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Provogue (India) Ltd.

BSE: 532647 Sector: Industrials
NSE: PROVOGE ISIN Code: INE968G01033
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OPEN 3.68
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VOLUME 8704
52-Week high 11.11
52-Week low 3.41
P/E
Mkt Cap.(Rs cr) 85
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 3.68
CLOSE 3.68
VOLUME 8704
52-Week high 11.11
52-Week low 3.41
P/E
Mkt Cap.(Rs cr) 85
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Provogue (India) Ltd. (PROVOGE) - Auditors Report

Company auditors report

To

The Members of Provogue (India) Limited

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS financial statements of Provogue(India) Limited ("the Company") which comprise the Balance Sheet as at 31March 2017 the Statement of Profit and Loss (including other comprehensive income) theStatement of Cash Flows and the Statement of Changes in Equity for the year ended on thatdate and a summary of the significant accounting policies and other explanatoryinformation (herein after referred to as "standalone Ind AS financialstatements").

Management's Responsibility for the Standalone Ind AS Financial Statements

The Company's Board of Directors is responsible for the matters stated in sub-section 5of Section 134 of the Companies Act 2013 ("the Act") with respect to thepreparation of these standalone Ind AS financial statements that give a true and fair viewof the financial position financial performance including other comprehensive incomecash flows and changes in equity of the Company in accordance with the accountingprinciples generally accepted in India including the Indian Accounting Standards("Ind AS") prescribed under Section 133 of the Act read with relevant rulesissued thereunder. This responsibility also includes maintenance of adequate accountingrecords in accordance with the provisions of the Act for safeguarding the assets of theCompany and 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 effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe standalone Ind AS financial statements that give a true and fair view and are freefrom material 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.

We have taken into account the provisions of the Act the accounting and auditingstandards and matters which are required to be included in the audit report under theprovisions of the Act and the Rules made thereunder. We conducted our audit in accordancewith the Standards on Auditing specified under sub-section 10 of Section 143 of the Act.Those Standards require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether the standalone Ind AS financialstatements are free from material misstatement. An audit involves performing procedures toobtain audit evidence about the amounts and the disclosures in the standalone Ind ASfinancial statements. The procedures selected depend on the auditor's judgment includingthe assessment of the risks of material misstatement of the standalone Ind AS financialstatements whether due to fraud or error. In making those risk assessments the auditorconsiders internal financial controls relevant to the Company's preparation of thestandalone Ind AS financial statements that give a true and fair view in order to designaudit procedures that are appropriate in the circumstances. An audit also includesevaluating the appropriateness of the accounting policies used and the reasonableness ofthe accounting estimates made by the Company's Directors as well as evaluating theoverall presentation 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 standalone Ind AS financial statements.

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 including the Ind AS of thefinancial position of the Company as at 31 March 2017 and its financial performanceincluding other comprehensive income its cash flows and the changes in equity for theyear ended on that date.

Emphasis of Matter:

We draw attention to the following matter in the Notes to the financial statements:Note 39 to the financial statements regarding non provision of service tax for the periodfrom June 01 2007 to September 30 2011 on rent on immovable properties taken forcommercial use by the Company aggregating ` 279.47 Lacs pending final disposal of theappeal filed before the Hon'ble Supreme Court. The matter is contingent upon the finaloutcome of litigation. Our opinion is not qualified in respect of the above matters.

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 exercise of powers conferred by sub-section11 of section 143 of the Act we enclose in "Annexure A" a statement onthe matters specified in paragraphs 3 and 4 of the Order.

2. As required by sub-section 3 of Section 143 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 other comprehensiveincome) the Statement of Cash Flows and the Statement of Changes in Equity dealt with bythis Report are in agreement with the books of account;

(d) In our opinion the aforesaid standalone Ind AS financial statements comply withthe Indian Accounting Standards prescribed under Section 133 of the Act read withrelevant rules issued thereunder;

(e) The matter described in the Emphasis of Matters paragraph above in our opinionmay not have an adverse effect on the functioning of the Company.

(f) On the basis of the written representations received from the Directors as on 31stMarch 2017 and taken on record by the Board of Directors none of the Directors aredisqualified as on 31st March 2017 from being appointed as a Director in termsof subsection 2 of Section 164 of the Act;

(g) 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" and ;

(h) 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 in our opinionand to the best of our information and according to the explanations given to us:

(i) The Company does not have any pending litigations which would impact its financialposition. - Refer Note 39 to the standalone IND AS financial statements

(ii) The company did not have any long term contracts including derivative contractsfor which there were any material foreseeable losses.

