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Shree Narmada Aluminium Industries Ltd.

BSE: 513127 Sector: Others
NSE: N.A. ISIN Code: N.A.
BSE 05:30 | 01 Jan Shree Narmada Aluminium Industries Ltd
NSE 05:30 | 01 Jan Shree Narmada Aluminium Industries Ltd

Shree Narmada Aluminium Industries Ltd. (SHNARMADAALUM) - Auditors Report

Company auditors report

To the Members Of

Shree Narmada Aluminium Industries Limited

Report on the Financial Statements

Qualified Opinion

We have audited the accompanying financial statements of Shree Narmada AluminiumIndustries Limited ("the Company") which comprise the Balance Sheet as at March31 2021 the Statement of Profit and Loss (including Other Comprehensive Income)statement of changes in equity and Cash Flow Statement for the year then ended andincluding a summary of significant accounting policies and other explanatory information.

In our opinion and to the best of our information and according to the explanationsgiven to us except in respect of consequential possible impacts of the matters mentionedunder para 'Basis of Qualified Opinion' the aforesaid financial statements give theinformation required by the Companies Act 2013 ("the Act") in the manner sorequired and give a true and fair view in conformity with the Indian Accounting Standardsprescribed under section 133 of the Act read with the Companies (Indian AccountingStandards) Rules 2015 as amended ("Ind AS") and other accounting principlesgenerally accepted in India of the state of affairs of the Company as at 31st March2021 the profit and total comprehensive income the changes in equity and its cash flowsfor the year ended on that date.

Basis for Qualified Opinion

The Company is a sick Company under Sick Industrial Companies Act 1985. The order ofthe Honorable High Court of Gujarat dated May 16 2008 for rehabilitation is under theprocess of implementation. Meanwhile a secured creditor filed an application before Debtrecovery Tribunal-III (DRT-III) and the court receiver now having the possession ofproperty. Despite net worth of the Company fully eroded the Management is of the opinionthat the Going Concern Assumption is sustainable and accordingly the accounts of theCompany have been prepared on going concern basis. (Refer Note 18 of financialstatements). This situation indicates that material uncertainty exists that may castsignificant doubt on Company's ability to continue as going concern. The financialstatement do not adequately disclose this matter.

We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Companies Act 2013. Our responsibilities under thoseStandards are further described in the Auditor's Responsibilities for the Audit of theFinancial Statements section of our report. We are independent of the Company inaccordance with the Code of Ethics issued by the Institute of Chartered Accountants ofIndia together with the ethical requirements that are relevant to our audit of thefinancial statements under the provisions of the Companies Act 2013 and the Rules thereunder and we have fulfilled our other ethical responsibilities in accordance with theserequirements and the Code of Ethics. We believe that the audit evidence we have obtainedis sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the financial statements of the current period. These matterswere addressed in the context of our audit of the financial statements as a whole and informing our opinion thereon and we do not provide a separate opinion on these matters.

Information Other than the Financial Statements and Auditor's Report Thereon

The Company's Board of Directors is responsible for preparation of the otherinformation. The other information comprises the information included in Board's Reportincluding Annexure to Board's Report Corporate Governance and Shareholder's Informationbut does not include the financial statements and our auditor's report thereon.

• Our opinion on the Financial Statements does not cover the other information andwe do not express any form of assurance conclusion thereon.

• In connection with our audit of the financial statements our responsibility isto read the other information and in doing so consider whether the other information ismaterially inconsistent with the financial statements or our knowledge obtained in theaudit or otherwise appears to be materially misstated.

• If based on the work we have performed we conclude that there is a materialmisstatement of this other information we are required to report that fact. We havenothing to report in this regard.

Responsibilities of Management and those charged with governance for the financialStatements

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 including other comprehensive income changes in equity and cashflows of the Company in accordance with the accounting principles generally accepted inIndia including the Accounting Standards specified under Section 133 of the Act. 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.

In preparing the financial statements management is responsible for assessing theCompany's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or has no realisticalternative but to do so.

Those Board of Directors are also responsible for overseeing the company's financialreporting process.

