Narmada Gelatines Ltd Auditors Report.

To the members of narmada gelatines limited

Report on the financial statements

We have audited the accompanying financial statements of narmada gelatines limited ("the company"), which comprise the balance sheet as at 31st march 2017, the statement of profit and loss and 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 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 and presentation 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, read with rule 7 of the companies (accounts) rules, 2014. The management of the companies are responsible for maintenance of adequate accounting records in accordance with the provisions of the act for safeguarding the assets of the company and for preventing and detecting frauds and other irregularities; the selection and application of appropriate accounting policies, making judgments and estimates that are reasonable and prudent; and the 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 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 theact 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 the 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. An audit also includes evaluating the appropriateness of the 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 obtained is sufficient and appropriate to provide a basis for our audit opinion on the financial statements.

Opinion

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 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 31st march 2017, its profits and its cash flows for the year ended on that date.

Report on other legal and regulatory requirements

1. 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, and on the basis of such checks of the books and records of the company as we considered appropriate and according to the information and explanations given to us, we give in the "annexure 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 theact, 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 purpose of our audit; b. In our opinion, proper books of account as required by law have been kept so far as it appears from our examination of those books; c. The balance sheet, statement of profit and loss and 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 theaccounting standards specified under section 133 of theact, read with rule 7 of the companies (accounts) rules, 2014; e. On the basis of written representations received from the directors as on march 31, 2017 taken on record by the board of directors of the company, none of the directors of the company is disqualified as on march 31, 2017, from being appointed as a director in terms of sub-section (2) of section 164 of theact.

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 other matters to be included in theauditor’s report in accordance with rule 11 of the companies (audit and auditor’s) 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 – refer note 29 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 have been certain delays in transferring amounts, required to be transferred to the investor education and protection fund by the company - refer note 39 to the financial statements.

(iv) the company has provided requisite disclosures in financial statements (refer note 37 on financial statements) as to holdings as well as dealings in specified bank notes during the period from november 08, 2016 to december 30, 2016 and these are in accordance with the books of accounts maintained by the company.

For t r chadha & co llp
Charteredaccountants
Firm registration no.: 006711n/n500028
Vikas kumar
Partner
Membership no: 75363
Place: jabalpur
Date: 23 rd may 2017

Annexureato the independentauditor’s report on financial statements

The annexure-a referred to in our report of even date to the members of narmada gelatines limited,3(‘the company’)3on the financial statements for the year ended march 31,32017.3we report that:

(a) the company has maintained proper records showing full particulars including the quantitative details and situation of fixed assets. (b) as per the information and explanation given to us, the company has physically verified its fixed assets in phased manner designed to cover all the fixed assets once in every 3 years on rotation basis, which, in our opinion is reasonable having regard to the size of the company and nature of the assets. No material discrepancies were noticed on such verifications.

(c) according to the information and explanation given to us and on the basis of our examination of the records of the company, in case of immovable properties (freehold land and buildings) as disclosed in the note 10 fixed assets of the financial statements, the title deeds are held in the name of the company.

2. The inventory (except inventory in transit, the subsequent confirmation of which has been obtained) has been physically verified by the management during the year. In our opinion, the frequency of verification is reasonable. The discrepancies noticed on verification between the physical stocks and records were not material in relation to the operations of the company and the same has been properly dealt with in the books of account.

3. As informed to us, the company has not granted any loans secured or unsecured to companies, firms, limited liability partnership or other parties covered in register maintained under section 189 of companies act, 2013. Accordingly, clause (iii) (a), (b) and (c) of para 3 of the companies (auditor’s report) order, 2016 are not applicable to the company.

4. As informed to us, the company has not given any loans, investments, guarantees, and securities referred in section 185 and 186 of the companies act, 2013. Accordingly, clause (iv) of para 3 of the companies (auditor’s report) order, 2016 are not applicable to the company.

5. The company has not accepted any deposits from the public within the meaning of section 73 to 76 of the act and rules framed there under.

6. As explained to us, the maintenance of cost records has not been prescribed by the central government under section 148 (1) of the companiesact, 2013 for any of the goods manufactured by the company.

