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National Steel & Agro Industries | Auditor's Report > Steel - GP & GC Sheets > Auditor's Report from National Steel & Agro Industries - BSE: 513179, NSE: NATNLSTEEL
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National Steel & Agro Industries

BSE: 513179|NSE: NATNLSTEEL|ISIN: INE088B01015|SECTOR: Steel - GP & GC Sheets
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Auditor's Report (National Steel & Agro Industries) Year End : Mar '16

Report on the Financial Statements

We have audited the accompanying financial statements of NATIONAL STEEL AND AGRO INDUSTRIES LIMITED (the Company) which comprise the Balance Sheet as at 31st March, 2016, the Statement of Profit and Loss, 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 (the Rules). 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

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 misstatements. 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 controls 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. 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 statements.

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, 2016 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, 2016 issued by the Central Government of India in term of sub-section (11) of Section 143 of the Act (hereinafter referred to as the Order), and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure A 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 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 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, 2016, taken on record by the Board of Directors, none of the director is disqualified as on 31st March, 2016 from being appointed as a director in terms of Section 164 (2) of the Act.

f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls refer to our separate report in Annexure B and

g) 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 knowledge and belief and according to the information and explanations given to us:

(i) The Company has disclosed the impact of pending litigations as at 31st March, 2016 on its financial position in its financial statements as referred in annexure to Auditors'' Report vii(b).

(ii) The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, and as required on long-term contracts including derivative contracts.

(iii) There has been no amounts, required to be transferred, to the investor Education and Protection Fund by the Company.

(Referred to in paragraph (1) of our report of even date)

(i) (a) As explained to us, in respect of fixed assets, the Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

(b) As explained to us, the fixed assets have been physically verified by the management, in accordance with the program of verification adopted by the Company. In our opinion, the frequency of verification is reasonable having regard to the size of the Company and the nature of its assets. To the best of our knowledge, no material discrepancies have been noticed on such verification.

(c) In respect of immovable property, title deeds of all the immovable properties are in the name of the Company.

(ii) As explained to us, the inventory of the Company has been physically verified during the year by the management. In respect of materials lying with third parties these have been confirmed by them. In our opinion the frequency of the verification is reasonable. In our opinion, the discrepancies noticed on verification between the physical stocks and book records were not material, having regard to the size of the operations of the Company.

(iii) As explained to us, the Company has not granted any loans, secured or unsecured, to Companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under Section 189 of the Companies Act, 2013.

(iv) According to the records of the Company examined by us, the Company had given corporate guarantee on behalf of associate and full particulars of the guarantee have been disclosed in the financial statement.

(v) The Company has not accepted any deposits from the public within the meaning of Section 73 and 76 of the Companies Act, 2013 and the rules framed there under to the extent notified.

(vi) We have broadly reviewed the books of account maintained by the Company in respect of products where, pursuant to the rules made by the Central Government of India, the maintenance of cost records has been specified under sub-section (1) of Section 148 of the Companies Act, 2013 and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.

(vii) (a) According to the records of the Company examined by us and the information and explanations given to us, in our opinion, the Company is generally regular in depositing the 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 and other material statutory dues, as applicable, with the appropriate authorities.

(b) According to the information and explanations given to us and the records of the Company examined by us, the particulars of dues of Income-Tax, Sales-Tax, Entry-Tax, Wealth-Tax, Service-Tax, Customs Duty, Excise Duty and Cess as at 31st March, 2016 which have not been deposited on account of disputes are as follows.

Statement of Disputed Dues

Name of Statute

Nature of Dues

Amount Disputed (Rs. )

Period

Forum where dispute is pending

The Central Excise Act

Excise

Duty

12,50,482

2013-14

Commissioner (Appeals), Bhopal

4,88,837

2014-15

Commissioner (Appeals), Bhopal

Penalty

5,00,000

2014-15

Commissioner (Appeals), Bhopal

5,00,000

2014-15

Commissioner (Appeals), Bhopal

5,00,000

2014-15

Commissioner (Appeals), Bhopal

CENVAT Credit

1,47,91,017

2014-15

Commissioner Central Excise, Indore

Differential

Duty

11,63,22,636

2014-15

Central Excise and Service Tax Appellate Tribunal, New Delhi

Differential

Duty

1,03,04,238

2015-16

Commissioner of Central Excise & Service Tax, Indore

Custom Duty

1,92,99,130

2014-15

Commissioner of Customs, Mundra port, Gujrat

Sales Tax Act

Entry Tax

50,47,197

2004-05

M.P. Commercial Tax Appellate Board, Bhopal

State Case

5,19,604

2004-05

M.P. Commercial Tax Appellate Board, Bhopal

State Case

18,68,541

2005-06

M.P. Commercial Tax Appellate Board, Bhopal

VAT Ta x

8,57,947

2010-11

Appeal to Joint Commissioner of Sales Tax, Mumbai

Sales Tax (Commercial Tax)

Entry Tax

5,49,730

2008-09

Commercial Tax Tribunal, Ghaziabad

Entry Tax

14,79,228

2009-10

Commercial Tax Tribunal, Ghaziabad

Entry Tax

1,25,56,862

2009-10

2010-11

Hon''ble Supreme Court of India, Ghaziabad

VAT Ta x

8,32,935

2010-11

Sales Tax (Ghaziabad)

(viii) According to the records of the Company examined by us and the information and explanation given to us, the Company has not defaulted in repayment of loans or borrowings to any financial institutions, banks, Government or any dues to debenture holders as at balance sheet date.

(ix) According to the records of the Company examined by us and the information and explanation given to us, the Company has not raised money by way of initial public offer or further public offer (including debt instruments) and term loan.

(x) During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of material fraud by the Company or any fraud on the Company by its officers or employees, noticed or reported during the year, nor have we been informed of any such case by the management.

(xi) According to the records of the Company examined by us, managerial remuneration has been paid or provided in excess of the limits prescribed under provisions of Section 197 read with schedule V of the Companies Act, 2013. As per the information given to us, the Company is in the process of complying with the provisions of the aforesaid section by putting up the matter to Shareholders'' approval in the ensuing General Meeting and thereafter for the requisite consent of Central Government.

(xii) The Company is not a Nidhi company.

(xiii) According to the records of the Company examined by us and the information and explanation given to us, all transactions with the related parties are in compliance with Section 177 and 188 of Companies Act, 2013 and the details have been disclosed in the financial statement as required by applicable accounting standards.

(xiv) According to the records of the Company examined by us, the Company has not made any preferential allotment or private allotment of shares or fully or partly convertibles debenture during the year.

(xv) According to the records of the Company examined by us and the information and explanation given to us, the Company has not entered into any non-cash transactions with directors or persons connected with him.

(xvi) According to the records of the Company examined by us the Company is not required to be registered under Section 45 IA of the Reserve Bank of India Act, 1934.

For Gupta Saharia & Co.

Chartered Accountants

FRN-103446W

Place : Indore CA Suresh Saharia

Dated : 27th May, 2016 (Partner)

Membership No. 040180

Source : Dion Global Solutions Limited
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