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Sir Shadi Lal Enterprises Ltd.

BSE: 532879 Sector: Agri and agri inputs
NSE: N.A. ISIN Code: INE117H01019
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NSE 05:30 | 01 Jan Sir Shadi Lal Enterprises Ltd
OPEN 32.00
PREVIOUS CLOSE 30.50
VOLUME 1900
52-Week high 43.85
52-Week low 23.50
P/E 10.93
Mkt Cap.(Rs cr) 16
Buy Price 30.50
Buy Qty 200.00
Sell Price 31.00
Sell Qty 100.00
OPEN 32.00
CLOSE 30.50
VOLUME 1900
52-Week high 43.85
52-Week low 23.50
P/E 10.93
Mkt Cap.(Rs cr) 16
Buy Price 30.50
Buy Qty 200.00
Sell Price 31.00
Sell Qty 100.00

Sir Shadi Lal Enterprises Ltd. (SIRSHADILAL) - Auditors Report

Company auditors report

To

The Members of

Sir Shadi Lal Enterprises Limited

Report on the Standalone Ind AS Financial Statements

OPINION

We have audited the accompanying standalone financial statements of Sir Shadi LalEnterprises Limited ("the Company") which comprises the Balance Sheet as atMarch 312019 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 financial statements including a summary of significant accountingpolicies and other explanatory information (here in after referred to as "thestandalone financial statements"). In our opinion and to the best of our informationand according to the explanations given to us the aforesaid standalone financialstatements give the information required by the Companies Act2013("the Act") inthe manner so required and give a true and fair view in conformity with the IndianAccounting Standards prescribed under section 133 of the Act read with the Companies(Indian Accounting Standards) Rules 2015 as amended ("Ind As") and otheraccounting principles generally accepted in India of the state of affairs of the Companyas at March 31 2019 and the loss and total comprehensive income changes in equity andits Cash flows for the year ended on that date.

BASIS FOR OPINION

We conducted our audit of the standalone financial in accordance with the Standards onAuditing (SAs) specified under section 143(10) of the Companies Act 2013. Ourresponsibilities under those Standards are further described in the Auditor'sResponsibilities for the Audit of the 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 independence requirements thatare relevant to our audit of the standalone financial statements under the provisions ofthe Companies Act 2013 and the Rules there under and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the ICAI's Code of Ethics. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our audit opinion on the standalone financial statements.

KEY AUDIT MATTERS

Key Audit Matters are those matters that in our professional judgement 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 andinforming our opinion thereon and we do not provide a separate opinion on these matters.We have determined the matters described below to be the key audit matters to becommunicated in our audit report.

Key Audit Matters Auditor's Response
The Net Worth of the company has since been eroded on account of operational losses incurred by the company up to the F.Y. 2014-15 which was basically on account of low recovery of sugar from sugarcane. Whereas on account of improvement in the sugar manufacturing unit during the season 2015-16 the recovery has substantially improved with the result that the company has earned profit during the year 2016-17. As such the company will remain as a going concern and is likely to pay it's liabilities including cane dues from expected generation of cash flow. However the accumulated losses of the company as at 31.03.2019 were Rs 10445.28 Lakhs as against the paid up capital of Rs 525.00 Lakhs. Attention is invited to note no. 46 of the Financial Statements wherein it is explained that the Company has significant accumulated losses which have resulted in erosion of the net worth of the Company as on 31st March 2019. The reasons for improvement explained by the Company in the said note no. 46 that it will continue as a going concern and it will likely to pay its liabilities from expected generation of cash flow are in our opinion uncertain. We are unable to comment upon the said uncertainties.

OTHER MATTER

1. The Company has not maintained accounts on "Accrual Basis" to the extent:

i) of Rs. 5969.02 Lacs in respect of interest on late payment of Cane price which havenot been provided as stated by the Company in Note No. 36 of the aforesaid StandaloneFinancial Statements.

ii) of liability (which is not determined by the Company) towards bonus relating toFinancial Year 2014-15 in accordance with revised Bonus Notification dated 1st January2016 as stated by the Company in Note No. 37 of the aforesaid Financial Statements.

2. As stated in Note No. 38 to the Standalone Financial Statements the managements hasdecided not to make any further provision this year for Deferred Tax Assets. Themanagement in view of current year loss and accumulated losses and in absence of virtualcertainty about future profitability has decided not to account for the effect ofDeferred Taxation for this year and continuing to carry forward the Deferred Tax AssetsRs. 6881.11 Lakhs already accounted for in earlier years.

OTHER INFORMATION

The Company's Board of Directors is responsible for the other information. Thiscomprises the information included in the Director's report but does not include thefinancial statements and our auditor's report thereon.

