To the Members of
Rajasthan Cylinders and Containers Ltd
Report on the Standalone Financial Statements
We have audited the accompanying standalone financial statements ofRajasthan Cylinders and Containers Ltd ("the Company") which comprise theBalance Sheet as at March 31 2018 the Statement of Profit and Loss (including othercomprehensive income) the statement of Cash Flows and statement of changes in equity forthe year then ended and a summary of significant accounting policies and otherexplanatory information.
Management's Responsibility for the Standalone FinancialStatements
The Company's Board of Directors is responsible for the mattersstated in section 134(5) of the Companies Act 2013 ("the Act") with respect topreparation of these standalone financial statements that give a true and fair view offinancial position financial performance including other comprehensive income cash flowsand changes in equity of the Company in accordance with Indian Accounting Standards (IndAS) prescribed under section 133 of the Act read with the Companies (Indian AccountingStandards) Rules 2015 as amended and other accounting principles generally accepted inIndia. 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 standalonefinancial 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 standalonefinancial statements based on our audit.
We have taken into the 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 thereunder.
We conducted our audit in accordance with the Standards on Auditingspecified under Section 143(10) of the Act. Those Standards 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 involves performing procedures to obtain audit evidence aboutthe amounts and disclosures in the financial statements. The procedures selected depend onthe auditor's judgment including the assessment of the risks of materialmisstatement of the standalone financial statements whether due to fraud or error. Inmaking those risk assessments the auditor considers internal financial control relevantto the Company's preparation of the financial statements that give a true and fairview in order to design audit procedures that are appropriate in the circumstances. Anaudit also includes evaluating the appropriateness of the accounting policies used and thereasonableness of the accounting estimates made by the Company's Directors as wellas evaluating the overall presentation of the standalone financial statements.
We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our qualified audit opinion on the standalone financialstatements.
Basis for Qualified Opinion
(i) The Company has not provided for Bad debts (Non Current Assets-Loans) of Rs. 56.31 Lakhs from a body corporate M/s Ankur Drugs and Pharma Limited whichis under liquidation.
We further report that had the observation made by us in para (i)above been considered the loss for the year would have been Rs. 135.55 Lakhs (as againstthe reported figure of Rs. 79.23 Lakhs) the Other equity for the year would have been Rs.2120.83 Lakhs (as against the reported figure of Rs. 2177.14 Lakhs) and Financialassets-Loans Non Current for the year end would have been Rs. Nil (as against the reportedfigure of Rs. 56.31 Lakhs).
In our opinion and to the best of our information and according to theexplanations given to us except for the effects of the matter described in the Basis forQualified Opinion paragraph the aforesaid standalone financial statements give theinformation required by the Act in the manner so required and give a true and fair view inconformity with the accounting principles generally accepted in India of the state ofaffairs of the Company as at March 31 2018 and its loss total comprehensive income thechanges in equity and its cash flows for the year ended on that date.
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 the mattersspecified in paragraphs 3 and 4 of the Order to the extent applicable.
2. As required by section 143(3) of the Act we report that:
(a) We have sought and obtained all the information and explanationswhich to the best of our knowledge and belief were necessary for the purpose of our audit.(b) Except for the effects of the matter described in the Basis for Qualified Opinionparagraph above in our opinion proper books of account as required by law have been keptby the Company so far as it appears from our examination of those books. (c) The BalanceSheet the Statement of Profit and Loss (including other comprehensive income) the CashFlow Statement and the Statement of Changes in Equity dealt with by this Report are inagreement with the books of account. (d) Except for the effects of the matter described inthe Basis for Qualified Opinion paragraph above in our opinion the aforesaid standalonefinancial statements comply with the Indian Accounting Standards specified under section133 of the Act. (e) The matter described in the Basis for Qualified Opinion paragraphabove in our opinion may have an adverse effect on the functioning of the company. (f)On the basis of written representations received from the directors as on 31st March2018 and taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2018 from being appointed as a director in terms of Section 164(2) of theAct. (g) The qualification relating to other matters connected there with are stated inthe Basis for Qualified Opinion paragraph above. (h) With respect to the adequacy of theinternal financial controls over financial reporting of the Company and the operatingeffectiveness of such controls refer to our separate report in "Annexure B";and (i) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rule 2014 in our opinionand to the best of our information and according to the explanation given to us:
The Company has disclosed the impact of pending litigation on itsfinancial position in its financial statements- Refer Note No. 34 to the financialstatements. i. The Company does not have any long term contracts including derivativecontracts for which there were any material foreseeable losses. ii. There were no amountwhich were required to be transferred to the Investor Education and Protection Fund by theCompany during the year ended 31st March 2018.
For S.S. SURANA & CO.
(FRN. 001079C) Sd/-
(Prahalad Gupta) Partner
Membership No. 074458
Place: Jaipur Date: 30/05/2018
ANNEXURE - A FORMING PART OF THE INDEPENDENT AUDITOR'S REPORT OFRajasthan Cylinders and Containers Ltd
Referred to in paragraph under the heading of "Report on otherLegal & Regulatory Requirements" of our report of even date to the Members ofRajasthan Cylinders and Containers Ltd on the standalone financial statement for the yearended March 31st 2018; (i) (a) As explained to us the Company generally maintains properrecords showing full particulars including quantitative details and situation of fixedAssets. (b) As informed to us parts of the assets have been physically verified by themanagement in accordance with a phased programme of verification; however such physicalverification reports were not available for our verification. As informed to us nomaterial discrepancies have been noticed on such verification. (c) According to theinformation and explanations given to us and on the basis of our examination of therecords of the Company the title deeds of immovable properties are held in the name ofthe Company except for the following immovable property:
|Name of Immovable Property || |
Total Number of Cases
Gross Block (Amount in Rs.)
