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Sita Shree Food Products Ltd.

BSE: 532961 Sector: Agri and agri inputs
NSE: SITASHREE ISIN Code: INE686I01011
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VOLUME 300
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Buy Price 0.39
Buy Qty 4.00
Sell Price 0.39
Sell Qty 1300.00
OPEN 0.39
CLOSE 0.39
VOLUME 300
52-Week high 0.80
52-Week low 0.39
P/E
Mkt Cap.(Rs cr) 1
Buy Price 0.39
Buy Qty 4.00
Sell Price 0.39
Sell Qty 1300.00

Sita Shree Food Products Ltd. (SITASHREE) - Auditors Report

Company auditors report

INDEPENDENT AUDITOR’S REPORT

To

The Members

Sita Shree Food Products Ltd.

INDORE

Report on the Standalone Financial Statements

We have audited the accompanying Standalone financial statements of Sita Shree FoodProducts Limited which comprise the Balance Sheet as at March 31 2018 the Statement ofProfit and Loss (Including other comprehensive income) the statement of changes in equityand the statement of Cash Flow Statement for the year then ended and a summary ofsignificant accounting policies and other explanatory information.

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 Companies act 2013("the act") with respect to the preparation ofthese Standalone financial statements that give a true and fair view of the financialstatements financial performance including other comprehensive income cash ows andchanges in equity of the company in accordance with the Indian Accounting Standards (INDAS) prescribed under section 133 of the act read with the companies (Indian AccountingStandards) Rules 2015 as amended and other accounting principles generally accepted inIndia. This responsibility also includes the maintenance of adequate accounting records inaccordance with the provisions of the act for safeguarding the assets of the company andfor preventing and detecting fraud & other irregularities; selection and applicationof appropriate accounting policies; making judgment and estimates that are reasonable andprudent; and design implementation and maintenance of internal financial control thatwere operating effectively for ensuring the accuracy and completeness of accountingrecords relevant to the preparation and presentation of Standalone financial statementsthat give a true and fair view and are free from material misstatement whether due tofraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on these Standalone financial statementsbased on our audit.

We have taken into account the provisions of the act accounting and auditing standardsand matters which are required to be included in the audit report under the provisions ofthe act and the rules there under and order issued under section 143(11) of the act.

We conducted our audit in accordance with the Standards on Auditing specified undersection 143(10) of the act. Those standards require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetherthe Standalone financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the Standalone financial statements. The procedures selected depend on theauditor’s judgment including the assessment of the risks of material misstatement ofthe financial statements whether due to fraud or error. In making those risk assessmentsthe auditor considers internal control relevant to the Company’s preparation of theStandalone financial statements that give true and fair view in order to design auditprocedures that are appropriate in the circumstances. An audit also includes evaluatingthe appropriateness of accounting policies used and the reasonableness of the accountingestimates made by company’s directors as well as evaluating the overall presentationof the Standalone financial statements. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our audit opinion on theStandalone financial statements.

Opinion

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:

(a) In the case of the Balance Sheet of the state of affairs of the Company as atMarch 31 2018;

(b) In the case of the Profit and Loss Account total other comprehensive income forthe year ended on that date;

(c) In the case of the statement of changes in Equity and;

(d) In the case of the Cash Flow Statement of the cash ows for the year ended on thatdate

Emphasis of Matter

We draw attention to the following matters in the notes to the financial statement: a)Note 14 in the financial statement which indicates that the Company has accumulates lossesand its net worth has been fully eroded the company has incurred a net loss of332970873/- during the current year and the company’s current liabilities exceeds itscurrent assets as at the Balance Sheet date. The financial statements of the company havebeen prepared on a Going Concern basis. b) Note 24 in the financial statement whichindicates the amount of revenue from operations which is Rs. (39884531)/- . There was asales return from a party of Rs. 95249440/- during the year which was deteriorated and wassold as scrap at negligible value as it was un t for human/ animal consumption and thusrevenue from operations turned out to be negative in value.

