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Balmer Lawrie and Company

BSE: 523319|NSE: BALMLAWRIE|ISIN: INE164A01016|SECTOR: Packaging
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Auditor's Report (Balmer Lawrie and Company) Year End : Mar '16


We have audited the accompanying standalone financial statements of Balmer Lawrie & Co. Limited (the Company), which comprise
the Balance Sheet as at March 31, 2016, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and
a summary of significant accounting policies and other explanatory information, in which are incorporated the returns for the
year ended on that date audited by the Branch Auditors of the Company''s branches located under Northern region, Western region
and Southern region.

Managements Responsibility for the Financial Statements

The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Companies Act 2013 (the Act)
with respect to the preparation of these standalone financial statements that give a true and fair view of the financial
position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in
India, including the Accounting Standards specified under section 133 of the Act, read with Rule 7 of the Companies (Accounts)
Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of
the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities, selection
and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design,
implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the accuracy
and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a
true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors Responsibility

Our responsibility is to express an opinion on these standalone financial statements based on our audit.

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

We conducted our audit in accordance with the Standards on Auditing specified under section 143(10) of the Act. Those Standards
require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements.
The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the
financial statements, whether due to fraud or error. In making, those risk assessments, the auditor considers internal financial
control relevant to the company''s preparation and fair presentation of the financial statements in order to design audit
procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting
policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the
overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone
financial statements give the information required by the Act in the manner so required and give a true and fair view in
conformity with the accounting principles generally accepted in India:

(a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2016;

(b) in the case of Statement of Profit and Loss, of the Profit for the year ended on that date; and

(c) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

Emphasis of Matters

We draw attention to the following Notes to the financial statements, which describe the uncertainty related to the outcome. Our
opinion is not qualified in respect of this matter.

a) Note No.26.7:- Trade receivables, loans and advances and deposits for which confirmations are not received from the parties
are subject to reconciliation and consequential adjustments on determination/ receipt of such confirmation.

b) Note No. 26.29: A case of misappropriation of cash through wrong adjustments was noticed in one units of the company during
the course of review of debtors in the month of January 2016. The company is presently undertaking a thorough reconciliation of
the relevant outstanding. Based on preliminary in-house enquiry, an amount of Rs. 34.58 Lakhs has now been identified as
defalcated and the same is provided for in the books. The case has since been handed over to investigating agency and necessary
further legal action will be taken thereafter

Other Matter

a) Confirmation of outstanding balances of trade receivable, claims recoverable various advances, deposits, trade payables and
other liabilities was not available for our verification

b) We did not audit the financial statements of three (3) Regions included in the standalone financial statements of the Company
whose financial statement reflect total assets of Rs. 85746.89 lac as at 31st March 2016 and total revenue of Rs. 231998.27 lac
for the year ended on that date, as considered in the standalone financial statements. The. financial statements of these
regions have been audited by the branch auditors whose reports have been furnished to us, and our opinion in so far as it relates
to the amounts and disclosures included in respect of these Regions, is based solely on the report of such Branch auditors.

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 the Annexure- A, a statement on the matters specified in paragraphs 3 and 4 of the
order.

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 best of our knowledge and belief were necessary
for the purpose of our audit.

b) In our opinion, proper books of accounts as required by law have been kept by the Company so far as it appears from our
examination of those books.

c) The reports on the account of the three (3) Regions of the Company audited under section 143(8) of the act by Branch auditors
have been submitted to us and have been properly dealt with by us in preparing this report.

d) The Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this report are in agreement
with the books of accounts.

e) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133
of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

f) On the basis of the written representations received from the directors as on 31st March, 2016 taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March, 2016 from being appointed as a director in terms of Section
164 (2) of the Act.

g) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating
effectiveness of such controls, refer to our separate Report in Annexure B.

h) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit
and Auditors) Rules, 2014, in our opinion and 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 financial statements- Refer Note 26.2(a) and (b) to the
financial statements;

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

iii) There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

iv) As required by section 143(5) of the Act, a statement on the matters specified as per directions given by the Comptroller &
Auditor General of India, is given in Annexure- C.

i) In respect of its fixed assets:

a) The Company has generally maintained proper records showing full particulars, including quantitative details and situation of
the fixed assets.

(b) The Company has a regular programme of physical verification of its fixed assets by which plant and machinery are verified
every year and other fixed assets are verified in a phased manner over a period of three years which, in our opinion, is
reasonable having regard to the size of the Company and nature of its assets. As explained to us, in accordance with its
programme plant and machinery and certain other fixed assets were verified during the year and no material discrepancies were
noticed on such verification.

