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Sterlite Technologies Ltd.

BSE: 532374 | NSE: STRTECH |

Represents Equity.Intra - day transactions are permissible and normal trading is done in this category
Series: EQ | ISIN: INE089C01029 | SECTOR: Cables - Telephone

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  • Prev. Close

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  • Open Price

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    0.00 (0)

  • Offer Price (Qty.)

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Annual Report

For Year :
2019 2018 2017 2016 2015 2014 2013 2012 2011

Auditor's Report

Report on the audit of the Standalone financial statements

Qualified Opinion

1. We have audited the accompanying standalone financial statements of Sterlite Technologies Limited (“the Company”), which comprise of the Balance Sheet as at March 31, 2019, the Statement of Profit and Loss (including Other Comprehensive Income), Statement of Changes in Equity and Statement of Cash Flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies and other explanatory information.

2. In our opinion and to the best of our information and according to the explanations given to us, except for the indeterminate effects of the matter described in the Basis for Qualified Opinion paragraph of our report, the aforesaid standalone financial statements give the information required by the Companies Act, 2013 (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 March 31, 2019, total comprehensive income (comprising of profit and other comprehensive income), changes in equity and its cash flows for the year then ended.

Basis for Qualified opinion

3. We draw your attention to Note 44 to the standalone financial statements, which states that the Company in an earlier year received an order of CESTAT upholding a demand of Rs. 188 crores (including penalties but excluding interest) (''188 crores as at March 31, 2018) in relation to a excise/customs matter. The Company’s appeal against this order with the Honourable Supreme Court has been admitted. Based on the current status and legal advice received, the management has recognised a provision amounting to Rs. 4.5 crores as on March 31, 2019, (Rs. 4.5 crores as at March 31, 2018), in respect of this matter based on its best estimate. Pending disposal of the matter by the Honourable Supreme Court, we are unable to comment on the adequacy of the provision made towards the amount of excise / customs duty payable.

4. We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified opinion.

Emphasis of Matter - Amortisation of goodwill recognized on acquisition

5. We draw attention to Note 46 to the standalone financial statements which describes that the Company had recognised Goodwill on amalgamation during the financial year ended March 31, 2016, which is being amortised over a period of five years from the appointed date of September 29, 2015, in accordance with the accounting treatment prescribed under the Scheme of amalgamation approved by the Gujarat High Court. Our opinion is not modified in respect of this matter.

Key audit matters

6. Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements of the current year. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. In addition to the matter described in the Basis for Qualified Opinion paragraph above, we have determined the matters described below to be the key audit matters to be communicated in our report.

Key audit matter

How our audit addressed the key audit matter

1. Revenue Recognition on transition to Ind AS 115

(Refer note 2(b), 3 and 51 to the standalone financial statements)

Our testing approach included both tests of controls as well

substantive procedures (i.e test of details).

Effective April 1, 2018, the Company has adopted Ind AS 115

“Revenue from Contracts with Customers”. Consequently,

As part of our test of controls, we understood and evaluated the

management has reviewed its existing contracts with customers

design and tested the operating effectiveness of controls over

under the model provided in Ind AS 115.

revenue recognition.

Management has applied significant judgements with respect to:

Our substantive testing of revenue transactions was designed to

- Combination of contracts entered into with the same customer;

cover certain large and complex contracts and testing of sample of

other contracts. Our procedures included, among other things:

- Identification of performance obligations;

- Allocation of consideration to identified performance obligations;

- Reading of selected contracts to identify significant terms of

- Recognition of revenue over a period of time or at a point in

the contracts;

time based on timing when control is transferred to customer.

- Assessing appropriateness of management’s significant

For assessment of the date of transfer of control, Management

judgements in accounting for identified contracts;

has obtained legal opinion in respect of certain arrangements.

- Evaluation of the contract terms and also consideration of the legal

Further, for contracts where revenue is recognised over a period

opinion obtained by Management with respect to assessment of

of time, the Company made estimates which impact the revenue

the date of transfer of control;

recognition. Such estimates include, but are not limited to:

- Testing of timing of recognition of revenue (including procedures

related to cut off) in line with the terms of contracts;

- costs to complete,

. rnntrart ricl/''c

- contract risks,

- Testing the key management assumptions used to estimate

contract cost, contract risks, claims etc;

- price variation claims,

- Testing of journal entries for unusual/irregular revenue

- liquidated damages

transactions; and

We focused on this area because a significant portion of the

- Consideration of the adequacy of the disclosures as required to be

revenue generated requires management to exercise judgement

made by Management under the new standard.

and therefore could be subject to material misstatement due to

fraud or error.