Our opinion is not modified in respect of these matters. Other Matters

The comparative financial information of the Company for the year ended 31st March 2017and the transition date opening balance sheet as at 1st April 2016 included in thesestandalone Ind AS financial statements are based on the previously issued statutoryfinancial statements prepared in accordance with the Companies (Accounting Standards)Rules 2006 audited by the predecessor auditor whose report for the year ended 31st March2017 and 31st March 2016 dated 30 May 2017 and 6 June 2016 respectively expressed anunmodified opinion on those standalone financial statements as adjusted for thedifferences in the accounting principles adopted by the Company on transition to the INDAS which have been audited by us.

As per the information and explanations gives to us by the management of the companyduring previous year forensic audit was conducted by the Banks and financial institutionsand on the basis of that audit a consortium meeting was held on 31st January 2018 with themanagement of the company the minutes of which states that there were no adverse ndingsin the FAR and lenders are ready to consider the OTS proposal of the company. We areunable to form any opinion regarding this matter as Forensic Audit Report was not providedto us.

Our opinion is not modified in respect of these matters. Report on Other Legal andRegulatory Requirements

1. As required by the Companies (Auditor’s Report) Order 2016 issued by theCentral Government of India in terms of sub-section (11) of section 143 of the Act(hereinafter referred to the "Order") and on the basis of such checks of thebooks and records of the Company as we considered appropriate and according to theinformation and explanations given to us we give in the Annexure a statement on thematters specified in paragraphs 3 and 4 of the Order.

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

a. We have obtained all the information and explanations which to the best of ourknowledge and belief were necessary for the purpose of our audit;

b. In our opinion proper books of account as required by law have been kept by theCompany so far as appears from our examination of those books.

c. The Balance Sheet Statement of Profit and Loss including other comprehensiveincome statement of changes in Equity and statement of Cash Flow dealt with by thisReport are in agreement with the books of account.

d. In our opinion the Balance Sheet Statement of Profit and Loss and Cash FlowStatement comply with the Indian Accounting Standards prescribed under section 133 of theact read with the companies (Indian Accounting Standards) Rules 2015 as amended.

e. On the basis of written representations received from the directors as on March 312018 and taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2018 from being appointed as a director in terms of sub-section (2) ofsection 164 of the Companies Act 2013.

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’. Our report expresses an unmodified opinion onthe adequacy and operating effectiveness of the company’s internal financial controlover financial reporting.

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 best of our information and according to the explanation given to us.

1) The company has disclosed the impact of pending litigation on its financial positionin its financial statements.

2) The company has made provisions as required under the applicable law or accountingstandards for material foreseeable losses if any on long term contracts includingderivative contracts.

3) There has been no delay in transferring amounts required to be transferred to theinvestor’s education and protection fund by the company.

For: VINAY GANDHI & ASSOCIATES
CHARTERED ACCOUNTANTS
(Regn.No.014442C)
(VINAY GANDHI)
Place: Indore PROPRIETOR
Date: 30/05/2018 M.NO. 075972

ANNEXURE A TO THE AUDITORS REPORT

Annexure to the Auditor’s Report (referred to in paragraph 3 of our Report of evendate to the members of Sita Shree Food Products Ltd. Indore on the Financial Statementfor the year ended 31st March 2018).

1.1. As informed to us the Company has maintained proper records showing fullparticulars including quantitative details and situation of fixed assets.

1.2. As informed to us all the fixed assets have been physically verified during theyear by the management at reasonable intervals and which is in our opinion is reasonablehaving regards to the size of the Company. No material discrepancies were noticed on suchverification.

1.3. 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 Property are heldin the name of the company. The discrepancies noticed on physical verification were notmaterial and have been dealt in books of accounts.

2. The inventories have been physically verified during the year at reasonableintervals by the management. The discrepancies noticed on physical verification were notmaterial and have been dealt in books of accounts.

3. According to the information and explanations given to us the Company has receivedunsecured loans to 1/2/3 bodies corporate covered in the register maintained undersection 189 of the Companies Act 2013 in respect of which:

(a) The terms and conditions of the grant of such loans are in our opinion primafacie not prejudicial to the Company’s interest.

