You are here » Home » Companies » Company Overview » Sharda Motor Industries Ltd

Sharda Motor Industries Ltd.

BSE: 535602 Sector: Auto
NSE: SHARDAMOTR ISIN Code: INE597I01028
BSE 00:00 | 03 Dec 816.35 2.00
(0.25%)
OPEN

834.45

HIGH

841.60

LOW

809.60

NSE 00:00 | 03 Dec 816.95 -1.05
(-0.13%)
OPEN

828.90

HIGH

837.00

LOW

809.50

OPEN 834.45
PREVIOUS CLOSE 814.35
VOLUME 2803
52-Week high 858.95
52-Week low 310.00
P/E 17.46
Mkt Cap.(Rs cr) 2,429
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 834.45
CLOSE 814.35
VOLUME 2803
52-Week high 858.95
52-Week low 310.00
P/E 17.46
Mkt Cap.(Rs cr) 2,429
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Sharda Motor Industries Ltd. (SHARDAMOTR) - Auditors Report

Company auditors report

To The Members of Sharda Motor Industries Limited Report on the Audit of the StandaloneFinancial Statements Opinion

We have audited the accompanying standalone financial statements of Sharda MotorIndustries Limited ("the Company") which comprise the Balance Sheet as at March31 2021 the Statement of Profit and Loss (including Other Comprehensive Income) theStatement of Changes in Equity and the Statement of Cash Flows for the year then endedand notes to the standalone financial policies and otherstatements including explanatorysummaryofsignificant information (hereinafter referred to as"thestandalonefinancial statements") In our opinion and to the best of ourinformation and according to the explanations given to us the aforesaid standalonefinancial statements give the information required by the Companies Act 2013 ("theAct") 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 2021 and its profit including other comprehensive loss changes in equityand its cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit of the standalone financial statements in accordance with theStandards on Auditing (SAs) specified under section 143(10) of the Act. Ourresponsibilities under those Standards are further described in the Auditors' Responsibilitiesfor the Audit of the Standalone Financial Statements section of our report. We areindependent of the Company in accordance with the Code of Ethics issued by the Instituteof Chartered Accountants of India (ICAI) together with the ethical requirements that arerelevant to our audit of the standalone financial statements under the provisions of theAct and the Rules made there under and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the Code of Ethics. We believethat the audit evidence we have obtained is sufficient and appropriate to provide a basisfor our opinion.

Emphasis of Matter

We draw attentiontoNoteNo.43ofthestandalonefinancialstatements which describes thepossible effect of uncertainties relating to COVID-19 pandemic on the Company's financialperformance as assessed by the management. Our opinion is not modified in respect of theabove matter.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the standalone financial statements of the current period.These matters were addressed statements as a whole and in forming our opinion thereonand we do not provide a separate opinion on these matters. We have determined the matterdescribed below to be the key audit matter to be communicated in our report.

Key Audit Matter Auditors' Response
Completeness and measurement of Contingent Liabilities arising from uncertain tax positions and disputed matters Our audit procedure included the following:
In the standalone financial statements contingent liabilities arising from uncertain tax positions and disputed matters as reported under the Note No. 20.1 to the financial statements forconsidering these matters as contingent liabilities through discussion with the year ended 31.03.2021. We discussed with the management regarding the internal control system for identifying and estimating such contingent liabilities as well as the reporting of such contingent liabilities in the standalone financial statements.
From our point of view this matter was of particular importance for our audit because the recognition and measurement of this material item to a large extent based on the estimates and assumptions made by the Company's management. Obtained a detailed understanding and assumptions applied for the management of the Company. Assessed management's estimate of the possible outcome of the disputed cases.
In addition we engaged our internal tax expert to assess the appropriateness of Company's assumption and explanations for these matters.
In light of the above we reviewed and verified the adequacy of disclosures made for these matters in the standalone financial statements.