Our opinion on the financial statements does not cover the other information and we donot express any form of assurance conclusion thereon.

In connection with our audit of the financial statements our responsibility is to readthe 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 misstatement of this other information we arerequired to report that fact.

We have nothing to report in this regard.

Responsibilities of Management 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 total comprehensive income changes in equity and cashflows of the Company in accordance with the Ind AS and other accounting principlesgenerally accepted in India specified under section 133 of the Act read with theCompanies(Indian Accounting Standards)Rules 2015 as amended. 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 accountingpolicies; making judgments and estimates that are reasonable and prudent; and designimplementation and maintenance of accounting policies; making judgments and estimates thatare reasonable and prudent; and design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe standalone financial statement that give a true and fair view and are free frommaterial misstatement whether due 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 Standalone Financial Statement

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 auditor's 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 theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis 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 standalonefinancial statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.

• 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 standalone financial statements or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor's 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 standalonefinancial statements including the disclosures and whether the standalone financialstatements represent 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 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 standalone financial statementsof the current period and are therefore the key audit matters. We describe these mattersin our auditor's 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 (Auditor's Report) Order2016("the Order")issued by the Central Government of India in terms of sub-section (11) of section 143 ofthe companies Act we give in the "Annexure A" a Statement on the mattersspecified in paragraphs 3 and 4 of the Order.

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 Profit and Loss (including other comprehensiveincome)the 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 standalone financial statements comply with theAccounting Standards specified under Section 133 of the Act

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 Control 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 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 financial statements (Refer Note No. 35 of the Standalone financialstatements);

ii) The Company did not have any long term contracts including derivative contracts forwhich there were any foreseeable losses; and

iii) There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.

For M. SHARAN GUPTA & CO.

Chartered Accountants (Firm's Registration No. 06430N)

M.S. Gupta
Place : New Delhi Proprietor
Dated : 25th May 2019 (Membership No. 084721)

Annexure "A" To The Independent Auditor's Report of even date of theStandalone Ind AS Financial Statements of Sir Shadi Lai Enterprises Limited for the yearended on 31st March 2019.

(Referred to in paragraph 1 of the Independent Auditors' Report of even date under theheading "Report on Other Legal and Regulatory Requirements" to the members ofSir Shadi Lal Enterprises Limited on the standalone Ind AS financial statements as of andfor the year ended March 31 2019.)

i. In respect of the Company's fixed assets:

a. The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets on the basis of available information.

b. The Company's programme of physical verification of all its fixed assets once inthree years is in our opinion reasonable having regard to the size of the Company andthe nature of its fixed assets. We are informed that in accordance with the programme nophysical verification of fixed assets was carried out during the year under report.

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 immovable properties arestated to be held in the name of the Company. The original Title Deeds were not producedto us for our verification and we were told that same are deposited as security with StateBank of India and District Co-Operative Bank.

ii. a) During the year the inventories have been physically verified by the managementexcept Shamli Distillery and material sent for job work and lying with third party. In ouropinion the frequency of verification is reasonable b) The discrepancies noticed onphysical verification between the physical stocks and the book records were not materialhowever the discrepancies noticed have been properly accounted for in the books ofaccount.

iii. The Company has not granted any loans secured or unsecured to companies firms orother parties covered in the Register maintained under section 189 of the Act.Accordingly the provisions of clause 3 (iii) (a) to (c) of the Order are not applicableto the Company and hence not commented upon.

iv. In our opinion and according to the information and explanations given to us thecompany has complied with the provisions of section 185 and 186 of the Companies Act 2013with respect to loans investments guarantees and securities.

v. According to the information and explanations given to us the Company has notaccepted any deposit from the public during the year therefore the provisions of clause(v) of paragraph 3 of the Order is not applicable to the Company.

vi. We have broadly reviewed the cost records maintained by the Company pursuant to theCompanies (Cost Records and Audit) Rules 2014 prescribed by the Central Government underSection 148 (1) (d) of the Companies Act 2013 and are of the opinion that prima faciethe prescribed accounts and cost records have been maintained. We have however not madea detailed examination of the cost records with a view to determine whether they areaccurate or complete.

vii. a) According to the information & explanations given to us and on the basis ofour examination of the records of the Company there is no undisputed amounts payable inrespect of provident fund employees' State insurance income-tax value added taxwealth-tax Goods and service-tax customs duty excise duty cess and other materialstatutory dues were outstanding at the year end for a period of more than six monthsfrom the date of becoming payable.

b) According to the records of the Company and the information and explanations givento us there are no amounts in respect of income-tax value added tax sales taxwealth-tax Goods and service-tax customs duty excise duty and cess which have not beendeposited with the appropriate authorities on account of any dispute other than mentionedin ‘Annexure-1' to this report.

c) Except Goods & Service Tax the Company has generally been regular in depositingundisputed statutory dues including Provident Fund Employee's State Insurance IncomeTax Excise Duty Cess and other material statutory dues applicable to it with theappropriate authorities.

viii. Based on our audit procedures and according to the information and explanationsgiven to us we are of the opinion that the Company has not defaulted in repayment of duesto banks or Government during the year. The Company has no outstanding dues in respect offinancial institutions or debenture holders.

