The Members of
NITIN SPINNERS LIMITED
REPORT ON THE IND AS FINANCIAL STATEMENTS
We have audited the accompanying Ind AS financial statements of NITIN SPINNERS LIMITED("the Company") which comprise the Balance Sheet as at 31st March 2018 theStatement of Profit and Loss (including Other Comprehensive Income) the Cash FlowStatement and the Statement of Changes in Equity for the year then ended and a summary ofthe significant accounting policies and other explanatory information.
MANAGEMENT'S RESPONSIBILITY FOR THE IND AS 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 Ind AS financial statements that give a true and fair view of the state ofaffairs(financial position) Profit and loss (financial performance including othercomprehensive income) cash flows and changes in equity of the Company in accordance withthe accounting principles generally accepted in India including the Indian AccountingStandards (Ind AS) specified under Section 133 of the Act read with the Companies (IndianAccounting Standards) Rules 2015 as amended.
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 accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating eff ectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe Ind AS financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
Our responsibility is to express an opinion on these Ind AS financial statements basedon our audit. We have taken into account the provisions of the Act the accounting andauditing standards and matters which are required to be included in the audit report underthe provisions of the Act and the Rules made there under. We conducted our audit of theInd AS financial statements in accordance with the Standards on Auditing specified underSection 143(10) of the Act. Those Standards require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetherthe Ind AS financial statements are free from material misstatement. An audit involvesperforming procedures to obtain audit evidence about the amounts and the disclosures inthe Ind AS financial statements. The procedures selected depend on the auditor's judgmentincluding the assessment of the risks of material misstatement of the Ind AS financialstatements whether due to fraud or error. In making those risk assessments the auditorconsiders internal financial control relevant to the Company's preparation of the Ind ASfinancial statements that give a true and fair view in order to design audit proceduresthat are appropriate in the circumstances. An audit also includes evaluating theappropriateness of the accounting policies used and the reasonableness of the accountingestimates made by the Company's Directors as well as evaluating the overall presentationof the Ind AS financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Ind AS financial statements.
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 Act in the manner so required and give a true and fair view in conformity with theaccounting principles generally accepted in India including Ind AS of the state ofaffairs (financial position) of the Company as at 31st March 2018 and its profit(financial performance including other comprehensive income) its cash flows and thechanges in equity for the year ended on that date.
The comparative financial information of the Company for the year ended 31st March2017 and the transition date opening balance sheet as at 1st April 2016 included in theseInd AS financial statements are based on the previously issued statutory financialstatements prepared in accordance with the Companies (Accounting Standards) Rules 2006and audited by the predecessor auditor whose audit report for the year ended 31st March2017 and 31st March 2016 dated 06th May 2017 and 3rd May 2016 respectively expressed anunmodified opinion on those financial statements as adjusted for the diff erences in theaccounting principles adopted by the Company on transition to the Ind AS which have beenaudited by us. Our opinion is not modified in respect of above matter.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
1. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Government of India in terms of sub-section (11) of Section 143 of the Actand on the basis of such checks of the books and records of the Company as we consideredappropriate and according to the information and explanations given to us we give in the Annexure1 a statement on the matters specified in the paragraphs 3 and 4 of the said 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 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) Statement of Cash Flow and the Statement of Changes in Equity dealt with by thisReport are in agreement with the books of account.
(d) In our opinion the aforesaid Ind AS financial statements comply with the IndianAccounting Standards specified under Section 133 of the Act. (e) On the basis of thewritten representations received from the directors as on 31st March 2018 taken on recordby the Board of Directors none of the directors is disqualified as on 31st March 2018from being appointed as a director in terms of Section 164 (2) of the Act.
(f) With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating eff ectiveness of such controls refer to ourseparate report in
(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 (as amended) inour opinion and to the best of our information and according to the explanations given tous: a. The Company has disclosed the impact of pending litigations on its financialposition in its Ind AS financial statements. Refer Note 29 to the financial statements; b.The Company did not have any long-term contracts including derivative contracts for whichthere were any material foreseeable losses. c. There are no amounts which are required tobe transferred to the Investor Education and Protection Fund by the Company.
For Kalani & Company
M. No. 108170 Place of Signature : Bhilwara Dated : 10th May 2018
To the Independent Auditors' Report
Referred to in our report of even date to the members of NITIN SPINNERS LIMITED on theaccounts for the year ended 31st March 2018
(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets (Property Plant & Equipment);.
