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Sancia Global Infraprojects Ltd.

BSE: 532836 Sector: Engineering
NSE: N.A. ISIN Code: INE391H01010
BSE 11:15 | 19 Feb Sancia Global Infraprojects Ltd
NSE 05:30 | 01 Jan Sancia Global Infraprojects Ltd
OPEN 0.31
PREVIOUS CLOSE 0.30
VOLUME 10100
52-Week high 0.36
52-Week low 0.29
P/E
Mkt Cap.(Rs cr) 1
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.30
Sell Qty 136.00
OPEN 0.31
CLOSE 0.30
VOLUME 10100
52-Week high 0.36
52-Week low 0.29
P/E
Mkt Cap.(Rs cr) 1
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.30
Sell Qty 136.00

Sancia Global Infraprojects Ltd. (SANCIAGLOBAL) - Auditors Report

Company auditors report

To

The Members of

Sancia Global Infraprojects Limited Report on the Financial Statements

We have audited the accompanying financial statements of M/s Sancia GlobalInfraprojects Limited (hereinafter referred to as "the Company") comprisingof the Balance Sheet as at 31st March 2017 the Statement of Profit and Loss and the CashFlow Statement for the year then ended and a summary of the significant accountingpolicies and other explanatory information (hereinafter referred to as "the financialstatements").

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 standalone financial statements that give a true and fair view of the financialposition financial performance and cash flows of the Company in accordance with theaccounting principles generally accepted in India including the Accounting Standardsspecified under Section 133 of the Act read with Rule 7 of the Companies (Accounts)Rules 2014.

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 financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

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 andthe disclosures in the financial statements. The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of thefinancial statements whether due to fraud or error. In making those risk assessments theauditor considers internal financial control relevant to the Company's preparation of thefinancial statements that give a true and fair view in order to design audit proceduresthat are appropriate in the circumstances but not for the purpose of expressing an opinionon whether the Company has an adequate internal financial controls system over financialreporting in place and the operating effectiveness of such controls. An audit alsoincludes evaluating the appropriateness of the accounting policies used and thereasonableness of the accounting estimates made by the Company's Board of Directors aswell as evaluating the overall presentation of the 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 financial statements.

Basis for Qualified Opinion

1. The Financial Statements of the company has been prepared on a going concern basisalthough Note -23 in the financial statement indicates that the Company has accumulatedlosses of the Company is Rs. 402.02 Crores (Previous year: Loss Rs. 411.25 crores) and itsnet worth is negative Rs.197.04 Crores (Previous period: Negative Rs. 206.27crores) at theend of the reporting period which indicates erosion of Net worth of the Company. TheCompany can be termed as "SICK" within the meaning of clause (O) of sub section(1) of section 3 of the Sick Industrial Companies (Special Provision) Act 1985.

The Company has during the year under consideration incurred Net Profit of Rs. 9.23cr.due to the impact of deferred tax during the current financial year (Previous Year LossRs. 3.13 Crore) and net cash profit during the current year of Rs. 0.30 Crore (Previousyear cash profit = Rs. 0.57 Crore). Also the Company current liabilities exceeded itscurrent assets as at the balance sheet date. These conditions along with other mattersset forth in Note- 33 indicate the existence of a material uncertainty that castsignificant doubt about the Company's ability to continue as a going concern. However thefinancial statements of the Company have been prepared on a going concern basis for thereasons stated in the Note -34

2. The company has defaulted on payment of dues to Banks & Financial Institutions.As stated in Note-21 the company has defaulted to redeem the FCCB along with interest.

3. State Bank of India has taken over the physical possession of the mortgaged propertyof the company situated at Village Rampar Dist. Kutch Gujarat and plot at Kalamboli(Maharashtra) under the recovery proceeding as per the SARFAESI Act 2002.

4. Bank of India (secured creditor) have assigned all the rights title and interest infinancial assistance in favour of "Edelweiss Asset Reconstruction Company Limited(EARC)" vide letter no. EdelARC/3985-2014 dated April 30 2014 received from"Edelweiss Asset Reconstruction Company Limited."During the period under reviewcompany signed a terms of settlement dated 20th Oct. 2015 with "M/s Edelweiss AssetsReconstruction company Limited" (Secured Creditor) for settlement of its debtpertaining to EARC Trust-SC 19. As per the terms of the settlement the company/ investorshall pay an amount of Rs.18.40 cr. over the period of 2015 to 2022 by roping an investori.e. M/s Infracon Equipments Private Limited who has executed an Agreement to sale dated19th Oct. 2015 for purchase of entire mortgaged assets of the company by paying/discharging the Secured liabilities/ secured debt to the secured creditor being"Edelweiss Asset Reconstruction Company Limited over the period of time dulymentioned in the terms of settlement dated 20th Oct. 2015.

