To the Members of Supreme Engineering Limited
(Formerly Known as Supreme Heatreaters Private Limited)
Report on the Audit of the Ind AS Financial Statement
We have audited the accompanying Ind AS Ind AS Financial Statement of SupremeEngineering Limited (Formerly known as Supreme Heatreaters Private Limited) (theCompany) which comprise the Balance Sheet as at March 31 2021 the Statement ofProfit and Loss (including the Statement of Other Comprehensive Income) the Statement ofCash Flows and the Statement of Changes in Equity for the year then ended and notes to theInd AS Financial Statement including a summary of significant accounting policies andother explanatory information.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Ind AS Ind AS Financial Statement give the information requiredby the Companies Act 2013 as amended (the Act) in the manner so required andgive a true and fair view in conformity with the Ind AS & accounting principlesgenerally accepted in India:
a) in the case of the balance sheet of the state of affairs of the Company as at March31 2021; and
b) in the case of the statement of profit and loss of the loss including othercomprehensive income for the year ended on that date.
c) in the case of the statement of cash flows of the cash flows for the year ended onthat date.
d) in the case of the statement of changes in equity of the changes in equity sharecapital and other equity for the year ended on that date.
Basis for opinion
We have conducted our audit of the Ind AS Ind AS Financial Statement in accordance withthe Standards on Auditing (SAs) as specified under section 143(10) of the Act.Our responsibilities under those Standards are further described in theAuditors Responsibilities for the Audit of the Ind AS FinancialStatement section of our report. We are independent of the Company in accordancewith the Code of Ethics issued by the Institute of Chartered Accountants ofIndia together with the ethical requirements that are relevant to our audit of the Ind ASFinancial Statement under the provisions of the Act and the Rules thereunder and we havefulfilled our other ethical responsibilities in accordance with these requirements and theICAI Code of Ethics. We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the Ind AS Ind AS FinancialStatement.
Emphasis of Matter We draw attention to the fact that
The Company is required to get cost audit conducted as per the requirement of section148 of the Companies Act 2013 however the same has not been conducted. Our opinion is notmodified in respect of above matters.
The Companys Board of Directors is responsible for the other information. Theother information comprises the Board of Directors' Report but does not include the IndAS Ind AS Financial Statement and our Auditors report thereon. Our opinion on theInd AS Ind AS Financial Statement does not cover the other information and we do notexpress any form of assurance conclusion thereon. In connection with our audit of the IndAS Ind AS Financial Statement our responsibility is to read the other information and indoing so consider whether such other information is materially inconsistent with the IndAS Financial Statement or our knowledge obtained in the audit or otherwise appears to bematerially misstated. If based on the work we have performed we conclude that there is amaterial misstatement of this other information we are required to report that fact. Wehave nothing to report in this regard.
Managements Responsibility for the Ind AS Financial Statement
The Companys Board of Directors is responsible for the matters stated in section134(5) of the Act with respect to the preparation of these Ind AS Ind AS FinancialStatement that give a true and fair view of the financial position financial performanceincluding other comprehensive income cash flows and changes in equity of the Company inaccordance with the accounting principles generally accepted in India i Indian AccountingStandards (Ind AS) specified under Section 133 of the Act read with the Companies (IndianAccounting Standards) Rules 2015 as amended.
This responsibility also includes the maintenance of adequate accounting records inaccordance with the provision of the Act for safeguarding of the assets of the Company andfor preventing and detecting the frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial control that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe Ind AS Financial Statement that give a true and fair view and are free from materialmisstatement whether due to fraud or error.
In preparing the Ind AS Ind AS Financial Statement the management is responsible forassessing the Companys ability to continue as a going concern disclosing asapplicable matters related to going concern and using the going concern basis ofaccounting unless management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so. Those Board of Directors arealso responsible for overseeing the Companys financial reporting process.
Auditors Responsibilities for the audit of the Ind AS Ind AS Financial Statement
Our objectives are to obtain reasonable assurance about whether the Ind AS Ind ASFinancial Statement as a whole are free from material misstatement whether due to fraudor error and to issue an auditors report that includes our opinion. Reasonableassurance is a high level of assurance but is not a guarantee that an audit conducted inaccordance with SAs will always detect a material misstatement when it exists.Misstatements can arise from fraud or error and are considered material if individuallyor in the aggregate they could reasonably be expected to influence the economic decisionsof users taken on the basis of these Ind AS Ind AS Financial Statement.
