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Taneja Aerospace and Aviation Ltd.

BSE: 522229 | NSE: TANEJAERO | Series: | ISIN: INE692C01020 | SECTOR: Miscellaneous

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Apr 08, 14:37
16.25 0.60 (3.83%)
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AVERAGE VOLUME
5-Day
8,791
10-Day
14,569
30-Day
15,080
7,597
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    15.65

  • Open Price

    14.75

  • Bid Price (Qty.)

    16.25 (29)

  • Offer Price (Qty.)

    16.80 (200)

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Taneja Aerospace and Aviation is not listed on NSE

Annual Report

For Year :
2018 2016 2015 2014 2013 2012 2011 2010 2009

Auditor's Report

Report on the Standalone Financial Statements We have audited the accompanying standalone financial statements of Taneja Aerospace and Aviation Limited (the Company), which comprise the Balance Sheet as at March 31, 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 Standalone 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 standalone 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 safe guarding 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. Auditor''s Responsibility Our responsibility is to express an opinion on these standalone 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 thereunder. 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 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 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 qualified audit opinion on the standalone financial statements. Basis for Qualified Opinion 1) The Company has debited Rs. 34.74 Lakhs under advertisement and travelling expenses being reimbursement to a group company for which no evidence/supporting is provided. This has resulted in overstatement of loss for the year and understatement of amount receivable from the group company by Rs. 34.74 Lakhs. 2) The Company during the year commenced the business of trading in electrical goods (Refer Note No. 38) where in sales are only to LightO Technologies Private Limited (a related party). Further, the Company also gave Inter Corporate Deposit to the said related party which was in excess of the amount approved by the audit committee by Rs.185 Lakhs. As at March 31, 2015, the Company has to receive Rs. 256.31 Lakhs against sale of goods and Rs. 688.84 Lakhs (including interest) against Inter Corporate Deposit. We were not provided with sufficient and appropriate audit evidence about the recoverability of the above amounts. Consequently, we are unable to determine whether any adjustments to these amounts are necessary. 3) We draw attention to Note No. 36 forming part of the standalone financial statements, which refers to the fact that the shareholders of the Company at their meeting (convened on the directions of the Hon''ble High Court of Madras) held on April 15, 2015 have approved the Scheme of Arrangement between the Company and TAAL Enterprises Limited, a wholly owned subsidiary of the Company w.e.f. October 1, 2014 subject to receipt of regulatory approvals. Further, the above mentioned note also refers to the proposed Reduction in Share Capital of the Company as a consequence of the said Scheme, the terms of which were approved by the shareholders of the Company by way of special resolution passed at their Extraordinary General Meeting held on April 15, 2015. Though the said Scheme was sanctioned by the Hon''ble High Court of Judicature at Madras on June 22, 2015 (the copy of which was received on July 23, 2015) i.e. before the adoption of accounts by the Board of Director''s on August 14, 2015, the effect of the said Scheme is not given in the accounts. We are unable to determine its impact, if any, on the standalone financial statements. 4) The Company needs to strengthen its policies, procedures and overall controls in order to provide proper evidences regarding recoverability of debtors, valuation of work in progress and accounting for direct and indirect taxes including statutory compliances.We are unable to determine its impact, if any, on the standalone financial statements. Qualified Opinion In our opinion and to the best of our information and according to the explanations given to us, except for the possible effects of the matters described in the Basis for Qualified Opinion paragraph above, the aforesaid standalone 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 March 31, 2015, and its loss and its cash flows for the year ended on that date. Emphasis of Matter The Company has outstanding MAT Credit Entitlement of Rs. 134.69 Lakhs as on March 31, 2015, which in the opinion of the management, based on the projected future taxable profits, will be utilized within the stipulated time period prescribed as per the provisions of Income Tax Act, 1961. Considering the uncertainties around the assumptions used for projections of future taxable profits and its consequential effect on utilization of MAT Credit Entitlement, we are unable to comment on the recoverability of MAT Credit Entitlement outstanding as at March 31, 2015 and its consequential impact on the Statement of Profit and Loss for the year ended March 31, 2015 and on the Reserves of the Company as on that date (Refer Note No. 18). Our opinion is not qualified in respect of this matter. 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 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. 2. As required by Section 143 (3) of the Act, we report that: (a) We have sought and obtained, except for the matters described in the Basis for Qualified Opinion paragraph, all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit. (b) Except for the possible effects of the matters described in the Basis for Qualified Opinion paragraph above, 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) Except for the possible 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, except AS-2 Valuation of Inventories, specified under section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. (e) The matters 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 March 31, 2015, 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. (g) The qualification relating to the maintenance of accounts and other matters connected therewith are as stated in the Basis for Qualified Opinion paragraph above. (h) 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 as referred to in Note No. 27 to the financial statements. ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses. iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company. (i) a. The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets. b. Part of the fixed assets have been physically verified by the management during the year in line with regular programme of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. According to the information and explanations given to us, no material discrepancies were noticed on such verification as compared to the book records. (ii) a. As explained to us, inventories have been physically verified during the year by the management. In our opinion, the frequency of such verification is reasonable. b. The procedures of physical verification of inventories followed by the management are generally reasonable and adequate in relation to the size of the Company and the nature of its business. c. The Company has maintained proper records of inventory except in the case of Work in Progress. No material discrepancies were noticed on verification between the physical stocks and the book records. In our opinion, the present operative modules of ERP are insufficient to ascertain the cost and arrive at proper valuation of Work in Progress as per the Accounting Policies and Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. (iii) During the year under audit, the Company has granted fresh unsecured loans by way of Inter Corporate Deposit to five companies covered in the register maintained under section 189 of the Companies Act, 2013. The aggregate maximum amount outstanding during the year was Rs. 2022.25 Lakhs and the aggregate year-end balance of such loans amounted to Rs. 1978.64 Lakhs. a. There are no stipulations for the repayment of principal and the interest thereon. Therefore, we are unable to comment on the regularity of receipt of the principal amount and interest thereon. b. No principal or interest can be termed as overdue in the absence of time of repayment and thus we are unable to comment on the steps taken for recovery of principal and interest thereon. (iv) In our opinion and according to the information and explanations given to us, internal control system is inadequate considering the size of the Company and the nature of its business with regard to purchase of inventories and for the sale of goods and services. Further, there is a continuing failure to correct major weakness in internal control systems in the areas of debtors, valuation of work in progress and accounting for direct and indirect taxes including statutory compliances (Refer paragraph 4 of Basis for Qualified Opinion above). (v) As per the explanations given to us, the Company has not accepted any deposits from the public in accordance with the provisions of Sections 73 to 76 of the Act and the rules framed thereunder. Accordingly, the provisions stated in paragraph 3 (v) of the Order is not applicable to the Company. (vi) The cost accounts and records were not made available to us. Hence, we are unable to comment on the maintenance of cost records as specified by the Central Government under Section 148(1) of the Companies Act, 2013. (vii) a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company is irregular in depositing undisputed statutory dues applicable to it with the appropriate authorities during the year. Tax Deducted at Source (TDS) amounting to Rs.21.94 Lakhs and Service Tax amounting to Rs.42.31 Lakhs are in arrears as at March 31, 2015 for a period of more than six months from the date they became payable. b) According to the information and explanations given to us, dues that have not been deposited by the Company on account of disputes are : Name of Nature of Period to the Statute Dues which it relates Customs Act, Customs F.Y. 2007-08 1962 Duty Finance Act, Service F.Y. 2005-06 1994 Tax to F.Y. 2009-10 Central Excise Excise F.Y. 2012-2013 Act, 1944 Duty Central Excise Excise F.Y. 2013-14 Act, 1944 Duty to F.Y. 2014-15 Central Excise Excise F.Y. 2008-09 Act, 1944 Duty to F.Y. 2011-12 Finance Act, Service F.Y. 2008-09 1994 Tax to F.Y. 2012-13 Sales Tax Sales Tax F.Y. 2007-08 to F.Y. 2009-10 Name of the Statute Amount Amount Forum where under paid the dispute is dispute under pending (Rs. in protest Lakhs) (Rs. in Lakhs) Customs Act, 1962 622.67 - CESTAT Finance Act, 1994 317 10 CESTAT Central Excise Act, 1944 23.73 - CESTAT Central Excise Act, 1944 57.50 - Adjudicating Authority Central Excise Act, 1944 80.24 - CESTAT Finance Act, 1994 124.37 - CESTAT Sales Tax 55.00 - Adjudicating Authority c) There are no amounts required to be transferred to the 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 Company does not have any accumulated losses at the end of the financial year. The Company has incurred cash losses during the financial year. However it had not incurred any cash losses in the immediately preceding financial year. (ix) In our opinion and according to the information and explanations given to us, the Company has not defaulted during the year in repayment of dues to financial institutions or banks. The Company did not have any outstanding debentures during the year. (x) In our opinion and according to the information and explanations given to us, the terms and conditions of the guarantee given by the Company for loan taken by its subsidiary from bank is not, prima facie prejudicial to the interest of the Company. (Refer Note No. 27B on guarantee given to bank on behalf of subsidiary). (xi) In our opinion and according to the information and explanations given to us, the Company has raised Term Loan of Rs. 800 Lakhs during the period under audit. Also, the Term Loan availed during the year has, on an overall basis, been applied for the purposes for which the said loans were obtained. (xii) According to the information and explanations given to us, no material fraud on or by the Company has been noticed or reported during the course of our audit. For Haresh Upendra & Co. Chartered Accountants Firm Reg. No.: 103513W Haresh B. Shah Partner Pune, August 14, 2015 Membership No.: 32208