(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company,
title deeds of Immovable properties are held in the Name of the Company except to the extent of the properties and values
specified in Note No.26.1 (a) and (b).

ii) The inventory of the Company except goods in transit has been physically verified during the year by the management. In our
opinion, having regard to the nature and location of inventory the frequency of verification is reasonable and no material
discrepancies were noticed on such verification.

iii) The Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register
maintained under section 189 of the Companies Act 2013. Accordingly, clauses 3(iii) (a) to 3(iii) (c) of the Order are not
applicable.

iv) The Company has not given any loans, guarantees, securities or made Investments which is required to be complied with the
provisions of section 185 and 186 of the Companies Act, 2013.

v) The Company has not accepted any deposits, according to the directives issued by the Reserve Bank of India and the provisions
of sections 73 to 76 or any other relevant provisions of the Companies Act and the rules framed thereunder.

vi) We have broadly reviewed the cost record maintained by the Company in respect of the products of Grease and Lubricants,
Industrial Packaging & Leather Chemicals where, pursuant to the Companies (Cost records and Audit) Rules, 2014 read with
companies (Cost records and Audit) Amendment Rules, 2014 prescribed by the Central Government under section 148 of the Companies
Act, 2013 and are of the opinion that, prima facie, the prescribed cost records have been maintained. We have, however, not made
a detailed examination of the cost record with a view to determine whether they are accurate or complete. To the best of our
knowledge and according to the information and explanations given to us, the central government has not prescribed the
maintenance of cost records for any other product of the Company.

vii) (a) The Company has generally been regular in depositing undisputed statutory dues including provident fund, employee''s
state insurance, income tax, sales tax, service tax, duty of customs, duty of excise, value added tax, cess and other statutory
dues to the appropriate authorities and there was no amount due for more than six months as at the last day of the financial
year.

(b) The disputed statutory dues of income tax, sales tax, service tax, duty of customs, duty of excise and value added tax
aggregating to Rs. 10185.49 lac have not been deposited as mentioned in Note No.26.2(a) to the accounts showing the amounts
involved and the forum where the dispute is pending.

viii) The Company has not defaulted in repayment of dues to any financial institutions or Banks as at the Balance Sheet date and
there is no debenture holder.

ix) The Company has not raised moneys by way of initial public offer or further public offer (including debt instruments) and
term loans during the year under audit. Hence this clause is not applicable.

x) Attention is drawn to Note No. 26.29 where fraud has been detected on the Company during the year and according to the
information and explanation given to us no fraud by the Company has been noticed or reported during the year.

xi) By virtue of Article 7A of the Articles of Association of the company, the President of India is entitled to determine terms
and conditions of appointment of the Directors. The inter alia includes determination of remuneration payable to the Whole- Time
Directors. Hence this clause is not applicable.

xii) The Company is not a Nidhi Company. Hence this clause is not applicable.

xiii) According to the information and explanations provided to us and the records of the company examined by us, the Company has
not been able to comply with the requirements of Section 177 in respect of composition of Audit Committee, since independent
directors on the board are yet to be appointed by the Government of India.

All transactions of the Company with related parties are in compliance with Section 188 of Companies Act, 2013 where applicable
and the details have been disclosed in the financial statement in Note No. 26.20(i) and (ii) as required by the applicable
accounting standard.

xiv) The Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures
during the year under review. Hence this clause is not applicable

xv) The Company has not entered into any non-cash transactions with directors or persons connected with him. Hence, this clause
is not applicable.

xvi) The Company is not required to be registered under section 45 lA of the Reserve Bank of India Act, 1934. Hence, this clause
is not applicable.

Directions under sections 143(5) of the Companies Act 2013

Sl.
No Direction Auditors'' Replies

1 Whether the company has clear title/ lease
Deeds for freehold and Details are
leasehold respectively? If not please state
the area of freehold and furnished in
leasehold land for which title/ lease deeds
are not available? Annexure C- 1

2 Whether there are any cases of waiver/
write off of debts/ loans/ Details are
interest etc. if yes, the reason there
for and amount involved furnished in
Annexure C- 2

3 Whether proper records are maintained for
inventories lying with third Not applicable
parties & assets received as gift/ grant(s)
from the Govt. or other authorities.

Direction under section 143(5) of the Companies Act 2013

Annexure - C - 1

Details of freehold and leasehold land for which title/ lease deeds are
not available as on 31.03.2016.

