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Nova Iron & Steel Ltd.

BSE: 513566 Sector: Metals & Mining
NSE: NOVAIRNSTL ISIN Code: INE608C01026
BSE 16:01 | 19 Sep 3.96 -0.05
(-1.25%)
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3.96

HIGH

3.96

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3.96

NSE 05:30 | 01 Jan Nova Iron & Steel Ltd
OPEN 3.96
PREVIOUS CLOSE 4.01
VOLUME 504
52-Week high 8.30
52-Week low 3.88
P/E
Mkt Cap.(Rs cr) 14
Buy Price 3.96
Buy Qty 566.00
Sell Price 4.10
Sell Qty 7.00
OPEN 3.96
CLOSE 4.01
VOLUME 504
52-Week high 8.30
52-Week low 3.88
P/E
Mkt Cap.(Rs cr) 14
Buy Price 3.96
Buy Qty 566.00
Sell Price 4.10
Sell Qty 7.00

Nova Iron & Steel Ltd. (NOVAIRNSTL) - Auditors Report

Company auditors report

To the Members of M/s. Nova Iron and Steel Ltd.

Report on the Standalone Ind-As Financial Statements

We have audited the accompanying Standalone Ind-AS Financial Statements of M/s NovaIron and Steel Ltd. ("the Company") which comprise the Balance Sheet as at31st March 2018 and the Statement of Profit and Loss (including Other ComprehensiveIncome) the Statement of Changes in Equity and the Statement of Cash Flow for the yearthen ended and a summary of the significant accounting policies and other explanatoryinformation.

Management's Responsibility for the Standalone 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 Standalone Ind-AS Financial Statements that give a true and fair view of thefinancial position financial performance including other comprehensive income cashflows and changes in equity of the Company in accordance with the Indian AccountingStandards (Ind-AS) prescribed under section 133 of the Act read with the companies (IndianAccounting Standards) Rules2015 as amended and other accounting principles generallyaccepted in India.

This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing and detecting frauds and other irregularities selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the StandaloneInd-AS Financial Statements that give a true and fair view and Standalone are free frommaterial misstatement whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these Standalone Ind-AS Financialstatements based on our audit.

In conducting our audit we have taken into account the provisions of the Act theaccounting and auditing standards and matters which are required to be included in theaudit report under the provisions of the Act and the Rules made there under and the orderissued under Section 143(11) of the Act

We conducted our audit of the Standalone Ind-AS Financial Statements in accordance withthe Standards on Auditing specified u/s 143(10) of the Act. These Standards require thatwe comply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether the Ind-AS Financial Statements are free from materialmisstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the Standalone Ind-AS financial statements. The procedures selected dependon the auditor's judgement including the assessment of the risks of material misstatementof the Standalone Ind-AS Financial Statements whether due to fraud or error. In makingthose risk assessments the auditor considers internal financial control relevant to theCompany's preparation of Ind-AS Financial Statements that give a true and fair view inorder to design audit procedures that are appropriate in the circumstances. An audit alsoincludes evaluating the appropriateness of accounting policies used and the reasonablenessof the accounting estimates made by Company's Directors as well as evaluating the overallpresentation of the Standalone 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 financial statements.

Emphasis of Matter

(a) Land under Property Plant and Equipment includes land measuring 72.95 acreamounting to at Rs 194.34 Lacs bought by the company in the name of third parties.Transfer of the same in the company's name is yet to be initiated. (Refer Note No. 49 ofFinancial Statement).

(b) Audited Accounts as per IND AS Were prepared for the year ending March 31st 2017for consolidation purpose while the final accounts adopted in AGM were on IGAAP. (ReferNote No. 50 of Financial Statement).

Our opinion is not qualified in respect of the afore matter

Other Matter

The Standalone Ind as financial statement of the Company for the year ended 31st March2017 ls prepared in accordance with Companies (Accounting standards) Rules 2006 wereaudited by another firm of Chartered Accountants under the Companies Act. 2013 who videtheir report dated 29th May 2017 expressed an unmodified opinion on those financialstatements.

Our opinion is not qualified in respect of the aforesaid matter

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Standalone Ind-AS Financial Statements give the informationrequired by the Act in the manner so required and give a true and fair view in conformitywith the accounting principles generally accepted in India of the state of affairs of thecompany as at 31 March 2018 and their profit (including other comprehensive income)their cash flows and changes in equity for the year ended on that date.

Report on Other Legal and Regulatory Requirements

(i) As required by the Companies (Auditors Report) Order 2016 ("theOrder") issued by the Central Government of India in terms of the section 143(11) ofthe Companies Act 2013 we give in "Annexure A" a statement on the mattersspecified in the paragraphs 3 and 4 of the said Order to the extent applicable.

