The Members of
TEXMACO RAIL & ENGINEERING LIMITED
Report on the Audit of the Standalone Financial Statements
1. We have audited the accompanying standalone financial statements of TEXMACO RAIL & ENGINEERING LIMITED ("the Company"), which comprise the Balance Sheet as at 31st March 2022, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Cash Flows, the Statement of Changes in Equity and notes to the financial statements for the year then ended on that date including a summary of significant accounting policies and other explanatory information in which are incorporated the returns for the year ended on that date audited by the branch auditor of the Kalindee unit (hereinafter referred to as "Standalone Financial Statements").
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013 ("the Act") in the mannersorequiredandgiveatrueandfairviewinconformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2022, its profit (including Other Comprehensive Income), changes in equity and its cash flows for the year ended on that date.
Basis for Opinion
2. We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. 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 standalone financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
3. Key Audit Matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matters described below to be the key audit matters to be communicated in our report .
|Key Audit Matter||Procedures Performed|
|Investment in Subsidiaries/ Joint Ventures and Associates||Principal Audit Procedures|
|The impairment review of unquoted equity instruments and debt, with a carrying value of H 6961.79 lakhs, is considered to be a risk area due to the size of the balances as well as the judgmental nature of key assumptions, which may be subject to management override. The carrying value of such unquoted equity instruments and debt is at risk of recoverability.||Besides obtaining an understanding of Managements processes and controls with regard to testing the impairment of the unquoted equity instruments in loss making subsidiaries and joint ventures. Our procedures included the following:|
|• Understood the managements underlying assumptions and appropriateness of the valuation used;|
|• Compared the Companys assumptions with comparable benchmarks in relation to key inputs such as long-term growth rates and discount rates;|
|Contingent Liabilities||Principal Audit Procedures|
|The Company operates in a complex tax environment and is required to discharge direct and indirect tax obligations under various legislations such as Income Tax Act, 1961, the Finance Act, 1994, Goods and Services Tax Acts and VAT Acts of various states.||In assessing the exposure of the Company for the tax litigations, we have performed the following procedures:|
|The tax authorities under these legislations have raised certain tax demands on the Company in respect of the past periods. The Company has disputed such demands and has appealed against them at appropriate forums. As at March 31, 2022 the Company has an amount of H12,412.75 Lakhs involved in various pending tax litigations.||• Obtained an understanding of the process laid down by the management for performing their assessment taking into consideration past legal precedents, changes in laws and regulations, expert opinions obtained from external tax / legal experts (as applicable);|
|Ind AS 37 requires the Company to perform an assessment of the probability of economic outflow on account of such disputed tax matters and determine whether any particular obligation needs to be recorded as a provision in the books of account or to be disclosed as a contingent liability. Considering the significant degree of judgement applied by the management in making such assessments and the resultant impact on the financial statements, we have considered it to be an area of significance for our audit.||• Assessed the processes and entity level controls established by the Company to ensure completeness of information with respect to tax litigations;|
|• Along with our tax experts, we undertook the following procedures:|
|• Reading communications with relevant tax authorities including notices, demands, orders, etc., relevant to the ending litigations, as made available to us by the management;|
|• Testing the accuracy of disputed amounts from the underlying communications received from tax authorities and responses filed by the Company;|
|• Considered the submissions made to appellate authorities and expert opinions obtained by the Company from external tax / legal experts (wherever applicable) which form the basis for managements assessment;|
|• Assessed the positions taken by the management in the light of the aforesaid information and based on the examination of the matters by our tax experts. Read the disclosures included in the financial statements in accordance with Ind AS 37.|
|Revenue Recognition for long term projects||Our audit procedures included the following:|
|The Companys significant through long term engineering, procurement and construction contracts. Revenue from these contracts is recognized over a period of time in accordance with the requirements of Ind AS 115, Revenue from Contracts with Customers. Due to the nature of the contracts, revenue recognition involves usage of percentage of completion method which is determined based on proportion of contract costs incurred to date compared to estimated total contract costs, which involves significant judgments, identification of contractual obligations and the Companys rights to receive payments for performance completed till date, changes in scope and consequential revised contract price and recognition of the liability for loss making contracts/ onerous obligations. Accuracy of revenues significantly on andonerousobligations, profits account of change in judgements and estimates.||• We evaluated the Companys accounting policies pertaining portion of business is undertaken to revenue recognition and assessed compliance with the policies in terms of Ind AS 115 -Revenue from Contracts with Customers.|
|We identified and tested controls related to revenue recognition and our audit procedure focused on determination of progress of completion, recording of costs incurred and estimation of costs to complete the remaining contract obligations through inspection of evidence of performance of these controls.|
|• We tested on a sample basis, and inspected the underlying customer contracts, performed retrospective review of costs incurred with estimated costs to identify significant variations and assessed whether those variations were considered in estimating the remaining costs to complete and consequential determination of stage of completion, which formed the basis of revenue recognition under the input method. We reviewed the managements evaluation process to recognize revenue over a period of time, the status of completion for projects and total cost estimates. We analysed the forecast of sample contracts arising from contract modifications and current ongoing negotiations and settlements that may impair the profitability of such contracts as well as the collectability of such contracts by reference to the recent credit review assessment of the customer prepared by management.|
|• We inspected contracts with exceptions including contracts with low or negative margins, loss making contracts, changes in planned cost estimates, contractswithsignificant probable penalties due to delay in contract execution and overdue net receivable positions for contracts significant with marginal or no movement to determine the level of provisioning required.|
|• We assessed that the contractual positions and revenue for the year were presented and disclosed in the financial statements.|
Our reporting on KAM in so far as it relates to the Kalindee unit is based on the corresponding report of the branch auditor.
