The Members of
SURAJ PRODUCTS LIMITED
Reports on the Financial Statements
We have audited the accompanying IndAS Financial Statementsof "M/S. SURAJ PRODUCTSLIMITED" (the "Company") which comprise of the Balance Sheet as at 31stMarch 2020 the related Statement of Profit and Loss (including Other ComprehensiveIncome) and the Cash Flow Statement for the year ended and the statement of changes inequity for the year then ended and a summary of significant accounting policies and otherexplanatory information which we have signed under reference to this report.
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Ind AS financial statements give the information required bythe Act in the manner so required and give a true and fair view in conformity with the IndAS and accounting principles generally accepted in India of the state of affairs of theCompany as at March 31 2020 and profit total comprehensive income the changes inequity and its cash flows for the year ended on that date.
Basis for Opinion
We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Companies Act 2013. Our responsibilities under thoseStandards are further described in the Auditor's Responsibilities for the Audit of theFinancial Statements section of our report. We are independent of the Company inaccordance with the Code of Ethics issued by the Institute of Chartered Accountants ofIndia together with the ethical requirements that are relevant to our audit of the Ind ASfinancial statements under the provisions of the Companies Act 2013 and the Rulesthereunder and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the Code of Ethics. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key Audit Matters are those matters that in our professional judgement were of mostsignificance in our audit of the Ind AS financial statements of the current period. Thesematters were addressed in the context of our audit of the Ind AS financial statements as awhole and informing our opinion thereon and we do not provide a separate opinion onthese matters. We have determined the matters described below to be the key audit mattersto be communicated in our report.
|Sl. No. Key Audit Matter ||Auditor's Response |
|1 Evaluation of uncertain tax positions ||Principal Audit Procedures |
|The Company has material uncertain tax positions including matters under dispute which involves significant judgment to determine the possible outcome of these disputes. ||Our procedure included amongst others assessing the appropriateness of management's assumptions and estimates in relation to uncertain tax positions challenging those assumptions and considering advice received by management from external parties to support their position. We have involved our tax specialists to consider management's assessment of the tax positions and related provision/liability accruals when necessary. We concur with management estimates and the outcome of their procedures to determine the relevant provision/ liability. |
Information Other than the Financial Statements and Auditor's Report Thereon
The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the Management Discussion and AnalysisBoard's Report including Annexure to Board's Report Business Responsibility ReportCorporate Governance and Shareholder's Information but does not include the financialstatements 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 misstated. If based on the work we haveperformed we conclude that there is a material misstatement of this other information weare required to report that fact. We have nothing to report in this regard.
Responsibilities of Management and those charged with governance for the Ind ASfinancial 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 Ind AS financial statements that give a true and fair view of the financialposition financial performance including other comprehensive income change in equity andcash flows of the Company in accordance with the Indian Accounting Standards (Ind AS) andaccounting principles generally accepted in India specified under section 133 of the Actread with the Companies (Indian Accounting Standards) Rules 2015 as amended. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding of the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateimplementation 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 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 financial statements management is responsible for assessingthe Company'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 Ind AS Financial Statement
Our objectives are to obtain reasonable assurance about whether the Ind AS financialstatements as a whole are free from material misstatement whether due to fraud or errorand to issue an auditor's report that includes our opinion. Reasonable assurance is a highlevel of assurance but is not a guarantee that an audit conducted in accordance with SAswill always detect a material misstatement when it exists. Misstatements can arise fromfraud or error and are considered material if individually or in the aggregate theycould reasonably be expected to influence the economic decisions of users taken on thebasis of these Ind AS 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 Ind AS financialstatements whether due to fraud or error design and perform audit procedures responsiveto those risks and obtain audit evidence that is sufficient and appropriate to provide abasis for our opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error as fraud may involve collusionforgery intentional omissions misrepresentations or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to designaudit procedures that are appropriate in the circumstances. Under section 143(3)(i) of theCompanies Act 2013 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 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 Ind AS 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 Ind AS financialstatements including the disclosures and whether the Ind AS financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.
