which comprise theStandalone Balance Sheet as at March 31st 2021 the Standalone Statement ofProfit and Loss (including Other Comprehensive Income) the Standalone Statement ofChanges in Equity and the Standalone Statement of Cash Flow Statement for the year thenended and a summary of significant accounting policies and other explanatory information.In our opinion and to the best of our information and according to the explanations givento us the aforesaid Standalone Financial Statements give the information required by theCompanies Act 2013 (“the 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 2015 as amended(“Ind AS”) and other accounting principles generally accepted in India of thestate of affairs of the Company as at March 31 2021 and its loss total comprehensiveincome the changes in equity and its cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit of the standalone financial statements inaccordance with the Standards on Auditing specified under section 143(10) of the Act(SAs). Our responsibilities under those Standards are further described in theAuditor's Responsibility for the Audit of the Standalone Financial Statements sectionof our report. We are independent of the Company in accordance with the Code of Ethicsissued by the Institute of Chartered Accountants of India (ICAI) together with the ethicalrequirements that are relevant to our audit of the standalone financial statements underthe provisions of the Act and the Rules made there under and we have fulfilled our otherethical responsibilities in accordance with these requirements and the ICAI's Code ofEthics. We believe that the audit evidence obtained by us is sufficient and appropriate toprovide a basis for our audit opinion on the Standalone Financial Statements.

Key Audit Matters

Key audit matters are those matters that in our professional judgmentwere of most significance in our audit of the Standalone Financial Statements of thecurrent period. These matters were addressed in the context of our audit of the Standalonefinancial statements as a whole and in forming our opinion thereon and we do not providea separate opinion on these matters. We have determined the matters described below as Keyaudit matters and for each matter our description of how our audit addressed the matteris provided in that context.

Key audit matters How our audit addressed the key audit matter
Investment in Associate and Subsidiaries
The company carries its investments in two subsidiaries and an associate at cost adjusted for impairment if any. At 31st March 2021 total investments amounted to INR 47.18 cr the amount is significant to the financial statements. Moreover the testing of impairment exercise involves the use of estimates and judgements. The identification of impairment events and the determination of an impairment charge also require the application of significant judgement by management in particular with respect to the timing quantity and estimation of future cash flows. In view of the significance of the investments and the above we consider investment valuation/impairment to be a significant key audit matter. Our audit procedures comprised amongst others:
• We have assessed the valuation methodology used by management and the requirements in IndAS and tested the inputs used
• Our audit response also consisted of analyzing the possible indications of impairment and discussed them with management.
• We have discussed the forecasted results of the investments with management and also reviewed the substantiation of the forecasts based on historical information.
• We have reviewed the market value of assets provided by the management based upon prevalent market conditions and evidences of the market value of the assets.
Valuation of Biological Assets
The company's biological assets include standing timber unharvested green leaf etc. which is measured at fair value less costs to sell. The principal assumptions and estimates in the determination of the fair value include assumptions about the yields or quantity of biological asset market prices and the stage of transformation. With reference to this key audit matter we have:
The determination of these assumptions and estimates require careful evaluation by management and could lead to material impact on the financial position and the results of the Company. Refer note no 8 to the financial statement. Evaluating the design and implementation of Company's controls around the valuation of biological assets and agricultural produce.
• Assessing the plucking yields and basis of quantification of biological asset and analyze the stage of transformation considered for the fair valuation.
• Assessing the basis reasonableness and accuracy of adjustments made to market prices.
• Testing the consistency of application of the fair value approaches and models over the years.
Contingent Liabilities Our audit procedures included among others:
The Company is exposed to different laws regulations and interpretations thereof. The company is also subject to number of significant claims and litigations. The assessment of the likelihood and quantum of any liability in respect of these matters can be judgmental due to the uncertainty inherent in their nature. I. Understanding and assessing the internal control environment relating to the identification recognition and measurement of provisions for disputes potential claims and litigation and contingent liabilities;
At March 31 2021 the Company has disclosed significant pending legal cases with respect to Income tax under appeal Seigniorage Charges lease rent and other material contingent liabilities [Refer Note 39.1 to the financial statements]. II. Analyzed significant changes/update from previous periods and obtained a detailed understanding of such items. Assessed recent judgments passed by the court authorities affecting such change;
We considered this to be a key audit matter since the accounting and disclosure of claims and litigations is complex and judgmental and the amounts involved are or can be material to the financial statements. III. Discussed the status of significant known actual and potential litigations with the management & noted that information placed before the board for such cases and
IV. Assessment of the management's assumptions and estimates related to the recognized provisions for disputes and disclosures of contingent liabilities in the financial statements.