Information Other than the Standalone Financial Statements and Auditors' Report Thereon

The Company's Board of Directors is responsible for the preparation of the otherinformation. The other information comprises the information included in the AnnualReport but does not includethestandalonefinancialstatements and our auditors' reportthereon. The Annual Report is expected to be made available to us after the date of thisauditors' report. does not Ouropinionon cover the other standalonefinancialinformation and we will not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements our responsibilityis to read the other information identified above when it becomes available and in doingso consider whether the other information is materially inconsistent with the standalonefinancial statements or our knowledge obtained during the course of our audit orotherwise appears to be materially misstated. When we read the Annual Report if weconclude that there is a material misstatement therein we are required to communicate thematter to those charged with governance.

Management's Responsibility for the Standalone Financial Statements

The Company's Board of Directors is responsible for the matters stated in section134(5) of the Act with respect to the preparation of these standalone financial statementsthat give a true and fair view of the financial position financial performance (includingother comprehensive loss) changes in equity and cash flows of the Company in accordancewith the accounting principles generally accepted in India including the Indianaccounting Standards (Ind AS) specified under section 133 of the Act. This responsibilityalso includes maintenance of adequate accounting records in accordance with the provisionsof the Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and designimplementation 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 standalone financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

In preparing the standalone financial statements the management is as a going concerndisclosing as applicable matters related to going concern and using the going concernbasis of accounting unless the management either intends to liquidate the Company or tocease operations or has no realistic alternative but to do so. The Board of Directors isalso responsible for overseeing the Company's financial reporting process.

Auditors' Responsibilities for the Audit of the Standalone Financial Statements

Our objectives are to obtain reasonable assurance about whether the standalonefinancial statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditors' report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregatetheycouldreasonablybeexpectedtoinfluencethe economic decisions of users taken onthe basis of these standalone 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 risk of material misstatement of the standalone 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 financial controls relevant to the audit in orderto design audit procedures that are appropriate in the circumstances. Under section143(3)(i) of the Act we are also responsible for expressing our opinion on whether theCompany has adequate internal financial controls system in place and the operatingeffectiveness of such controls.

Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by management.

Conclude on the appropriateness of management's use of the going concern basis ofaccounting and based on the audit evidence obtained whether a material uncertaintyexists relatedtoeventsorconditionsthatmaycastsignificantdoubt on the Company's ability tocontinue as a going concern. If we conclude that a material uncertainty exists we arerequired to draw attention in our auditors' report to the related disclosuresinthestandalonefinancialstatements or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditors' report. However future events or conditions may cause the Company to cease tocontinue as a going concern.

Evaluate the overall presentation structure and content of the standalone financialstatements including the disclosures and whether the standalone financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.

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 alsoprovide those charged with governance with a statement that we have complied with relevantethical requirements regarding independence and to communicate with them allrelationships 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 standalone financialstatementsof the current period and are therefore the key audit matters. We describe these mattersin our auditors' report unless law or regulation precludes public disclosure about thematter or when 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. As required by the Companies (Auditors' Report) Order 2016 ("the Order")issued by the Central Government in terms of Section 143(11) of the Act we give in"AnnexureA" specifiedin paragraphs statementonthematters 3 and 4 of theOrder to the extent applicable.

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

a) We have sought and obtained all the information and 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 Profitand Loss including Other ComprehensiveIncome the Statement of Changes in Equity and the Statement of Cash Flow dealt with bythis Report are in agreement with the books of account.

d) In our opinion the aforesaidstandalonefinancialstatements comply with theAccountingStandardsspecifiedunder Section 133 of the Act read with the Companies (IndianAccounting Standards) Rules 2015 as amended.

e) On the basis of the written representations received from the directors as on March31 2021 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2021 from being appointed as a director in terms of Section 164 (2) of theAct.

f) With respect to the adequacy of the internal financial controls with reference tothe financial statements of the Company and the operating effectiveness of such controlsrefer to our separate Report in "Annexure B" to this report.

g) In our opinion and to the best of our information and according to the explanationsgiven to us the remuneration paid by the Company to its directors during the year is inaccordance with the provisions of section 197 of the Act.

h) With respect to the other matters to be included in the Auditors' Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 as amended inour opinion and to the best of our information and according to the explanations given tous:

i. The Company has disclosed the impact of pending litigations on its financialposition in its standalone financial refer Note 20.1 to the standalone financialstatements.