Materiality is the magnitude of misstatements in the financial statements thatindividually or in aggregate makes it probable that the economic decisions of areasonably knowledgeable user of the financial statements may be influenced. We considerquantitative materiality and qualitative factors in
(i) planning the scope of our audit work and in evaluating the results of our work; and
(ii) to evaluate the effect of any identified misstatements in the financialstatements.
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 Ind AS financial statements ofthe current period and are therefore the key audit matters. We describe these matters inour auditor's report unless law or regulation precludes public disclosure about the matteror when in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverseconsequences of doing so would reasonably beexpected 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) Order 2016 ("The Order")issued by the Central Government of India in terms of sub-section (11) of Section 143 ofthe Companies Act 2013 we give in the Annexure-A a statement on the matters specified inParagraphs 3 and 4 of the Order.
2. As required by Section 143(3) of the Companies Act 2013 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 appears from our examination of those books;
c) The Balance Sheet the Statement of Profit and Loss and the Cash Flow Statement andthe Statement of Changes in Equity dealt with by this report are in agreement with thebooks of account;
d) In our opinion the aforesaid Ind AS financial statements comply with the IndianAccounting Standards specified under Section 133 of the Act.
e) On the basis of written representations received from the directors as on 31stMarch 2020 and taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2020 from being appointed as a director in terms ofsub-section (2) of Section 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";
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(16) of the Act
h) With respect to the other matters included in the Auditor's Report in accordancewith Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinion and to thebest of our knowledge and information and according to the explanation given to us:-
i) The Company has disclosed the impact of pending litigations on its financialposition in its Ind AS Financial Statements - Refer Note 33 to the Ind AS FinancialStatements;
ii) The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.
iii) There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company
| ||For B D S & Co. |
| ||(Formerly Bharat D Sarawgee& Co.) |
| ||Chartered Accountants |
| ||Firm Registration No. 326264E |
| ||(Bharat D Sarawgee) |
|Place: Kolkata ||Partner |
|Date: 29th day of June 2020 ||Membership No.: 061505 |
Annexure - A to the Auditors' Report
ADDITIONAL INFORMATION ANNEXED TO THE INDEPENDENT AUDITORS' REPORT
As required by the Companies (Auditor's Report) Order 2016 issued by the Company LawBoard in terms of section 143(11) of the Companies Act 2013 and on the basis of suchchecks as we considered appropriate and as per the information and explanations given tous during the course of audit we further state 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 bywhich fixed assets are verified in a phased manner over a period of three years. Inaccordance with this programme certain fixed assets were verified during the year and nomaterial discrepancies were noticed on such verification. In our opinion this periodicityof physical verification is reasonable having regard to the size of the Company and thenature of its assets.
(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 areheld in the name of the Company.
(ii) According to information and explanation given to us the stocks have beenphysically verified during the year by the management. In our opinion the frequency ofverification is reasonable.According to the information and explanations given to us nomaterial discrepancies were noticed on such verification.
(iii) In respect of loans secured or unsecured granted by the Company to companiesfirms Limited Liability Partnerships or other parties covered in the register maintainedunder section 189 of the Companies Act 2013 according to the information and explanationgiven to us:
a) The company hasnot granted any secured/ unsecured loans& advances to companiesfirms Limited Liability Partnerships & other partiescovered in the registermaintained under section 189 of the Companies Act 2013. Accordingly paragraph 3(iii) ofthe Order is not applicable.
(iv) In our opinion and as per the information & explanations given to us theCompany has not given any loans during the year and hence the provisions of Section 185and 186 of the Act are not applicable to the company.
(v) In our opinion and according to the information and explanations given to us theCompany has not accepted any deposits. Hence the directives issued by the Reserve Bank ofIndia and provisions of sections 73 to 76 or any other relevant provisions of theCompanies Act and the rules framed there under are not applicable to the company.
(vi) In our opinion and based on the information and explanation given to us theCentral Government of India has not prescribed the maintenance of cost records under u/s148 (1) of the Companies Act for any of the products of the company.
