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Ramsarup Industries Ltd.

BSE: 532690 Sector: Metals & Mining
NSE: RAMSARUP ISIN Code: INE005D01015
BSE 00:00 | 21 Jun Ramsarup Industries Ltd
NSE 05:30 | 01 Jan Ramsarup Industries Ltd
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VOLUME 4000
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OPEN 1.20
CLOSE 1.20
VOLUME 4000
52-Week high 1.20
52-Week low 0.57
P/E
Mkt Cap.(Rs cr) 4
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Ramsarup Industries Ltd. (RAMSARUP) - Auditors Report

Company auditors report

Independent Auditor’s Report

To the Members of

RAMSARUP INDUSTRIES LIMITED Report on the Financial Statements

We have audited the accompanying financial statements of Ramsarup Industries Limitedwhich comprise the Balance Sheet as at March 31 2016 and the Statement of Profit andLoss and Cash Flow Statement for the year then ended and a summary of significantaccounting 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 that give a true and fair view of the financial positionfinancial performance and cash flows of the Company in accordance with the accountingprinciples generally accepted in India including the Accounting Standards specified underSection 133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014. 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 wereoperating 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.

Auditor’s Responsibility

Our responsibility is to express an opinion on these financial statements based on ouraudit.

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 there under.

We conducted our Audit 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 financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the financial statements. The procedures selected depend on theauditor’s judgment including the assessment of the risks of material misstatement ofthe financial statements whether due to fraud or error. In making those risk assessmentsthe auditor considers internal financial control relevant to the Company’spreparation and fair presentation of the financial statements in order to design auditprocedures that are appropriate in the circumstances but not for the purpose ofexpressing an opinion on whether the company has in place an adequate internal financialcontrols system over financial reporting and the operating effectiveness of such controls.An audit also includes evaluating the appropriateness of accounting policies used and thereasonableness of the accounting estimates made by management as well as evaluating theoverall presentation of the financial statements. We believe that the audit evidence wehave obtained is sufficient and appropriate to provide a basis for our audit opinion onthe financial statements.

Basis for Qualified opinion:-

1) The Company has four manufacturing units at Kalyani ShyamnagarKharagpur andDurgapur all of which are under the suspension of work for the last few years and theyare under the symbolic /physical possession of lenders due to default of payment of theoutstanding loans. Detail physical verifications of fixed assets and inventories could notbe conducted by the management. We have also not been able to obtain sufficientappropriate audit evidences (SAAE) in respect of existence and valuation of fixed assetsand inventories lying at these factories.

2) Since manufacturing activity in the company has been suspended in all itsmanufacturing units (except generation of power in wind mills). There are indication whichsuggest impairment in the value of Plant & Machinery and other Fixed Assets of thecompany which has not been done.

3) Borrowings from banks and financial institutions have been classified asnonperforming assets by the lenders. No balance confirmation of the outstanding loan couldbe obtained nor any bank statement has been provided by them. In absence of the same weare unable to confirm the accuracy of the balances appearing in the books of account. Asthe borrowings have been considered as NPA no interest has been charged by the bankssince then. The company has not provided interest on these borrowings from 1stJuly 2014 to 31st March 2016 which amounts to Rs. 998.80 Crores (previous period Rs.395.84 Crores from 1st July 2014 to 31st March 2015).

4) The net worth of the company has been fully eroded and therefore the company filedan application before the Ld. BIFR which is still pending. The Company’s ability tocontinue the business as going concern is significantly dependent upon the viability ofthe restructuring plan to be approved by the Ld. BIFR.

5) As explained to us although necessary Security / Watch & Ward arrangements havebeen made for safety of the plant by the company its lenders or ARC at its variousmanufacturing units yet precautionary safety action against risk of fire burglary ornatural calamity needs to be taken.

Qualified Opinion:-

In our opinion and to the best of our information and according to the explanationsgiven to us except for the possible effects of the matter described in the basis forqualified opinion paragraph the aforesaid financial statements give the informationrequired by the Act in the manner so required and give a true and fair view in conformitywith the accounting principle generally accepted in India of the state of affairs of thecompany as at 31st March 2016 and its Loss and its Cash flows for the yearended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order 2015 ("theOrder") issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Act we give in the Annexure a statement on the matters specified inparagraphs 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 and except for the matters described in the basis forQualified Opinion paragraph all the information and explanations which to the best of ourknowledge and belief were necessary for the purpose of our audit.

b) Except for the possible effects of the matter described in the basis for QualifiedOpinion Paragraph above in our opinion proper books of account as required by law havebeen kept by the Company so far as appears from our examination of those books.

