To the Members of Mukand Engineers Limited Report on the Financial Statements
We have audited the accompanying financial statements of M/s Mukand EngineersLimited ("the Company") which comprise the Balance Sheet as at March 312018 the Statement of Profit and Loss (including Other Comprehensive Income) Cash FlowStatement and Statement of Changes in Equity for the year then ended and asummaryofsignificantaccounting 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 preparation ofthese financial statements to give a true and fair view of the financial positionfinancial performance (including other comprehensive income) cash flows and changes inequity of the Company in accordance with the accounting principles generally accepted inIndia including the Indian Accounting Standards specified in the Companies (IndianAccounting Standards) Rules 2015 (as amended) under Section 133 of the Act. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding of the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; anddesign implementation and maintenance of adequate internal financial controls that areoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror.
Our responsibility is to express an opinion on these financial statements based on ouraudit We have taken into account the provisions of the Act and the Rules made there underincluding the Accounting and Auditing Standards and matters which are required to beincluded in the audit report under the provisions of the Act and the Rules madethereunder.
We have conducted our audit in accordance with the Standards on Auditing specifiedunder Section 143(10) of the Act and other applicable authoritative pronouncements issuedby the Institute of Chartered
Accountants of India. Those standards and pronouncements require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether the financial statements are free from material misstatement. An audit involvesperforming procedures to obtain audit evidence about the amounts and disclosures in thefinancial statements. The procedures selected depend on the auditors' judgment includingthe assessment of the risks of material misstatement of the financial statements whetherdue to fraud or error. In making those risk assessments the auditor considers internalfinancial control relevant to the Company's preparation of the financial statements thatgive true and fair view in order to design audit procedures that are appropriate in thecircumstances. An audit also includes evaluating the appropriateness of accountingpolicies used and the reasonableness of the accounting estimates made by the Company'sDirectors as well as evaluating the overall presentation of the financial statements. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our audit opinion on the financial statements.
In our opinion and to the best of our information and according to the explanationsgiven to us the financial statements give the information required by the Act in themanner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at March31 2018 and its Loss (after adjusting other comprehensive income) and its cash flows forthe year ended on that date.
The financial information of the Company for the year ended March 31 2017 and thetransition date opening balance sheet as at April 1 2016 included in these financialstatements are based on the previously issued statutory financial statements for theyears ended March 31 2017 and March 31 2016 prepared in accordance with the Companies(Accounting Standards) Rules 2006 (as amended) which were audited by us on which weexpressed an unmodified opinion dated May 24 2017 and May 20 2016 respectively. Theadjustments to those financial statements for the differences in accounting principlesadopted by the Company on transition have been audited by us.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order 2016 issued by the CentralGovernment of India in terms of sub-section (11) of the section 143 of the Act(hereinafter referred to as "the Order") and on the basis of such checks of thebooks and records of the Company as we considered appropriate and according to theinformation and explanations given to us we give in the "Annexure A" astatement on the matters specified in paragraph 3 and 4 of the Order.
2. As required by Section 143(3) of the Act we report that: a. We have sought andobtained all the information and explanations which to the best of our knowledge andbelief were necessary for the purpose of our audit. b. In our opinion proper books ofaccount as required by law have been kept by the Company so far as it appears from ourexamination of those books. c. The Balance Sheet Statement of Profit and Loss (includingother comprehensive income) Cash Flow Statement and the Statement of Changes in Equitydealt with by this Report are in agreement with the books of account. d. In our opinionthe aforesaid financial statements comply with the Indian Accounting Standards specifiedunder Section 133 of the Act. e. On the basis of written representations received from theDirectors as on March 31 2018 and taken on record by the Board of Directors none of thedirectors is disqualified as on March 31 2018 from being appointed as a Director interms of Section 164(2) of the Act. f. With respect to the adequacy of the internalfinancial controls over financial reporting of the Company and the operating effectivenessof such controls refer to our separate report in "Annexure B". g. With respectto the other matters to be included in the Auditors' Report in accordance with Rule 11 ofthe Companies (Audit and Auditors) Rules 2014 in our opinion and to the best of ourknowledge and belief and according to the information and explanations given to us: i. TheCompany has disclosed the impact if any of pending litigations as at March 31 2018 onits financial position in its financial statements. ii. The Company has made provision asat March 31 2018 as required under the applicable law or accounting standards formaterial foreseeable losses if any on long-term contracts. The Company has not enteredinto any Derivative Contracts during the financial year. iii. There has been no delay intransferring amounts required to be transferred to the Investor Education and ProtectionFund by the Company during the year ended March 31 2018.