(b) The fixed assets (Property Plant & Equipment) have been physically verified bythe management at reasonable intervals; no material discrepancies were noticed on suchverification.
(c) The title deeds of immovable properties are held in the name of the Company (ii)Physical verification of inventory has been conducted at reasonable intervals bymanagement. As informed to us no material discrepancies have been noticed on suchverification.
(iii) The Company has not granted any loans secured or unsecured to any companiesfirms limited liability partnership or other parties covered in register maintained underSection 189 of the Companies Act 2013.
(iv) No loans have been given to parties covered under section 185 of the CompaniesAct 2013. The Company has not given any guarantee or provided any security to any partycovered under section 185 or 186 of the Companies Act 2013. In case of investmentsprovisions of section 185 and 186 of the Companies Act 2013 has been complied.
(v) The Company has not accepted deposits from the public within the meaning ofSections 73 to 76 of the Companies Act 2013 and the rules made there under hence thisclause is not applicable.
(vi) The maintenance of cost records has been prescribed by the Central Governmentunder section 148(1) of the Companies Act 2013 and as informed to us such accounts andrecords have been so made and maintained. However we have not conducted a detailedexamination of the same.
(vii) (a) Undisputed statutory dues including provident fund employee state insuranceincome tax sales-tax wealth tax service tax custom duty excise duty value added taxcess and other statutory dues have generally been regularly deposited with the appropriateauthorities and there are no undisputed dues outstanding as on 31st March 2018 for aperiod of more than six months from the date they became payable. (b) According toinformation and explanations given to us the gross disputed statutory dues of income taxsales tax or service tax or duty of customs or duty of excise or value added tax amountsto 1194.10 Lacs in aggregate as on 31st March 2018 out of which 376.58 Lacs has beendeposited under protest/adjusted by tax authorities and the balance of 817.52 Lacs of dueshave not been deposited on account of matters pending before appropriate authorities asdetailed below:
|Sl. No ||Name of Statute ||Nature of the disputed statutory dues ||Period to which the amount relates (FY) ||Forum where the dispute is pending ||Gross Amount due ( Rs. in Lacs.) ||Amount deposited under protest/ adjusted by tax authorities ( Rs. in Lacs.) ||Amount not deposited (in Lacs.) |
|1 ||Central Excise ||Interest on Excise Duty ||2008 ||Supreme Court New Delhi ||787.02 ||Nil ||787.02 |
|2. ||Central Excise ||Excise duty and penalty ||2006-07 ||High Court Jodhpur ||9.25 ||9.25 ||Nil |
|3. ||Customs ||Redemption Fine ||2009-10 ||CESTAT Ahmadabad ||0.50 ||Nil ||0.50 |
|4 ||Central excise ||Excise Duty and Penalty ||01.04.2000 to 30.06.2000 ||Commissioner (A) Jaipur ||20.37 ||Nil ||20.37 |
|5 ||Central Excise ||Refund- Rebate Claim ||2017 ||Commissioner (A) Jaipur ||9.63 ||Nil ||9.63 |
|6. ||Rajasthan Vat Act ||Input Credit ||2012-13 ||Dy. Commissioner (A) Ajmer ||5.78 ||5.78 ||Nil |
|7 ||Rajasthan Vat Act ||Input Credit ||2013-14 ||Dy. Commissioner (A) Ajmer ||250.25 ||250.25 ||Nil |
|8 ||Rajasthan Vat Act ||Input Credit ||2014-15 ||Dy. Commissioner (A) Ajmer ||111.30 ||111.30 ||Nil |
| ||Total || || || ||1194.10 ||376.58 ||817.52 |
(viii) In our opinion and according to the information and explanations given to usthe Company has not defaulted in repayment of loans or borrowing to a financialinstitution banks government or dues to debenture holders.
(ix) The Company has not raised any money by way of initial public off er or furtherpublic off er. According to the information and explanations given to us the money raisedby the Company by way of term loans have been applied for the purpose for which they wereobtained.
(x) According to the information and explanations given to us and as represented by theManagement and based on our examination of the books and records of the Company and inaccordance with generally accepted auditing practices in India we have been informed thatno case of frauds has been committed on or by the Company or by its officers or employeeshas been noticed or reported during the year. (xi) Managerial remuneration has been paidor provided in accordance with the requisite approvals mandated by the provisions ofsection 197 read with Schedule V to the Companies Act.