Information other than the Standalone Financial Statements andAuditor's Report thereon

The Company's Board of Directors is responsible for thepreparation of the other information. The other information comprises the informationincluded in the Board's Report including annexure to the Board's Report &other Shareholder's Information but does not include the Consolidated FinancialStatements Standalone Financial Statements and our auditor's report thereon.

Our opinion on the Standalone Financial Statements does not cover theother information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the Standalone Financial Statementsour responsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the Standalone Financial Statements orour knowledge obtained in the audit or otherwise appears to be materially misstated. Ifbased on the work we have performed we conclude that there is a material misstatement ofthis other information; we are required to report that fact. We have nothing to report inthis regard.

Management's Responsibility for the Standalone FinancialStatements

The Company's Board of Directors is responsible for the mattersstated in section 134(5) of the Act with respect to the preparation of these StandaloneFinancial 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 accounting principles generally accepted in Indiaincluding the Indian Accounting Standards (Ind AS) specified under section 133 of the Actread with (Indian Accounting Standards) Rules 2015 as amended. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and the designimplementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the Standalone FinancialStatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

In preparing the Standalone Financial Statements management isresponsible for assessing the Company's ability to continue as a going concerndisclosing as applicable matters related to going concern and using the going concernbasis of accounting unless management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so.

Those Board of Directors are also responsible for overseeing theCompany's financial reporting process.

Auditor's Responsibilities for the Audit of the StandaloneFinancial Statements

Our objectives are to obtain reasonable assurance about whether theStandalone Financial Statements as a whole are free from material misstatement whetherdue to fraud or error and to issue an auditor's report that includes our opinion.Reasonable assurance is a high level of assurance but is not a guarantee that an auditconducted in accordance with SAs will always detect a material misstatement when itexists. Misstatements can arise from fraud or error and are considered material ifindividually or in the aggregate they could reasonably be expected to influence theeconomic decisions of users taken on the basis of these Standalone Financial Statements.As part of an audit in accordance with SAs we exercise professional judgment and maintainprofessional 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 section 143(3)(i)of the Companies Act 2013 we are also responsible for expressing our opinion on whetherthe Company 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 management's 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 theCompany's ability to continue as a going concern. If we conclude that a materialuncertainty exists we are required to draw attention in our auditor's report to therelated disclosures in the Standalone Financial Statements or if such disclosures areinadequate to modify our opinion. Refer to paragraph “material uncertainty relatedto going concern” above in respect to our reporting in respect to going concernappropriateness. Our conclusions are based on the audit evidence obtained up to the dateof our auditor's report. However future events or conditions may cause the Companyto cease to continue 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.

Materiality is the magnitude of misstatements in the StandaloneFinancial Statements that individually or in aggregate makes it probable that theeconomic decisions of a reasonably knowledgeable user of the Standalone FinancialStatements may be influenced. We consider quantitative materiality and qualitative factorsin (i) planning the scope of our audit work and in evaluating the results of our work; and(ii) to evaluate the effect of any identified misstatements in the Standalone FinancialStatements.

We communicate with those charged with governance regarding amongother matters the planned scope and timing of the audit and significant audit findingsincluding any significant deficiencies in internal control that we identify during ouraudit.

We also provide those charged with governance with a statement that wehave complied with relevant ethical requirements regarding independence and tocommunicate with them all relationships and other matters that may reasonably be thoughtto bear on our independence and where applicable related safeguards.

From the matters communicated with those charged with governance wedetermine those matters that were of most significance in the audit of the StandaloneFinancial Statements for the financial year ended March 31 2021 and are therefore the keyaudit matters. We describe these matters in our auditor's report unless law orregulation 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 of the Act we give in the “Annexure A” a statement on thematters specified in paragraphs 3 and 4 of the Order.