Based on above procedures, we did not note any significant

exceptions in the estimates and judgements applied by the

In addition, first time disclosures required under Ind AS 115 have

Management in revenue recognition including those relating to

been identified as an area of focus for the current year.

presentation and disclosures.

2. Accounting policy and fair valuation of investments in joint venture in accordance with Ind AS 109 Refer note 2 (o) (Accounting

Policies) to the Standalone Financial Statements

The Company makes investments in start-ups and growth

Our audit procedures included:

companies. Such investment activity is separately managed from

the manufacturing activities with a stated objective of earning a

- Understanding the controls of the Company around investment

return from appreciation in the value of the investments and are

strategy in start-ups and growth companies;

made with identified exit strategies. The total carrying value of such

- Evaluation of the design and testing the operating effectiveness

investments as at March 31, 2019 is Rs. 22.86 crores. Management

of the aforesaid controls;

has concluded that basis the terms of the contract with the investee

- Evaluation of the Company’s investment strategy and

companies such investments will qualify to be investment in

internal organization;

Associates or Joint Ventures. Further Management has evaluated

- Consideration of the investment subscription agreements for the

the requirements of Ind AS 28 for availing the exemption from

terms and conditions;

applying equity method of accounting and concluded that such

- Discussion with the relevant management personnel engaged

exemption is available to the Company for such investments. The

in managing the investment decisions and involved in such

Company has accordingly elected to measure such investments at

transactions to understand the purpose of such investments and

fair value through Profit and Loss account in accordance with Ind

how the investment activity is managed;

AS 109 in the standalone financial statements. Management has

- Evaluation of the criteria considered by the management in their

obtained a report from an independent valuer for determining the

conclusion on accounting treatment in accordance with the

fair valuation of the investments as at the Balance Sheet date.

requirements of Ind AS 28 and Ind AS 109.

- Consideration of adequacy of disclosures in the standalone

We focused on this area as there was significant judgement

financial statements along with related accounting policies.

involved in concluding whether the exemption from equity method

- Assessment of the methodology and the appropriateness

of accounting for such investments is available to the Company and

of the valuation models and inputs used by management to

the fair valuation of these investments contain assumptions that are

value investments.

not observable.

Based on the results above procedures, we found the accounting

policy followed by Management to be appropriate and did not find

any material exceptions to management’s estimates and judgements

with regard to the accounting and fair valuation of investments in

accordance with the relevant accounting standard.

Other Information

7. The Company’s Board of Directors is responsible for the other information. The other information comprises the information included in the Directors’ Report, but does not include the standalone financial statements and our auditor’s report thereon.

Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of management and those charged with governance for the financial statements

8. The Company’s Board of Directors is responsible for the matters stated in section 134(5) of 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, changes in equity 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. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgements 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 standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

9. In preparing the standalone financial statements, management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so. Those Board of Directors are also responsible for overseeing the Company’s financial reporting process.

Auditor’s responsibilities for the audit of the financial statements

10. Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.

11. As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:

- Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

- Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under Section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the company has adequate internal financial controls with reference to standalone financial statements in place and the operating effectiveness of such controls.

- Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

- Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern.

- Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

12. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

13. We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

14. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current year and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on other legal and regulatory requirements

15. As required by the Companies (Auditor’s Report) Order, 2016 (“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 B a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

16. 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, except for the matter described in the Basis for Qualified Opinion paragraph above, 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 (including other comprehensive income), Statement of Changes in Equity and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

(d) Except for the indeterminate effects of the matters described in the Basis for Qualified Opinion paragraph above, in our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act.

(e) The outcome of the matter described in the Basis for Qualified Opinion paragraph above in our opinion, may have an adverse effect on the functioning of the Company.

(f) On the basis of the written representations received from the directors as on 31st March, 2019 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2019 from being appointed as a director in terms of Section 164 (2) of the Act.

(g) The reservation relating to maintenance of accounts and other matters connected therewith are as stated in the Basis for Qualified Opinion paragraph above.

(h) With respect to the adequacy of the internal financial controls with reference to standalone financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure A”.

(i) 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) Except for the matters described in the Basis for Qualified Opinion paragraph above, the Company has disclosed the impact, if any, of pending litigations as at March 31, 2019 on its financial position in its standalone financial statements - Refer Note 22, 39 and 44 to the standalone financial statements;

(ii) The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts - Refer Note 20 to the standalone financial statements;

(iii) There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended March 31, 2019.

