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« Mar 14
Auditor's Report (ITC) Year End : Mar '15
1.  We have audited the accompanying standalone financial statements of
 ITC LIMITED (the Company), which comprise the Balance Sheet as at
 31st March, 2015, the Statement of Profit and Loss and the Cash Flow
 Statement for the year then ended, and a summary of the significant
 accounting policies and other explanatory information.
 
 Management's Responsibility for the Standalone Financial Statements
 
 2.  The Company's Board of Directors is responsible for 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
 
 3.  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
 Section143 (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.
 
 4.  An audit involves performing procedures to obtain audit evidence
 about the amounts and the 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 the 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.
 
 5.  We believe that the audit evidence we have obtained is sufficient
 and appropriate to provide a basis for our audit opinion on the
 standalone financial statements.
 
 Opinion
 
 6.  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 31st March, 2015, and its profit and its
 cash flows for the year ended on that date.
 
 Report on Other Legal and Regulatory Requirements
 
 7.  As required by the Companies (Auditor's Report) Order, 2015 (the
 Order) issued by the Central Government in terms of Section 143(11) of
 the Act,
 
 we give in the Annexure a statement on the matters specified in
 paragraphs 3 and 4 of the Order.
 
 8.  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
 purposes of our audit.
 
 (b) In our opinion, proper books of account as required by law have
 been kept by the Company so far as it appears from our examination of
 those books.
 
 (c) 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 account.
 
 (d) 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.
 
 (e) On the basis of the written representations received from the
 directors as on 31st March, 2015 taken on record by the Board of
 Directors, none of the directors is disqualified as on 31st March, 2015
 from being appointed as a director in terms of Section 164(2) of the
 Act.
 
 (f) 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 position in its financial statements in accordance with the
 generally accepted accounting practice – also refer Note 31(iv)(a)(i)
 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 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 Auditors' Report (Referred to in paragraph
 7 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,
 including quantitative details and situation of the fixed assets.
 
 (b) The fixed assets were physically verified during the year by the
 Management in accordance with a regular programme of verification
 which, in our opinion, provides for physical verification of all the
 fixed assets at reasonable intervals. According to the information and
 explanations given to us, no material discrepancies were noticed on
 such verification.
 
 (ii) In respect of its inventory:
 
 (a) As explained to us, the inventories other than material lying with
 third parties (which have substantially been confirmed) were physically
 verified during the year by the Management at reasonable intervals.
 
 (b) In our opinion and according to the information and explanations
 given to us, the procedures of physical verification of inventory
 followed by the Management were 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 no material discrepancies were noticed on physical
 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.
 
 (iv) In our opinion and according to the information and explanations
 given to us, there are adequate internal control systems commensurate
 with the size of the Company and the nature of its business for the
 purchase of inventory and fixed assets and for the sale of goods and
 services. During the course of our audit, we have not observed any
 major weakness in such internal control system.
 
 (v) According to the information and explanations given to us, the
 Company has not accepted any deposit during the year and accordingly
 the question of complying with section 73 and 76 of the Companies Act
 2013 does not arise.  In respect of unclaimed deposits, the Company has
 complied with the provisions of Sections 74 and 75 or any other
 relevant provisions of the Companies Act. According to the information
 and explanations given to us, no Order has been passed by the Company
 Law Board or the National Company Law Tribunal or the Reserve Bank of
 India or any Court or any other Tribunal on the Company.
 
 (vi) We have broadly reviewed the cost records maintained by the
 Company pursuant to the Companies (Cost Records and Audit) Rules, 2014,
 as amended and prescribed by the Central Government under sub-section
 (1) of Section 148 of the Companies Act, 2013, and are of the opinion
 that, prima facie, the prescribed cost records have been made and
 maintained. We have, however, not made a detailed examination of the
 cost records with a view to determine whether they are accurate or
 complete.
 