(xii) The provisions of clause 3 (xii) of the Order for Nidhi Company are notapplicable to the Company.
(xiii) The Company has complied with the provisions of Section 177 and 188 of theCompanies Act 2013 w.r.t. transactions with the related parties wherever applicable.Details of the transactions with the related parties have been disclosed in the financialstatements as required by the applicable accounting standards.
(xiv) During the year Company has made preferential allotment/ private placement ofshares in compliance with the requirement of Section 42 of Companies Act 2013 and theamount raised has been used for the purpose for which the funds were raised.
(xv) The Company has not entered into any non-cash transactions with the directors orpersons connected with him as covered under Section 192 of the Companies Act 2013.
(xvi) According to information and explanation given to us the Company is not requiredto be registered u/s 45-IA of Reserve Bank of India Act 1934. Accordingly provision ofclause 3(xvi) of the Order is not applicable to the Company.
For Kalani & Company
M. No. 108170 Place of Signature : Bhilwara Dated : 10th May 2018
Referred to in paragraph 2(f) under Report on other Legal and RegulatoryRequirements' section of our report of even date to the members of NITIN SPINNERS LIMITEDon the Ind AS financial statements for the year ended 31st March 2018
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 with reference to Ind AS financialstatements of NITIN SPINNERS LIMITED ("the Company") as of 31st March 2018 inconjunction with our audit of the Ind AS Financial Statements of the Company for the yearended on that date.
MANAGEMENT'S RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS
The Company's management is responsible for establishing and maintaining internalfinancial controls w.r.t. Ind AS financial statements based on the internal control overfinancial reporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls over Financial Reporting issued by the Institute of Chartered Accountants ofIndia (ICAI'). These responsibilities include the design implementation andmaintenance of adequate internal financial controls that were operating eff ectively forensuring the orderly and efficient conduct of its business including adherence toCompany's policies the safeguarding of its assets the prevention and detection of fraudsand errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Act.
Our responsibility is to express an opinion on the Company's internal financialcontrols w.r.t. Ind AS financial statements 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 the extentapplicable to an audit of internal financial controls both applicable to an audit ofInternal Financial Controls and both issued by ICAI.
Those Standards and the Guidance Note require that we comply with ethical requirementsand plan and perform the audit to obtain reasonable assurance about whether adequateinternal financial controls w.r.t. Ind AS financial statements was established andmaintained and if such controls operated eff ectively in all material respects. Our auditinvolves performing procedures to obtain audit evidence about the adequacy of the internalfinancial controls system w.r.t. Ind AS financial statements and their operating effectiveness. Our audit of internal financial controls w.r.t. Ind AS financial statementsincluded obtaining an understanding of internal financial controls w.r.t. Ind AS financialstatements assessing the risk that a material weakness exists and testing and evaluatingthe design and operating eff ectiveness of internal control based on the assessed risk.The procedures selected depend on the auditor's judgment including the assessment of therisks of material 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 Company's internal financial controls systemw.r.t. Ind AS financial statements.
MEANING OF INTERNAL FINANCIAL CONTROLS W.R.T. IND AS FINANCIAL STATEMENTS
A Company's internal financial control w.r.t. Ind AS financial statements 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 Company's internal financial control w.r.t.Ind AS financial statements 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 reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the Company are being made only inaccordance with authorizations of management and directors of the Company; and (3) providereasonable assurance regarding prevention or timely detection of unauthorized acquisitionuse or disposition of the Company's assets that could have a material eff ect on thefinancial statements.
INHERENT LIMITATIONS OF INTERNAL FINANCIAL CONTROLS W.R.T. IND AS FINANCIAL STATEMENTS
Because of the inherent limitations of internal financial controls w.r.t. Ind ASfinancial statements 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 w.r.t.Ind AS financial statements to future periods are subject to the risk that the internalfinancial controls w.r.t. Ind AS financial statements may become inadequate because ofchanges in conditions or that the degree of compliance with the policies or proceduresmay deteriorate.
In our opinion the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsw.r.t. Ind AS financial statements were operating eff ectively as at 31st March 2018based on the internal controls w.r.t. Ind AS financial statements criteria established bythe Company considering the components of internal controls stated in the Guidance Note onAudit of Internal Financial Controls over Financial Reporting issued by the ICAI.
For Kalani & Company
M. No. 108170
Place of Signature : Bhilwara
Dated : 10th May 2018