Sl
No. Location Area Remarks

1. Gopalpur Holiday home,Orissa 0.235 Acres Photocopy of Title
deed available.

2. Balmer Lawrie & Co. 21,
N. S. Road, 1 Bigha, Lease deeds available
Kolkata - 700 001 3 Katha,3
Cha- tak

3. Balmer Lawrie & Co. Faridabad 61005 Sq. Original Title deeds
yards not available

4. 9B,Queens Park, Kolkata
- 700 019 2 Bigha, Lease deeds available
6 Katha, and
7 Chatak

5. Bishram Kutir, Puri Bunglow 1 Acre Lease deeds available

6. 96,Tollygunge Circular Road,
Kolkata - 700 053 896 Sq. ft Lease deeds available

7. Trivoli court lA Ballygunge
Circular Road, 2257.55
Sq. ft Lease deeds available
Kolkata - 700 019

8. 39, Ballygunge Circular
Road, Kolkata - 700 019 1 Bigha, 9 Lease deeds available
Katha, 7
Chatak

9. Himadri Apartments, Flat
no. 40, 22 Ballygunge 1800 Sq. Ft Lease deeds available
Park Road, Kolkata - 700 019

10. Ajanta Appartments, 10
Gurusaday Road, 2000 Sq.Ft Lease deeds available
Kolkata - 700 019

11. Golf Link Appartment,50,
Chanditala Lane, 1000 Sq. Ft Lease deeds available
Block D, 1st Floor,
Kolkata - 700 040

12. New Beerbhoom Coal Co. Ltd.
Asansol, 5353.16
Sq. Mtr Lease not renewed
Burdawan after year 2000.

13. SF,Annapurna Appartments
224 & 224/1, 1485 sq. ft Lease deeds
A.J.C Bose Road,
Kolkata - 700 017 available.

14. Container & Cylinder
Division 2921.05
Sq.Mtr Lease Deed expired
on 31.05.2005
and on 19.01.2002.
Renewed Lease Deed
not available.

15. Barrel Division
Sewree,Mumbai 2653.99 Certified True Copy
Sq. Mtr found.

16. 5 J.N. Heredia Marg,
Ballard Estate, - Original lease deeds
Mumbai - 400001 not available.

17. Industrial Packaging
Division, Plot No. - G15, G16 lease deed
G-15,G-16, G-17,
MIDC, Taloja, with MIDC pending
Industrial Area,
Maharashtra - 410208 for Registration. G17
registered lease
deed is found.

18. Survey No. 201/1,
Sayli Village, Original Title deeds/
Silvassa - 396230 lease deeds not
available. Copy of
agreement found.

19. Survey No. 23/1/1,
KhadoliVillage, Original Title deeds/
Silvassa - 396230 lease deeds not
available. Copy of
agreement found.

20. BL Housing complex,
Plot No. 1-1& 1-2, 2413 sq. Mts Photocopy of MOU
Sector 2, Phase II,
Nerul, Navi Mumbai
400 706 with CIDCO available.

Direction under section 143(5) of the Companies Act 2013

Annexure - C - 2

Details of write-off of debts, advances, deposits and fixed assets etc.
as on 31.03.2016 Sl.

Sl. Reasons for write-offs 31-03-2016
No.

1. Debts

Liquidated Damage 33.80

Difference in Excise Duty 3.85

Closed Business/Party not traceable 46.38

Adhoc Deduction by customers/Reconciliation Problem 10.81

Quality related Problem I damaged goods 5.08

Cancellation Charges, Service Tax not paid by
customers 7.32

Service Charges/ No Show tickets etc

Price differential not paid by customers 19.13

Difference of VAT, CST 11.56

Demurrage Charges/Port charges/Transit Penalty 3.36

TDS receivable 28.85

82.84

TOTAL 252.98

2. Loans & Advances

Claims short settled by Insurance Co. 10.32

Detention charges/Tpt charges 0.38

TOTAL 10.70

3. Inventory

Rejected barrels not brought back from customers
(Greases) 64.50

TOTAL 11.29

4. Deposits

Sundry Deposits written off 11.29

5. Fixed Assets

Fixed Assets written off 2.39

TOTAL 2.39

6. Write off of debts/ deposits against provisions
made in earlier 140.48
years

GRAND TOTAL 482.34

For Dutta Sarkar & Co.

Chartered Accountants

FRN:303114E

Mainak Chakrabarti

Partner

Membership No:063052


Place : Kolkata

Date : 26th May, 2016

Source : Dion Global Solutions Limited
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