<dhhead>Independent Auditors Report</dhhead>
To,
The Members of Madhusudan Industries Limited Report on the Audit of
Financial Statements Opinion
We have audited the accompanying financial statements of
MADHUSUDAN INDUSTRIES LIMITED ("the Company"), which
comprise the Balance Sheet as at 31st March, 2023, the Statement of Profit and
Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the
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
(hereinafter referred to as "the financial statements")
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 Companies Act, 2013 ("the Act") in the manner so required and give a true
and fair view in conformity with the Indian Accounting Standards prescribed under the
section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015,
as amended, ("Ind AS") and other accounting principles generally accepted in
India, of the state of affairs (financial position) of the Company as at 31st
March, 2023, the profit (financial performance including other comprehensive income),
changes in equity and its cash flows for the year ended on that date.
Basis of Opinion
We conducted our audit of the financial statements in accordance with
the Standards on Auditing ("SAs") specified under section143(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 ("ICAI") together with the ethical
requirements that are relevant to our audit of the financial statements under the
provisions of the Act and the Rules made thereunder, and we have fulfilled our other
ethical responsibilities in accordance with these requirements and the ICAI’s Code of
Ethics. We believe that the audit evidence obtained by us is sufficient and appropriate to
provide a basis for our opinion on financial statements.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment,
were of most significance in our audit of the financial statements of the current period.
These matters were addressed in the context of our audit of the financial statements as a
whole, and in forming our opinion thereon, and we do not provide a separate opinion on
these matters. However, in our opinion, there was no matter of most significance in our
audit of the financial statements of the current period.
Information other than the Financial Statements and Auditor’s
Report thereon
The Company’s management and the Board of Directors are
responsible for the other information. The other information comprises the information
included in the Management Discussion and Analysis, Board’s Report including
Annexures to Board’s Report, Business Responsibility Report, Corporate Governance
Report, and Shareholders’ Information, but does not include the financial statements
and our auditor’s report thereon.
Our opinion on the 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 financial statements, our
responsibility is to read the other information and, in doing so, consider whether the
other information is materially inconsistent with the financial statements or our
knowledge obtained during the course of our 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.
Management’s and Board of Directors’ Responsibilities for the
Financial Statements
The Company’s Management and the Board of Directors are
responsible for the matters stated in section 134(5) of the Act with respect to the
preparation and presentation of these financial statements that give a true and fair view
of the financial position, financial performance (including other comprehensive income),
changes in equity and cash flows of the Company in accordance with the accounting
principles generally accepted in India, including the Indian Accounting Standards
specified under section 133 of the Act read with relevant Rules issued thereunder. 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 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.
In preparing the financial statements, the Management and the Board of
Directors are 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.
The Board of Directors are also responsible for overseeing the
Company’s financial reporting process.
Auditor’s Responsibilities for the Audit of the Financial
Statements
Our objectives are to obtain reasonable assurance about whether the
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 financial statements.
As part of an audit in accordance with SAs, we exercise professional
judgment and maintain professional skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the
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 Companies Act, 2013, we are also responsible for expressing our
opinion on whether the Company has adequate internal financial controls system 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 and the
Board of Directors.
• Conclude on the appropriateness of management’s and Board
of Directors’ 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 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
financial statements, including the disclosures, and whether the financial statements
represent the underlying transactions and events in a manner that achieves fair
presentation.
Materiality is the magnitude of misstatements in the financial
statements that, individually or in aggregate, makes it probable that the economic
decisions of a reasonably knowledgeable user of the financial statements may be
influenced. We consider quantitative materiality and qualitative factors in (i) planning
the scope of our audit work and in evaluating the results of our work; and (ii) to
evaluate the effect of any identified misstatements in the financial statements.
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.
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.
From the matters communicated with those charged with governance, we
are required to determine those matters that were of most significance in the audit of the
financial statements of the current period 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
As required by the Companies (Auditor’s Report) Order, 2020
("the Order"), issued by the Central Government of India in terms of subsection
(11) of section 143 of the Companies Act, 2013, we give in "Annexure A" 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, based on our audit 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 (including
Other Comprehensive Income),the Statement of Changes in Equity and the Statement of Cash
Flows(the financial statements) dealt with by this Report are in agreement with the books
of account.
(d) In our opinion, the aforesaid financial statements comply with the
Indian Accounting Standards specified under Section 133 of the Act, read with the
Companies (Indian Accounting Standards) Rules, 2015 as amended.
