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Shah Construction Company Ltd.

BSE: 509870 Sector: Infrastructure
NSE: N.A. ISIN Code: INE02C301011
BSE 00:00 | 16 Jul Shah Construction Company Ltd
NSE 05:30 | 01 Jan Shah Construction Company Ltd
OPEN 55.10
PREVIOUS CLOSE 55.10
VOLUME 20
52-Week high 55.10
52-Week low 0.00
P/E
Mkt Cap.(Rs cr) 1
Buy Price 55.10
Buy Qty 680.00
Sell Price 0.00
Sell Qty 0.00
OPEN 55.10
CLOSE 55.10
VOLUME 20
52-Week high 55.10
52-Week low 0.00
P/E
Mkt Cap.(Rs cr) 1
Buy Price 55.10
Buy Qty 680.00
Sell Price 0.00
Sell Qty 0.00

Shah Construction Company Ltd. (SHAHCONSTRUCTN) - Auditors Report

Company auditors report

TO THE MEMBERS OF M/S. SHAH CONSTRUCTION COMPANY LIMITED

REPORT ON THE STANDALONE FINANCIAL STATEMENTS

OPINION

We have audited the standalone financial statements of Shah Construction CompanyLimited ("the Company") which comprise the balance sheet as at 31st March2019 and the statement of Profit and Loss statement of changes in equity and statementof cash flows for the year then ended and notes to the financial statements including asummary of significant accounting policies and other explanatory.

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the Act in the manner so required and give a true and fair view in conformity with theaccounting principles generally accepted in India of the state of affairs of the Companyas at March 31 2019 and loss changes in equity and its cash flows for the year ended onthat date.

BASIS FOR OPINION

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 Rulesthereunder and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the Code of Ethics. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our opinion.

MANAGEMENT'S RESPONSIBILITY AND THOSE CHARGED WITH GOVERNANCE FOR THE STANDALONEFINANCIAL 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 changes in equity and cash flows of the Company inaccordance with the accounting principles generally accepted in India including theaccounting Standards specified under section 133 of the Act. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate implementationand maintenance of accounting policies; making judgments and estimates that are reasonableand prudent; 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 financialstatement that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

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 THE FINANCIAL STATEMENTS

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 forexpressing our opinion on whether the company has adequate internal financial controlssystem in place and the operating effectiveness 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.

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.

OTHER MATTER

We draw attention to the following matter in the notes to the financial statements:

In our opinion Subject to Note No. 5 and 7 regarding valuation of overseas propertyplant & Equipment and other overseas Non-Current Assets in foreign currency are valuedat the rate prevailing as on 30.03.1984 Balance Sheet as at March 31 2019 the Statementof Profit and Loss including the statement of Other Comprehensive Income the Cash FlowStatement and the Statement of Changes in Equity for the year comply with the IndianAccounting Standards (Ind AS) specified under section 133 of the Act read with theCompanies (Indian Accounting Standards) Rules 2015 as amended.

Our opinion is not modified in respect of these matters.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

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 Companies Act 2013 we give in the "Annexure A" a statement on the mattersspecified in paragraphs 3 and 4 of the Order to the extent applicable.

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 the Statement of Profit and Loss the statement of changes inequity and the Cash Flow Statement dealt with by this Report are in agreement with thebooks of account.

d) In our opinion the aforesaid standalone financial statements comply with theAccounting Standards specified under Section 133 of the Act read with the Companies(Indian Accounting Standards) Rules 2015.

e) On the basis of the written representations received from the directors as on 31stMarch 2019 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2019 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 litigation on its financial positionin its financial statements – Refer Note No 28 to the financial statements.

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.

For A.C.MODI & ASSOCIATES

Chartered Accountants

Firm's registration number: 116555W

ALPESH C.MODI

Proprietor

Membership number: 101342

Place: Mumbai

Date: 15th May 2019

ANNEXURE - A TO THE AUDITORS' REPORT

The Annexure referred to in Independent Auditors' Report to the members of the Companyon the standalone financial statements for the year ended 31 March 2019 we report that:

1. In respect of its fixed assets:

a) The company has generally maintained proper records showing full particularsincluding quantitative details and situation of fixed assets.

b) The Company has regular programme for physical verification in a periodic mannerwhich is in our opinion is reasonable having regard to the size of the company and thenature of its assets. No material discrepancies were noticed on such verification exceptFixed Assets situated at foreign sites in Iraq amounting to Rs. 8.98 crores at cost arenot verifiable.

c) According to information and explanation given to us and on the basis of examinationof the records of the company the title deeds of immovable properties are held in thename of the company.

