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SVC Industries Ltd.

BSE: 524488 Sector: Industrials
NSE: ATVPETRO ISIN Code: INE038B01010
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NSE 05:30 | 01 Jan SVC Industries Ltd
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VOLUME 14788
52-Week high
52-Week low
P/E
Mkt Cap.(Rs cr) 12
Buy Price 0.76
Buy Qty 20212.00
Sell Price 0.00
Sell Qty 0.00
OPEN 0.76
CLOSE 0.76
VOLUME 14788
52-Week high
52-Week low
P/E
Mkt Cap.(Rs cr) 12
Buy Price 0.76
Buy Qty 20212.00
Sell Price 0.00
Sell Qty 0.00

SVC Industries Ltd. (ATVPETRO) - Auditors Report

Company auditors report

TO THE MEMBERS OF SVC INDUSTRIES LIMITED

(Formerly known as SVC Superchem Limited)

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS financial statements of SVCINDUSTRIES LIMITED (Formerly known as SVC Superchem Limited) ("the Company")which comprise the Balance Sheet as at 31st March 2018 the Statement of Profit and Loss(including other comprehensive income) the Cash Flow Statement and the Statement ofChanges in Equity for the year then ended and a summary of the significant accountingpolicies and other explanatory information (herein after referred to as "StandaloneInd AS Financial Statement").

Management's Responsibility for the Standalone Ind AS 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 Ind AS financial statements that give a true and fair view of thefinancial position financial performance including other comprehensive income cash flowsand changes in equity of the Company in accordance with the accounting principlesgenerally accepted in India including the Indian Accounting Standard (Ind AS) prescribedunder Section 133 of the Act read with relevant rules issued thereunder.

This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding of the assets of the Companyand for preventing and detecting 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 controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe standalone Ind AS financial statements that give a true and fair view and are freefrom material misstatement whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these standalone Ind AS financialstatements based on our audit.

We have taken into account the provisions of the Act the accounting and auditingstandards and matters which are required to be included in the audit report under theprovisions of the Act and the Rules made thereunder.

We conducted our audit of the standalone Ind AS financial statements in accordance withthe Standards on Auditing specified under Section 143(10) Act. Those Standards requirethat we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether the standalone Ind AS financial statements are freefrom material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the standalone Ind AS financial statements. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the standalone Ind AS financial statements whether due to fraud or error.In making those risk assessments the auditor considers internal financial controlrelevant to the Company's preparation of the standalone Ind AS financial statements thatgive a true and fair view in order to design audit procedures that are appropriate in thecircumstances. An audit also includes evaluating the appropriateness of accountingpolicies used and the reasonableness of the accounting estimates made by the Company'sDirectors as well as evaluating the overall presentation of the standalone Ind ASfinancial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the standalone Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone Ind AS financial statements give the informationrequired by the Act in the manner so required and give a true and fair view in conformitywith the accounting principles generally accepted in India including Ind AS of thefinancial position of the Company as at 31st March 2018 and its financial performanceincluding other comprehensive income its cash flows and the changes in equity for theyear ended on that date.

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 Section 143(11) of the Act we givein the "Annexure A" a statement on the matters specified in paragraphs 3 and 4of the said Order to the extent applicable.

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

a) We have sought and obtained all the information and explanations which to the bestof our knowledge and belief were necessary for the purpose 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 the statement of cash flows andthe statement of change in equity dealt with by this Report are in agreement with thebooks of account;

d) In our opinion the aforesaid standalone Ind AS financial statements comply with theAccounting Standards specified under Section 133 of the Act read with relevant ruleissued thereunder;

e) On the basis of the written representations received from the directors as on 31stMarch 2018 and taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2018 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"; and g) With respect to the other matters to beincluded in the Auditor's Report in accordance with Rule 11 of the Companies (Audit &Auditors) Rules 2014 in our opinion and to the best of our information and according tothe explanations given to us:

(I) The Company has disclosed the impact of pending litigations on its financialposition in its standalone Ind AS financial statements Refer Note 12a to 12e 23 25 and29 to the standalone Ind AS financial statements;

(ii) There are no foreseeable losses on any long term contract including derivativecontract as required under applicable law or accounting standards;

(iii)According to records of the company there are no amounts that are due to betransferred to the Investor Education and Protection Fund in accordance with the relevantprovisions of the Act and rules made there under.

For CHATURVEDI SK & FELLOWS

Chartered Accountants

Firm Registration No. 112627W

Srikant Chaturvedi

Partner

Membership No. 070019

Place: Mumbai.

Date: 02/06/2018

ANNEXURE A TO THE INDEPENDENT AUDITORS' REPORT

The Annexure referred to in Paragraph 1 under the heading of 'Report on Other Legal andRegulatory Requirements' of our report of even date on the financial statements of SVCINDUSTRIES LIMITED (Formerly known as SVC Superchem Limited) for the year ended 31st March2018.