 (vii) According to the information and explanations given to us and
 according to the books and records as produced and examined by us, in
 our opinion:
 
 (a) The Company is regular in depositing undisputed statutory dues
 including Provident Fund, Employees' State Insurance, Income-tax, Sales
 tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Value Added
 Tax, Cess and other material statutory dues as applicable with the
 appropriate authorities.
 
 (b) As at 31st March, 2015, the following are the particulars of dues
 on account of Income-tax, Sales Tax, Wealth Tax, Service Tax, Customs
 Duty, Excise Duty, Value Added Tax and Cess matters that have not been
 deposited on account of any dispute:
 
 Name of             Nature of                    Amount
 the statute         the dues                   (Rs. in Crores)
 
 Sales Tax           Sales tax                     37.58
 and Value           and VAT
 Added Tax
 Laws                                              18.36
 
                                                  221.83
 
 Customs             Customs                        0.09
 Act, 1962            duty
 
                                                    1.74
 
 Central              Excise duty                  29.85
 Excise
 Act, 1944
 
                                                   88.23
 
                                                    4.10
 
 Finance Act,         Service tax                   1.32
 1994
 
                                                   46.88
 
 Income-tax           Income-tax                   89.61
 Act, 1961
 
                                                   26.61
 
 
 
 Name of
 the statute               Period to which        Forum where pending
                           the amount relates
 
                           Various years
                           covering the period
 
 Sales Tax
 and Value
 Added Tax
 Laws                       1987-2015             Appellate Authority -
                                                  upto Commissioners'/
                                                  Revisional 
                                                  authorities level
 
                            1994-2014             Appellate Authority -
 
                                                  Tribunal level
 
                            2000-2011             High Court
 
 Customs
 Act, 1962                  2010-2014             Appellate Authority -
                                                  upto Commissioners'/
                                                  Revisional 
                                                  authorities level
 
                            2005-2007             Appellate Authority -
                                                  Tribunal level
 
                            1996-2014             Appellate Authority -
 
 Central
 Excise
 Act, 1944                                       upto Commissioners'/
                                                 Revisional authorities
                                                 level
  
                            1973-2014            Appellate Authority -
                                                 Tribunal level
 
                            2005-2010            High Court
 
 Finance Act,
 1994                       2006-2012            Appellate Authority -
                                                 upto Commissioners'/
                                                 Revisional authorities
                                                 level
 
                            2004-2011            Appellate Authority -
                                                 Tribunal level
 
 Income-tax
 Act, 1961                  2005-2011            Appellate Authority -
                                                 upto Commissioners'/
                                                 Revisional authori
                                                 -ties level
 
                            1999-2007            Appellate Authority -
                                                 Tribunal level
 
 Out of the total disputed dues aggregating Rs. 566.20 Crores as above, Rs.
 355.67 Crores has been stayed for recovery by the relevant authorities.
 
 (c) The Company has been regular in transferring amounts to the
 Investor Education and Protection Fund in accordance with the relevant
 provisions of the Companies Act, 1956 (1 of 1956) and Rules made
 thereunder within time.
 
 (viii) The Company does not have accumulated losses at the end of the
 financial year and the Company has not incurred cash losses during the
 financial year covered by our audit and in the immediately preceding
 financial year.
 
 (ix) According to the information and explanations given to us, the
 Company has not defaulted in repayment of dues to any financial
 institution, bank or to debenture holders during the year.
 
 (x) In our opinion and according to the information and explanations
 given to us, the terms and conditions of the guarantees given by the
 Company for loans taken by others from banks and financial institutions
 are not, prima facie, prejudicial to the interests of the Company.
 
 (xi) In our opinion and according to the information and explanations
 given to us, the term loans 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 by the Company and no significant
 fraud on the Company has been noticed or reported during the year.
 
                                     For Deloitte Haskins & Sells
 
                                            Chartered Accountants
 
                                 (Firm's Registration No. 302009E)
 
                                                   Shyamak R Tata
 
 Kolkata                                                  Partner
 
 22nd May, 2015                            (Membership No. 38320)
Source : Dion Global Solutions Limited
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