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Swaraj Engines Ltd.

BSE: 500407 Sector: Engineering
NSE: SWARAJENG ISIN Code: INE277A01016
BSE 00:00 | 19 Feb 1294.45 19.65
(1.54%)
OPEN

1267.00

HIGH

1309.95

LOW

1267.00

NSE 00:00 | 19 Feb 1283.00 6.80
(0.53%)
OPEN

1280.05

HIGH

1307.00

LOW

1280.00

OPEN 1267.00
PREVIOUS CLOSE 1274.80
VOLUME 672
52-Week high 2139.05
52-Week low 1256.35
P/E 18.77
Mkt Cap.(Rs cr) 1,570
Buy Price 1270.00
Buy Qty 1.00
Sell Price 1280.00
Sell Qty 10.00
OPEN 1267.00
CLOSE 1274.80
VOLUME 672
52-Week high 2139.05
52-Week low 1256.35
P/E 18.77
Mkt Cap.(Rs cr) 1,570
Buy Price 1270.00
Buy Qty 1.00
Sell Price 1280.00
Sell Qty 10.00

Swaraj Engines Ltd. (SWARAJENG) - Auditors Report

Company auditors report

To the Members of Swaraj Engines Limited

Report on the Financial Statements

We have audited the accompanying financial statements of Swaraj Engines Limited("the Company") which comprise the Balance Sheet as at 31st March 2018 andthe Statement of Profit and Loss (including Other Comprehensive Income) the Cash FlowStatement and the Statement of Changes in Equity for the year then ended and a summary ofthe significant accounting policies and other explanatory information.

Management's Responsibility for the 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 financial statements that give a true and fair view of the financial positionfinancial performance including other comprehensive income cash flows and changes inequity of the Company in accordance with the accounting principles generally accepted inIndia including the Indian Accounting Standards (Ind AS) prescribed under Section 133 ofthe Act read with the Companies (Indian Accounting Standards) Rules 2015 as amendedand other accounting principles generally accepted in India.

This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these financial statements based on ouraudit. In conducting our audit we have taken into account the provisions of the Act theaccounting and auditing standards and matters which are required to be included in theaudit report under the provisions of the Act and the Rules made thereunder.

We conducted our audit of the financial statements in accordance with the Standards onAuditing specified under Section 143(10) of the Act. Those Standards require that wecomply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the financial statements. The procedures selected depend on theauditor's judgment including the assessment of the risks of material misstatement of thefinancial statements whether due to fraud or error. In making those risk assessments theauditor considers internal financial control relevant to the Company's preparation of thefinancial statements that give a true and fair view in order to design audit proceduresthat are appropriate in the circumstances. An audit also includes evaluating theappropriateness of the accounting policies used and the reasonableness of the accountingestimates made by the Company's Directors as well as evaluating the overall presentationof the financial statements.

We believe that the audit evidence obtained by us is sufficient and appropriate toprovide a basis for our audit opinion on the financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by the Actin the manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at 31stMarch 2018 its profit total comprehensive income its cash flows and the changes inequity for the year ended on that date.

Report on Other Legal and Regulatory Requirements

As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government in terms of Section 143(11) of the Act we give in"Annexure A" a statement on the matters specified in paragraphs 3 and 4 of theOrder.

As required by Section 143(3) of the Act based on our audit on the separate financialstatements to the extent applicable 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 Cash Flow Statement and Statement of Changes in Equity dealt with by thisReport are in agreement with the relevant books of account.

d) In our opinion the aforesaid financial statements comply with the Indian AccountingStandards prescribed under Section 133 of the Act read with relevant rules issuedthereunder.

e) On the basis of the written representations received from the directors as on 31stMarch 2018 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 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 controls overfinancial 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 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 2.3 to the financial statements);

(ii) The Company did not have any long-term contracts including derivative contractsfor which there were any material foreseeable losses;

(iii) There were no delay in transferring amounts required to be transferred to theInvestor Education and Protection Fund by the Company during the year.

For B.K. KHARE & CO.

Chartered Accountants

Firm Registration No. 105102W

PADMINI KHARE KAICKER

Partner

Membership No. 044784

Mumbai April 23 2018

ANNEXURE – A TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 1 under 'Report on Other Legal and Regulatory Requirements'section of our report of even date)

(i) In respect of its Fixed Assets:

a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.

b) The fixed assets have not been physically verified by the management during the yearbut the Company has a system of periodic verification of fixed assets. In our opinion thefrequency of verification is at reasonable intervals considering the size of the Company.

c) The title deeds of immovable properties are held in the name of the Company.

(ii) In respects of Inventory:

a) The stocks of finished goods stores spare parts and raw materials of the Companyin its possession have been physically verified by the management at reasonable period.Stock-in-transit as on 31st March 2018 has been verified by the management on subsequentreceipt of the goods.

b) In our opinion the procedures of physical verification of stocks followed by themanagement were reasonable and adequate in relation to the size of the Company and natureof its business.

c) The company is maintaining proper records for inventory and discrepancies betweenthe physical stocks and the book stocks which have been properly dealt with in the booksof account were not material.