(iv) The reporting on disclosures relating to the Specified Bank Notes is not applicable to the Company for the year ended March 31, 2019.

Annexure A to Independent Auditors’ Report

Referred to in paragraph 16(h) of the Independent Auditors’ Report of even date to the members of Sterlite Technologies Limited on the standalone financial statements for the year ended March 31, 2019

Report on the Internal Financial Controls with reference to standalone financial statements under Clause (i) of Sub-section 3 of Section 143 of the Act

1. We have audited the internal financial controls with reference to standalone financial statements of Sterlite Technologies Limited (the “Company”) as of March 31, 2019 in conjunction with our audit of the standalone financial statements of the Company for the year ended as on that date.

Management’s Responsibility for Internal Financial Controls

2. The Company’s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India (ICAI). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.

Auditors’ Responsibility

3. Our responsibility is to express an opinion on the Company''s internal financial controls with reference to standalone financial statements based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) and the Standards on Auditing deemed to be prescribed under section 143(10) of the Act to the extent applicable to an audit of internal financial controls, both applicable to an audit of internal financial controls and both issued by the ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls with reference to standalone financial statements was established and maintained and if such controls operated effectively in all material respects.

4. Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system with reference to standalone financial statements and their operating effectiveness. Our audit of internal financial controls with reference to standalone financial statements included obtaining an understanding of internal financial controls with reference to standalone financial statements, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.

The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the standalone financial statements, whether due to fraud or error.

5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company’s internal financial controls system with reference to standalone financial statements.

Meaning of Internal Financial Controls with reference to standalone financial statements

6. A company''s internal financial controls with reference to standalone financial statements is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of standalone financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial controls with reference to standalone financial statements includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of standalone financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company''s assets that could have a material effect on the standalone financial statements.

Inherent Limitations of Internal Financial Controls with reference to standalone financial statements

7. Because of the inherent limitations of internal financial controls with reference to standalone financial statements, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls with reference to standalone financial statements to future periods are subject to the risk that the internal financial controls with reference to standalone financial statements may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Basis for Qualified Opinion

8. According to the information and explanations given to us and based on our audit, the following material weakness has been identified in the operating effectiveness of the Company’s internal financial controls with reference to standalone financial statements as at March 31, 2019:

The Company’s internal financial controls over the evaluation and assessment of provision for an excise/customs matter pending with the Honourable Supreme Court were not operating effectively which could potentially result in the Company not recognising adequate provision in respect of this matter.

Refer paragraph 3 of the main audit report.

A ‘material weakness’ is a deficiency, or a combination of deficiencies, in internal financial control with reference to standalone financial statements, such that there is a reasonable possibility that a material misstatement of the company''s annual or interim standalone financial statements will not be prevented or detected on a timely basis.

Qualified opinion

9. In our opinion, except for the possible effects of the material weakness described in the Basis for Qualified Opinion paragraph above on the achievement of the objectives of the control criteria, the Company has maintained, in all material respects, adequate internal financial controls with reference to standalone financial statements and such internal financial controls with reference to standalone financial statements were operating effectively as of March 31, 2019, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the ICAI.

10. We have considered the material weakness identified and reported above in determining the nature, timing, and extent of audit tests applied in our audit of the standalone financial statements of the Company for the year ended March 31, 2019 and the material weakness has affected our opinion on the standalone financial statements of the Company and we have accordingly issued a modified report on the standalone financial statements.

Annexure B to Independent Auditors’ Report

Referred to in paragraph 15 of the Independent Auditors’ Report of even date to the members of Sterlite Technologies Limited on the standalone financial statements as of and for the year ended March 31, 2019

i. (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation, of fixed assets.

(b) The fixed assets are physically verified by the Management according to a planned programme designed to cover all the items once in three years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, fixed assets have been physically verified by the Management during the previous year and no material discrepancies have been noticed on such verification. Further, the physical verification of cables is impractical due the manner in which they have been installed/laid.

(c) The title deeds of immovable properties, as disclosed in Note 4 on fixed assets to the standalone financial statements, are held in the name of the Company.

ii. The physical verification of inventory excluding stocks lying with third party have been conducted at reasonable intervals by the Management during the year. In respect of inventory lying with third parties, these have substantially been confirmed by them.