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 Ind AS Ind AS FinancialStatement 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 to designaudit procedures that are appropriate in the circumstances. Under section 143(3)(i) of theAct we are also responsible for expressing our opinion on whether the Company hasadequate internal financial controls system in place and the operating effectiveness ofsuch controls.
Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by management.
Conclude on the appropriateness of managements use of the going concern basis ofaccounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on theCompanys ability to continue as a going concern. If we conclude that a materialuncertainty exists we are required to draw attention in our auditors report to therelated disclosures in the Ind AS Ind AS Financial Statement or if such disclosures areinadequate to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditors report. However future events or conditionsmay cause the Company to cease to continue as a going concern.
Evaluate the overall presentation structure and content of the Ind AS FinancialStatement including the disclosures and whether the Ind AS Financial Statement representthe underlying 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 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.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors Report) Order 2016 (theOrder) issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Act we give in the Annexure A a statement on the matters specified inthe paragraph 3 and 4 of the order.
2. As required by section 143(3) of the Act we report that: a) we have soughtand obtained all the information and explanations which to the best of our knowledge andbelief 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 thestatement of profit and loss including the statement of other comprehensive income thestatement of cash flows and Statement of Changes in Equity dealt with by this report arein agreement with the books of account.
d) in our opinion the aforesaid Ind AS Financial Statement comply with the IndianAccounting Standards specified under Section 133 of the Act read with the Companies(Indian Accounting Standards) Rules 2015 as amended
e) on the basis of written representations received from the directors as on 31 March2021 taken on record by the Board of Directors none of the directors is disqualified ason 31 March 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 over financialreporting of the company and the operating effectiveness of such controls refer to ourseparate report inAnnexure B.
g) In our opinion the managerial remuneration for the year ended 31stMarch 2021 has been paid / provided by the Company to its directors in accordance withthe provisions of Section 197 read with Schedule V of the Act;
h) with respect to the other matters to be included in Auditors Report in accordancewith Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinion and to thebest of our information and according to explanations given to us:
i. The Company does not have any pending litigations which would impact its financialposition;
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 R T Jain & Co. LLP
FRN : 103961W / W100182
(CA Bankim Jain)
Mem No. : 139447
UDIN : 21139447AAAAEO2435
Mumbai June 30 2021
Annexure A to the Independent Auditors Report
Referred to in paragraph 1 under the heading Report on Other Legal and RegulatoryRequirements of our report of even date on the accounts of the company for the yearended 31st March 2021
On the basis of such checks as we considered appropriate and according to theinformation and explanation given to us during the course of our audit we report that:
i. (a) The company has maintained proper records showing full particulars includingquantitative details and situation of its fixed assets.
(b) As explained to us fixed assets have been physically verified by the managementduring the year; no material discrepancies were noticed on such verification.
(c) Based on our audit procedures and the information and explanation received by usthe title deeds of property are held in the name of Company.
ii. (a) As explained to us inventories have been physically verified during the yearby the management at reasonable intervals.
(b) In our opinion and on the basis of our examination of the records no materialdiscrepancy was noticed on physical verification of stocks by the management as comparedto book records.
iii. According to the information and explanations given to us and on the basis of ourexamination of the books of account the Company has not granted any loans to itsassociate concern covered in the register maintained under section 189 of the CompaniesAct 2013.
iv. The Company has not given any loans made any investments or provided anyguarantee security under section 185 and 186 of the Companies Act 2013.
v. In our opinion the Company has not accepted any deposits within the meaning of Rule2 (b) of Companies (Acceptances of Deposits) Rules 2014.
vi. According to the information and explanations provided by the management costrecords have been prescribed under section 148(1) of the Companies Act 2013 in respect ofproducts of the Company. Those records have been properly maintained by the company.However cost audit has not been conducted.
vii. (a) According to the records of the company undisputed statutory dues includingProvident Fund Investor Education and Protection Fund Employees State InsuranceIncome-tax Sales-tax Service Tax Goods and Service Tax Custom Duty Excise Duty cessto the extent applicable and any other statutory dues have generally been regularlydeposited with the appropriate authorities. According to the information and explanationsgiven to us there are following outstanding statutory dues as on 31st of March2021 for a period of more than six months from the date they became payable.
|Particulars ||Amount (in Rs.) |
|Provident Fund ||1258966.00 |
|ESIC ||3519.00 |
|Profession Tax ||54775.00 |
|Income Tax ||30875385.00 |
|Dividend Distribution Tax ||2544192.00 |
|TDS & TCS ||4571030.00 |
|Interest on TDS ||38561.00 |
|Total ||39346428.00 |
(b) According to the information and explanations given to us there are followingamounts payable in respect of income tax service tax goods and service tax sales taxcustoms duty and excise duty which have not been deposited on account of any disputes.