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.

x. According to the information and explanations given to us no material fraud by theCompany or on the Company by its officers or employees has been noticed or reported duringthe course of our audit.

xi. According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has paid/provided for managerialremuneration in accordance with the requisite approvals mandated by the provisions ofsection 197 read with Schedule V to the Act.

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.

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 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.

xiv. According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year.

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.

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

For M. SHARAN GUPTA & CO.
Chartered Accountants
(Firm's Registration No. 06430N)
M. S. GUPTA
Place: New Delhi Proprietor
Date: 25.05.2019 (Membership No. 084721)

ANNEXURE ‘B' TO THE INDEPENDENT AUDITOR'S REPORT

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

We have audited the internal financial controls over financial reporting of SIR SHADILAL ENTERPRISES LIMITED ("the Company") as of March 31 2019 in conjunction withour audit of the Standalone Ind AS Financial Statements of the Company for the year endedon that date.

MANAGEMENT'S RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS

The Board of Directors of the Company is responsible for establishing and maintaininginternal financial controls based on the internal control over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls over FinancialReporting issued by the Institute of Chartered Accountants of India. Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business the safeguarding of its assets the prevention and detection offrauds and errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Companies Act 2013.

AUDITOR'S RESPONSIBILITY

Our responsibility is to express an opinion on the internal financial controls overfinancial reporting of the Company based on our audit.

We conducted our audit in accordance with the Guidance Note on Audit of InternalFinancial Controls Over Financial Reporting (the "Guidance Note") issued by theInstitute of Chartered Accountants of India and the Standards on Auditing prescribed underSection 143(10) of the Companies Act 2013 to the extent applicable to an audit ofinternal financial controls. Those Standards and the Guidance Note require that we complywith ethical requirements and plan and perform the audit to obtain reasonable assuranceabout whether adequate internal financial controls over financial reporting wasestablished and maintained and if such controls operated effectively in all materialrespects.

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 financial reporting includes those policies and procedures that(1) pertainto the maintenance of records that in reasonable detail accurately and fairly reflectthe transactions and dispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of financialstatements in accordance with generally accepted accounting principles and that receiptsand expenditures of the company are being made only in accordance with authorizations 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.LIMITATIONS OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING

Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.

OPINION

In our opinion to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at March 31 2019 based on the internal controlover financial reporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting issued by the Institute of Chartered Accountants ofIndia.

For M. SHARAN GUPTA & CO.
Chartered Accountants
(Firm's Registration No. 06430N)
M. S. GUPTA
Place: New Delhi Proprietor
Date: 25.05.2019 (Membership No. 084721)

(Annexure-1 as referred to in Para vii (b) of Annexure ‘B' to the Auditors' Reportof even date to the members of Sir Shadi Lai Enterprises Limited on the accounts for theyear ended 31st March 2019).

Following are the particulars of disputed dues (provided/considered contingentliability as appropriate) as on 31.03.2019 on account of Income-Tax Sales-Tax andExcise matters that have not been deposited on account of dispute:

Name of the Statute Nature of the Dues Amount (Rs. In Lakhs) Period to which the Amounts relates Forum where dispute is pending
Sales Tax Act Entry Tax 3.38 2012-2013 Addl. Commissioner Appeal Muzaffamagar
Central Excise Act Duty/Penalty 0.68 2005-2006 Commissioner Appeal Muzaffamagar
U.P. Excise Act Penalty for Low Recovery duty/ Penalty 1.85 1991-1992 Excise Commissioner Allahabad
55.42 1988-1989 Weight & Measurement Department Saharanpur High Court Allahabad
National Company Law Tribunal Security Deposit for Appeal

37.46

2011-2012
2012-2013 Competition Commission of India.
2013-2014

We have been informed that apart from above; there are no dues in respect ofWealth-tax Goods and Service-tax and Custom Duty which have not been deposited onaccount of any dispute.

For M. SHARAN GUPTA & CO.
Chartered Accountants
(Firm's Registration No. 06430N)
M. S. GUPTA
Place: New Delhi Proprietor
Date: 25th May 2019 (Membership No. 084721)