Auditor's Responsibilities for the Audit of financial statement

Our objectives are to obtain reasonable assurance about whether the financialstatements as a whole are free from material misstatement whether due to fraud or errorand to issue an auditor's report that includes our opinion. Reasonable assurance is a highlevel of assurance but is not a guarantee that an audit conducted in accordance with SAswill always detect a material misstatement when it exists. Misstatements can arise fromfraud or error and are considered material if individually or in the aggregate theycould reasonably be expected to influence the economic decisions of users taken on thebasis of these financial statements.

As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the financialStatements whether due to fraud or error design and perform audit procedures responsiveto those risks and obtain audit evidence that is sufficient and appropriate to provide abasis for our opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error as fraud may involve collusionforgery intentional omissions misrepresentations or the override of internal control.

• Obtain an understanding of internal control relevant to the audit in order todesign audit procedures that are appropriate in the circumstances. Under section 143(3)(i)of the Companies Act 2013 we are also responsible for expressing our opinion on whetherthe company has adequate internal financial controls system in place and the operatingeffectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management's use of the going concern basisof accounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe financial Statements or if such disclosures are inadequate to modify our opinion.Our conclusions are based on the audit evidence obtained up to the date of our auditor'sreport. However future events or conditions may cause the Company to cease to continue asa going concern.

• Evaluate the overall presentation structure and content of the financialStatements including the disclosures and whether the financial Statements represent theunderlying transactions and events in a manner that achieves fair presentation.

Materiality is the magnitude of misstatements in the financial statements thatindividually or in aggregate makes it probable that the economic decisions of areasonably knowledgeable user of the financial statements may be influenced. We considerquantitative materiality and qualitative factors in (i) planning the scope of our auditwork and in evaluating the results of our work; and (ii) to evaluate the effect of anyidentified misstatements in the financial statements.

We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and to communicate with themall relationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards.

From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the financial Statements of thecurrent period and are therefore the key audit matters. We describe these matters in ourauditor's report unless law or regulation precludes public disclosure about the matter orwhen in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication

Report on Other Legal and Regulatory Requirements

1.1 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 we give in the Annexure "A" a statement on the matters specified inparagraphs 3 and 4 of the Order to the extent applicable.

1.2 As required by section 143(3) 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 Statement of Profit and Loss including Other ComprehensiveIncome Statement of Changes in Equity and the Cash Flow Statement dealt with by thisReport 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) On the basis of the written representations received from the directors as on 31stMarch 2021 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2021 from being appointed as a director in terms of Section164 (2) of the Act

f) With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate report in "Annexure B".

g) With respect to the other matters to be included in 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 has disclosed the impact of pending litigations on its financialposition-Refer Note No. 16 and 17 of the financial statement.

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

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

Annexure A to Independent Auditors' Report

(Referred to paragraph 1 of "Report on Other Legal and RegulatoryRequirements" section of our report of even date)

i. In respect of Company's fixed assets:

(a) According to the information and explanations given to us the Company ismaintaining records showing full particulars including quantitative details andsituations of all the fixed assets.

(b) According to the information and explanations given to us the all the fixed assetsare in possession of the court receiver. Hence during the year physical verification wasnot conducted by the Management. (Refer note 18 of financial statement)

(c) According to the information and explanations given to us the title deed ofimmovable property is in the name of the Company.

ii. The company is a trading company; it does not hold any inventories. Thus clause3(ii) (a) (b) & (c) of the order regarding physical verification of inventories andmaintenance of records is not applicable.

iii. According to the information and explanations given to us the Company has notgranted any loans secured or unsecured to companies Limited Liability Partnershipsfirms or other parties covered in the register maintained under Section 189 of theCompanies Act 2013. Accordingly reporting under clause 3(iii)(a) to 3(iii)(c) are notapplicable to the Company.

iv. According to the information and explanations given to us the Company has notgiven/made any loans investments guarantees and security. Accordingly provisions ofsection 185 and 186 of the Companies Act 2013 are not applicable.

v. According to the information and explanations given to us the Company has notaccepted any deposits during the year from the public within the meaning of provisions ofsection 73 to 76 of the Companies Act 2013 and the rules framed there under andtherefore reporting under clause (V) of the order is not applicable to the Company.

vi. As the Company is not a manufacturing concern the clause 3(vi) of the Orderregarding maintenance of cost records under sub-section (1) of section 148 of theCompanies Act 2013 is not applicable to the Company.

vii. (a) In our opinion and according to the information and explanations given to usCompany is generally regular in depositing applicable undisputed statutory dues includingprovident fund employees' state insurance income tax Goods and Service tax sales taxwealth tax service tax custom duty duty of excise value added tax cess and any otherstatutory dues with the appropriate authorities during the year and no such dues areoutstanding for more than six months from the date they became payable as on 31stMarch 2021.