7. (a) according to the information and explanations given to us and on the basis of our examination of the records of the company, amounts deducted/accrued in the books of account in respect of undisputed statutory dues including employee’s state insurance, income tax, value added tax, sales tax, service tax, duty of excise, provident fund and other material statutory dues have been generally regularly deposited during the year by the company with the appropriate authorities. As explained to us, the company did not have any dues on account of duty of customs and cess.

According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, employees’ state insurance, service tax, sales tax, value added tax, duty of excise, income tax and any other material statutory dues were in arrears as at 31st march, 2017 for a period of more than six months from the date they became payable.

(b) according to the information and explanations given to us, the disputed dues on account of income tax, excise duty and sales tax which have not been deposited as at 31st march, 2017 is as under:

Nature of statute Amount* Period to Forum at which
( Lacs) Which it relates It is pending
Income tax 50.94 2000-01 High court
32.69 2001-02 High court
37.53 2002-03 High court
36.08 2011-12 Commissionerappeals
5.50 2012-13 Commissionerappeals
Total 162.74
Excise duty 228.05 2000-02 High court
11.72 2005-09 Commissioner /additional commissioner
0.34 2014-15 Cestat
Total 240.11
Sales tax 1.32 2004-05 Appellate tribunal bhopal
8.72 2005-06 Appellate tribunal bhopal
2.63 2009-10 Appellate tribunal bhopal
Total 12.67

*net of amount paid under protest/appeals deposits towards excise duty and sales tax does amount to 13.57 lacs and 21.24 lacs respectively.

8. The company has not obtained any loans from financial institution / bank / government /debenture holders which are outstanding as on 31st march, 2017 and hence there is no question of any default in the same.

9. According to the information and explanations given to us, the company has not raised any money by way of public issues and term loan during the year.

10. 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.

11. According to the information and explanations given to us and based on our examination of the records of the company has been paid / provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with schedule v of theact.

12. The entity is not a nidhi company. Therefore, the provisions of clause (xii) of para 3 of the companies (auditor’s report) order are not applicable to the company.

13. The company has entered into transactions with related parties in compliance with the provisions of section 177 and 188 of the act. The details of such related party transactions have been disclosed in the financial statements as required under accounting standard (as) 18, related party disclosures specified under section 133 of theact.

14. According to the information and explanations given to us and based on our examination of the records of the company, the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.

15. The company has not entered into any non-cash transaction with the directors or persons connected with him as contemplated under section 192 of the act. Accordingly, the provisions of clause (xv) of para 3 of the companies (auditor’s report) order, 2016 are not applicable to the company.

16. 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 (xvi) of para 3 of the companies (auditor’s report) order, 2016 are not applicable to the company.

For t r chadha &3co llp

Chartered accountants

Firm registration no.:3006711n/n500028

Vikas kumar

Partner

Membership no:375363

Place:3jabalpur

Date: 23rd may, 2017

Annexure b to the independent auditor’s report on financial statements

The annexure b referred to in our report of even date to the members of narmada gelatines limited ("the company") on the financial statements for the year ended 31st march 2017.

Report on the internal financial controls under clause (i) of sub-section 3 of section 143 of the companies act, 2013 (‘theact’)

We have audited the internal financial controls over financial reporting of armada gelatines limited ("the company") as of 31st march 2017 in conjunction with our audit of the financial statements of the company for the year ended on that date.

Management’s responsibility for internal financial controls

The company’s management is responsible for establishing and maintaining internal financial control 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 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 companiesact, 2013.

Auditors responsibility

Our responsibility is to express an opinion on the company’s 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 auditor’s 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 company’s internal financial controls system over financial reporting.

Meaning of internal financial controls over financial reporting

A company’s 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.acompany’s internal financial control over financial reporting includes those policies and procedures that i. Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; ii. 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 iii. 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 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, 2017, 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 charteredaccountants of india.

For t r chadha & co llp
Chartered accountants
Firm registration no.:3006711n/n500028
Vikas kumar
Partner
Membership no:375363
Place:3jabalpur
Date: 23rd may 2017