1. (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. In accordance with this programmecertain fixed assets were verified during the year and no material discrepancies except asmentioned in Note No. 24 of notes forming part of financial statement were noticed onsuch verification. In our opinion this periodicity of physical verification is reasonablehaving regard to the size of the Company and the nature of its assets.

(c) According to the information and explanations given to us and on the basis of ourexamination of records of the Company the title deeds of immovable properties are held inthe name of the Company for 236.83 acres and in the name of some of the present andearlier directors for 24.14 acres.

2. According to the information given to us physical verification of inventory wasconducted by the management during the year at reasonable intervals. According to theinformation and explanations given to us no material discrepancies were noticed onphysical verification of inventories.

3. The Company has not granted any loans secured and unsecured to companies firms orother parties listed in the register maintained under Section 189 of the Companies Act2013. Accordingly paragraphs 3(iii)(a) (b) and (c) of the Order are not applicable.

4. The Company has not given loans investments guarantees and security. AccordinglyParagraph 3(iv) of the Order is not applicable.

5. In our opinion and according to the information and explanations given to us theCompany has not accepted any deposits from the public. The provisions of Sections 73 to 76of the Companies Act 2013 and the rules framed thereunder are not applicable.

6. Maintenance of cost records under Section 148(1) of the Act as prescribed by theCentral Government is not applicable to the Company as the Company is yet to startcommercial production.

7. (a) According to the information and explanations given to us and on the basis ofour examination of records of the Company the Company is regular in depositing undisputedstatutory dues including Provident Fund Employees' State Insurance Income-tax ValueAdded Tax Service-tax Goods and Service tax and other material statutory dues applicableto the Company with the appropriate authorities.

(b) The disputed statutory dues aggregating to Rs. 22.71 lakhs that have not beendeposited on account of disputed matters pending before appropriate authorities. Out ofthe above a sum of Rs. 2.63 lakh has been deposited under protest. The details ofdisputed statutory dues are as under:

Nature of dues Period Amount Rs. in Lakhs Forum where dispute is pending
UP Value Added Tax 2007-08 0.82 Appellate Tribunal Agra
UP Value Added Tax 2008-09 1.81 Appellate Tribunal Agra
Provident Fund / Demurrage 1995-2003 20.08 Allahabad
22.71 High Court

8. Due to non-commencement of commercial operations for more than a decade causingnon-servicing of its debts the Company has defaulted on the dues of State Bank of India(NCD of Rs. 15.00 Crore) Canara Bank (NCD of Rs. 14.72 Crore) & PICUP (Loan of Rs.26.38 Crore) for aggregate amount of Rs. 56.10 Crore. Company is in negotiations forsettlement of their dues.

9. According to the information and explanation provided to us Company has not raisedmoney by way of initial public offer or further public offer (including debt instruments)and term loans during the year. Accordingly paragraph 3(ix) of the Order is notapplicable.

10. 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.

11. According to the information and explanations given to us the Company has not paidmanagerial remuneration during the year. Accordingly paragraph 3(xi) of the Order is notapplicable.

12. 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.

13. According to the information and explanations given to us and based on ourexamination of records of the Company transactions with related parties are in compliancewith Sections 177 and 188 of the Act where applicable and details of such transactionshave been disclosed in the financial statements as required by the applicable accountingstandards.

14. According to the information and explanations given to us and based on ourexamination of records of the Company the Company has not made any preferential allotmentor private placement of shares or fully or partly convertible debentures during the year.

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

16. According to the information and explanations given to us the Company is notrequired to register under Section 45-IA of the Reserve Bank of India Act 1934.

For CHATURVEDI SK & FELLOWS

Chartered Accountants

Firm Registration No. 112627W

Srikant Chaturvedi

Partner

Membership No. 070019

Place: Mumbai.

Date: 02/06/2018

Annexure B to the Auditors' Report

Report on the Internal Financial Controls under Clause (f) of Sub-Section 3 of Section143 of the Companies Act 2013 ('the Act')

We have audited the internal financial Controls over financial reporting of SVCINDUSTRIES LIMITED (Formerly known as SVC Superchem Limited) ('the Company') as of 31stMarch 2018 in conjunction with our audit of the financial statements of the Company forthe year ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for the 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 the Company's policies the safeguarding of its assetsthe prevention 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.

Auditors' Responsibility

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 judgement 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 ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; (2)provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the company are being made only in accordance with authorisations 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.

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.

Opinion

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 March 31 2018 based on"the internal control over financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls Over Financial Reporting issued by the Institute ofChartered Accountants of India".

For CHATURVEDI SK & FELLOWS

Chartered Accountants

Firm Registration No. 112627W

Srikant Chaturvedi

Partner

Membership No. 070019

Place: Mumbai.

Date: 02/06/2018