Net Block (Amount in Rs.)
|Building || |
|Lease deed is yet to be executed and registered. |
| || || || || |
(ii) As per information furnished the inventory lying at its locationhas been physically verified during the year by the management at reasonable intervals.The discrepancies noticed on verification between the physical stocks and the book recordswere not material. (iii) According to information and explanations given to us thecompany has given advances to 3 bodies corporate covered in the register maintained underSection 189 of the Companies Act 2013.
(a) The terms and conditions of the grant of such loans are notprejudicial to the company's interest.
(b) The principal amount of loan and interest is payable on demand.Repayment of Loan and interest is received as and when demanded. (c) Since the amount ofloan and interest is repayable on demand and the company has not recalled the loan hencethere is no overdue. (iv) In our opinion and according to the information and explanationsgiven to us the Company has complied with the provisions of section 185 and 186 of theAct with respect to the loans and investments made except following:
|Name of Company ||Relation with Director || |
Maximum Amount Outstanding during the year (Rs.)
Amount Outstanding as at Balance Sheet date (Rs.)
| || || || |
|1. Shipra Towers Pvt Ltd ||One director of lending company is director || |
(v) In our opinion and according to the information and explanationsgiven to us the company has not accepted any deposits within in the meaning of theprovisions of Sections 73 to 76 or any other relevant provisions of Companies Act 2013and the rules framed thereunder and the directives issued by Reserve Bank of India. (vi)As explained to us the Central Government has prescribed maintenance of the cost recordsunder section 148(1) of the Companies Act 2013 in respect to the company's products.We are of the opinion that prima facie the prescribed accounts and records have been madeand maintained by the company. However we have not made detailed examination of suchrecords.
(vii) (a) According to the records of the company produced for ourverification the company is generally regular in depositing undisputed statutory duesincluding provident fund employees' state insurance income tax sales tax servicetax duty of customs duty of excise value added tax Goods and Service Tax cess and anyother statutory dues to appropriate authorities wherever applicable. According to theinformation and explanation given to us no undisputed arrears of statutory dues wereoutstanding as on 31/03/2018 for a period of more than six months from the date theybecame payable. (b) According to the information and explanations given to us there areno dues of Income Tax or Sales Tax or Service Tax or duty of Customs or duty of Excise orValue Added Tax or Goods and Service Tax which have not been deposited with theappropriate authorities on account of any dispute.
(viii) According to the records of the Company and information given tous we are of the opinion that the company has not defaulted in repayment of Loans fromBanks. Further as per records of the company during the year there were no loans orborrowings from any Financial Institutions Government or debenture holders. (ix) Thecompany has not raised any money by the way of Initial Public Offer or Further PublicOffer (including debt instruments) and term loans during the year. Accordingly paragraph3 (ix) of the Order is not applicable. (x) According to the information and explanationsgiven to us no fraud by the Company or on the Company by its officers or employees hasbeen noticed or reported during the course of our audit
. (xi) According to the information and explanations give to us andbased on our examination of the records of the Company the Company has paid/provided formanagerial remuneration in accordance with the requisite approvals mandated by theprovisions of section 197 read with Schedule V to the Act. (xii) In our opinion andaccording to the information and explanations given to us the Company is not a Nidhicompany. Accordingly paragraph 3(xii) of the Order is not applicable. (xiii) According tothe information and explanations given to us and based on our examination of the recordsof the Company transactions with the related parties are in compliance with sections 177and 188 of the Act where applicable and details of such transactions have been disclosedin the financial statements as required by the applicable Indian accounting 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) As explained and informed to us by the management the company has notentered into any non cash transaction with the directors or person connected with them.Accordingly paragraph 3(xv) of the Order is not applicable. (xvi) The company is notrequired to be registered under Section 45IA of the Reserve Bank of India Act1934.
For S.S. SURANA & CO.
(FRN. 001079C) Sd/- (Prahalad Gupta) Partner
Membership No. 074458
Place: Jaipur Date: 30/05/2018
Annexure - B to the Independent Auditors' Report on StandaloneFinancial Statements of Rajasthan Cylinders and Containers Ltd Report on the InternalFinancial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act2013 ("the Act")
We have audited the internal financial controls over financialreporting of Rajasthan Cylinders and Containers Ltd ("the Company") as of 31March 2018 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
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. Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to company's policies the safeguardingof its assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required under the Companies Act 2013.
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 the Institute of Chartered Accountantsof India. 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 thatthe audit evidence we have obtained is sufficient and appropriate to provide a basis forour audit opinion on the Company's internal financial controls system over financialreporting.
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 financial statements for external purposes in accordancewith generally accepted accounting principles. A company's internal financial control overfinancial reporting 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 reasonableassurance that transactions are recorded as necessary to permit preparation of financialstatements in accordance with generally accepted accounting principles and that receiptsand expenditures 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 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.
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 2018 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 the Institute ofChartered Accountants of India.
For S.S. SURANA & CO.
Accountants (FRN. 001079C) Sd/-
Membership No. 074458
Place: Jaipur Date: 30/05/2018