(iii) The Company has not granted any loans secured or unsecured to companies firmsLimited Liability Partnerships or other parties covered in the register maintained underSection 189 of the Companies Act 2013.

(iv) In our opinion and according to the information and explanations given to us thecompany has complied with the provisions of Sections 185 and 186 of the Companies Act2013 in respect of loans investments guarantees and security.

(v) The Company has not accepted any deposits from the public and hence the directivesissued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any otherrelevant provisions of the Act and the Companies (Acceptance of Deposit) Rules 2015 withregard to the deposits accepted from the public are not applicable.

(vi) On the basis of information given to us we are of the opinion that prima faciethe cost records and accounts prescribed by the Central Government of India underSub-section(1) of Section 148 of the Companies Act 2013 have been maintained. Howeverwe are not required to and have not carried out any detailed examination of such accountsand records.

(vii) According to the information and explanations given to us in respect ofstatutory dues:

(a) The Company has been generally regular in deposit in gun disputed statutory duesincluding Provident Fund Employees' State Insurance Income-Tax Sales Tax Customs DutyExcise Duty Value Added Tax Cess Goods and Service tax and other material statutorydues applicable to it to the appropriate authorities.

(b) There were no undisputed amounts payable in respect of Provident Fund Employees'State Insurance Income- Tax Sales Tax Service Tax Customs Duty Excise Duty ValueAdded Tax Cess Goods and Services Tax and other material statutory dues in arrears as atMarch 31 2018 for a period of more than six months from the date they became payable.

(c) The details of dues of Income Tax & Excise duty which have not been depositedas on March 31 2018 on account of disputes are given below :

(Rs. in Lakhs)
Statute Nature Forum where dispute is pending Period to which the Amount relates Amount involved
Central Excise Act 1944 Excise Duty Appellate Authority - Tribunal Level F.Y. 2004-05 to F.Y. 2009-10 180.34
Income Tax Act 1961 Income Tax High Court Assessing Officer A.Y. 1997-98 and A.Y. 2003-04 471.52

(viii) In our opinion and according to the information and explanations given to usthe Company has not defaulted in the repayment of dues to Banks Financial Institutionsand Government or debenture holders.

(ix) The Company has not raised moneys by way of initial public offer or further publicoffer (including debt instruments} or term loans and hence reporting under clause 3 (ix)of the Order are not applicable to the Company and not commented upon.

(x) To the best of our knowledge and according to the information and explanationsgiven to us no fraud by the Company or on the Company by its officers or employees hasbeen noticed or reported during the year.

(xi) Based upon the audit procedures performed and the information and explanationsgiven by the management the managerial remuneration has been paid or provided inaccordance with the requisite approvals mandated by the provisions of section 197 readwith Schedule V to the Companies Act.

(xii) The Company is not a Nidhi Company and hence reporting under Clause 3 (xii) ofthe Order is not applicable to the Company.

(xiii) In our opinion and according to the information and explanations given to us theCompany is in compliance with Sections 177 and 188 of the Companies Act 2013 whereapplicable for all transactions with the related parties and the details of related partytransactions have been disclosed in the financial statements as required by the applicableaccounting standards.

(xiv) During the year the Company has not made any preferential allotment or privateplacement of shares or fully or partly Convertible debentures and hence reporting underClause 3 (xiv) of the Order is not applicable to the Company.

(xv) In our opinion and according to the information and explanations given to usduring the year the Company has not entered into any non-cash transactions with itsdirectors or persons connected with him. Accordingly the provisions of Clause 3 (xv) ofthe Order are not applicable to the Company and hence not commented upon.

(xvi) In our opinion the Company is not required to be registered under Section 45-1of the Reserve Bank of India Act 1934 and accordingly the provisions of Clause 3 (xvi)of the Order are not applicable to the Company and hence not commented upon.

For B.K. KHARE & CO.

Chartered Accountants

Firm Registration No. 105102W

PADMINI KHARE KAICKER

Partner

Membership No. 044784

Mumbai April 23 2018

ANNEXURE– B TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph "f" under 'Report on Other Legal and RegulatoryRequirements' section of our report of even date)

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 SwarajEngines Limited ("the Company") as of March 31 2018 in conjunction with ouraudit of the 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. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessthe safeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Companies Act 2013.

Auditor's 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") issued by the Institute of Chartered Accountants of Indiaand the Standards on Auditing prescribed under Section 143(10) of the Companies Act 2013to the extent applicable to an audit of internal financial controls. Those Standards andthe Guidance Notes require that we comply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whether adequate internal financialcontrols over financial reporting was established and maintained and if such controlsoperated 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 whether the risk of a material weakness exists and testing and evaluating thedesign and operating effectiveness of internal control based on the assessed risk. Theprocedures selected depend on the auditor's judgement including the assessment of therisks of material 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 authorizations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorized 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 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 2018 based on "the internalcontrol over financial reporting criteria established by the Company considering theessential components of internal control stated in the Guidance Note on Audit of InternalFinancial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India".

For B.K. KHARE & CO.

Chartered Accountants

Firm Registration No. 105102W

PADMINI KHARE KAICKER

Partner

Membership No. 044784

Mumbai April 23 2018