(b) The schedule of repayment of principal and payment of interest has been stipulatedand repayments or receipts of principal amounts and interest have been regular as perstipulations. (c) There is no overdue amount remaining outstanding as at the year-end.

4. In our opinion and according to the information and explanations given to us thereare no loans and guarantee granted in respect of the provisions of the Section 185 and 186of the Companies Act 2013; however based on our examination of the records of the Companywe report that investments has been made in accordance with the provision of Section 186of the Act.

5. According to the information and explanations given to us the Company has notaccepted any deposits in terms of directives issued by Reserve Bank of India and theprovisions of Sections 73 to 76 or any other relevant provisions of the Companies Act2013 and the rules framed there under.

6. We have broadly reviewed the cost records maintained by the Company pursuantsub-section (1) of Section 148 of the Companies Act 2013 and are of the opinion thatprima facie the prescribed accounts and records have been made and maintained.

7.1. The company is not regular in depositing undisputed & disputed statutory duesincluding Provident Fund Employees State Insurance Income Tax Sales Tax Wealth TaxService Tax Duty of Customs Duty of Excise Value Added Tax Cess and any otherstatutory dues with the appropriate authorities and we have been noticed that there arefollowing arrears of outstanding statutory dues as at the last day of the financial yearunder Audit for a period of more than six months from the date they became payable as on31.03.2018.

S.NO. STATUTORY LIABILITIES AMOUNT
1 INTEREST ON TAX 694077
2 PF PAYABLE 245512
3 PROFESSIONAL TAX EMPLOYEE 145400
4 DIVERSION TAX 383370
5 SERVICE TAX PAYABLE 37195
6 TDS 1960847
7 WORK CONTRACT TAX 600

7.2 Details of Dues of Income Tax Sales tax which have not been deposited as atMarch31 2018 On account of dispute are given below:

Nature of the statute Nature of dues Authorities where dispute is pending Period to which the amount relates Amount in Rs. Lakhs
M.P. Commercial tax Sales tax ACTO 2013-2014 47.90
M.P. Commercial tax Sales tax ACTO 2014-2015 486.00
The Income tax act 1961 Income Tax Commissioner 2011-12 801.61
The Income tax act 1961 Income Tax CIT(A) 2014-15 358.84

8.1 According to the information and explanations given to us the Company hasdefaulted in repayment of term loan installment as well as interest on various creditfacilities obtained by the company from banks and other financial institution. Banks &loan accounts of the company have been classified as NPA by Banks. The Companydoesn’t have any borrowing by way of debentures from government.

8.2 Entire Net worth of the company has been eroded and the company suffers heavylosses. The accumulated losses is Rs.1681880075/- as compared to Equity capital ofcompany Rs. 278341740/-

9. To the best of our knowledge and belief and according to the information andexplanations given to us and based on documents provided to us the company has not raisedmoneys by way of initial public offer or further public offer (including debtinstruments)during the year or term loans and hence reporting under clause 3 (9) of theorder is not applicable to the company.

10. During the course of our examination of the books of accounts and record of thecompany and according to the information and explanations given to us we have neithercome across any instance of material fraud on the company by its officers/employees or bythe Company noticed or reported during the year nor have we been informed of any such caseby the management.

11. Based on our audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to the information and explanationsgiven by the management we report that the managerial remuneration has been paid/provided in accordance with the requisite approvals mandated by the provisions of Section197 read with Schedule V to the Act.

12. In our opinion and according to the information and explanations given to us theCompany is not a nidhi company. Therefore the provisions of Clause 3(xii) of the Orderare not applicable to the Company.

13. According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with related parties are incompliance with Section 177 and 188 of the Act where applicable and details of suchtransactions to the extent required has been disclosed in the financial statements asrequired by the applicable Indian accounting standards.

14. During the year the company has not made any preferential allotment or privateplacement of shares or fully or partly paid convertible debentures and hence reportingunder clause 3(14) of the order is not applicable to the company.

15. 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.

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

For: VINAY GANDHI & ASSOCIATES
CHARTERED ACCOUNTANTS
(Regn.No.014442C)
(VINAY GANDHI)
Place: Indore PROPRIETOR
Date: 30/05/2018 M.NO. 075972