AUDITORS
TO THE MEMBERS OF
THE BENGAL COAL COMPANY LIMITED
Report on the Financial Statements
We have audited the accompanying financial statements of The Bengal Coal Company
Limited (the Company) which comprise the balance sheet as at 31st March, 2014 and the
statement of profit and loss for the year then ended and a summary of significant
accounting policies and other explanatory information.
Managements Responsibility for the Financial Statements
Management is responsible for 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 Standards referred to in sub-section (3C) of
section 211 of the Companies Act, 1956 ("the Act") read with the General
Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate Affairs in respect
of Section 133 of the Companies Act, 2013. This responsibility includes the design,
implementation and maintenance of internal control 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 conducted our audit in accordance with the Standards on Auditing issued by the
Institute of Chartered Accountants of India. 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 auditors
judgement, 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 control relevant to the Companys preparation and fair presentation of
the financial statements in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the effectiveness of
the entitys internal control. An audit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of the accounting estimates made by
management, as well as evaluating the overall presentation of the financial statements.
Except as stated in point (b) to basis for qualified opinion paragraph, we believe that
the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our qualified audit opinion.
Basis for Qualified Opinion
(a) Where appropriate audit evidence is available
(i) Non provision against diminution in book value of long term investments in Yule
Financing & Leasing Co.Ltd.,The New Beerbhoom Coal Co.Ltd., Webfil Ltd. and Yule Agro
Industries Ltd. amounting to Rs.41.36 lakhs.
(ii) Non provision against non readability of the principal and interest on maturity
amounting to Rs. 30 lakhs and Rs. 77,096 /- respectively from a body corporate.
(b) Where adequate audit evidence is not available due to long pending issues from the
Central Government, Commissioner of Payments side relating to nationalisation of the
company with effect from 1 st May, 1973
(i) According to the information and explanations given to us, we are unable to
ascertain the extent of reliability of the amount of Rs. 18,51,915/- pertaining to trade
receivables (Note -12 to the accounts).
(ii) As regards amount receivable from Central Government Rs. 2,53,60,543/- referred to
in Note - 2 (f) to the accounts, in the absence of any necessary confirmations from the
appropriate authorities we are unable to state if the interest aggregating Rs.2,32,29,629
(including Rs.78,978/- for the year) has actually accrued to the company. Further from the
available records and information it has not been possible to ascertain the extent to
which Rs. 19,74,458 being principal amount and Rs.93,456 being Interest on Sales Tax
receivable as per claims pending under appeal included in Rs. 2,53,60,543/- as aforesaid
may eventually be realised.
(iii) As stated in Note - 2 (d) to the accounts, only those claims which have been
admitted by the Commissioner of Payments or are still pending with them / appellate courts
have been included in Other Liabilities relating to pre nationalisation except to the
extent of Rs. 1,73,16,676/- for the reasons indicated therein and therefore, adjustments
may be required in these accounts in respect of the aforesaid pending claims / claims
under appeals. Further, as per the order of the Commissioner of Payments admitting /
rejecting the claims of the creditors against the company were not available in all cases,
we have accepted the amount of such claims (i.e. admitted or rejected as well as pending
claims and claims under appeal) as represented to us by the company.
Qualified Opinion
In our opinion and to the best of our information and according to the explanations
given to us, except for the effects of the matter described in the Basis for Qualified
Opinion paragraph, the 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 31
st March, 2014;
(b) in the case of the Statement of Profit and Loss, of the loss for the year ended on
that date.
Emphasis of Matter
We draw attention to Note - 2 (c) to the accounts which describes necessary adjustments
to be made in the books amounting to Rs. 85.74 lakhs on account of settlement of SBIs
claim on the company after legal formalities for withdrawal of the pending suit by the SBI
before the debt recovery tribunal is completed. Our opinion is not qualified in respect of
this matter.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors Report)Order,2003 issued by the Central
Government of India in terms of subsection (4A) of Section 227 of the Act, we give in the
Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.
2. As required by section 227(3) of the Act, we report that:
a. except for the matters stated in Basis for Qualified Opinion paragraph, we have
obtained all the information and explanations which to the best of our knowledge and
belief were necessary for the purpose of our audit;
b. except for the matters stated in Basis for Qualified Opinion paragraph, 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 and Statement of Profit & Loss dealt with by this report are
in agreement with the books of account.
d. except for the matter described in the Basis for Qualified Opinion paragraph,, in
our opinion, the balance sheet and statement of profit and loss comply with the Accounting
Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 read
with the General Circular 15/2013 dated 13 September 2013 of the Ministry of Corporate
Affairs in respect of Section 133 of the Companies Act, 2013; and
e. On the basis of written representations received from the Directors as on 31 st
March, 2014, and taken on record by the Board of Directors, none of the directors is
disqualified as on 31 st March, 2014from being appointed as a Director in terms of clause
(g) of sub section (1) of Section 274 of the Act.
|
DILIP KUMAR SAHA, FCA, Partner |
|
Membership No.050482 |
|
For and on behalf of |
|
SUJIT CHAKRAVORTI & ASSOCIATES |
| Place :Kolkata |
Chartered Accountants |
| Date:The20th Dayof June,2014 |
Firm Registration No. 308153E |
The Annexure referred to in paragraph 1 of the Our Report of even date to the members
of The Bengal Coal Company Limited on the accounts of the company for the year ended 31 st
March, 2014.