(b) As at March 31 2021 according to the records of the Company and the informationand explanations given to us disputed dues payable by the Company on account of IncomeTax/ Sales Tax/ Wealth Tax/ Service Tax/ Duty of Custom/Duty of Excise are as under:

Nature of Dues No. Name of Statute For the year ended March 31 2021 Period Forum
1 The Bombay Sales Tax Act Sales Tax Interest And Penalty 114000 1991-92 Before Honorable Tribunal Filed by Company.
2 The Bombay Sales Tax Act Sales Tax Interest And Penalty 2217000 1992-93 Before Honorable Tribunal Filed by Company.
3 The Bombay Sales Tax Act Sales Tax Interest And Penalty 2618000 1993-94 Before Honorable Tribunal Filed by Company.
4 The Bombay Sales Tax Act Sales Tax Interest And Penalty 918000 1994-95 Before Honorable Tribunal Filed by Company.
5 The Bombay Sales Tax Act Sales Tax Interest And Penalty 200000 1995-96 Before Honorable Tribunal Filed by Company.
6 The Bombay Sales Tax Act Sales Tax Interest And Penalty 8000 1999-00 Before Honorable Tribunal Filed by Company.

viii. According to the information and explanations given to us and on the basis of ourexamination of the books of accounts in our opinion the Company has not defaulted inrepayment of dues to banks government and any financial institutions. The Company did nothave any debentures outstanding as the year end.

ix. According to the information and explanations given to us by the management theCompany has not raised any fund by way of public issue or from term loan. Accordinglyreporting under clause (ix) is not applicable.

x. According to the information and explanation given to us we have not come acrossany instance of fraud by the Company or any fraud on the Company by its officers oremployees either noticed or reported during the year on or by the Company.

xi. To the best of our knowledge and according to the information and explanationsgiven to us the Company has neither paid nor provided for any managerial remunerationduring the year and hence reporting under clause 3(xi) of the Order is not applicable tothe company.

xii. According to the information and explanation given to us in our opinion theCompany is not a Nidhi Company as prescribed under section 406 the Act.

xiii. According to the information and explanations given to us all transactions withthe related parties are in compliance with sections 177 and 188 of Companies Act 2013where applicable for all transaction with the related party and details of related partytransactions have been disclosed in the financial statement etc. as required by theapplicable accounting standards.

xiv. The Company has not made any preferential allotment or private placement of sharesor fully or partly convertible debentures during the year. Accordingly reporting underclause 3(xiv) of the order is not applicable to the company.

xv. According to the information and explanations given to us the company has notentered into any non-cash transactions with directors or persons connected with him andhence reporting under clause 3(xv) of the Order is not applicable to the Company.

xvi. The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934.

Annexure B to The Independent Auditor's Report of Even Date on The Financial Statementsof Shree Narmada Aluminium Industries Limited.

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 ShreeNarmada Aluminium Industries Limited. ("the Company") as of March 31 2021 inconjunction with our audit of the financial statements of the Company for the year endedon that date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing and maintaining internalfinancial controls based on the criteria established by the Company considering the sizeof Company and 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 ("ICAI"). These responsibilities include thedesign implementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to Company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe Companies Act 2013.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting(the "Guidance Note") and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material respects.

Our 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 included obtaining anunderstanding of internal financial controls over financial reporting assessing the riskthat a material weakness exists and testing and evaluating the design and operatingeffectiveness of internal control based on the assessed risk. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the financial statements whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company's internal financial controls systemover financial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

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

(1) pertain to the maintenance 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 controlswere operating effectively as at March 31 2021 based on the assessment of essentialcomponents of internal controls over financial reporting stated in the Guidance Notecarried out by the Company and representation to that effect is made available to us bythe Company.

For K M Swadia & Company
Chartered Accountants
(Firm Registration No.110740w)
Sd/-
CA R K Rajput
Partner
Place: Vadodara Membership No.125333
Date: 29th June 2021. UDIN: 21125333AAAACP3266

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