You are here » Home » Companies » Company Overview » Torrent Pharmaceuticals Ltd

Torrent Pharmaceuticals Ltd.

BSE: 500420 Sector: Health care
NSE: TORNTPHARM ISIN Code: INE685A01028
BSE 00:00 | 20 Mar 1869.30 -1.65
(-0.09%)
OPEN

1867.60

HIGH

1882.75

LOW

1860.50

NSE 00:00 | 20 Mar 1867.90 5.00
(0.27%)
OPEN

1873.85

HIGH

1880.00

LOW

1855.25

OPEN 1867.60
PREVIOUS CLOSE 1870.95
VOLUME 5379
52-Week high 1960.00
52-Week low 1223.75
P/E 39.50
Mkt Cap.(Rs cr) 31,632
Buy Price 1860.00
Buy Qty 51.00
Sell Price 1880.00
Sell Qty 40.00
OPEN 1867.60
CLOSE 1870.95
VOLUME 5379
52-Week high 1960.00
52-Week low 1223.75
P/E 39.50
Mkt Cap.(Rs cr) 31,632
Buy Price 1860.00
Buy Qty 51.00
Sell Price 1880.00
Sell Qty 40.00

Torrent Pharmaceuticals Ltd. (TORNTPHARM) - Auditors Report

Company auditors report

TO THE MEMBERS OF

TORRENT PHARMACEUTICALS LIMITED

Report on the Audit of the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS financial statements of TorrentPharmaceuticals Limited ("the Company") which comprise the Balance Sheet as at31st March 2018 the Statement of Profit and Loss the Statement of Changes in Equity andthe Statement of Cash Flows for the year then ended and summary of the significantaccounting policies and other explanatory information (herein after referred to as"standalone Ind3AS financial statements").

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 the stateof affairs Profit (including other comprehensive income) changes in equity and cash 3owsof the Company in accordance with the accounting principles generally accepted in Indiaincluding the Indian Accounting Standards (Ind AS) prescribed under section 133 of theAct.

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 of theaccounting records relevant to the preparation and presentation of the standalone Ind ASfinancial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

In preparing the financial statements management is responsible for assessing theCompany'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.

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 speci3ed under Section 143(10) of the Act. Those Standardsrequire that 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 the 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 are also responsible to conclude on the appropriateness of management's use of thegoing concern basis of accounting and based on the audit evidence obtained whether amaterial uncertainty exists related to events or conditions that may cast significantdoubt on the entity's ability to continue as a going concern. If we conclude that amaterial uncertainty exists we are required to draw attention in the auditor's report tothe related disclosures in the financial statements or if such disclosures areinadequate to modify the opinion. Our conclusions are based on the audit evidenceobtained up to the date of the auditor's report. However future events or conditions maycause an entity to cease to continue as a going concern.

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 of the state of affairs of theCompany as at 31st March 2018 its Profit (including other comprehensive income) changesin equity and its cash 3ows for the year ended on that date.

Other Matters

The audited standalone Ind AS financial statements of the Company for the correspondingyear ended 31st March 2017 prepared in accordance with Ind AS included in thesestandalone Ind AS financial statements have been audited by the predecessor auditorswhose audit report dated 26th May 2017 expressed an unModified opinion on those auditedstandalone Ind AS financial statements. Our opinion is not Modified in respect of thesematter.

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 in terms of Section 143(11) of the Act we give in"Annexure A" a statement on the matters speci3ed in paragraphs 3 and 4 of theOrder.

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 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 the Cash Flow Statement andStatement of Changes in Equity dealt with by this Report are in agreement with the booksof account.

(d) In our opinion the aforesaid standalone Ind AS financial statements comply withthe Indian Accounting Standards prescribed under section 133 of the Act.

(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 with reference tofinancial statements of the Company and the operating effectiveness of such controlsrefer to our separate Report in "Annexure B".

(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 the best of our information and according to the 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 41 to thestandalone Ind AS financial statements;

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;

iv. The disclosures in the financial statements regarding holdings as well as dealingsin speci3ed bank notes during the period from 8th November 2016 to 30th December 2016have not been made since they do not pertain to the financial year ended 31st March 2018.

For B S R & Co. LLP
Chartered Accountants
(Firm's Registration No. 101248W/W-100022)
Jamil Khatri
Ahmedabad Partner
30th May 2018 Membership No. 102527

ANNEXURE A TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in our report of even date)

(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of 3xed assets.