(ii) 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 thebest of our knowledge and belief were necessary for the purpose of our audit; b. inour opinion proper books of account as required by law have been kept by the Company sofar as it appears from our examination of those books;

c. the Balance Sheet Statement of Profit and Loss

Other Comprehensive Income the Cash Flow and Statement of Changes in Equity dealt withby this report are in agreement with the books of account;

d. in our opinion the aforesaid Standalone Ind-AS Financial Statement comply withthe Indian Accounting Standards specified under section 133 of the act.

e. on the basis of the written representation received from the directors as on 31March 2018 taken on record by the Board of Directors none of the directors isdisqualified as on 31 March 2018 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";

g. with respect to the other matters to be included in Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our information and according to the explanations given to us;

i. The Company has disclosed the impacts of pending litigations on its financialposition in its Standalone Ind-AS Financial Statements as on 31 March 2018. (Refer tonote no 35)

ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.

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

For Mehra Goel & Co.
Chartered Accountants
FRN : 000517N
Place : New Delhi Sanjay Mehra
Date : 29.05.2018 Partner
M.N. : 085389

"ANNEXURE A" TO THE INDEPENDENT AUDITORS' REPORT ON THE STANDALONE IND - ASFINANCIAL STATEMENTS OF M/S. NOVA IRON & STEEL LTD.

(Referred to in paragraph 1 under the heading ‘Report on Other Legal &Regulatory Requirement' of our report of even date to the financial statements of theCompany for the year ended March 31 2018)

i. In respect of companies fixed assets:

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

(b) The Fixed Assets have been physically verified by the management in a phasedmanner designed to cover all the items over a period of three years which in ouropinion is reasonable and adequate having regard to the size of the company and nature ofits business. A portion of the fixed assets were physically verified by the managementduring the year. According to the information & explanation given to us no materialdiscrepancies between the books records and the physical fixed assets have been noticed.

(a) According to the information and explanation given to us during the course of ouraudit the title deeds of immovable properties are held in the name of the company ExceptRegistration of Freehold land amounting to Rs 19434130 is not in the name of thecompany

ii. In respect of Inventory:

The inventory of the Company in its possession has been physically verified by themanagement at reasonable intervals. In our opinion the frequency of verification isreasonable.

In our opinion and according to the information and explanations given to usdiscrepancies noticed on physical verification have been properly dealt with in the booksof account.

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 listed in the register maintained under Section 189 of the Companies Act 2013.

iv. In our opinion and according to information and explanations given to us duringthe year the company has not given any loan made any investments given any guaranteesor provided any securities covered under section 185 and 186 of the Companies Act 2013.

v. To the best of our knowledge and according to information and explanations given tous the company has not accepted any deposits during the year and therefore the provisionsof clause 3 (v) of the order are not applicable to the company.

vi. To the best of our knowledge the Central Government has prescribed the maintenanceof cost records under Section 148 (1) of the Companies Act 2013 which have beenmaintained by the company and these have been broadly reviewed by us and we are of theopinion that prima facie the prescribed accounts and records have been made andmaintained. However we have not nor we are required carried out any detailedexamination of such accounts and records.

vii. In respect of statutory dues :

(a) According to information and explanations given to us and on the basis of ourexamination of the books of account and records the Company has been generally regularin depositing undisputed statutory dues including Provident Fund Employees StateInsurance Income-Tax Sales tax Service Tax Duty of Customs Duty of Excise Valueadded Tax Cess and any other statutory dues with the appropriate authorities. Accordingto the information and explanations given to us no undisputed amounts payable in respectof the above were in arrears as at March 31st 2018 for a period of more than six monthsfrom the date they become payable Except the cases listed below :

Name of the statute Amount Current Status
(In Rs )
Entry Tax (Including Interest Due) 34244722 Not yet paid
Service Tax 2140012 Not yet paid
Employee State Insurance 520554 Paid On 8th & 9th May 2018
Provident Fund 1591250 Paid On 8th & 9th May 2018

(b) According to records of the Company there are no undisputed dues outstanding ofCustom Duty Service Tax Cess etc. on account of any dispute except Sales Tax(VAT)Income Tax and Excise Duty Entry Tax as per details given below :-