During the period under consideration as per the deed of assignment M/s InfraconEquipments Private Limited assign its rights title interest and claims present andfuture if any to M/s Infracon Resources & Development Private Limited. Now Ml sInfracon Resources & Development Private Limited will be the beneficial owner of allthe present and future encumbered or unencumbered tangible assets receivables andadvances including earlier advances made to CNPC BOMCO by M/s Sancia Global InfraprojectsLimited in lieu of settlement/payment to the secured creditor/lender being "M/sEdelweiss Asset Reconstruction Company Limited" and "Bank of India" (thesecured creditor/secured lender) considering the lower depreciable value of the tangibleassets of the company.

During the period under Consideration Company obtain the possession of certain tangibleassets along with the liability of custom duty associated with the same as per the Courtorder. This asset will also form part and parcel for settlement of secured lender i.e. M/s"Edelweiss Asset Reconstruction Company Limited."

5. During the period under consideration company has settle the entire loan of M/s J& K Bank. J & K Bank is in the process to remove the charge on the entireequipments/machineries financed by them. M/s Infracon Resources & Development PrivateLimited will be the beneficial owner of all these equipments/machineries.

6. During the F.Y. 2013-14 M/s Suryoday Alio Metal Powders Limited a companyregistered under the companies Act 1956 and having its Registered office at 302 B- WingNarayan Chamber 555 Narayan Peth Pune- 411030 (Maharashtra) filed a legal suit in thecourt at Kolkata for winding-up the company due to defaulting of payment of Rs.10419948/- by M/s Sancia Global Infraprojects Limited. In the said matter The highcourt at Kolkata issued the order of liquidation of the company.

7. In the absence of details of testing for impairment of certain assets viz.Production plants which were not operational during the period we are unable to statewhether provisions if any is required to be made in this regard.

8. Short term Loans & Advances includes advances given to suppliers which areoutstanding for more than one year. Relevant documents and confirmations of balances areyet to be obtained.

Qualified Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by the Actin the manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India;

a) In the case of the Balance Sheet of the state of affairs of the Company as at March31 2017;

b) In the case of the Statement of Profit and Loss of the profit for the year ended onthat date; and

c) In the case of the Cash Flow Statement of the cash flows for the year ended on thatdate.

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 ofthe Act based on the comments in the auditors' reports of the Company we give in theAnnexure "A" a statement on the matters specified in paragraphs 3 and 4 of theOrder to the extent applicable.

2. As required by section 143(3) of the Act we report that:

a. Except as stated in our comments under Basis of Qualified Opinion we have soughtand obtained 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 appears from our examination of those books.

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

d. In our opinion the aforesaid financial statements comply with the AccountingStandards specified under Section 133 of the Act read with Rule 7 of the Companies(Accounts) Rules 2014.

e. The going concern matter described in Basis of Qualified Opinion paragraph above inour 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 31 March2017 taken on record by the Board of Directors none of the directors is disqualified ason 31 March 2017 from being appointed as a director in terms of Section 164(2) of theAct.

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 as Annexure -B.

h. With respect to the other matters included in the Auditor's Report and to our bestof our information and according to the explanations given to us we further report that

i) The Company has disclosed the impact of the pending litigations on its financialposition in its financial statements as referred to notes to the financial statements.

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

iii) There have been no amounts which are required to be transferred to the InvestorEducation and Protection Fund by the Company.

iv) The company has provided requisite disclosure in Financial Statements as regardsits holding and dealings in Specified Bank Notes as defined in Notification No S.O.3407(E)dated November 8 2016 of the Ministry of Finance during the period from November 8 2016to December 30 2016.Based on audit procedures performed and representations provided tous by the management we report that the disclosures are in accordance with the books ofaccounts maintained by the company and as produced to us by the Management - Refer Note tothe financial statements

For and on behalf of
M/s K.M. Tapuriah & Co.
Chartered Accountants
Firm Regn. No.:314043E
Sd /-
CA Naveen Mohta
Place: Mumbai (Partner)
Date: August 23 2017 Membership no: 048111

Annexure to the Independent Auditors' Report

The Annexure referred to in our Independent Auditors' Report to the members of theCompany on the standalone financial statements for the year ended 31 March 2017 we reportthat:

1 (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets subject to the annexure to the AuditorsReport for the period ended on 31.03.2010.

(b) As explained to us all fixed assets have not been physically verified by themanagement during the period but there is a regular programme of verification which inour opinion is reasonable having regard to the size of the Company and the nature of itsassets. No material discrepancies were noticed on such verification.

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

2 As explained to us company had no inventories except consumables spares during theyear hence clause (ii) of the order is not applicable to the company.

