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Bal Pharma

BSE: 524824|NSE: BALPHARMA|ISIN: INE083D01012|SECTOR: Pharmaceuticals
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« Mar 14
Auditor's Report (Bal Pharma) Year End : Mar '15
We have audited the accompanying standalone financial statements of M/s
 BAL PHARMA LIMITED, which comprise the balance sheet as at 31 March
 2015, 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.
 
 Management''s responsibility for the standalone 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 and presentation 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; 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.
 
 Auditor''s 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
 there under. 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 of the financial statements that give a true and fair view
 in order to design audit procedures that are appropriate in the
 circumstances, but not for the purpose of expressing an opinion on
 whether the Company has in place an adequate internal financial
 controls system over financial reporting and the operating
 effectiveness of such controls. An audit also includes evaluating the
 appropriateness of Company''s management and Board of 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 of the state of affairs of the Company as
 at 31 March 2015, its profits and its cash flows for the year ended on
 that date.
 
 Report on other legal and regulatory requirements
 
 1. As required by the Companies (Auditor''s Report) Order, 2015 (the
 Order) issued by the Central Government of India in terms of
 sub-section II of section 143 of the Act, we give in theAnnexure a
 statement on the matters specified in paragraphs 3 and 4 of the Order,
 to the extent applicable.
 
 2. As required by section 143(3) of the Act, we further 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 account as required by law have been
 kept by the company so far as appears from our examination of those
 books and proper returns adequate for the purposes of our audit have
 been received from the branches not visited by us;
 
 (c) The balance sheet, statement of profit and loss and cash flow
 statement dealt with by this report are in agreement with the books of
 account and with the returns received from branches not visited by us;
 
 (d) In our opinion, the aforesaid standalone financial statement comply
 with the Accounting Standards specified under Section 133 of the Act,
 read with Rule 7 of the Companies(Accounts) Rules,2014.
 
 (e) On the basis of the written representations received from the
 directors, as on 31 March 2015 and taken on record by Board of
 Directors, none of the directors is disqualified as on 31 March 2015
 from being appointed as a director in terms of section 164(2) of the
 Act.
 
 (f) In our opinion and to the best of our information and according to
 the explanations given to us, we report as under with respect to other
 matters to be included in the Auditor''s Report in accordance with Rule
 11 of the Companies (Audit and Auditors) Rules,2014;
 
 i. The Company has disclosed the impact, if any, of pending litigations
 as at 31 March 20l5,on its financial position in its financial
 statements - Refer Note 36 to the financial statements;
 
 ii. The Company has not entered into any long-term contracts including
 derivative contracts requiring provision under the applicable law or
 accounting standards, for material foreseeable losses;
 
 iii. There has been no delay in transferring amounts, required to be
 transferred, to the Investor Education and Protection Fund by the
 Company.
 
 Annexure to the Independent Auditor''s Report
 
 (The annexure referred to in paragraph I under the heading Report on
 other legal and regulatory requirements of our report of even date
 to the members of Bal Pharma Limited for the year ended 31 March 2015)
 
 i. In respect of its fixed assets
 
 (a) The Company has maintained proper records showing full particulars,
 including quantitative details and situation of fixed assets.
 
 (b) As informed to us by the management the Company has a policy of
 physically verifying fixed assets in a phased manner over a period
 which, in our opinion, is reasonable having regard to the size of the
 Company and the nature of its assets.  We are informed that there was
 no material discrepancies noticed on such verification.
 
 ii. In respect of its inventories
 
 (a) As explained to us, the inventories were physically verified by the
 Management at reasonable intervals during the year. In our opinion the
 frequency of verification is reasonable.
 
 (b) In our opinion and according to the information and explanations
 given to us, the procedures of physical verification of inventories
 followed by the Management are reasonable and adequate in relation to
 the size of the Company and the nature of its business.
 
 (c) In our opinion and according to the information and explanations
 given to us, the Company has maintained proper records of its
 inventories and the discrepancies noticed on such physical verification
 between physical stock and book records were not material and have been
 adequately dealt with in the books of account.
 
 iii. (a) The company has granted loans to two bodies corporate covered
 in the register maintained under section 189 of the Companies Act, 2013
 (''the act'').
 
 (b) In the case of the loans granted to the bodies corporate listed in
 the register maintained under section 189 of the Act, the borrowers
 have been regular in the payment of the interest as stipulated. The
 terms of arrangements do not stipulate any repayment schedule and the
 loans are repayable on demand.  Accordingly, paragraph 3(iii) (b) of
 the order is not applicable to the company in respect of repayment of
 the principle amount.
 
 (c) There are no overdue amounts of more than rupees one lakh in
 respect of the loans granted to the bodies corporate listed in the
 register maintained under section 189 of the Act.
 
 iv. In our opinion and according to the information and explanations
 given to us, there exist an adequate internal control system
 commensurate with the size of the Company and nature of its business
 with regard to purchases of inventory, fixed assets and for the sale of
 goods and services. During the course of our audit, we have not
 observed any continuing failure to correct major weaknesses in internal
 control system.
 
 v. The Company has not accepted any deposit from public. No order has
 been passed by Company Law Board or National Company Law Tribunal or
 Reserve Bank of India or any Court or any other Tribunal.
 
 vi. We have broadly reviewed the books of accounts maintained by the
 Company pursuant to the rules prescribed by the Central Government for
 maintenance of cost records under 148(1) of the Companies Act, 2013 in
 relation to products manufactured, and are of the opinion that, prima
 facie, the prescribed accounts and records have been made and
 maintained. We have not made a detailed examination of the records with
 a view to determine whether they are accurate and complete.
 
 vii. According to the information and explanation given to us:
 
 (a) The company has been regular in depositing undisputed statutory
 dues including provident fund, employees'' state insurance, income-tax,
 sales-tax, wealth tax, service tax, duty of customs, duty of excise,
 value added tax, cess and any other statutory dues applicable to it
 have generally been regularly deposited with the appropriate
 authorities. There are no undisputed amounts payable in respect of
 aforesaid material statutory dues as at 31 March 2015, which were in
 arrears for a period of more than six months from the date they became
 payable.
 