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;

(c) The Balance Sheet the Statement of Profit and Loss including the Statement ofOther Comprehensive Income the Cash Flow Statement and Statement of Changes in Equitydealt 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 specified under Section 133 of the Act read with Companies (IndianAccounting Standards) Rules 2015 as amended from time to time;

(e) On the basis of the written representations received from the directors as on March31 2021 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2021 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 with reference to these Standalone Financial Statements and theoperating effectiveness of such controls refer to our separate Report in “AnnexureB” to this report;

(g) In our opinion and to the best of our information and according to the explanationgiven to us the remuneration paid by the company to its directors during the year is inaccordance with the provisions of section 197 of the Act.

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

i. The Company has disclosed the impact of pending litigations on itsfinancial position in its Standalone Financial Statements Refer Note 39.1 to theStandalone Financial Statements;

ii. The Company did not have any long-term contracts includingderivative contracts for which there were any material foreseeable losses;

iii. There has been no delay in transferring amounts required to betransferred to the Investor Education and Protection Fund by the Company during the year.

Annexure - A to the Independent Auditor's Report

(Referred to in ‘Report on Other Legal and RegulatoryRequirements' section of our report of even date in respect to statutory audit ofJoonktollee Tea & Industries Limited for the year ended 31st March 2021)

We report that:

i. In respect of its fixed assets:

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

b) According to information and explanation given to us fixed assets have beenphysically verified during the year by the management at reasonable intervals and nomaterial discrepancies have been noticed on such physical verification. In our opinionthis periodicity of physical verification is reasonable having regard to the size of theCompany and the nature of its assets.

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 except for in as follows:

Name of the Unit Assets Description As at 31st march 2021 ( Rs in Lacs) Gross Block Net Block Remarks
Shreemoni Tea Factory Leasehold Land and Buildings 617.29 245.25 In process of transfer in the name of Company
Joonktollee Tea Estate Leasehold Land 2.25 2.25
Chemoni & Pudukad Rubber Estate Leasehold Land 10.60 10.60

ii. According to information and explanation given to us inventories were physicallyverified during the year by the management at reasonable intervals and no materialdiscrepancies were noticed on such verification.

iii. In our opinion and according to information and explanation given to us theCompany has not granted any loan to parties covered in the register maintained undersection 189 of the Companies Act 2013. Accordingly paragraph 3(iii) of the Order is notapplicable.

iv. In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Section 185 and Section 186 of the Act withrespect to the loans given. The company has neither issued any guarantee nor has providedany security on behalf of any parties or made any investment in parties covered underSection 185 and Section 186 of the Act.

v. According to information and explanations given to us the Companyhas not accepted any deposits within the meaning of Sections 73 to Sections 76 of the Actduring the year.

vi. The Central Government has prescribed maintenance of Cost recordsunder section 148(1) of the Act for the Company's Tea Rubber and Coffee units. Wehave broadly reviewed the books of accounts maintained by Company in respect of productwhere pursuant to the rule made by the Central Government of India the maintenance of costrecords has been prescribed under section 148 (1) of the Companies Act 2013 and are of theopinion that prima facie the prescribed records have been 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 andon the basis of our examination of the records of the Company the Company is regular indepositing undisputed statutory dues including provident fund employee's stateinsurance income tax sales tax wealth tax service tax duty of customs duty ofexcise value added tax Goods & Service tax Cess and other statutory dues with theappropriate authorities. According to the information and explanations given to us noundisputed amounts payable in respect of provident fund employees' state insuranceincome tax Goods & Service tax sales tax service tax duty of customs duty ofexcise value added tax cess and other material statutory dues were in arrears as at 31stMarch 2021 for a period of more than six months from the date they became payable.