(e) On the basis of the written representations received from the
directors as on 31st March, 2023 taken on record by the Board of Directors,
none of the directors is disqualified as on 31st March, 2023 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
with reference to financial statements of the Company and the operating effectiveness of
such controls, refer to our separate Report in "Annexure B". Our report
expresses an unmodified opinion on the adequacy and operating effectiveness of the
Company’s internal financial controls with reference to financial statements.
(g) With respect to the matter to be included in the Auditor’s
Report in accordance with the requirements of section 197(16) of the Act, as amended, we
state that no remuneration was paid by the Company to its directors during the year under
report.
(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, as amended, 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 as at 31st
March, 2023 on its financial position in its financial statements. Refer Note no.34(b) to
the financial statements.
ii. According to the information and explanations provided to us, the
Company did not have any long term contracts including derivative contracts for which
there were any material foreseeable losses.
iii. There has been no delay in transferring amounts, required to be
transferred, to the Investor Education and Protection Fund by the Company.
iv. (a) The Company’s Management and the Board of Directors have
represented that, to the best of their knowledge and belief, no funds have been advanced
or loaned or invested (either from borrowed funds or share premium or any other sources or
kind of funds) by the Company to or in any other person or entity, including foreign
entity ("Intermediaries"), with the understanding, whether recorded in writing
or otherwise, that the Intermediary shall, whether, directly or indirectly lend or invest
in other persons or entities identified in any manner whatsoever by or on behalf of the
Company ("Ultimate Beneficiaries") or provide any guarantee, security or the
like on behalf of the Ultimate Beneficiaries.
(b) The Company’s Management and the Board of Directors have
represented, that, to the best of their knowledge and belief, no funds have been received
by the Company from any person or entity, including foreign entity ("Funding
Parties"), with the understanding, whether recorded in writing or otherwise, that the
Company shall, whether, directly or indirectly, lend or invest in other persons or
entities identified in any manner whatsoever by or on behalf of the Funding Party
("Ultimate Beneficiaries") or provide any guarantee, security or the like on
behalf of the Ultimate Beneficiaries; and
(c) Based on the audit procedures that have been considered reasonable
and appropriate in the circumstances, nothing has come to our notice that has caused us to
believe that the representations under sub-clause (i) and (ii) of Rule 11(e) as provided
under (a) and (b) above, contain any material misstatement.
v. The Company has not declared or paid any dividend during the year
and has not proposed final dividend for the year.
vi. Our report in terms of clause (g) of Rule 11 of the Companies
(Audit and Auditors) Rules, 2014, as amended, on whether the Company has used accounting
software with specified features for maintaining the books of account is now made
applicable by the Government in respect of financial year commencing on or after 1st
April, 2023. Hence no reporting is required for F.Y. 2022-23.
ANNEXURE-A TO THE INDEPENDENT AUDITOR’S REPORT
(Referred to in ‘Report on Other Legal and Regulatory
Requirements’ section of our report to the Members of
MADHUSUDAN INDUSTRIES LIMITED of even date for the year ended 31st
March, 2023)
Based on the audit procedures performed by us for the purpose of
reporting a true and fair view on the financial statements of the Company and taking into
consideration the information and explanations provided to us by the Company and the books
of account and other records examined by us in the normal course of audit and to the best
of our knowledge and belief, we state that:
1) In respect of the Company’s Property, Plant and Equipment
and Intangible Assets:
(a) (A) The Company has maintained proper records showing full
particulars, including quantitative details and situation of Property, Plant and
Equipment.
(B) The Company does not have intangible assets.
(b) The Company has a regular program of physical verification of
its property, plant and equipment by which the property, plant and equipment are verified
in a phased manner. In our opinion, the periodicity of physical verification is reasonable
having regard to the size of the Company and the nature of its assets. No material
discrepancies were noticed on such verification during the year.
(c) The title deeds of all immovable properties (other than
properties where the company is the lessee and the lease agreements are duly executed in
favour of the lessee) disclosed in the financial statements under the head "Property
Plant and Equipment", are held in the name of the Company.
(d) The Company has not revalued any of its Property, Plant and
Equipment during the year.
(e) No proceedings have been initiated during the year or are
pending against the Company as at 31st March, 2023 for holding any benami
property under the Benami Transactions (Prohibition) Act, 1988 (as amended in 2016) and
rules made thereunder.