Name of the statute Nature of dues Net of amount paid (Rs. In Lacs) Period to which amount related Forum where dispute is pending
Excise Duty Modvat Credit Disallowed 72.62 Plus Penalty A.Y. 2004-05 Appeal filed with Custom Excise & Service Tax Appellate Tribunal New Delhi.
Excise Duty Demand 2.90 A.Y. 2007-08 Commissioner Central Excise.
Excise Duty Demand 57.58 Oct – 1999 To March - 2004 Commissioner of Central Excise – Raipur.
Excise Duty Demand 126.70 April – 2007 To July – 2011 Commissioner of Central Excise – Raipur.
Excise Duty Modvat Credit Disallowed And Penalty Imposed 39.45 March – 2014 & January – 2015 Commissioner Appeal – Raipur
Excise Duty Demand on under valuation And Penalty 81.61 Oct – 2011 To June - 2012 Commissioner Appeal – Raipur
Income Tax Imposed Demand 18.70 A.Y. 1994-95 Appeal Pending before ITAT.
Income Tax Demand 143.38 A.Y. 2007-08 Appeal Pending before ITAT.
VAT Demand 2.23 A.Y. 2004-05 Commissioner of Commercial Tax.
VAT Demand 0.25 A.Y. 2006-07 Revision Pending with Asstt.
Commissioner of Commercial Tax.
VAT Demand 530.60 A.Y. 2003-04 Revision filed before Addl. Comm. Commercial Tax was filed and order was issued in favour of the Company Case remanded back to A.C. Commercial Tax.
VAT Demand 594.08 A.Y. 2004-05 Revision filed before Addl. Comm. Commercial Tax was filed and order was issued in favour of the Company Case remanded back to A.C. Commercial Tax.
Entry Tax Tax Demand 5.05 A.Y. 2006-07 Revision Pending with Addl. Commissioner of Commercial Tax

viii. In our opinion and according to the information and explanations given to us theCompany has not defaulted in the repayment of dues to banks. The Company has not taken anyloan either from financial institutions or from the government and has not issued anydebentures.

ix. To the best of our knowledge and according to information and explanations given tous the company has not raised moneys by way of initial public offer or further publicoffer (including debt instruments) or term loans during the period under review and hencereporting under clause 3 (ix) is not applicable to the company.

x. Based upon the audit procedures performed and the information and explanations givenby the management we report that no fraud by the Company or on the company by itsofficers or employees has been noticed or reported during the year.

xi. According to the information and explanations given to us by the management themanagerial remuneration has been paid or provided in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the CompaniesAct 2013.

xii To the best of our knowledge and according to information and explanations given tous the company is not a Nidhi Company and hence reporting under clause 3 (xii) is notapplicable to the company.

xiii To the best of our knowledge and according to the information and explanationsgiven to us all transactions with the related parties are in compliance with sections 177and 188 of Companies Act 2013 where applicable and the details have been disclosed inthe Financial Statements as required by the applicable Indian accounting standards.

xiv During the year the company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures during the year underreview. Hence the provisions of clause 3 (xiv) of the Order are not applicable to theCompany.

xv. Based upon the audit procedures performed and the information and explanationsgiven by the management during the year under review the company has not entered into anynon-cash transactions with directors or persons connected to them and hence provisions ofSection 192 of the Companies Act 2013 are not applicable to the Company.

xvi. In our opinion and according to the information and explanation given to us thecompany is not required to be registered under section 45 IA of the Reserve Bank of IndiaAct 1934.

For Mehra Goel & Co.
Chartered Accountants
FRN : 000517N
Sanjay Mehra
Place : New Delhi Partner
Date : 29.05.2018 M.N. : 085389

"ANNEXURE B" TO THE INDEPENDENT AUDITOR'S REPORT ON THE STANDALONE IND-ASFINANCIAL STATEMENTS OF NOVA IRON AND STEEL STANDALONE IND AS LTD.

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 of NOVA IRONAND STEEL LTD. ("the Company") as of March 31 2018 in conjunction with ouraudit of the Standalone Ind-As financial statements of the Company for the year ended onthat Standalone Ind as 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 Reportingissued by the Institute of Chartered Accountants of India. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe Companies Act 2013.

Auditors' Responsibility

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 on Audit of Internal Financial Controls Over Financial Reporting(the "Guidance Note") and the Standards on Auditing issued by ICAI and deemedto 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 the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material respects. Our auditinvolves performing procedures to obtain audit evidence about the adequacy of the internalfinancial controls system over financial reporting and their operating effectiveness. Ouraudit of internal financial controls over financial reporting included obtaining anunderstanding of internal financial controls over financial reporting assessing the riskthat a material weakness exists and testing and evaluating the design and operatingeffectiveness of internal control based on the assessed risk. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement 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 systemover financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal financial control over financialreporting includes those policies and procedures that (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.

Opinion

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 March 31 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.

For Mehra Goel & Co.
Chartered Accountants
FRN : 000517N
Sanjay Mehra
Place : New Delhi Partner
Date : 29.05.2018 M.N. : 085389