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

ii. There has been no delay in transferring amounts required to be transferred to theInvestor Education and Protection Fund by the Company.

Annexure ‘A' To the Independent Auditors' Report

The Annexure referred to in Independent Auditors' Report to the members of the Companyon the standalone financial statements for the year ended March 31 2021 we report that:(i) In respect of fixed assets:

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

(b) The Company has a regular programme of physical verification of its fixed assets bywhichfixedassetsareverifiedat periodic intervals. In our opinion this periodicity ofphysical verification is reasonable having regard to the size of the Company and thenature of its assets. No material discrepancies were noticed on such verification.

(c) On the basis of information and explanation provided by the management the titledeeds of immovable properties are held in the name of the Company. (ii) On the basis ofinformation and explanation provided by the management inventories have been physicallyverified by the management during the year except for stock-in-transit and stocks lyingwith third parties. In our opinion the frequency of such verification is reasonable. Nomaterial discrepancies were noticed on physical verification of inventories by themanagement.

(iii) According to the information and explanations given to us the Company has notgranted any loan secured or unsecured to companies firms Limited LiabilityPartnerships (LLPs) or other parties covered in the register maintained under Section 189of the Act. Accordingly the provisions of paragraphs 3(iii)(a) 3(iii)(b) and 3(iii)(c)of the Order are not applicable. (iv) According to the information and explanations givento us the Company has not entered into any transaction covered under section 185. TheCompany has complied with the provisions of Sections 186 of the Act in respect ofinvestments made. The Company has not granted any loans and has not provided anyguarantees or securities to parties covered under Section 186 of the Act.

(v) The Company has not accepted any deposits from the public in accordance with theprovisions of Sections 73 to 76 of the Act and the rules framed there under. Accordinglyparagraph 3(v) of the Order is not applicable to the Company. (vi) We have broadlyreviewed the books of accounts maintained by the Company pursuant to the rules prescribedby the Central Government for maintenance of cost records under sub-section (I) of Section148 of the Act in respect of product covered and are of the opinion that prima facie theprescribed accounts and records have been made and maintained. However we have not made adetailed examination of the records.

(vii) According to the information and explanations given to us in respect ofstatutory dues:

(a) The Company is generally regular in depositing undisputed statutory dues includingprovident fund employees' state insurance income tax duty of customs goods and servicetax cess and other applicable statutory dues with the appropriate authorities. There wereno undisputed amounts payable in respect of provident fund employees' state insuranceincome tax goods and services tax cess and other applicable statutory dues in arrears asat March 31 2021 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us except as stated belowthere are no dues of income tax sales tax value added tax service tax goods andservices tax duty of customs and duty of excise which have not been deposited by theCompany with the appropriate authorities on account of any dispute.

S. No. Nature of statute Nature of dues Amount (Rs. in lacs)* Period to which amount relates Forum where dispute is pending
1 Maharashtra Sales VAT 23.69 F.Y. 2010-11 Sales Tax Tribunal Nashik
Tax Act 9.39 F.Y. 2011-12 Joint Commissioner Nashik
2 Tamil Nadu Sales Tax Act VAT 29.72 F.Y. 2005-06 & 2006-07 High Court Madras
3 Uttar Pradesh VAT Act VAT 21.30 F.Y. 2016-17 Additional Commissioner (Appeals) Commercial Tax Range II Noida
4 Gujarat VAT Act VAT 38.65 F.Y. 2016-17 Ld. Assistant Commissioner of Sales Tax
(2) Unit- 11 Ahmedabad
4.20 F.Y. 2017-18 Ld. Assistant commissioner of Sales Tax
(2) Unit- 11 Ahmedabad
5 Central Excise Act Cenvat Credit 440.00 F.Y. 2008-09 & 2009-10 Hon'ble Supreme Court of India
6 Income Tax Act Income Tax 1.03 A.Y. 2013-14 Commissioner of Income Tax Appeal
Income Tax 308.15 A.Y. 2017-18 Commissioner of Income Tax Appeal
Income Tax 5.85 A.Y. 2018-19 National e-Assessment Centre New Delhi
7 Maharashtra Goods and Service Tax Act Transitional Credit 21.94 F.Y. 2017-18 Deputy Commissioner of State Tax Nashik

*Net of protest money paid.