(vii) The company is regular in depositing with appropriate authorities undisputedstatutory dues including provident fund employee state insurance income tax sales taxservice tax excise duty cess and other material statutory dues applicable to it.
a) According to the information and explanations given to us no undisputed amountspayable in respect of income tax provident fund employee state insurance sales taxexcise duty and other material statutory dues were in arrears as at 31stMarch 2020 for a period of more than six months from the date they became payable.
b) According to information and explanation given to us there are no disputed dues ofSales Taxes Entry Tax and Excise Duty which has not been deposited. The particulars ofdues of Income Tax which has not yet been deposited on account of dispute are as follows:
|Name of Statute ||Nature of Dues ||Amount in Rs. ||Period to which the amount relates to ||Forum where the dispute is pending |
|The Orissa Sales Tax Act 1947 ||Dispute regarding ITC ||368720 ||2005-2006 to 2007-2008 ||Sales Tax Tribunal Odisha Cuttack |
|The Orissa Sales Tax Act 1947 ||Dispute regarding ITC ||539432 ||01.10.2008 to 31.03.2012 ||Sales Tax Tribunal Odisha Cuttack |
|The Orissa Entry Tax Rules 1999 ||Entry Tax on Inter-State Purchases ||970000 ||2002-2003 to 2003-2004 ||Dy. Commissioner (Appeals) Sundargarh Range Rourkela |
|The Orissa Entry Tax Rules 1999 ||Entry Tax on Inter-State Purchases ||210378 ||01.10.2008 to 31.03.2012 ||Sales Tax Tribunal Odisha Cuttack |
|The Orissa Entry Tax Rules 1999 ||Entry Tax on Inter-State Purchases ||1064589 ||01.04.2013 to 31.03.2015 ||Additional. Commissioner Sales Tax (Appeals) Rourkela |
|Central Sales Tax1956 ||Non- submission of C- Form Declaration ||311693 ||2004-2005 ||Additional. Commissioner Sales Tax (Appeals) Rourkela |
|Central Sales Tax1956 ||Non- submission of C- Form Declaration ||178849 ||2008- to 2012 ||Sales Tax Tribunal Odisha Cuttack |
|Income Tax Act 1961 ||Reopening Proceedings U/s 147 ||1701300 ||2011-2012 ||Commissioner of Income Tax (Appeals) |
(viii) Based on our audit procedures and on the according to the information andexplanations given by the management we are of the opinion that the company has notdefaulted in repayment of dues to financial institutions and bank. The company does nothave any borrowings by way of debentures.
(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 we report that nomaterial fraud by the company or on the company by its officers or employees has beennoticed or reported during the course of our audit.
(xi) In our opinion and according to the information and explanation given to us andbased on the examination of records of the company managerial remuneration has been paid/provided in accordance with the requisite approvals mandated by the provisions of Section197 read with Schedule V of the Companies Act.
(xii) In our opinion and according to the information and explanation 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 all transactions withrelated parties are in compliance with Section 177 & 188 of the Companies Act and thedetails have been disclosed in the Financial Statements etc. as required by theapplicable accounting 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 private placement orpreferential allotment of shares or fully or partly convertible debentures during the yearunder review.
(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.
Annexure - B to the Auditors' Report
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 M/s.SurajProducts Limited ("the Company") as of 31 March 2020 in conjunction with ouraudit of the Ind AS financial statements of the Company for the year ended on that date.
Management's Responsibility for Internal Financial Controls
The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls over Financial Reportingissued by the Institute of Chartered Accountants of India ('ICAI'). These responsibilitiesinclude the design implementation and maintenance of adequate internal financial controlsthat were operating effectively for ensuring the orderly and efficient conduct of itsbusiness including adherence to company's policies the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired 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 and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material respects.
Our 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 financialreporting 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 financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorizations of management and directors of the company; and
(3) provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the company's assets that could have amaterial effect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.
In our opinion the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at 31 March 2020 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.