3. In our opinion and according to the information and explanation given to us duringthe period under review the company has not granted any loans secured or unsecured tocompanies firms or other parties covered in the register maintained under section 189 ofthe Companies Act 2013 ('the Act'). Accordingly Clause 3(iii) (a) (b) and (c) of theorder are not applicable for the year.

4. In our opinion and according the information and explanation given to us during theperiod under audit there are no loans guarantees and securities granted in respect ofwhich provisions of section 185 and 186 of the Companies Act 2013 are applicable and hencenot commented upon.

5. The Company has not accepted any deposits within the meaning of Sections 73 to 76 ofthe Act and the Companies (Acceptance of Deposits) Rules 2014 (as amended). Accordinglythe provisions of clause 3(v) of the Order are not applicable

6. To the best of our knowledge and belief the Central Government has not prescribedthe maintenance of cost records under section 148(1) of the Act 2013 for any of theservices rendered by the Company. Accordingly the provisions of clause 3(vi) of the Orderare not applicable.

7. (a) According to the information and explanations given to us and on the basis ofour examination of the records of the Company amounts deducted/ accrued in the books ofaccount in respect of undisputed statutory dues including provident fund income taxsales tax wealth tax service tax duty of customs value added tax cess and othermaterial statutory dues have been regularly deposited during the year by the Company withthe appropriate authorities. According to the information and explanations given to us noundisputed amounts payable in respect of statutory dues were in arrears as at 31 March2017 for a period of more than six months from the date they became payable exceptProfessional tax Sales tax service tax and Income tax.

(b) As at the Balance Sheet date the following are the details of the disputed incometax that has not been deposited by the Company on account of disputes

Nature of Dues Amount Forum where dispute pending
Income tax
AY 2013-14 Rs 4187510/- CIT (Appeals)

8. The Accumulated losses of the Company is Rs. 402.02 Crores (Previous year: Loss Rs.411.25 crores) and its net worth is negative Rs. 197.04 Crores (Previous period: NegativeRs. 206.27 crores) at the end of the reporting period which indicates erosion of Net worthof the Company. The Company can be termed as"SICK" within the meaning of clause(O) of sub section (1) of section 3 of the Sick Industrial Companies (Special Provision)Act 1985.

9. The Company is having outstanding dues to financial institutions or banks and FCCBholders during the year as mentioned under the Qualified Opinion & Report on otherLegal and Regulatory Requirements paragraph above.

10. According to the information and explanation given by the management the companyhas neither raised any monies by way of initial public offer or further public offer andterm loan during the year. Hence reporting under clause (ix) is not applicable.

11. According to the information and explanation given by the management we reportthat the managerial remuneration has been paid/ provided in accordance with the requisiteapprovals mandated by the provisions of section 197 read with schedule V to the CompaniesAct 2013.

12. In our opinion the company is not a Nidhi company. Therefore the provisions ofclause 3(xii) of the order are not applicable to the company and hence not commented upon.

13. In our opinion during the period under review all transactions with the relatedparties are in compliance with section177 and 188 of Companies Act 2013 and the detailshave been disclosed in the Financial Statements as required by the applicable accountingstandards.

14. Based upon the audit procedures performed and the information and explanationsgiven by the management the company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures during the year underreview. Accordingly the provisions of clause 3 (xiv) of the Order are not applicable tothe Company and hence not commented upon.

15. Based upon the audit procedures performed and the information and explanationsgiven by the management the company has not entered into any non-cash transactions withdirectors or persons connected with him. Accordingly the provisions of clause 3 (xv) ofthe Order are not applicable to the Company and hence not commented upon.

16. In our opinion the company is not required to be registered under section 45 IA ofthe Reserve Bank of India Act 1934.

For and on behalf of
M/s K.M. Tapuriah & Co.
Chartered Accountants
Firm Regn. No.:314043E
Sd /-
CA Naveen Mohta
Place: Mumbai (Partner)
Date: August 23 2017 Membership no: 048111

Annexure "B" to the Auditors' Report

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 SanciaGlobal Infraprojects Limited ("the Company") as of March 31 2017 in conjunctionwith our audit 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. 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 controls overfinancial reporting based on our audit. We conducted our audit in accordance with theGuidance Note on Audit of Internal Financial Controls Over Financial Reporting (the"Guidance Note") and the Standards on Auditing issued by ICAI and deemed to beprescribed under section 143(10) of the Companies Act 2013 to the extent applicable toan audit of internal financial controls both applicable to an audit of Internal FinancialControls and both issued by the Institute of Chartered Accountants of India. 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 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 of records that in reasonable detail accurately andfairly reflect the transactions 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) Provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the company's assets that could have amaterial 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 2017 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 and on behalf of
M/s K.M. Tapuriah & Co.
Chartered Accountants
Firm Regn. No.:314043E
Sd /-
CA Naveen Mohta
Place: Mumbai (Partner)
Date: August 23 2017 Membership no: 048111