(viii) In our opinion and according to the information and explanations given to usthe Company has not taken any loans or borrowings from any financial institution bank orgovernment nor has it issued any debentures. Accordingly paragraph 3(viii) of the Orderis not applicable to the Company.

(ix) The Company did not raise any money by way of initial public offer or furtherpublic offer (including debt instruments) and term loans during the year. Accordinglyparagraph 3(ix) of the Order is not applicable to the Company.

(x) According to the information and explanations given to us no fraudbytheCompany officersorontheCompanybyits employees has been noticed or reported during the year.

(xi) The Company has paid or provided for managerial remuneration in accordance withthe requisite approvals mandated by the provisions of section 197 read with Schedule V toAct.

(xii) In our opinion and according to the information and explanations given to us theCompany is not a Nidhi Company. Accordingly paragraph 3(xii) of the Order is notapplicable to the Company.

(xiii) 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 section 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the standalone financial statements as required by theapplicable Indian Accounting Standards.

(xiv) The Company has not made any preferential allotment or private placement ofshares or fully or partly convertible debentures during the year. Accordingly paragraph3(xiv) of the Order is not applicable to the Company.

(xv) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not entered into non-cashtransactions with directors or persons connected with him. Accordingly paragraph 3(xv) ofthe 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. Accordingly paragraph 3(xvi) of the Order is not applicable tothe Company.

Annexure ‘B' To the Independent Auditors' Report

(Referred to in paragraph 2(f) under ‘Report on Other Legal and RegulatoryRequirements' section of our report of even date to the Members of Sharda Motor IndustriesLimited)

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act") Opinion

We have audited the internal financial controls with reference to financial statementsof Sharda Motor Industries Limited ("the Company") as of March 31 2021 inconjunction with our audit of the standalone financial statements of the Company for theyear ended on that date.

In our opinion to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlssystem with reference to financial statements and such internal financial controls withreference to financial statements were operating effectively as at March 31 2021 basedon the internal financial controls with reference to financial statements 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.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal to financial statements 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 (‘ICAl'). 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 with reference to financial statements based on our audit. We conducted our auditin accordance with the Guidance Note on audit of Internal Financial Controls overFinancial Reporting (the "Guidance Note") and the Standards on Auditing issuedby ICAI and deemed to be prescribed under section 143(10) of the Companies Act 2013 tothe extent applicable to an audit of internal financialcontrols both applicable to anaudit of Internal Financial Controls and both issued by the Institute of CharteredAccountants of India. Those Standards and the Guidance Note require that we comply withethical requirements and plan and perform the audit to obtain reasonable assurance aboutwhether adequate 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 with reference to financial statements and theiroperating effectiveness. Our audit of internal financial controls with reference tofinancial statements included obtaining an understanding of internal financial controlsassessing 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 auditors' 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 systemwith reference to financial statements.

Meaning of Internal Financial Controls with reference to Financial Statements

A company's internal financial control with reference to financial statements is aprocess designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles. A company's internal financial controlswith reference to financial statements includes those policies and procedures that (1)pertain to the maintenance of records that in reasonable detail accurately and fairlyreflect 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 withauthorisations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorised acquisition use ordisposition of the company's assets that could have a material effect on the financialstatements.

Inherent Limitations of Internal Financial Controls with reference to FinancialStatements

Because of the inherent limitations of internal financial controls with reference tofinancial statements including the possibility of collusion or improper managementoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projections of any evaluation of the internal financial controls withreference to financial statements to future periods are subject to the risk that theinternal financial control with reference to financial statements may become inadequatebecause of changes in conditions or that the degree of compliance with the policies orprocedures may deteriorate.

For Gupta Vigg & Co.

Chartered Accountants

Firm's Registration Number: 001393N

(CA. Deepak Pokhriyal)

Partner

Membership Number: 524778

UDIN: 21524778AAAACK1675

New Delhi

June 23 2021

.