2. The Company does not hold any physical inventories during the
year. Thus clauses 3(ii)(a) and (b) of the Order are not applicable for the year under
report.
3. (a) During the year, the Company has not provided any
guarantee or security or granted any loans or advances in the nature of loans, secured or
unsecured, to companies, firms, Limited Liability Partnerships or any other parties and
hence reporting under clauses 3(iii)(a),(b), (c), (d), (e) and (f) of the Order are not
applicable for the year under report.
(b) In our opinion, the investments made during the year are, prima
facie, not prejudicial to the Company’s interest.
4. In our opinion, the Company has complied with the provisions of
Sections 185 and 186 of the Companies Act, 2013 with respect to the investments made. The
Company has not given any loans, provided any guarantee or security during the year.
5. The Company has not accepted any deposits from the public within
the meaning of the directives issued by the Reserve Bank of India, provisions of Sections
73 to 76 of the Act, or any other relevant provisions of the Act and the rules framed
thereunder. Hence reporting under clause 3(v) of the Order is not applicable.
6. In our opinion and according to the information and explanations
given to us, the Company is not required to maintain cost records specified by the Central
Government under sub-section (1) of section 148 of the Act.
7. (a) The Company has generally been regular in depositing
undisputed statutory dues including Goods and Service Tax, Provident Fund, Employees’
State Insurance, Income-tax, Sales-tax, Value Added Tax, Duty of Customs, Duty of Excise,
Service-tax, Cess and any other statutory dues, as applicable, to the appropriate
authorities. Further, no undisputed amounts payable in respect thereof were outstanding at
the year end for a period of more than six months from the date they became payable.
(b) According to the information and explanations given to us,
following disputed statutory dues have not been deposited on account of disputed matters
pending before appropriate authorities are as under:
Name of Statute |
Nature of Dues |
Amount Rs. (Lakhs) |
Forum where dispute is pending |
| 1 Gujarat Sales Tax Act |
Sales-tax |
139.34 |
Honourable Gujarat High Court |
|
|
|
|
|
|
|
|
8. There were no transactions relating to previously unrecorded
income that have been surrendered or disclosed as income during the year in the tax
assessments under the Income Tax Act, 1961 (43 of 1961).
9. The Company does not have any loans or borrowing from any lender
during the year. Accordingly, clauses 3(ix) (a), (b), (c), (d), (e) and (f) of the Order
are not applicable.
10. (a) The Company has not raised any money by way of initial
public offer or further public offer (including debt instruments) during the year. Hence,
reporting under clause 3(x)(a) of the Order is not applicable to the Company for the year
under report.
(b) During the year, the Company has not made any preferential
allotment or private placement of shares or convertible debentures (fully, partially or
optionally convertible) and hence, reporting under clause 3(x)(b) of the Order is not
applicable for the year under report.
11. (a) No fraud by the Company or any fraud on the Company has
been noticed or reported during the year.
(b) No report under sub-section (12) of section 143 of the
Companies Act has been filed by the auditors in Form ADT-4 as prescribed under rule 13 of
Companies (Audit and Auditors) Rules, 2014 with the Central Government, during the year
and upto the date of this report.
(c) No whistle blower complaints were received by the Company
during the year.
12. The Company is not a Nidhi Company. Accordingly, provisions of
clauses 3(xii) (a), (b) and (c) of the Order are not applicable.
13. In our opinion and according to the information and
explanations given to us, the Company is in compliance with Sections 177 and 188 of
Companies Act, 2013 where applicable, in respect of all transactions with the related
parties and the details of related party transactions have been disclosed in the financial
statements as required by the applicable Indian Accounting Standards.
14. (a) In our opinion the Company has an adequate internal audit
system commensurate with the size and the nature of its business.
(b) We have considered, the internal audit report for the year
under audit, issued to the Company, in determining the nature, timing and extent of our
audit procedures.
15. In our opinion, the Company has not entered into any non-cash
transactions with directors or persons connected with them, covered under section 192 of
the Companies Act, 2013.
Accordingly, clause 3(xv) of the Order is not applicable to the Company
for the year under report.
16. (a) The Company is not required to be registered under Section
45-IA of the Reserve Bank of India Act, 1934.
Accordingly, clauses 3(xvi)(a), (b) and (c) of the Order is not
applicable to the Company.
