To the Members of EASTERN SUGAR & INDUSTRIES LIMITED
Report on the Audit of the Standalone Financial Statements
Qualified Opinion
We have audited the standalone financial statements of EASTERN SUGAR & INDUSTRIES
LIMITED ("the Company"), which comprise the balance sheet as at 31st March 2021,
and the statement of Profit and Loss, 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. 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 section of our report, the
aforesaid financial statements 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 31st
March 2021 and profit/loss, and its cash flows for the year ended on that date. Basis for
Qualified Opinion
? TDS Compliances:
Non compliance of sections 194-A, 192, 194-I & 194-J, of Income Tax Act, 1961 with
respect to (i) TDS on Interest other than interest on securities (ii) Salary (iii) Rent
and (iv) Fee for professional & Technical services respectively. The Company has not
deducted TDS in respect of the above and has not deposited to the credit of Central
Government.
? Generally Accepted Accounting Principles :
The Company has not complied with Generally Accepted Accounting Principles and has not
followed Indian Accounting Standards 19 for accounting of Gratuity, Leave liabilities and
other retirement benefits towards employees, bonus in the preparation of Financial
Statement. The estimated liability on account of retirement gratuity has not been
ascertained and not provided for in the accounts.
? Provision of Depreciation on its Fixed Assets:
The Company has not provided depreciation on its Fixed Assets for the period covered
under this audit. The Company has also not provided depreciation on transition to Schedule
II of The Companies Act, 2013.
We conducted our audit in accordance with Standards on Auditing (SAs) specified under
section 143(10) of the Companies Act, 2013. Our responsibilities under those Standards are
further described in the Auditors 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 Companies Act, 2013 and we have fulfilled our other ethical
responsibilities in accordance with these requirements and the ICAIs Code of Ethics. We
believe that the audit evidence we have obtained is sufficient and appropriate to provide
a basis for our qualified opinion.
Material Uncertainty Related to Going Concern
Due to operational difficulties ,company has suspended its operation of Cane Crushing
since FY 2004-05 & incurred a net loss of Rs 21.00 Lakhs during the year ended
31.03.2021 and also Rs 16.46 Lakhs in preceding previous year. Further one of the
Financial Creditors has filled petition to NCLT under Insolvency and Bankruptcy Code 2016
against the company. The company has filled affidavit in reply before honble NCLT Kolkata
Bench. Therefore as per our view the financial statements for the FY 20-21 should be
prepared on Non-Going Concern Basis.
Information other than the financial statements and auditors report thereon
The Companys board of directors is responsible for the preparation of the other
information. The other information comprises the information included in the Boards
Report including Annexures to Boards Report but does not include the financial statements
and our auditors 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 the
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. 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. In
addition to the matter described in the Basis for Qualified Opinion section we have
determined the matters described below to be the key audit matters to be communicated in
our report:
No Revenue from operation during the year & in preceding previous years,on enquiry
it was found that factory was taken on lease from M/s Shree Hanuman Sugar & Industries
Limited,w.e.f 1st of June,1995.The lease was terminated on 30th of
June 2006.The last crushing season was FY 2003-04.All the Fixed Assets of the company will
be acquired by the said company (erstwhile lessor)at their gross values appearing in the
books of the company as on the date of transfer subject to the approval of the lending
institutions for which they have agreed in-Principle.We have taken the management
Representation in this regard.
Responsibilities of Management and Those Charged with Governance for the Standalone
Financial Statements
The Companys Board of Directors is responsible for the matters stated in section
134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of
these financial statements that give a true and fair view of the financial position,
financial performance and cash flows of the Company in accordance with the accounting
principles generally accepted in India, including the accounting Standards specified under
section 133 of the Act. 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, management is responsible for assessing the
Companys 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 Companys financial
reporting process.
Auditors 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 auditors 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.
Conclude on the appropriateness of managements 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 Companys
ability to continue as a going concern. If we conclude that a material uncertainty exists,
we are required to draw attention in our auditors 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 auditors
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.
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 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
auditors 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.