(b) The Company has a regular programme of physical veri3cation of its 3xed assets bywhich 3xed assets are veri3ed by the management in a phased manner over a period of threeyears. In accordance with this programme certain 3xed assets were veri3ed during the yearand no material discrepancies were noticed on such veri3cation. In our opinion thisperiodicity of physical veri3cation is reasonable having regard to the size of the Companyand the nature of its assets.

(c) According to the information and explanations given to us and the records examinedby us and based on the examination of the registered sale deed / transfer deed /conveyance deed provided to us we report that the tittle deeds of immovable propertiesare held in the name of the Company. Immovable properties of land and building whosetittle have been pledged as security for loans are held in the name of the Company basedon the con3rmations received from parties. In respect of immovable properties of land andbuildings that have been taken on lease and disclosed as 3xed asset in the financialstatements the lease agreements are in the name of the Company where the Company is thelessee in the agreement.

(ii) The inventory has been physically veri3ed by the management during the year. Inour opinion the frequency of such veri3cation is reasonable. The discrepancies noticed onveri3cation between the physical stocks and the book records were not material and havebeen appropriately dealt with in the books of accounts.

(iii) According to the information and explanations given to us the Company has notgranted any loans secured or unsecured to companies 3rms limited liabilitypartnerships or other parties covered in the register maintained under Section 189 of theAct. Accordingly paragraphs 3 (iii) (a) (b) and (c) of the Order are not applicable tothe Company.

(iv) In our opinion and according to the information and explanations given to us theCompany has not granted any loans or provided any guarantees or security to the partiescovered under Section 185 of the Act during the year. The Company has complied with theprovisions of Section 186 of the Act in respect of grant of loans making investments andproviding guarantees and securities as applicable.

(v) In our opinion and according to the information and explanations given to us theCompany has not accepted any deposits from the public in accordance with the provisions ofsection 73 to 76 or any other relevant provisions of the Act and the rules framed thereunder. Accordingly paragraph 3(v) of the Order is not applicable to the Company.

(vi) We have broadly reviewed the records maintained by the Company pursuant to therules prescribed by the Central Government for maintenance of cost records undersub-section 1 of section 148 of the Act and are of the opinion that prima facie theprescribed accounts and records have been made and maintained. However we have not made adetailed examination of the records with a view to determine whether they are accurate orcomplete.

(vii) (a) According to the information and explanations given to us and on the basis ofour examination of the records of the Company amounts deducted/accrued in the books ofaccount in respect of undisputed statutory dues including Provident Fund Employees' StateInsurance Income-Tax Sales-Tax Service Tax Goods and Service Tax Duty of CustomsDuty of Excise Value Added Tax Cess and other material statutory dues have beengenerally regularly deposited during the year by the Company with the appropriateauthorities.

According to the information and explanations given to us no undisputed amountspayable in respect of Provident Fund Employees' State Insurance Income-Tax Sales-TaxService Tax Goods and Service Tax Duty of Customs Duty of Excise Value Added Tax Cessand other material statutory dues were in arrears as at 31st March 2018 for a period ofmore than six months from the date they became payable.

(b) According to the information and explanations given to us there are no dues ofIncome-tax Sales tax Service tax Goods and Service Tax Duty of customs Duty ofexcise Value added tax and Cess as at 31st March 2018 which have not been depositedwith the appropriate authorities on account of any dispute other than those mentioned inEnclosure I to this report.

(viii) In our opinion and according to the information and explanations given to usthe Company has not defaulted in repayment of dues to its bankers government financialinstitution and its debenture holders.

(ix) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not raised any money by way ofinitial public offer further public offer (including debt instruments) during the year.In our opinion and according to information and explanations given to us the term loanshave been applied by the Company during the year for the purposes for which they wereraised.

(x) According to the information and explanations given to us no fraud by the Companyor on the Company by its officers or employees has been noticed or reported during theyear.

(xi) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has paid/provided for managerialremuneration in accordance with the requisite approvals mandated by the provisions ofSection 197 read with Schedule V to the Act.

(xii) In our opinion and according to the information and explanations given to us theCompany is not a Nidhi company as prescribed under section 406 of the Act. Accordinglyparagraph 3(xii) of the Order is not applicable to the Company.

(xiii) According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with the provisions of Sections 177 and 188 of the Act where applicable. Thedetails of such related party transactions have been disclosed in the Standalone Ind ASfinancial statements as required by the applicable Indian Accounting Standards.

(xiv) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year. Accordingly paragraph 3(xiv) of the Order is not applicable to the Company.

(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 any non-cashtransactions with directors or persons connected with them. Accordingly paragraph 3(xv)of the Order is not applicable to the Company.

(xvi) In our opinion and according to the information and explanations given to us theCompany is not required to be registered under Section 45-IA of the Reserve Bank of IndiaAct 1934. Accordingly paragraph 3(xvi) of the Order is not applicable to the Company.