GIRISH M. PATHAK
Membership No. 102016
For and on behalf of
K.K.MANKESHWAR & CO.
Mumbai 28th May 2018
ANNEXURE A TO INDEPENDENT AUDITORS' REPORT
(The Annexure referred to in our report to the members of Mukand Engineers Limitedfor the year ended March 31 2018.)
(i) In respect of its Fixed Assets:
(a) The Company is maintaining proper records showing full particulars includingquantitative details and situation of fixed assets. (b) As per the explanation given tous the Fixed Assets were physically verified by the Management in accordance with aregular programme covering all the assets over a period of three years which in ouropinion is reasonable having regard to the size of the Company and the nature of itsassets. Pursuant to the program the management during the year has physically verified aportion of the fixed assets and no material discrepancies were noticed on suchverification. In our opinion this periodicity of physical verification is reasonablehaving regard to the size of the Company and nature of is assets.
(c) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the Company does not hold any immovableproperties in its name.
(ii) The physical verification of inventory excluding stocks with third parties hasbeen conducted at reasonable intervals by the Management during the year. In respect ofinventory lying with third parties these have substantially been confirmed by them. Inour opinion the frequency of verification is reasonable.
(iii) In our opinion and according to information and explanations given to us theCompany has not granted any loans secured or unsecured to Companies firms or otherparties covered in the register maintained under Section 189 of the Act during the year.Consequently clauses (iii) (a) (iii) (b) and (iii) c of paragraph 3 of the Order are notapplicable to the Company.
(iv) In our opinion and according to the information and explanations given to us theCompany has not granted any loans or provided any guarantees or security in respect of anyloans to any party covered under Section 185 and 186 of the Act. The Company has compliedwith the provisions of Section 186 of the Act in respect of investments made in bodycorporate.
(v) In our opinion and according to the information and explanations given to us theCompany has generally complied with the directives issued by the Reserve Bank of India andthe provisions of Sections 73 to 76 or any other provisions of the Act and the Companies(Acceptance of Deposits) Rules 2014 to the extent notified with regard to depositsaccepted from the public. The Company not being an "Eligible Company" as definedin Companies (Acceptance of Deposits) Rules 2014 sought and obtained the approval fromthe Company Law Board for extension in time limit for repayment of Public Depositsoutstanding as on March 31 2015 on the respective due dates of maturity.
(vi) The Central Government has not prescribed the maintenance of cost records undersection 148(1) of the Act for any of the services rendered by the Company.
(vii) In respect of Statutory Dues:
(a) According to the information and explanations given to us and the records of theCompany examined by us in our opinion the Company is generally regular in depositingundisputed statutory dues including Provident Fund Investor Education and ProtectionFund Employees' State Insurance and other material statutory dues as applicable to itwith the appropriate authorities. Some delays have been observed in the payment of IncomeTax Sales Tax including Value Added Tax Service Tax Goods and Service Tax Entry Taxand Cess. As explained to us there were no dues towards Custom Duty Wealth Tax andExcise Duty during the year. According to information and explanations given to us therewere no undisputed amounts payable in respect of Income Tax Service Tax Entry Tax ValueAdded Tax Cess and other material statutory dues in arrears as on 31st March 2018 for aperiod of more than six months from the date they become payable.
