We have audited the accompanying financial statements of Mahalaxmi
Seamless Limited (the company), which comprise the Balance Sheet as
at 31 March 2015, the Statement of Profit and Loss, the 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
The Company''s Board of Directors is responsible for the matters 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 the maintenance of
adequate accounting records in accordance with the provision of the Act
for safeguarding of the assets of the Company and for preventing and
detecting the 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 internal financial control, 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 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 true and fair view 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 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;
a) in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2015;
b) in the case of the Statement of Profit and Loss, of the loss 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.
Report on other Legal and Regulatory Requirements
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 Companies Act, 2015, we give in
the Annexure a statement on the matters specified in paragraphs 3 and 4
of the Order, to the extent applicable.
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 appears from our examination of those
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.
e) On the basis of written representations received from the directors
as on 31 March, 2015, taken on record by the 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) With respect to the other matters included in the Auditor''s Report
and to our best of our information and according to the explanations
given to us :
i) The Company does not have any pending litigations which would impact
its financial position except as below :
There are some labour related matters pending in the Labour Court at
Raigad and Mumbai. The Company''s Liability towards such matters cannot
ii) The Company did not have any long-term contracts including
derivatives contracts for which there were any material foreseeable
iii) The Company has Rs. 1,58,738/- related to financial year 2007-2008
required to be transferred to investor education and protection fund.
Annexure to Auditors Report
(Referred to in Paragraph 1 under the heading of report on other legal
and regulatory requirements of our report of even date)
i) In respect of its fixed assets:
a. In our opinion Company is not maintaining proper records showing
full particulars including quantitative details and situation of fixed
b. As explained to us, the fixed assets of the Company have been
physically verified during the year by the management, but in view of
Inadequate fixed assets records we are unable to comment on
c. The Company has not disposed off substantial parts of fixed assets
during the year.
ii) In respect of its inventories:
a. The inventory has been physical verified during the year by the
management at reasonable intervals.
b. The procedures followed by the management for physical verification
of stock are in our opinion reasonable and adequate in relation to the
size of the company and nature of its business.
c. In our opinion and according to the information and explanation
given to us, the company has maintained proper records of its
inventories and discrepancies were noticed on verification between the
physical stock & book stock were not material have been properly dealt
with in the books of account.
iii) In respect of the loans, secured or unsecured, granted by the
Company to companies, firms or other parties covered in the register
maintained under Section 189 of the Companies Act, 2013:
a. The Company has not granted any loan, secured or unsecured to
companies, firms, or other parties covered in the register maintained
under section 189 of the Act.
b. In view of our comments in Para iii) (a) above, clauses (iii) (a)
and (b) of the said Order are not applicable to the Company.
iv) In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchases of inventory and fixed assets and for the sale of goods and
services, however, in our view, it needs to be further strengthened.
During the course of our audit, we have not observed any continuing
failure to correct major weakness in internal control systems.
v) The company has not accepted deposits, hence clauses (v) of the said
Order is not applicable to the Company.
vi) Based on the information and explanation provided to us, the
Company has maintained the cost records prescribed by the Central
Government under Section 148 (1) of the Companies Act, 2013. However,
we have not made detailed examination of such cost records with a view
to determine whether they are maintained adequately.
vii) In respect of statutory dues:
a. Accordingly to the records of the Company, the undisputed statutory
dues including Provident Fund, ESIC, Sales Tax, Wealth Tax, Service
Tax, Customs Duty, Excise Duty, and Cess have generally been regularly
deposited with the appropriate authorities except certain delays.
According to the information and explanations given to us, there are no
undisputed amount payable in respect of such statutory dues which have
remained outstanding as at 31st March, 2015 for a period more than six
months from the date they became payable.
b. According to the information and explanations given to us, the
Company has no dues of Income Tax, Sales Tax, Wealth Tax, Service Tax,
Custom Duty, Excise Duty and Cess which have not been deposited on
account of disputes with the related authorities except as below:
Nature of Liability Financial year to Amount (Rs.)
which it concerns
Income tax Liability F.Y. 2008-09 12,93,013/-
Income tax Liability F.Y. 2009-10 4,42,2107-
Sales Tax Liability F.Y. 2004-05 65,57,957/-
c. According to information and explanation given to us, the Company
has Rs. 1,58,738/- related to financial year 2007-2008 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.
viii) The accumulated losses as at the end of the financial year do not
exceed 50% of the Net Worth and the Company has not incurred cash loss
in the current financial year however there was cash loss during the
preceding financial year amounting to Rs. 2,59,92,961/-.
ix) In our opinion and according to the information and explanations
given to us the Company has not defaulted in repayment of its dues to
banks and financial institutions.
x) The Company has not given any guarantees for loans taken by others
from banks and financial institutions.
xi) There are no term loans raised during the year.
xii) In our opinion 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 K C P L AND Associates LLP
Firm No. 119223 W
M. No. 121275
Date: 30th May, 2015