We have audited the accompanying financial statements of HINDUSTAN ZINC
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 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 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.
Our responsibility is to express an opinion on these 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
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 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.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion on the financial
In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid 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
1. 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.
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
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
(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 financial statements comply with the
Accounting Standards specified under Section 133 of the Act, read with
Rule 7 of the Companies (Accounts) Rules, 2014), together with the
early adoption by the Company of Accounting Standard (AS) 30 Financial
Instruments, Recognition and Measurement, effective April 1, 2007, and
the consequential limited revisions as has been announced by the
Institute of Chartered Accountants of India to certain Accounting
Standards, as stated in Note 2 (a) and 38.
(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
(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 - Refer to Note 25 to
the financial statements;
ii. The Company did not have any long-term contracts including
derivative contracts for which there were any material foreseeable
iii. There has been no delay in transferring amounts, required to be
transferred, to the Investor Education and Protection Fund by the
ANNEXURE TO THE INDEPENDENT AUDITORS'' 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,
including quantitative details and situation of the fixed assets.
(b) Some of the fixed assets were physically verified during the year
by the Management in accordance with a 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
(ii) In respect of its inventories:
(a) As explained to us, the inventories (excluding inventories with
third parties) 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 inventories
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
(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,having regard to the explanations that some of the items
purchased are of special nature and suitable alternative sources are
not readily available for obtaining comparable quotations,there is an
adequate internal control system 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. During the year, the
Company did not have transactions in respect of sale of services.During
the course of our audit we have not observed any major weaknesses in
such internal control system.
(v) According to information and explanations given to us, the Company
has not accepted any deposits from public during the year. In respect
of unclaimed deposits, the Company has complied with the provisions of
sections 73 to 76 or any other relevant provisions of the Companies
Act, 2013 and the rules made thereunder.
(vi) We have broadly reviewed the cost records maintained by the
Company 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 records with a view to determine whether they
are accurate or complete.
(vii) According to the information and explanations given to us in
respect of statutory dues:
(a) The Company has generally been regular in depositing undisputed
statutory dues, including Provident Fund, Income-tax, Sales Tax, Wealth
Tax, Service Tax, Duty of customs, Duty of excise, Value added tax,
Cess and any other material statutory dues with the appropriate
authorities. We are informed that the provisions of Employees'' State
Insurance Act, 1948 are not applicable to the Company
There were no undisputed statutory dues in arrears as at 31st March,
2015 for a period of more than six months from the date they became
(b) Details of dues of Income-tax, Sales Tax, Wealth Tax, Service Tax,
Customs duty, Excise duty, Value added tax and Cess which have not been
deposited as on March 31, 2015 on account of disputes are given below:
Name of Nature of dues which the
Statute amount relates
Claims Disputes in respect of sales tax
difference F.Y. 1980-81 to
/ classification and stock transfers
Excise Admissibility of Modvat / Cenvat
credit on F.Y. 1985-86 to
Duty inputs, capital goods, alleged duty 2014-15
demand on captive use of intermediate
goods, reversal of the amount on
dispatch of by-products, duty on
valuation and storage/ handling losses.
Income Tax Disputes in respect appeals pending AY 1996-97,
before CIT (A). 1999-2000,
Department''s Relief granted by CIT (A) for differences AY 1989-90 to
appeals in computation, allowances of certain 92, 1993-94,
Income Tax expenses and enhancement of rebate, etc. 99 and 2000-01
Relief granted by Tribunal for
differences in AY 1990-91 to
computation, allowances of certain 95 and 1996-97
expenses and enhancement of rebate, etc.
Name of Statue Amount
Forum where dispute
is Pending (Rs.in
Sales Tax Claims Deputy Commissioner, Joint 104.40
Commissioner, Commercial Tax
Department, Tribunal, High Court
and Supreme Court.
Duty Central Excise & Service Tax 419.35
Appellate Tribunal, Commissioner
(Appeals) and High Court /
Income Tax Commissioner of Income Tax 370.88
Income Tax Tribunal / Set aside Assessing 609.71
Officer/ CIT (A)
High Court / Supreme Court 113.04
Sub Total 722.75
(c) The amounts required to be transferred to investor education and
protection fund in accordance with the relevant provisions of the
Companies Act, 1956 (1 of 1956) and rules made thereunder has been
transferred to such fund within the prescribed time.
(viii) The Company does not have any accumulated losses as at the end
of the financial year and has not incurred cash losses in the financial
year and in the immediately preceding financial year.
(ix) The Company has not taken any borrowings from banks, financial
institutions or by way of debentures. Accordingly, the provisions of
clause 3(ix) of the Order are not applicable to the Company.
(x) According to the information and explanations given to us and the
records of the Company examined by us, the Company has not given any
guarantees for loans taken by others from banks or financial
institutions. Accordingly, the provisions of clause 3(x) of the Order
are not applicable to the Company.
(xi) The Company has not taken any term loans during the year.
Accordingly the provisions of clause 3(xi) of the Order are not
applicable to the Company.
(xii) To the best of our knowledge and according to the information and
explanations given to us, no fraud by the Company and no material fraud
on the Company has been noticed or reported during the year.
For DELOITTE HASKINS & SELLS LLP
(Firm''s Registration No. 117366W/W-100018)
(Membership No. 87104)
Date : April 20, 2015