On the basis of such checks as we considered appropriate and according to the
information and explanation given to us during the course of our audit, we report that:
1 The Company has no fixed assets and hence the relevant clauses are not applicable.
2 The Company has no inventories and hence the relevant clauses are not applicable.
3 a) The Company has not granted any loans secured or unsecured to any Companies, firms
or other parties covered in the register maintained U/s 301 of the Act. Hence, comment
under sub - clauses (b), (c) and (d) of Clause 3(iii) of the Companies (Auditors Report)
Order,2003 is not required.
e) The Company has not taken any loan from companies, firms or other parties listed in
the register maintained under U/s 301 of the Act. Therefore, the provisions of the
sub-clauses (f) & (g) of clause 3(iii) of the Order are not applicable to the company.
4 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. Further, on
the basis of our examination of books and records of the Company, and according to
information and explanation given to us, we have neither come across nor have been
informed of any continuing failure to correct major weaknesses in the aforesaid internal
control system.
5 The company has not entered into any contracts or arrangements referred to in Section
301 of the Companies Act, 1956.
6 The Company has not accepted any deposits from the public within the meaning of
Section 58A, 58AA or any other relevant provisions of the Act and the rules framed there
under.
7 As per information and explanation given by the management, since there is no longer
any business, the company does not have any internal audit system.
8 Maintenance of the cost records prescribed by Central Government of India under
clause (d) of sub-section (1) of Section 209 of the Act is not applicable to the Company.
9 a) The Company is regular in depositing with appropriate authorities, undisputed
statutory dues including Income Tax, Wealth Tax and other material statutory dues
applicable to it. According to the information and explanation given to us, no undisputed
amount payable in respect of Income Tax and other statutory dues were in arrears as at 31
st March,2013 for a period of more than six months from the date they became payable.
b) According to the information and explanation given to us and the records examined by
us, dues of Income Tax, Sales Tax, Wealth Tax, Service Tax, Excise Duty and Cess as at 31
st March,2014, which have not been deposited on account of dispute is Nil except an amount
of Rs. 27.46 lakhs relating to disputed income tax demand against which written petition
has been filed by the Company, which is pending before the Noble Calcutta High Court.
The demand has been stayed on the condition that a sum of Rs. 22 lakhs will be kept in
deposit account with UBI underthe lien with the IncomeTax Authorities till disposal of the
appeal.
10 The Company has accumulated losses as at 31 st March, 2014 and the net worth has
been totally eroded.
11 According to the records of the Company examined by us and the information and
explanations given to us, there are no dues payable to any financial institutions or banks
or debenture holders as at the balance sheet date except with SBI as stated in Note - 2
(c) to the accounts for which necessary adjustments to be made in the books amounting to
Rs. 85 lakhs on account of settlement of SBIs claim on the company, after legal
formalities for withdrawal of the pending suit by the SBI before the debt recovery
tribunal is completed.
12 The Company has not granted any loans and advances on the basis of security by way
of pledge of shares, debentures and other securities.
13 The provisions of any special statute applicable to chit fund / nidhi / mutual
benefit fund / societies are not applicable to the Company.
14 The Company has maintained proper records of the transactions of investments and
contracts and timely entries have been made therein. All shares are being held by the
company in its own name.
15 In our opinion, and according to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from banks or financial
institutions during the year.
16 According to the records of the Company examined by us and the information and
explanations given to us, the Company has not taken any term loan during the year.
Further, there is no outstanding term loan as at the Balance Sheet date.
17 On the basis of an overall examination of the Balance Sheet of the Company, in our
opinion and according to the information and explanations given to us, there are no funds
raised on short-term basis, which have been used for long-term investment.
18 The Company has not made any preferential allotment of shares to the parties and
companies covered in the register maintained under Section 301 of the Act during the year
and hence, commenting under this clause is not required.
19 The Company has not issued any Debentures and hence commenting under this clause is
not required.
20 The Company has not raised any money by public issue during the year.
21 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 fraud on or by the Company, noticed or reported during the year, nor have we
been informed of such case by the Management.
|
DILIP KUMAR SAHA, FCA, Partner |
|
(Membership No.050482) |
|
For and on behalf of |
|
SUJITCHAKRAVORTI & ASSOCIATES |
| Place: Kolkata |
Chartered Accountants |
| Date:The 20th Day of June, 2014 |
Firm Registration No. 308153E |
+91-9892691696