(b) According to the information and explanation given to us andrecords of Company examined by us the dues of sales tax income tax duty of customsduty of excise service tax and value added tax which have not been deposited on accountof any dispute and the forum where the dispute is pending as on 31st March 2021 are asunder: -

Name of the Statute Nature of Dues Amount (Rs. In Lakh) Period to which the amount relates Forum where dispute pending
Income Tax Act 1961 Karnataka Income Tax Demand 64.98 A.Y 2007-08 to 2013-14 Commissioner of Income Tax Appeal
Agricultural Income Tax Act 1957 Agricultural Income Tax 12.29 A.Y 2009-10 and 2010-11 Joint Commissioner of Commercial Taxes (Appeal)

viii. Based on our audit procedures and on the basis of information andexplanations given by the management the Company has not defaulted in repayment of duesto the Banks during the year.

ix. Based on information and explanations given to us and records ofthe Company examined by us the Company has raised Term Loan during the year and hasapplied the same for the purpose for which term loans are raised. The company did notraise any money by way of initial public offer or further public offer including debtinstruments during the year.

x. According to the information and explanations given to us no fraud by the Companyor on the Company by its officers or employees has been noticed or reported during thecourse of our audit.

xi. According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has paid/provided for managerialremuneration in accordance with the requisite approvals mandated by the provisions ofsection 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. Accordingly paragraph 3(xii) of the Order is notapplicable.

xiii. 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 sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the financial statements as required by the applicableaccounting 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.

xv. 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 him. Accordingly paragraph 3(xv) ofthe Order is not applicable.

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

Annexure - B to the Independent Auditor's Report

(Referred to in paragraph 2 (f) under “Report on Other Legal andRegulatory Requirements” section of our Report to the members of Joonktollee Tea& Industries Limited of even date)

We have audited the internal financial controls over financialreporting of Joonktollee Tea & Industries Limited (“the Company”) as of 31stMarch 2021 in conjunction with our audit of the Standalone Financial Statements of theCompany for the year ended on that date.

MANAGEMENT'S RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS OVERFINANCIAL REPORTING

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(‘ICAI'). These responsibilities include the design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the orderly and efficient conduct of its business including adherence tocompany's policies the safeguarding of its assets the prevention and detection offrauds and errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Companies Act 2013.

AUDITOR'S RESPONSIBILITY

Our responsibility is to express an opinion on the Company's internalfinancial controls over financial reporting based on our audit. We conducted our audit inaccordance with the Guidance Note on Audit of Internal Financial Controls over FinancialReporting (the “Guidance Note”) and the Standards on Auditing issued by ICAIand deemed to be prescribed under section 143(10) of the Companies Act 2013 to theextent applicable to an audit of internal financial controls both applicable to an auditof Internal Financial Controls and both issued by ICAI. Those Standards and the GuidanceNote require that we comply with ethical requirements and plan and perform the audit toobtain reasonable assurance about whether adequate internal financial controls overfinancial reporting was established and maintained and if such controls operatedeffectively in all material respects. Our audit involves performing procedures to obtainaudit evidence about the adequacy of the internal financial controls system over financialreporting and their operating effectiveness. Our audit of internal financial controls overfinancial reporting included obtaining an understanding of internal financial controlsover financial reporting assessing the risk that a material weakness exists and testingand evaluating the design and operating effectiveness of internal control based on theassessed risk. The procedures selected depend on the auditor's judgment includingthe assessment of the risks of material misstatement of the Standalone FinancialStatements whether due to fraud or error. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our audit opinion on theCompany's internal financial controls system over financial reporting.

MEANING OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING

A company's internal financial control over financial reporting is aprocess designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of Standalone Financial Statements for external purposes inaccordance with generally accepted accounting principles. A company's internal financialcontrol over financial reporting includes those policies and procedures that (1) pertainto the maintenance of records that in reasonable detail accurately and fairly reflectthe transactions and dispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of StandaloneFinancial Statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorizations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorized acquisition use ordisposition of the company's assets that could have a material effect on the StandaloneFinancial Statements.

INHERENT LIMITATIONS OF INTERNAL FINANCIAL CONTROLS OVER FINANCIALREPORTING

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

OPINION

In our opinion the Company has in all material respects an adequateinternal financial controls system over financial reporting and such internal financialcontrols over financial reporting were operating effectively as at 31 March 2021 based onthe internal control over financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls Over Financial Reporting issued by ICAI.

For JKVS & CO
Chartered Accountants
Firm ‘s Registration No. 318086E
(Utsav Saraf)
Partner
Membership No. 306932
UDIN: 21306932AAAABF3719
Place: Kolkata
Date: 11th June 2021

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