We are independent of the Group in accordance with the ethical requirements that are
relevant to our audit of the financial statements and we have fulfilled our other ethical
responsibilities in accordance with these requirements.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors Report) Order, 2016 ("the Order"),
issued by the Central
Government of India in terms of sub-section (11) of section 143 of the Companies Act,
2013, we give in the ‘Annexure A, a statement on the matters specified in paragraphs
3 and 4 of the Order, to the extent applicable.
2. As required by Section 143 (3) of the Act, we report that:
a) We have sought and obtained all the information and explanations which to the best
of our knowledge and belief were necessary for the purposes of our audit. b) In our
opinion, proper books of account as required by law have been kept by the Company so far
as it appears from our examination of those books. c) The Balance Sheet, the
Statement of Profit and Loss and the Cash Flow Statement dealt with by this Report are in
agreement with the books of account. d) In our opinion, the aforesaid financial statements
comply with the Accounting Standards specified under Section 133 of the Act, read with
Rule 7 of the Companies (Accounts) Rules, 2014. e) On the basis of the written
representations received from the directors as on 31st March, 2021 taken on record by the
Board of Directors, none of the directors is disqualified as on 31st March, 2021 from
being appointed as a director in terms of Section 164 (2) of the Act. f) With respect to
the adequacy of the internal financial controls over financial reporting of the Company
and the operating effectiveness of such controls, refer to our separate Report in
‘Annexure B. g) With respect to the matter to be included in the Auditors Report
under section 197(16), In our opinion and according to the information and explanations
given to us, the remuneration paid by the Company to its directors during the current year
is in accordance with the provisions of section 197 of the Act. The remuneration paid to
any director is not in excess of the limit laid down under section 197 of the Act. The
Ministry of Corporate Affairs has not prescribed other details under section 197(16) which
are required to be commented upon by us. h) With respect to the other matters to be
included in the Auditors 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
pending litigations which would impact its financial position.
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.
|
For Saraf Manoj & Co. |
|
Chartered Accountants |
|
FRN: 323473E |
| Place:-Kolkata |
Manoj Kumar Agarwal |
| Date: 29.06.2021 |
(PARTNER ) |
| UDIN:21062489AAAACG5832 |
Membership No. 062489 |
Annexure
The Annexure referred to in paragraph 1 of Our Report on "Other Legal and
Regulatory Requirements".
We report that:
i. a. The company has maintained proper records showing full particulars, including
quantitative details and situation of its fixed assets. b. As explained to us, fixed
assets have been physically verified by the management at reasonable intervals; no
material discrepancies were noticed on such verification. c. The title deeds of immovable
properties are held in the name of the company.
ii. As explained to us, inventories have been physically verified during the year by
the management at reasonable intervals. No material discrepancy was noticed on physical
verification of stocks by the management as compared to book records.
iii. According to the information and explanations given to us and on the basis of our
examination of the books of account, the Company has not granted any loans, secured or
unsecured, to companies, firms, Limited Liability Partnerships or other parties listed in
the register maintained under Section 189 of the Companies Act, 2013. Consequently, the
provisions of clauses iii (a), (b) and (c)of the order are not applicable to the Company.
iv. In respect of loans, investments, guarantees, and security, provisions of section
185 and 186 of the Companies Act, 2013 have been complied with.
v. The Company has not accepted any deposits from the public and hence the directives
issued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any other
relevant provisions of the Act and the Companies (Acceptance of Deposit) Rules, 2015 with
regard to the deposits accepted from the public are not applicable.
vi. As per information & explanation given by the management, maintenance of cost
records has not been specified by the Central Government under sub-section (1) of section
148 of the Companies Act, 2013.
vii. a. According to the records of the company, undisputed statutory dues including
Provident
Fund, Investor Education and Protection Fund, Employees State Insurance, Income-tax,
Sales-tax, Service Tax, Goods and Service tax, Custom Duty, Excise Duty, value added tax,
cess and any other statutory dues to the extent applicable, have generally been regularly
deposited with the appropriate authorities. According to the information and explanations
given to us there were no outstanding statutory dues as on 31st March 2021 for a period of
more than six months from the date they became payable, except :
| Name of the Statue |
Amount (Rs in Lakhs ) |
| PF Liabilities |
125.00 |
| TDS Payable |
0.43 |
| Gratuity Liability |
220.35 |
b. According to the records of the Company, the dues outstanding of income-tax,
sales-tax, service tax, goods and service tax, duty on custom, duty of excise, value added
tax and cess on account of any dispute, are as follows:
| Name of the Statue |
Nature of the Dues |
Amount (Rs. In lakhs) |
Period for which the amount relates |
| Income Tax Act ,1961 |
Income Tax, Interest etc |
584.05 |
AY 2011-12 |
| Income Tax Act ,1961 |
Income Tax, Interest etc |
197.08 |
AY 2012-13 |
The Information contained herein are based on & are limited to the extent of
details made available to us.