 (b) On the basis of our examination of the documents and records of the
 company, there are no amounts in respect of Provident Fund, Income Tax,
 Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise duty and Cess
 that have not been deposited with appropriate authorities on account of
 any dispute except as enumerated herein below which are pending before
 respective authorities as mentioned there against:
 
 Name of the Statute             Nature of dues               Amount in
 
 Chapter V of Finance Act, 1994  Service Tax and equivalent  1,08,36,228
                                 penalty
 
 The Central Excise Act, 1944    Central Excise Duty and 
                                 Penalty                     1,69,03,646
 
 The Central Excise Act,l944     Central Excise Penalty        24,91,506
 
 The Central Excise Act, 1944    Central Excise Duty and 
                                 Penalty                        8,38,598
 
 The Central Excise Act, 1944    Central Excise Duty and 
                                 Penalty                       12,09,387
 
 The Central Excise Act,l944     Central Excise Duty and
                                 Penalty                        2,16,694
 
 The Central Excise Act, 1944    Central Excise Duty and 
                                 Penalty                        3,16,719
 
 The Central Excise Act, 1944    Central Excise Duty and 
                                 Penalty                        2,24,679
 
 The Maharashtra Value Added     Central Sales Tax and
 tax 2002                        Penalty                        7,78,314
 
 The Kerala General Sales Tax    Local Sales Tax                4,95,991
 act 1963
 
 The Central Excise Act, 1944    Central Excise Duty and 
                                 Penalty                       21,82,891
 
 lncome Tax Act,l96l             Income tax                    89,50,439
 
 
 Name of the Statute           Period to which       Forum where dispute
                               amount relates        is pending
 
 Chapter V of Finance Act 1994 Nov 2007 to July 2011 Commissioner of 
                                                     Central Excise 
                                                     ( Appeals),
                                                     Bangalore
 
 The Central Excise Act, 1944  Nov 2007 to July 2011 Commissioner of 
                                                     Central Excise 
                                                     ( Appeals),
                                                     Bangalore
 
 The Central Excise Act, 1944  Apr 2005 to Nov 2009  Customs Excise 
                                                     Service Tax 
                                                     Appellate Tribunal,
                                                     Bangalore
 
 The Central Excise Act, 1944  May 2000 to Nov 2001  Customs Excise 
                                                     Service Tax 
                                                     Appellate Tribunal,
                                                     Mumbai
 
 The Central Excise Act, 1944  Jul 2012 to Jan 2013  Commissioner of 
                                                     Central Excise
                                                     (Appeal), Bangalore
 
 The Central Excise Act, 1944  Mar-12                Commissioner of 
                                                     Central Excise
                                                     (Appeal), Bangalore
 
 The Central Excise Act, 1944  Jan-12                Commissioner of 
                                                     Central Excise
                                                     (Appeal), Bangalore
 
 The Central Excise Act 1944   Jul 2011 to Nov 2011  Commissioner of 
                                                     Central Excise
                                                     (Appeal), Bangalore
 
 The Maharashtra Value Added   FY 2004-2005          The Deputy 
 tax 2002                                            Commissioner
                                                     (Appeals), Pune
 
 The Kerala General Sales      FY 2002 - 03          The Deputy 
 Tax Act 1963                                        Commissioner
                                                     (Appeals), Ernakulam
 
 The Central Excise Act 1944   FY 2010-11 to 2012-13 Commissioner of 
                                                     Central Excise, 
                                                     Bangalore
 
 Income Tax Act 1961           FY 2003-04 to 2007-08 High Court of 
                                                     Karnataka
 
 
 * Net of amounts paid under protest or otherwise. Amount as per demand
 order including interest and penalty wherever quantified.
 
 (c) There were no amounts which were required to be transferred to the
 Investor Education and Protection Fund by the Company.
 
 viii. The Company does not have any accumulated losses as at the end of
 the financial year. The Company has not incurred cash losses during the
 current and in the immediately preceding financial year.
 
 ix. Based on our audit procedures, information and explanations given
 to us, in our opinion the Company has not defaulted in repayment of
 dues to financial institutions and banks. The Company does not have any
 outstanding debentures during the year.
 
 x. In our opinion and according to the information and the explanations
 given to us, the company has not given any guarantee for the loans
 taken by others from banks or financial institutions.
 
 xi. In our opinion and according to the information and explanations
 given to us, the term loans taken by the company during the
 
 year have been applied for the purposes for which they were obtained.
 
 xii. To the best of our knowledge and according to the information and
 explanations given to us, no fraud on or by the Company has been
 noticed or reported during the course of our audit.
 
 For M/s T D JAIN AND D I SAKARIA
 Chartered Accountants
 Firm registration no: 002491S
 
 T D JAIN
 Partner
 M. No.: 012034
 
 Bangalore
 29 May 2015
 
Source : Dion Global Solutions Limited
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