4. The Companys Board of Directors is responsible for the other information. The other information comprises the information included in the Management Discussion and Analysis; Boards Report including Annexures to Board Report, Business Responsibility Report, Corporate Governance and Shareholders Information but does not include the standalone financial statements and our auditors report thereon. The aforesaid documents are expected to be made available to us after the date of this auditors report.
5. Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
6. In connection with our audit of the standalone financial statements, our responsibility is to read the other information when it becomes available and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.
7. When we read the aforesaid documents, if we conclude that there is a material misstatement therein, we are required to communicate the matters to those charged with governance.
Managements Responsibility for the Standalone Financial Statements
8. 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 standalonefinancialstatementsthatgiveatrueandfairview of the financial position, financial performance, changes in equity 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 statement that give a true and fair view and are free from material misstatement, whether due to fraud or error.
9. 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.
10. The Board of Directors are also responsible for overseeing the companys financial reporting process.
Auditors Responsibility for the Audit of the Financial Statements
11. 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.
12. 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.
• Obtained 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.
13. 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.
14. 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.
15. 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 matters or when 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.
16. Materiality is the magnitude of misstatements in the standalone 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.
17. We did not audit the financial statements of one unit included in the standalone Ind AS financial statements of the Company whose financial statements reflect total assets H 96,529.27 lakhs as at 31st March, 2022 and total revenues of H57,418.71 lakhs, total loss of H1,790.20 lakhs, total comprehensive loss of H2,034.02 lakhs and cash flows
(net) of H 2,414.25 lakhs for the year ended on that date. The financial statements of this unit have been audited by the branch auditor whose report has been furnished to us, and our opinion in so far as it relates to the amounts and disclosures included in respect of this unit, is based solely on the report of such branch auditor.
Our Opinion on the Standalone financial statements and our report on Other Legal and Regulatory Requirements below is not modified in respect of the above matter.
Report on Other Legal and Regulatory Requirements
18. As required by the Companies (Auditors Report) Order, 2020 ("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, a statement on the matters
specified in paragraphs 3 and 4 of the Order, to the extent applicable.
19. 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 report on the accounts of the unit of the Company audited under section 143(8) of the Act by branch auditor has been sent to us and has been properly dealt with by us in preparing this report.
(d) The Balance Sheet, the Statement of Profit and Loss (including other comprehensive income) and the Cash Flow Statement, Statement of Changes in Equity dealt with by this report are in agreement with the books of account and with the returns received from the unit not visited by us.
(e) in our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
(f) On the basis of the written representations received from the directors as on 31st March, 2022 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2022 from being appointed as a director in terms of Section 164 (2) of the Act;
(g) 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".
(h) With respect to the other matters to be included in the Auditors Report in accordance with the requirements of section 197(16) of the Act, as amended:
According to the information and explanations given to us and the records of the company examined by us, the total managerial remuneration paid as reflected in the financial statements for the year ended 31st March 2022 is in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Act, as applicable.
(i) 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:
a. The Company has disclosed the impact of pending litigations on its financial position in its financial statements – Refer Note 1.36 of the standalone financial statements.
b. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.
c. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
d. (i) The Management has represented that, to the best of its knowledge and belief, no funds (which are material either individually or in the aggregate) 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;
(ii) The Management has represented, that, to the best of its knowledge and belief, no funds (which are material either individually or in the aggregate) 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;
(iii) 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 (i) and (ii) above, contain any material misstatement.
e. (a) The final dividend proposed in the previous year, declared and paid by the Company during the year is in accordance with Section 123 of the Act, as applicable.
(b) The Company has neither declared nor paid any interim dividend during the year.
(c) The Board of Directors of the Company have proposed final dividend for the year which is subject to the approval of the members at the ensuing Annual General Meeting. The amount of dividend proposed is in accordance with section 123 of the Act, as applicable.
|For L. B. Jha & Co.|
|Firm Registration No: 301088E|
|Place: Kolkata||Membership No. 300389|
|Date: 20.05.2022||UDIN: 22300389AJHFRV9841|
ANNEXURE- A: TO THE INDEPENDENT AUDITORS REPORT to the Members of TEXMACO RAIL & ENGINEERING LIMITED
[Referred to in paragraph 18 of the Auditors Report of even date] i. (a) (A) The Company has maintained proper records showing full particulars including quantitative details and situation of Property, plant and Equipment.