The discrepancies noticed on physical verification of inventory as compared to book records were not material and have been appropriately dealt with in the books of accounts.

iii. The Company has not granted any secured or unsecured loans, to companies covered in the register maintained under Section 189 of the Act. There are no companies covered in the register maintained under Section 189 of the Act. Therefore, the provisions of Clause 3(iii), (iii)(a), (iii)(b) and (iii)(c) of the said Order are not applicable to the Company.

iv. In our opinion, and according to the information and explanations given to us, the Company has complied with the provisions of Section 185 and 186 of the Companies Act, 2013 in respect of the loans and investments made and guarantees and security provided by it.

v. The Company has not accepted any deposits from the public within the meaning of Sections 73, 74, 75 and 76 of the Act and the Rules framed there under to the extent notified.

vi. Pursuant to the rules made by the Central Government of India, the Company is required to maintain cost records as specified under Section 148(1) of the Act in respect of manufacture of copper cables. We have broadly reviewed the same 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 information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is regular in depositing the undisputed statutory dues, including provident fund, employees’ state insurance, income tax, duty of customs, cess, goods and service 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, there are no dues of goods and service tax and value added tax which have not been deposited on account of any dispute.

The particulars of dues of income tax, service tax, duty of customs and duty of excise as at March 31, 2019 which have not been deposited on account of a dispute, are as follows:

Name of the statute

Nature of dues

Amount in INR Crores$

Period to which the amount relates

Forum where the dispute is pending

Central Excise Act, 1944#

Excise Duty

188.00

2001-2003

Honourable Supreme Court

Excise Duty

30.07

2001-2003

Bombay High Court

Excise Duty

0.88

2002-2003

CESTAT Mumbai

Excise Duty

1.16

2013-2017

Additional commissioner Central GST and Central Excise, Daman

Customs Act, 1962#

Custom Duty

1.64

2013-2014

The commissioner of Customs (appeals)

Custom Duty

67.12

2001-2003

Mumbai High Court

Central Sales Tax Act, 1956

Central

Sales Tax 0.38

2014-2015

Assistance Commissioner of State Tax, Ahmedabad

Finance Act, 1994

Service Tax

0.42

2002-2007

Bombay High Court

Service Tax

0.45

1999-2003

Gujrat High Court

Service Tax

0.14

2013-2017

Commissioner- Appeals - Nasik

Service Tax

1.31

2013-16

CESTAT Gujrat

Income Tax Act, 1961*

Income Tax

2.67

AY 2013-14, AY 2015-16

Commissioner (Appeals) - Mumbai

Income Tax

0.71

AY 2011-12, AY 2013-14, AY 2014-15, AY 2015-16

Commissioner (Appeals) - Ahmedabad

Income Tax

0.04

AY 2012-13

Gujarat High Court

Income Tax

0.15

AY 2010-11, 2009-10

Income Tax Appellate Tribunal - Ahmedabad

* Amount disclosed above are after considering the rectification application filed by the Company with Income tax authorities.

# Demand disclosed above does not include the interest claimed but not quantified by the Central excise/customs authorities.

$ Net of amounts paid under protest.

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 institution or bank or Government or dues to debenture holders as at the balance sheet date. As stated in Note 39 to the standalone financial statements, the Company continues to dispute amounts aggregating Rs. 18.87 crores claimed by a bank in the earlier years, towards import consignments under letter of credit not accepted by the Company, owing to discrepancies in documents. Since the matter is in dispute, we are unable to determine whether there is a default in repayment of dues to the said bank.

ix. In our opinion, and according to the information and explanations given to us, the moneys raised by way term loans (including debt instruments) have been applied for the purposes for which they were obtained. The Company has not raised any moneys by way of initial public offer or further public offer.

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 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. The Company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act.

xii. As the Company is not a Nidhi Company and the Nidhi Rules, 2014 are not applicable to it, the provisions of Clause 3(xii) of the Order are not applicable to the Company.

xiii. The Company has entered into transactions with related parties in compliance with the provisions of Sections 177 and 188 of the Act. The details of such related party transactions have been disclosed in the standalone financial statements as required under Indian Accounting Standard (Ind AS) 24, Related Party Disclosures specified under Section 133 of the Act.

xiv. The Company has not made a preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review. Accordingly, the provisions of Clause 3(xiv) of the Order are not applicable to the Company.

xv. The Company has not entered into any non cash transactions with its directors or persons connected with him. Accordingly, the provisions of Clause 3(xv) of the Order are not applicable to the Company.

xvi. The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, the provisions of Clause 3(xvi) of the Order are not applicable to the Company.

For Price Waterhouse Chartered Accountants LLP

Firm Registration Number: 012754N/N500016

Neeraj Sharma

Partner

Membership Number: 108391

Place: Pune

Date: April 23, 2019