viii. In our opinion and according to the information and explanations given by the
management, we are of the opinion that, the Company has defaulted in repayment of dues to
a financial institution, bank, Government or debenture holders, as applicable to the
company.
ix. Based on our audit procedures and according to the information given by the
management, the company has not raised any money by way of initial public offer or further
public offer (including debt instruments) or taken any term loan during the year.
x. According to the information and explanations given to us, we report that no fraud
by the company or any fraud on the Company by its officers or employees has been noticed
or reported during the year. xi. According to the information and explanations given to
us, we report that managerial remuneration, if any paid, has been paid in accordance with
the requisite approvals mandated by the provisions of section 197 read with Schedule V to
the Companies Act.
xii. The company is not a Nidhi Company. Therefore, clause (xii) of the order is not
applicable to the company.
xiii. According to the information and explanations given to us, all transactions with
the related parties are in compliance with sections 177 and 188 of Companies Act, 2013
where applicable and the details have been disclosed in the Financial Statements etc. as
required by the applicable accounting standards.
xiv. The company has not made any preferential allotment or private placement of shares
or fully or partly convertible debentures during the year under review.
xv. Provisions of section 192 of Companies Act, 2013 have been complied with in case of
non-cash transactions entered by the company with directors or persons connected with him
xvi. The company is not required to be registered under section 45-IA of the Reserve Bank
of India Act, 1934 .
|
For Saraf Manoj & Co. |
|
Chartered Accountants |
|
FRN: 323473E |
| Place:-Kolkata |
Manoj Kumar Agarwal |
| Date: 29/06/2021 |
(PARTNER ) |
| UDIN: 21062489AAAACG5832 |
Membership No. 062489 |
AnnexureeBf
Report on Internal Financial Controls Over Financial Reporting
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section
143 of the Companies Act, 2013 ("the Act")
We have audited the internal financial controls over financial reporting of EASTERN
SUGAR & INDUSTRIES LIMITED ("the Company") as of March 31, 2021 in
conjunction with our audit of the financial statements of the Company for the year ended
on that date.
Managements Responsibility for Internal Financial Controls
The Companys 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. 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 companys 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.
Auditors Responsibility
Our responsibility is to express an opinion on the Companys internal financial
controls over financial reporting 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, both applicable to an audit of
Internal Financial Controls and, both issued by the Institute of Chartered Accountants of
India. 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 over financial reporting was 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 system over financial reporting and their operating
effectiveness. Our audit of internal financial controls over financial reporting included
obtaining an understanding of internal financial controls over financial reporting,
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 auditors judgement, 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 Companys internal financial controls system
over financial reporting.
Meaning of Internal Financial Controls Over Financial Reporting
A companys internal financial control over financial reporting 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 companys internal financial control over financial
reporting 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
authorisations 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 companys assets that could have a material effect on the financial
statements.
Inherent Limitations of Internal Financial Controls Over Financial Reporting
Because of the inherent limitations of internal financial controls over financial
reporting, 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 over financial
reporting to future periods are subject to the risk that the internal financial control
over financial reporting may become inadequate because of changes in conditions, or that
the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, the Company has, in all material respects, an adequate internal
financial controls system over financial reporting and such internal financial controls
over financial reporting were operating effectively as at March 31, 2021, 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.
|
For Saraf Manoj & Co. |
|
Chartered Accountants |
|
FRN: 323473E |
| Place:-Kolkata |
Manoj Kumar Agarwal |
| Date: 29/06/2021 |
(PARTNER ) |
| UDIN: 21062489AAAACG5832 |
Membership No. 062489 |
+91-9892691696