c) The Balance Sheet Statement of Profit and Loss and Cash Flow Statement dealt withby this Report are in agreement with the books of account.

d) Except for the possible effects of the matter described in the basis for QualifiedOpinion Paragraph in our opinion the Balance Sheet Statement of Profit and Loss andCash Flow Statement comply with the Accounting Standards specified under section 133 ofthe Act read with Rule 7 of the Companies (Accounts) Rules 2014.

e) The matter described in the basis for Qualified Opinion paragraph above in ouropinion may have an adverse effect on the functioning of the Company.

f) On the basis of written representations received from the directors as on March 312016 and taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2016 from being appointed as a director in terms of Section 164(2) of theAct.

g) The Qualification relating to the maintenance of accounts and other mattersconnected therewith are as stated in the basis for qualified opinion paragraph above.

h) With respect to other matters to be included in the Auditor’s Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rule 2014in our opinion andto the best of our information and according to the explanations given to us:

i) A number of litigations have been filed by some of the lender banks and creditors ofthe company against which primary liabilities stands provided in the books except forother claims and interest thereon. Apart from these various statutory / non-statutoryliabilities as stated in Note no 33 of financial statement have not been provided foralthough the financial impact thereon have been disclosed. ii) The Company is carrying oninfrastructure work at Rajasthan wherein substantial delay has happened for variousreasons in execution of the contract. This leads to cancellation of contract and losses soincurred will be ascertained at the relevant time. Total outstanding work contract is notascertainable at present in view of contracts being cancelled for non completion butagainst all the pending contracts bank guarantee have been provided of Rs. 1.37 crore.There are no outstanding derivative contracts in the Company. iii) There has been no delayin transferring amounts required to be transferred to the Investor Education &Protection Fund by the Company.

For P. K. Lilha & Co.
Chartered Accountants
FRN: 307008E
CA C.S. Agrawal
Place: Kolkata Partner
Date : 03.05.2016 Membership No. : 059534

"ANNEXURE A" - TO THE INDEPENDENT AUDITOR’S REPORT

The Annexure referred to in our Independent Auditors’ Report to the members of theCompany on the financial statements for the year ended 31st March 2016 We report that: i)In respect of its Fixed Assets:

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

b) It has been confirmed by the Management that all the Title Deeds in respectimmovable properties of both lease hold / free hold land are in the name of the company.c) As explained to us due to suspension of work in all its manufacturing units some ofwhich are in symbolic / physical possession of banks / Asset Reconstruction Company (ARC).

As such it has not been possible for the company to have physical verification done andas such discrepancy if any could not be ascertained. ii) In respect of its Inventories:

a) As explained to us the Inventories could not be physically verified by themanagement due to suspension of its manufacturing units some of which are in symbolic /physical possession of banks / Asset Reconstruction Company (ARC). The Stock has beentaken on the basis of previous year at the same estimated realizable value as the statusof material could not be verified.

b) The Company has been maintaining proper records of its inventories at the respectiveworks but in absence of physical verifications of inventories actual comparison with bookrecords have not been possible.

iii) As informed to us the Company during the year has not granted any loan securedor unsecured to companies firms Limited Liability Partnership or other parties coveredin register maintained under section 189 of the Companies Act 2013. Accordingly theprovisions of sub clause (iii) (b) & (c) of the Companies (Auditors Report) order2013 (as amended) are not applicable.

iv) In respect of loans investments guarantees and security provisions of section185 and 186 of the Companies Act 2013 have been complied with. However the company duringthe year has not given loan or provided guarantee or security to any person or other bodycorporate and not made any investment. v) According to the information and explanationgiven to us the Company has not accepted any deposit from the public; therefore theprovisions of clause (v) of the order are not applicable to the company.

vi) We have broadly reviewed the Books of Accounts maintained by the company in respectof generation of electricity where pursuant to the rules made by the Central Government ofIndia the maintenance of Cost Records have been prescribed U/s 148(1) of the Act and areof the opinion that prima facie the prescribed accounts and records have been made andmaintained. We have not however made a detailed examination of the records with a viewto determine whether they are accurate or complete.

vii) In respect of Statutory Dues: a) According to the information and explanationsgiven to us and on the basis of records of the Company amount deducted / accrued in thebooks of accounts in respect of undisputed statutory dues including Provident FundEmployees State Insurance Income Tax Sales Tax Service Tax Duty of Customs Duty ofExcise Value Added Tax Cess and other material statutory dues have been regularlydeposited with appropriate authorities during the year except the delays as below:Statement of arrears of Statutory Dues outstanding for more than six months from the datethey become payable up to 31.03.2016:

Sl. No. Name of Statute Amount ( Rs. in lacs)
i) Excise Duty Demand for F.Y. 2010-11 307.50
ii) ESI Contribution 6.54
iii) Professional Tax 1.41
Total 315.45

b) The disputed statutory dues that have not been deposited {Net of Amount Paid UnderProtest} on account of disputed matter pending before appropriate authorities are asunder:

Sl. Name of Statute Nature of Dues Amount ( Rs. in Lacs) Period to which amount relates Forum where dispute is pending
1 West Bengal Sales Sales Tax 59.41 Various Years from Appellate &
Tax Act 1994 1994-95 to1999-00 Revisional Board
2 West Bengal Sales Sales Tax 3576.58 2004-05 Appellate &
Tax Act 1994 Revisional Board
3 West Bengal VAT Tax VAT 4015.57 2005-06 Appellate &
Act 2003 Revisional Board
4 West Bengal VAT Tax VAT 16.24 2006-07 Appellate &
Act 2003 Revisional Board
5 West Bengal VAT Tax VAT 701.99 2007-08 Appellate &
Act 2003 Revisional Board
6 West Bengal VAT Tax VAT 696.60 2008-09 Appellate &
Act 2003 Revisional Board
7 West Bengal VAT Tax VAT 1433.79 2009-10 Appellate &
Act 2003 Revisional Board
8 West Bengal VAT Tax VAT 2613.51 2010-11 Appellate &
Act 2003 Revisional Board
9 West Bengal VAT Tax VAT 1550.63 2011-12 Appellate
Act 2003 Forum CD-01
10 Central Sales Tax Act Sales Tax 51.68 Various Years from Appellate &
1956 1994-95 to 1999-00 Revisional Board
11 Central Sales Sales Tax 200.63 Various Years from Kolkata High Court
Tax Act 1956 2000-01 to 2003-04
12 Central Sales Sales Tax 306.17 2004-05 & 2005-06 Appellate &
Tax Act 1956 Revisional Board
13 Central Sales Sales Tax 1033.76 2006-07 & 2007-08 Appellate &
Tax Act 1956 Revisional Board
14 Central Sales Sales Tax 865.41 2008-09 Appellate &
Tax Act 1956 Revisional Board
15 Central Sales Sales Tax 71.23 2009-10 Appellate &
Tax Act 1956 Revisional Board
16 Central Sales Sales Tax 172.03 2010-11 Appellate &
Tax Act 1956 Revisional Board
17 Central Sales Sales Tax 5.63 2011-12 Appellate
Tax Act 1956 Forum CD-01
18 Employee State ESI 26.03 Various Years from EI Court
Insurance 2002-03 to 2006-07
19 Employee State ESI 6.54 2001-02 and EI Court
Insurance 2002-03
20 Provident Fund Act PF 19.90 Various Years from Assistant / Regional
2009-10 to 2013-14 P. F. Commissioner
21 Service Tax Act Service Tax 4422.54 Various Years from Service Tax
2007-08 to 2011-12 Commissionerate
(Kol) (CBEC)
22 Commissioner of Excise Duty 467.85 2008-09 The Customs
Central Excise Excise
and Service Tax
Appellate Tribunal
23 Commissioner of Excise Duty 15.00 2009-10 The Customs
Central Excise Excise
and Service Tax
Appellate Tribunal
24 Commissioner of Excise Duty 454.28 2010-11 The Customs
Central Excise Excise
and Service Tax
Appellate Tribunal
25 Commissioner of Excise Duty 620.43 2011-12 The Customs
Central Excise Excise
and Service Tax
Appellate Tribunal
26 Income Tax Act 1961 Income Tax 417.67 A.Y. 2007-08 C I T (A)
27 Income Tax Act 1961 Income Tax 1141.81 A.Y. 2008-09 C I T (A)
28 Income Tax Act 1961 Income Tax 674.30 A.Y. 2010-11 C I T (A)
29 Wealth Tax Act 1957 Wealth Tax 1.66 A.Y. 2010-11 C I T (A)

viii) The company has defaulted in repayment of loans or borrowing to the financialinstitutions and bank in respect of secured / unsecured loans for last few years. Howeversince such loan have been classified as NPA no account statement or balance confirmationcould be made available to us. The company has therefore provided interest of Rs. 1332.06Crore till June 2014 and not provided of Rs. 998.80 Crore thereafter being interest atsuch rate / rates including penal interest if any. Interest has been computed on basis oflast sanctioned letters. Hence amount due may vary with Banks / Financial Institutions andFinancial Statements. Quantum of such interest has been reported under the head currentliabilities in the financial statement. The applicable details as at 31.03.2016 are asunder exclusive of such interest. a) To Banks:

Name of the Banks Principal O/S Amount
( Rs. in Crore)
1 Allahabad Bank 94.34
2 Axis Bank 147.99
3 Bank of India 58.84
4 Canara Bank 87.07
5 Central Bank of India 11.70
6 Development Credit Bank 14.76
7 Federal Bank 67.75
8 ICICI Bank 36.16
9 IDBI Ltd. 240.78
10 Indian Overseas Bank 75.64
11 ING Vysya Bank 19.43
12 IREDA 4.68
13 Oriental Bank of Commerce 115.17
14 Punjab National Bank 411.91
15 SIDBI 14.99
16 State Bank of India 64.63
17 The Karur Vysya Bank 64.60
18 UCO Bank 79.02
19 United Bank of India 184.34
20 Vijaya Bank 44.97
TOTAL 1838.78

b) To Financial Institutions:

Name of Financial Institutions Principal O/S Amount
( Rs. in Crore)
1 Bibby Financial Services (I) Pvt. Ltd. 7.53
2 Edelweiss Finance & Investments Ltd. 1.95
3 SBI Global Factors Ltd. 34.18
4 IFCI Ltd. 22.13
5 IFCI Factors Ltd. 10.60
6 TATA Capital Ltd. 20.09
7 LIC Mutual Fund 40.00
8 SREI Equipment Finance Pvt. Ltd. 5.18
9 WBIDCL 14.22
TOTAL 155.89

Some of the lender banks have already assigned part/full of their debts together withthe underline securities right title and interest thereon to some of the AssetsRe-construction Companies. But no impact has been given in the financial statements inabsence of any documentation to this effect.

ix) During the year no money raised by way of Initial Public Offer (IPO) or FurtherPublic Offer (FPO) (including debt instruments) and term loans hence other details arenot applicable.

x) Based upon the audit procedures performed and information and explanation given bythe management we report that no material fraud on or by the company has been noticed orreported during the course of our audit.

xi) During the year no managerial remuneration has been paid or provided hence otherdetails are not applicable.

xii) Provisions of Nidhi Company is not applicable.

xiii) As per information and explanations given to us no related party transactionshave been made as contemplated within the meaning of Section 188 of Companies Act 2013.However the disclosures as required under Accounting Standards 18 have been made in thefinancial statements.

xiv) The company has not made any preferential allotment or private placement of sharesor any convertible debentures during the year under review as such other details are notapplicable.

xv) As per information and explanations given to us the company has not entered intoany non cash transactions with the Directors or persons connected with him. Henceprovisions of Section 192 of Companies Act 2013 is not applicable.

xvi) As explained to us the company is not required to get registration u/s 45-IA ofthe Reserve Bank of India Act 1934.

For P. K. Lilha & Co.
Chartered Accountants
FRN: 307008E
CA C.S. Agrawal
Place: Kolkata Partner
Date : 03.05.2016 Membership No. : 059534

"ANNEXURE B" - TO THE INDEPENDENT AUDITOR’S REPORT

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("the Act").

We have audited the internal financial controls over financial reporting of RAMSARUPINDUSTRIES LIMITED ("the Company") as of March 31 2016 in conjunction with ouraudit 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 Reportingissued by the Institute of Chartered Accountants of India" (ICAI). 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.

Auditor’s 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") issued by the Institute of Chartered Accountants of India(ICAI) and the Standards on Auditing prescribed under Section 143(10) of the CompaniesAct 2013 to the extent applicable to an audit of internal financial controls. 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 performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor’s judgment including the assessment of the risks ofmaterial 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 controlssystem over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A company’s internal financial control over financial reporting 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 over financial reporting includes thosepolicies and procedures that:

(1) Pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company; (2) Providereasonable assurance that transactions are recorded as necessary to permit preparation offinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorizations of management and directors of the company; and (3) Provide reasonableassurance regarding prevention or timely detection of unauthorized acquisition use ordisposition of the company’s assets that could have a material effect on thefinancial 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 to the best of our information and according to the explanations givento us the Company has maintained in all material respects adequate internal financialcontrols over financial reporting and such internal financial controls over financialreporting were operating effectively as of March 31 2016 based on "the internalcontrol over financial reporting criteria established by the Company considering theessential components of internal control stated in the Guidance Note on Audit of InternalFinancial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India"(ICAI).

For P. K. Lilha & Co.
Chartered Accountants
FRN: 307008E
CA C.S. Agrawal
Place: Kolkata Partner
Date : 03.05.2016 Membership No. : 059534

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