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Lakhotia Polyesters Ltd.

BSE: 535387 | NSE: | Series: NA | ISIN: INE191O01010 | SECTOR: Textiles - General

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Lakhotia Polyesters is not listed on NSE

Annual Report

For Year :
2015 2014 2013

Auditor's Report

1 We have audited the accompanying financial statements of Lakhotia Polyesters India Limited (the Company), which comprise the Balance Sheet as at March 31, 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 Financial Statements 2 The management and Board of Directors of the Company are 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 Companies (Accounts) Rules, 2014. This responsibility 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 are 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 3 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 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 4 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 accounting policies used and the reasonableness of the accounting estimates made by the Company''s management and Board of 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 6 Opinion 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, 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 of India in terms of sub-section (11) of section 143 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 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; 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; d. in our opinion, the aforesaid financial statements comply with the applicable Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules 2014 e. on the basis of written representations received from the directors as on March 31, 2015, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 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 following pending litigations which would impact its financial position. The company, promoters, directors and certain group promoted entities are a party to litigation with the customs departments for import of certain materials based upon alleged misleading information. The matter is pending in Appeal before the Central Excise and Customs Appellate Tribunal, Mumbai and before the High Court, Mumbai. The total demand in the matter raised by the adjudicating authorities is to the tune of Rs 220.91 Lakhs against company and Rs 42.00 Lakhs against Shri M.S. Lakhotia, the Managing Director of the company. The amounts as stated are ex interest thereon. (ii) The Company did not have any long-term contracts including derivative contracts; as such the question of commenting on any material foreseeable losses thereon does not arise. (iii) There has not been an occasion in case of the Company during the year under report to transfer any sums to the Investor Education and Protection Fund. The question of delay in transferring such sums does not arise ANNEXURE TO AUDITOR''S REPORT Annexure referred to in paragraph 7 Our Report of even date to the members of Lakhotia Polyesters India Limited on the accounts of the company for the year ended 31st March, 2015. On the basis of such checks as we considered appropriate and according to the information and explanations given to us during the course of our audit, we report that (i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets ; (b) As explained to us, fixed assets have been physically verified by the management at regular intervals; as informed to us no material discrepancies were noticed on such verification; (ii) (a) The inventories at all business places have been physically verified by the management from time to time. In our opinion, the frequency of verification is reasonable. (b) In our opinion and according to the explanations given to us, the procedure of physical verification of the inventories followed by the management is reasonable and adequate in relation to the size of company and nature of business. (c) The company is maintaining proper records of inventory. As explained to us, there were no material discrepancies noticed on physical verification of inventories as compared to the book records. (iii) The company has granted loans, secured or unsecured to the companies, firms or other parties covered in the register maintained under section 189 of the Companies Act, 2013. The year end balances in respect of such 3 parties advances are to the tune of '' 123.23 Lakhs Based upon the management representations as made to us, we report that these advances are towards business transactions and in the normal course of business activity of the company. (iv) In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of fixed assets and for the sale of goods & services. Further, no continuing failure to correct major weaknesses in internal control system of the company is observed. (v) The Company has accepted deposits from its members and has complied with the provisions of the Companies Act, 2013. (vi) As informed to us, the Central Government has not prescribed maintenance of cost records under sub-section (1) of Section 148 of the Act. (vii) (a) According to the information and explanations given to us and based on the records of the company examined by us, the company is regular in depositing the undisputed statutory dues, including Provident Fund, Employees'' State Insurance, Income-tax, Sales-tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty and other material statutory dues, as applicable, with the appropriate authorities in India; (b) According to the information and explanations given to us and based on the records of the company examined by us, there are no dues of Income Tax, Wealth Tax, Service Tax, Sales Tax, Customs Duty and Excise Duty which have not been deposited on account of any disputes except customs duty to the tune of '' 220.91 Lakhs against company and Rs 42.00 Lakhs against Shri M.S. Lakhotia, the Managing Director of the company. The amounts as stated are ex interest thereon. (c) There has not been an occasion in case of the Company during the year under report to transfer any sums to the Investor Education and Protection Fund. The question of reporting delay in transferring such sums does not arise. (viii) The company does not have any accumulated losses as at 31.03.2015 The company has not incurred any cash loss during the financial year covered under audit and immediately preceding financial year. (ix) According to the records of the company examined by us and as per the information and explanations given to us, the company has not defaulted in repayment of dues to financial institutions or banks. Similarly no debentures have been issued by the company and hence compliance with the said clause is not applicable. (x) In our opinion, and according to the information and explanations given to us, the Company has not given any guarantee for loan taken by others from a bank or financial institution during the year. (xi) In our opinion, and according to the information and explanations given to us, the company has not raised any term loans during the year. (xii) During the course of our examination of the books and records of the company, carried in accordance with the auditing standards generally accepted in India, we have neither come across any instance of fraud on or by the Company noticed or reported during the course of our audit nor have we been informed of any such instance by the Management. or SABADRA & SABADRA CHARTERED ACCOUNTANTS Firm Registration No 108921W Sd/- JAGATPAL S BAJAJ, FCA Membership No. 122234 Partner Nashik 30.05.2015