(iii) There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.

(iv) The Company has provided requisite disclosures in the standalone Ind AS financialstatements as to holdings as well as dealings in Specified Bank Notes during the periodfrom 8 November 2016 to 30 December 2016. Based on audit procedures and relying on themanagement representation we report that the disclosures are in accordance with books ofaccount maintained by the Company and as produced to us by the Management – ReferNote 43 to the standalone Ind AS financial statements.

For Ajay Shobha & Co.
Chartered Accountants
Firm Reg. No. 317031E
Ajaykumar Gupta
Place : Mumbai Partner
Date : 29th May 2017 Mem. No. : 53071

ANNEXURE "A" TO THE INDEPENDENT AUDITORS REPORT

The Annexure referred to in Paragraph 1 under the heading "Report on Other Legaland Regulatory Requirements" in our Independent Auditor's Report to the members of Provogue(India) Limited for the year ended 31st March 2017.

As required by the Companies (Auditors Report) Order 2016 and according to theinformation and explanations given to us during the course of the audit and on the basisof such checks of the books and records as were considered appropriate we report that:

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

b) The Fixed Assets have been physically verified by the management during the year atreasonable intervals. In our opinion the frequency of verification is reasonable havingregard to the size of the Company and the nature of its assets. No discrepancies have beennoticed on such physical verification.

c) According to the information and explanations given to us and on the basis of ourexamination of records of the Company the title deeds of immovable properties are held inthe name of the Company.

(ii) The inventories have been physically verified by the management during the year atreasonable intervals. No material discrepancies were noticed on physical verification ofinventory by the management.

(iii) The company has granted unsecured loans to companies covered in the registermaintained under section 189 of the Companies Act 2013.

a) The said loans are interest free and the other terms and conditions of the grant ofsuch loans were not prima facie prejudicial to the company's interest;

b) The terms of arrangements do not stipulate any repayment schedule and the loans arerepayable on demand. Accordingly paragraph 3(iii)(b) of the Order is not applicable tothe Company in respect of repayment of the principal amount;

c) There are no overdue amounts in respect of such loans

(iv) The Company has not granted any loans or provided any guarantees or security tothe parties covered under the Section 185 of the Act. With regards to investments insecurities and loans provided to other body corporates after enforcement of section 186 ofthe Act the Company has complied with the provisions of section 186 of the Act.

(v) The Company has not accepted any deposits from the public in accordance with theprovisions of sections 73 to 76 of the Act and the rules framed there under.

(vi) The Central Government has prescribed the maintenance of cost record under Section148(1) of the Act. We have not reviewed the cost records maintained by the Company butbased on the information submitted by the Company we are of the view that such accountsand records have been made and duly maintained.

(vii) a) Accordingly to the records of the Company the undisputed statutory duesincluding Provident Fund Employees' State Insurance Income Tax Sales Tax Service TaxDuty of Custom Duty of Excise Value Added Tax Cess and other statutory dues to theextent applicable have not been regularly deposited with the appropriate authorities.There are no undisputed amount payable in respect of such statutory dues which haveremained outstanding as at 31st March 2017 for a period more than six monthsfrom the date they became payable.

b) According to the records of the Company Income Tax Sales Tax Service Tax Duty ofCustom Duty of Excise Value Added Tax which have not been deposited on account of anydispute with the relevant authorities are given below

Name of Statute Amount Period to which amount relates Forum where dispute is pending
(` in Lacs)
Sales Tax 97.08 2006-07 to 2011- 12 Deputy/Joint Commissioner – Appeals
Income Tax 600.96 2006-07 to 2012- 13 ITAT (Appeals)

(viii) The Company has not defaulted in the repayment loans or borrowing to bank as theJoint Lender's Forum (JLF) had invoked Strategic Debt Restructuring (SDR) under extant RBIguidelines w.e.f. January 25 2016 The company does not have any loans or borrowing fromfinancial institution or Government and has not issued any debentures.

(ix) The company did not raise money by way of initial public offer or further publicoffer (including debt instruments) and term loans during the year.

(x) According to the information & explanations given to us no fraud by thecompany or on the company by its officers or employees has been noticed or reported duringthe course of our audit.