|Nature of Statute ||Nature of Dues ||Forum where dispute is pending ||Period to which the amount relates ||Amount |
|Sales Tax Act and VAT Laws ||Sales Tax with interest and penalty ||Appellate Authority ||F Y 09-10 11-12 13-14 and 14-15 ||Rs. 94522670 |
viii. Based on our audit procedures and the information and explanations given by themanagement we are of the opinion that there has been no default in repayment of dues toany financial institution bank or debenture holders.
ix. Based on records of the company the company has not raised funds by IPO FPO orterm loan during the year. However the company had issued shares during the year 2018-19.The details of unutilised IPO proceeds as on 31/03/2021 are as follows :
|Particulars ||Proposed Utilisation ||Actual Utilisation ||Unutilised Amount |
|Part finance the working capital requirements ||70000000.00 ||70000000.00 ||- |
|Part repayment of High cost debt ||46711977.00 ||46711977.00 ||- |
|Capital Expenditure ||9507197.00 ||4318177.00 ||5189020.00 |
|General Corporate Purpose ||30000000.00 ||30000000.00 ||- |
|IPO Expenses ||21333125.00 ||21333125.00 ||- |
|Total ||177552299.00 ||172363279.00 ||5189020.00 |
x. Based on the audit procedures performed and the information and explanations givento us we report that no fraud on or by the Company has been noticed or reported duringthe year.
xi. According to information and explanations given to us in our opinion the companyhas paid managerial remuneration in accordance with the requisite approvals mandated bythe provisions of Section 197 read with Schedule V to the Companies Act 2013.
xii. The Company is not a nidhi company. Therefore the provision of this clause of theCompanies (Auditor's Report) Order 2016 is not applicable to the Company.
xiii. Based on our audit procedures and on the information given by the management thecompany has complied with the sections 177 and 188 of the Companies Act 2013 for all thetransactions with the related parties and the details of such transactions have beenproperly disclosed in the Ind AS Financial Statement as required by the applicableaccounting standards.
xiv. The Company has not made any preferential allotment of shares during the year toparties covered in register maintained under section 189 of the Companies Act 2013.
xv. The company has not entered into any non-cash transactions with directors of thecompany or its subsidiary or persons connected with them. xvi. The Company is not requiredto be registered under Section 45-IA of Reserve Bank of India Act 1934.
For R T Jain & Co LLP
FRN : 103961W / W100182
(CA Bankim Jain)
Mem No. : 139447
UDIN : 21139447AAAAEO2435
Mumbai June 30 2021
Annexure - B to the Independent Auditors Report
Referred to in paragraph 2(f) under the heading Report on Other Legal andRegulatory Requirements of our report of even date on the accounts of the companyfor the year ended 31st March 2021
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 (the Act)
We have audited the internal financial controls over financial reporting of SupremeEngineering Limited (Formerly known as Supreme Heatreaters Private Limited) (theCompany) as of March 31 2021 in conjunction with our audit of the Ind AS FinancialStatement of the Company for the year ended on that date. Managements Responsibilityfor Internal Financial Controls
The Companys 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 companys policies the safeguardingof its 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.
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 andprescribed under section 143(10) of the Companies Act 2013 to the extent applicable toan audit of internal financial controls both applicable to an audit of Internal FinancialControls and both issued by the Institute of Chartered Accountants of India. ThoseStandards and the Guidance Note require that we comply with ethical requirements and planand perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls over financial reporting was established and maintained and if suchcontrols operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting 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 auditors judgment including the assessment of the risks ofmaterial misstatement of the Ind AS Financial Statement 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 Companys internal financial controlssystem over 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 Ind AS Financial Statement for external purposes in accordance withgenerally accepted accounting principles. A company's internal financial control overfinancial reporting includes those policies and procedures that
(1) pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;
(2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of Ind AS Financial Statement in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorisations of management and directors of the company; and
(3) provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company's assets that could have amaterial effect on the Ind AS Financial Statement.
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.
In our opinion the Company has in all material respects an adequate internalfinancial controls system over financial reporting. However the Company does not haveformal written standard operating manuals or predefined standard operation procedure tomaintain the efficacy and effectiveness of the internal financial controls.
For R T Jain & Co LLP
FRN : 103961W/W100182
(CA Bankim Jain)
Mem No. : 139447
UDIN : 21139447AAAAEO2435
Mumbai June 30 2021