(b) In our opinion, there is no core investment company within the
Group (as defined in the Core Investment Companies (Reserve Bank) Directions, 2016) and
accordingly reporting under clause 3(xvi)(d) of the Order is not applicable.
17. The Company has not incurred cash losses during the financial
year covered by our audit and in the immediately preceding financial year.
18. There has been no resignation of the statutory auditors of the
Company during the year.
19. On the basis of the financial ratios, ageing and expected dates
of realisation of financial assets and payment of financial liabilities, other information
accompanying the financial statements and our knowledge of the Board of Directors and
Management plans and based on our examination of the evidence supporting the assumptions,
nothing has come to our attention, which causes us to believe that any material
uncertainty exists as on the date of the audit report indicating that Company is not
capable of meeting its liabilities existing at the date of balance sheet as and when they
fall due within a period of one year from the balance sheet date. We, however, state that
this is not an assurance as to the future viability of the Company. We further state that
our reporting is based on the facts up to the date of the audit report and we neither give
any guarantee nor any assurance that all liabilities falling due within a period of one
year from the balance sheet date, will get discharged by the Company as and when they fall
due.
20. According to the information and explanations given to us and
based on our examination of the records of the Company, provisions of section 135 of the
Act for Corporate Social Responsibility (CSR) are not applicable to Company and hence
reporting under clauses 3(xx)(a) and (b) of the Order are not applicable for the year.
21. The provisions of clause 3(xxi) of the Order are not applicable
to the Company as the Company does not have any subsidiary or associates.
ANNEXURE-B TO THE INDEPENDENT AUDITOR’S REPORT
(Referred to in paragraph (f) under "Report on Other Legal and
Regulatory Requirements" section of our report to the Members of
MADHUSUDAN INDUSTRIES LIMITED of even date for the year ended 31st
March, 2023)
Independent Auditor’s Report on the Internal Financial Controls
with reference to the financial statements under Clause (i) of sub-section 3 of Section
143 of the Companies Act, 2013 ("the Act")
Opinion
In conjunction with our audit of the financial statements of
MADHUSUDAN INDUSTRIES LIMITED (‘the Company’), as of and
for the year ended 31st March 2023, we have audited the internal financial
controls with reference to the financial statements of the Company as of that date.
In our opinion, the Company has, in all material respects, adequate
internal financial controls with reference to the financial statements and such internal
financial controls were operating effectively as at 31st March, 2023, based on
the internal financial controls with reference to the financial statements 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.
Management’s Responsibility for Internal Financial Controls
The Company’s management and the Board of Directors are
responsible for establishing and maintaining internal financial controls based on the
internal financial controls with reference to the financial statements 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 Companies Act, 2013.
Auditor’s Responsibility
Our responsibility is to express an opinion on the Company’s
internal financial controls with reference to the 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, issued by ICAI and deemed to be prescribed under Section 143(10) of the
Companies Act, 2013, to the extent applicable to an audit of internal financial controls
with reference to the financial statements. Those Standards and the Guidance Note require
that we comply with ethical requirements and plan and perform the audit to obtain
reasonableassurance about whether adequate internal financial controls with reference to
the financial statements were established and maintained and if such controls operated
effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about
the adequacy of the internal financial controls with reference to the financial statements
and their operating effectiveness. Our audit of internal financial controls with reference
to the financial statements included obtaining an understanding of such internal financial
controls, 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 judgment, including the assessment of the
risks of material misstatement of the financial statements, whether due to fraud or error.
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 the financial statements.
Meaning of Internal Financial Controls with Reference to the Financial
Statements
A Company’s internal financial controls with reference to the
financial statements is a process designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements for
external purposes in accordance with generally accepted accounting principles. A
Company’s internal financial controls with reference to the 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 financial statements in accordance with generally
accepted accounting principles, and that receipts and expenditures of the Company are
being made only in accordance with authorizations of management and directors of the
Company; and
(3) provide reasonable assurance regarding prevention or timely
detection of unauthorized acquisition, use, or disposition of the Company’s assets
that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls with Reference to
the Financial Statements
Because of the inherent limitations of internal financial controls with
reference to the 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 the financial statements to future periods are subject to the
risk that the internal financial controls with reference to the financial statements may
become inadequate because of changes in conditions, or that the degree of compliance with
the policies or procedures may deteriorate.’
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