For B S R & Co. LLP
Chartered Accountants
(Firm's Registration No. 101248W/W-100022)
Jamil Khatri
Ahmedabad Partner
30th May 2018 Membership No. 102527

ENCLOSURE 1-

Name of the Statute Nature of Dues Forum where dispute is pending Period to which the amount relates Amount demanded (Rs in crores) Rs ( Amount unpaid in crores)
The E.S.I. Act1948 E.S.I. Contribution Gujarat High Court 1993-94 to 2017-18 11.96 11.96
The Central Excise Act 1944 Cenvat Credit/Input service tax/ demand of duty and penalty CESTAT- Ahmedabad 2005-06 to 2010-11 0.55 0.33
The Central Excise Act 1944 Cenvat Credit/Input service tax/ demand of duty and penalty CESTAT- Kolkata 2011-12 2.26 2.20
The Central Excise Act 1944 Cenvat Credit/Input service tax/ demand of duty and penalty Commissioner (Appeals) Central Excise and CGST Ahmedabad 2006-07 0.02 0.02
The Central Excise Act 1944 Cenvat Credit/Input service tax/ demand of duty and penalty Commissioner (Appeals) Central Excise and CGST Siliguri 2014-15 0.37 0.37
The Central Excise Act 1944 Cenvat Credit/Input service tax/ demand of duty and penalty Commissioner (Appeals) Central Excise and CGST Indore 2005-06 to 2015-16 0.22 0.22
Finance Act 1994 Demand of Service Tax/Interest/ Penalty CESTAT- Ahmedabad 2013-14 to 2016-17 5.53 5.53
Finance Act 1994 Demand of Penalty CESTAT- Ahmedabad 2006-07 to 2011-12 0.51 0.31
Finance Act 1994 Demand of Service Tax/Interest/ Penalty Deputy Commissioner Of Central Excise & CGST Ahmedabad 2011-12 to 2013-14 0.63 0.63
Finance Act 1994 Demand of Service Tax/Interest/ Penalty Supreme Court of India 2007-08 to 2012-13 51.72 51.72
Kerala Value Added Tax Act 2003 Demand of Tax Deputy Commissioner Appeals 2005-06 to 2007-08 0.69 0.69
Kerala Value Added Tax Act 2003 Demand of Tax Deputy Commissioner Appeals 2009-10 to 0.07 0.07
2010-11
Kerala Value Added Tax Act 2003 Demand of Tax Deputy Commissioner Appeals 2012-13 to 0.04 0.04
2015-16
Orissa Value Added Tax Act 2004 Demand of Tax Additional Commissioner of Sales Tax Orrisa 2004-05 to 2008-09 2012-13 to 2013-14 0.53 0.53
The West Bengal Sales Tax Act1994 Demand of Tax Taxation Tribunal West Bengal 2004-05 0.10 0.10
Uttar Pradesh Trade Tax Act 1948 Demand of Tax Joint Commissioner Commercial Tax Uttar Pradesh 2003-04 and 2005-06 0.41 0.41
Uttar Pradesh Trade Tax Act 2008 Demand of Tax Joint Commissioner Commercial Tax Uttar Pradesh 2012-13 1.12 1.12
West Bengal Value Added Tax Act2003 Demand of Tax Additional Commissioner of Commercial Tax West Bengal 2005-06 2007-08 to 2008-09 1.31 1.31
West Bengal Value Added Tax Act2003 Demand of Tax Joint Commissioner Commercial Tax West Bengal 2010-11 0.47 0.47
The Income Tax Act 1961 Demand of Tax and Interest Commissioner (Appeals) Income Tax A.Y. 2013-14 to 2014-15 13.60 13.60

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 TorrentPharmaceuticals Limited ("the Company") as of 31st March 2018 in conjunctionwith our audit of the standalone Ind3AS financial statements of the Company for the yearended 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 FinancialReporting" issued by the Institute of Chartered Accountants of India (‘ICAI').These responsibilities include the design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the orderly andefficient conduct of its business including adherence to company's policies thesafeguarding 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.

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 ICAI. Those Standards and the GuidanceNote require that we comply with ethical requirements and plan and perform the audit toobtain reasonable assurance about whether adequate internal financial controls overfinancial reporting was established and maintained and if such controls operatedeffectively 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 re3ect 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 31st March 2018 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.

For B S R & Co. LLP
Chartered Accountants
(Firm's Registration No. 101248W/W-100022)
Jamil Khatri
Ahmedabad Partner
30th May 2018 Membership No. 102527