(b) According to information and explanations given to us upon our enquiries in thisregard and records of the Company the following statutory dues in respect of Income TaxWorks Contract Tax Entry Tax and Goods & Service Tax as at 31st March 2018 have notbeen deposited by the Company on account of disputes:
|Nature of dues ||Amount Rs. ||Period to which the amount relates ||Forum wherethe dispute is pending |
|Income Tax ||8622250 ||2000-2001 2001-2002 ||High Court of Bombay |
|Income Tax ||8455448 ||1999-2000 ||Income Tax Appellate |
| || ||2005-2006 ||Tribunal |
|Income Tax ||18288378 ||2013-2014 ||Commissioner of Income Tax |
|Income Tax ||9895634 ||2002-2003 to 2012-2013 ||Income Tax Department Authorities |
|Works Contracts Tax ||7583974 ||2001-2002 and 2002- 2003 ||High Court |
|Works Contracts Tax ||22076799 ||2001-2002 to 2004-2005 2011-12 2012-13 2014-15 ||Sales Tax Department Authorities |
|Entry Tax ||811173 ||1999-2000 to 2002-2003 ||High Court Odisha |
|Entry Tax ||127835 ||2003-2004 and 1999- 2000 ||Asst. Commissioner (Sales Tax) |
(viii) According to the records of the Company examined by us and information andexplanations given to us the Company has not defaulted in repayment of dues to anyfinancial institution or bank during the year. There are no dues to any debenture holders.
(ix) The Company did not raise any money by way of initial public offer or furtherpublic offer (including debt instruments) and term loans during the year. Accordinglyclause (ix) of paragraph 3 of the Order is not applicable.
(x) 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 on or by the Company noticed or reported during the year norhave we been informed of such case by the Management.
(xi) According to the information and explanations give 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 clause (xii) of paragraph 3 of the Order isnot applicable. (xiii) According to the information and explanations given to us and basedon our examination of the records of the Company transactions with the related partiesare in compliance with Sections 177 and 188 of the Act where applicable. The details ofrelated party transactions have been disclosed in the financial statements as requiredunder Indian Accounting Standard (Ind AS) 24 Related Party Disclosures as specified undersection 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2015.
(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 clause (xv) ofparagraph 3 of the Order is not applicable. (xvi) The Company is not required to beregistered under section 45-IA of the Reserve Bank of India Act 1934. Accordingly theprovisions of clause (xvi) of paragraph 3 of the Order are not applicable to the Company.
GIRISH M. PATHAK
Membership No. 102016
For and on behalf of
K.K.MANKESHWAR & CO.
Mumbai 28th May 2018
ANNEXURE B TO 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")
We have audited the internal financial controls over financial reporting ofMukandEngineers Limited ("the Company") as of March 31 2018 in conjunction withour audit 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 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 Reporting (the"Guidance Note") issued by the Institute of Chartered Accountants of India(ICAI'). These responsibilities include the design implementation and maintenanceof adequate internal financial controls that were operating effectively for ensuring theorderly and efficient conduct of its business including adherence to Company's policiesthe safeguarding 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 ("theAct").
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 and the Standards on Auditing deemed to be prescribed under section143(10) of the Act to the extent applicable to an audit of internal financial controlsboth applicable to an audit of Internal Financial Controls and both issued by ICAI. ThoseStandards and the Guidance Note require that we comply with ethical requirements and planand perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls over financial reporting was established and maintained and if suchcontrols operated effectively in all material respects. Our audit involves performingprocedures to obtain audit evidence about the adequacy of the internal financial controlssystem over financial reporting and their operating effectiveness. Our audit of internalfinancial controls over financial reporting included obtaining an understanding ofinternal financial controls over financial reporting assessing the risk that a materialweakness exists and testing and evaluating the design and operating effectiveness ofinternal control based on the assessed risk. The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of thefinancial statements whether due to fraud or error. We believe that the audit evidence wehave obtained is sufficientand 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 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 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 31st March 2018 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.
GIRISH M. PATHAK
Membership No. 102016
For and on behalf of
K.K.MANKESHWAR & CO.
Mumbai 28th May 2018