2. In respect of its inventories:

The management has conducted physical verification of inventory at reasonable intervalsduring the year. In our opinion the frequency of verification is reasonable and asexplained to us no material discrepancies were noticed on such physical verification.

3. In respect of loan given:

According to the information and explanations given to us the company has not givenany secured or unsecured loans to the persons covered under the register maintainedu/s.189 of the Companies Act2013 (The Act).

4. In our opinion and according to the information and explanations given to us theCompany has not given any loans or made any new investment during the year and hencereporting related to compliance with the provisions of section 185 and 186 of the Act doesnot required.

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 to the Company.

6. The Central Government has not prescribed the maintenance of cost records undersection 148(1) of the Act.

7. In respect of statutory dues:

(a) The Company is generally regular in depositing with appropriate authoritiesundisputed statutory dues including Provident Fund Employees' State InsuranceIncome-Tax Sales-Tax Goods and Services Tax Service Tax Duty of Custom Duty ofExcise Value Added Tax Cess and Other Statutory Dues applicable to it.

(b) According to the information and explanations provided to us no undisputed amountspayable in respect of Provident Fund Employees' State Insurance Income-Tax Service TaxSales-Tax Goods and Services Tax Duty of Custom Duty of Excise Value Added Tax Cessand Other Statutory Dues were outstanding at the year end for a period of more than sixmonths from the date they became payable.

(c) According to the records of the Company the dues of Income-Tax which have not beendeposited on March 31 2019 on account of any dispute are as follows:

Name of the Statute Nature of Dues Amount (in Lakhs) Period to which the amount relates Forum where dispute is pending
Income Tax Act 1961 Assessment Dues 10.62 Asst. Year 2008-09 CIT (Appeals)
Income Tax Act 1961 Assessment Dues 7.30 Asst. Year 2013-14 CIT (Appeals)
Income Tax Act 1961 Assessment Dues 1.72 Asst. Year 2014-15 CIT (Appeals)
Income Tax Act 1961 Assessment Dues 12.61 Asst. Year 2016-17 CIT (Appeals)

8. The Company does not have any loans or borrowings from any financial institutionbanks or government. The company has not issued any debenture as at the balance sheet dateand hence the provisions of clause 3(viii) of the order are not applicable.

9. The Company did not raise any money by way of initial public offer or further publicoffer (including debt instruments). In our Opinion and according to the information andexplanations given to us the company has not availed any term loan during the year.

10. Based upon the audit procedures performed for the purpose of reporting the true andfair view of the Financial Statements and according to the information and explanationsprovided by the management we report that no fraud by the Company or no fraud on theCompany by the officers and employees of the Company has been noticed or reported duringthe year.

11. According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has not paid/provided formanagerial remuneration and Accordingly paragraph 3 (xi) of the Order is not applicable.

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. According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the financial statements as required by the applicableaccounting standards.

14. According to the information and explanations provided to us and on an overallexamination of the balance sheet the Company has not made any preferential allotment orprivate placement of shares or fully or partly convertible debentures during the yearunder review and hence reporting requirements under clause 3(xiv) of the Order are notapplicable to the Company and not commented upon.

15. According to the information and explanations provided by the management duringthe year the company has not entered into any non-cash transactions with directors orpersons connected with him as referred to in section 192 of Companies Act 2013 and hencereporting requirements under clause 3(xv) of the Order are not applicable to the Companyand not commented upon.

16. According to the information and explanations provided to us the provisions ofsection 45-IA of the Reserve Bank of India Act 1934 are not applicable to the Company.

For A.C.MODI & ASSOCIATES

Chartered Accountants

Firm's registration number: 116555W

ALPESH C.MODI

Proprietor

Membership number: 101342

Place: Mumbai

Date: 15th May 2019

ANNEXURE -- - B TO THE AUDITORS' REPORT

REPORT ON THE INTERNAL FINANCIAL CONTROLS UNDER CLAUSE (I) OF SUB-SECTION-- 3 OFSECTION 143 OF THE COMPANIES ACT 2013 ("THE ACT")

We have audited the internal financial controls over financial reporting of M/s. ShahConstruction Company Limited (‘the Company') as of 31 March 2019 in conjunction withour audit of the standalone financial statements of the Company for the year ended on thatdate.

MANAGEMENT'S RESPONSIBILITYTY 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 safeguarding ofits 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.

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 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 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 INTERNALL 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 ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the company are being made only in accordance with authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised acquisition use or disposition of thecompany's assets that could have a material effect on the financial statements.

INHERENT LIMITATIONS OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING

Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial 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 31 March 2019 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 A.C.MODI & ASSOCIATES

Chartered Accountants

Firm's registration number: 116555W

ALPESH C.MODI

Proprietor

Membership number: 101342

Place: Mumbai

Date: 15th May 2019

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