(xi) According to the information and explanation 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 mandate by the provision ofsection 197 read with schedule V of 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 ourexaminations of the records of the Company transactions with the related parties are incompliance with sections 177 and 188 of the Act where applicable. The details of suchrelated party transactions have been disclosed in the standalone Ind AS financialstatements as required by applicable accounting standards.

(xiv) According to the information and explanations given to us and based on ourexamination of the records the Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures during the year. Howeverduring the year the company has issued 1190.25 lakhs shares as a part of SDR to itsvarious lenders.

(xv) According to the information and explanations given to us and based on ourexamination of the records the Company has not entered into non-cash transactions withdirectors or persons connected with him. Accordingly paragraph 3(xv) of the Order is notapplicable.

(xvi) The Company is not required to be registered under Section 45-IA of the ReserveBank of India Act 1934. Accordingly the provisions of Clause 3(xvi) of the Order are notapplicable to the Company.

For Ajay Shobha & Co.
Chartered Accountants
Firm Reg. No. 317031E
Ajaykumar Gupta
Place : Mumbai Partner
Date : 29th May 2017 Mem. No. : 53071

ANNEXURE "B" TO THE INDEPENDENT AUDITORS REPORT

Annexure "B" to the Independent Auditor's Report of even date on theFinancial statements of Provogue (India) Limited for the year ended 31st March2017. Report on the Internal Financial Controls under Clause (i) of Sub-section 3 ofSection 143 of the Act.

We have audited the internal financial controls over financial reporting of Provogue(India) Limited ("the Company") as of 31 March 2017 in conjunction with ouraudit of the standalone Ind AS financial statements of the Company for the year ended onthat date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal controls over financial reporting criteriaestablished by the Company considering the essential components of internal controlsstated in the Guidance Note on Audit of Internal Financial Controls over FinancialReporting (the "Guidance Note") issued by the Institute of Chartered Accountantsof 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 of fraudsand errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Companies Act 2013("the Act").

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 and the Standards on Auditing issued by ICAI and deemed to beprescribed under section 143(10) of the Act to the extent applicable to an audit ofinternal financial controls both applicable to an audit of Internal Financial Controlsand both issued by the ICAI. Those Standards and the Guidance Note require that we complywith ethical requirements and plan and perform the audit to obtain reasonable assuranceabout whether adequate internal financial controls over financial reporting wasestablished and maintained and if such controls operated effectively in all materialrespects. Our audit involves performing procedures to obtain audit evidence about theadequacy of the internal financial controls system over financial reporting and theiroperating effectiveness. Our audit of internal financial controls over financial reportingincluded obtaining an understanding of internal financial controls over financialreporting assessing the risk that a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal controls based on the assessed risk.The procedures selected depend on the auditor's judgment including the assessment of therisks of material misstatement of the standalone Ind AS financial statements whether dueto 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 control systemover financial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

A company's internal financial controls 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 controls 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 authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised 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 controlsover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.

Qualified Opinion

According to the information and explanation given to us and based on our audit thefollowing material weakness has been identified in the operating effectiveness of theCompany's internal financial controls over financial reporting as at 31st March 2017: Thedocumentation in respect of specific policies and procedures including inventories and theIT Controls pertaining to internal financial controls over financial reporting are notadequate and needs to be further strengthened. This may potentially result in the risk ofoverriding of these controls and misstatement in recording of transaction.

A "material weakness" is a defficiency or a combination of defficiencies ininternal control over financial reporting such that there is a reasonable possibilitythat a material misstatement of the Company's annual or interim financial statements willnot be prevented or detected on a timely basis.

In our opinion except for the possible effect of the material weakness described aboveon the achievement of the objectives of the control Criteria the Company has maintained in all material respects an adequate internal financial controls system over financialreporting and such internal financial controls over financial reporting were operatingeffectively as at 31st March 2017 based on the internal control over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting issued by the Institute of Chartered Accountants of India.

We have considered the material weaknesses identified and reported above in determiningthe nature timing and audit tests applied in our audit of the financial statements of theCompany and these material weaknesses above does not affect our opinion on the financialstatements of the Company.

For Ajay Shobha & Co.
Chartered Accountants
Firm Reg. No. 317031E
Ajaykumar Gupta
Place : Mumbai Partner
Date : 29th May 2017 Mem. No. : 53071