(B) The Company has maintained proper records showing full particulars of intangible assets.
(b) As explained to us, the company has a system of verifying all its major Property, Plant & Equipment over a period of three years. The Property, Plant and Equipment so scheduled for verification during this year have been physically verified. The discrepancies noticed on such verification were not material and have been properly dealt with in the books of accounts.
(c) According to the information and explanations given to us and the records of the Company examined by us, the title deeds of the immovable properties of the Company are held in the name of the Company except the immovable properties which were owned by companies demerged/merged with the Company under the scheme of arrangements approved by the appropriate authorities which are still held in the name of the erstwhile companies. Details of these companies are given below.
|Particulars||Description of item of property Land||Gross carrying value (J in Lakhs)||Year in Service||Title deeds held in the name of||Title Deed Holder||Year since Property held||Reason for not being held in the name of the company|
|i) Belgharia & Agarpara||456.92||Since 1944||Textile Machinery Corporation Ltd., Texmaco Ltd., now known as Texmaco Infrastructure & Holdings Ltd.||Promoter||1944||Held in the name of Pre-demerged entity.|
|ii) Sodepur||56.16||1999||Texmaco Ltd., now known as Texmaco Infrastructure & Holdings Ltd.||Promoter||1999 & 2000||Held in the name of Pre-demerged entity.|
|iii) Panihati||835.13||2006||Texmaco Limted, now known as Texmaco Infrastructure & Holdings Ltd.||Promoter||2006||Held in the name of Pre-demerged entity.|
|Property, Plant & Equipment||i) Flat no. 6A, Mandeville court, 1-D, Mandeville Garden, Kolkata-700019. Area - 1333 Sq. Ft.||14.86||2000||Texmaco Ltd., now known as Texmaco Infrastructure & Holdings Ltd.||Promoter||2000||Held in the name of Pre-demerged entity|
|ii) Flat no.4H,6,Hastings Park Road, Kolkata-700027. Area -1237 Sq.Ft.||2.10||2001||Texmaco Ltd., now known as Texmaco Infrastructure & Holdings Ltd.||Promoter||2001||Held in the name of Pre-demerged entity|
|iii) Flat at 1st Floor,1/115, Gariahat Road, Kolkata-700068 Area -1318 Sq Ft||14.59||2007||Texmaco Ltd., now known as Texmaco Infrastructure & Holdings Ltd.||Promoter||2007||Held in the name of Pre-demerged entity|
|Investment Property||i) Sodepur||35.32||2020||Texmaco Limted, now known as Texmaco Infrastructure & Holdings Ltd.||Promoter||2020||Held in the name of Pre-demerged entity.|
(d) According to the information and explanations given to us and the records of the company examined by us, the Company has not revalued any of its Property, Plant and Equipment or Intangible assets during the year.
(e ) According to the information and explanations given to us no proceeding have been initiated during the year or are pending against the Company as at March 31,2022 for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (as amended in 2016 ) and rules made thereunder.
ii. (a) The inventory has been physically verified by the management during the year. The discrepancies noticed on physical verification of inventory as compared to book records were not material and have been properly dealt with in the books of account. In our opinion, the frequency of verification is reasonable.
(b) According to the information and explanations given to us and the records of the company examined by us, the Company has been sanctioned working capital limits in excess of five crore rupees, in aggregate, from banks or financial institutions on the basis of security of current assets; the quarterly returns or statements filed by the company with such banks or financial institutions are in agreement with the books of account of the Company.
iii (a) According to the information and explanations given to us and based on the audit procedures conducted by us, the Company has granted unsecured loans to subsidiaries and associate companies, which are parties covered in the register maintained under section 189 of the Companies Act, 2013. Details are given below.
|Relationship with the Company||Aggregate amount given during the year (J in Lakhs) (excluding interest)||Balance outstanding at the balance sheet data (J in Lakhs) (excluding interest)|
(B) The Company has not granted any unsecured loans or provided any security or guarantees to any parties other than subsidiary companies, joint ventures and its associates. Hence Reporting under this clause is not applicable
(b) As the Company is charging interest against these loans; the terms and conditions of these loans in our opinion are not prima-facie prejudicial to the interests of the Company. However, since two of the subsidiary companies are yet to start their operation, interest from these companies against the outstanding loan are not yet received.
(c) There is no stipulation regarding recovery of loans as these loans are repayable on demand.
(d) The aforesaid loans being repayable on demand, there is no amount overdue for more than ninety days in respect of recovery of principal and interest of the above loans.
(e) Since all the above loans are repayable on demand , reporting under this clause is not applicable.
(f) According to information and explanation given to us and records of the Company examined by us, details of loans repayable on demands are as per below given
( H in lakhs)
|Particulars||All Parties||Promoters||Related Parties|
|Aggregate amount of loans/ advances in nature of loans|
|- Repayable on demand (A)||3391.09|
|- Agreement does not specify any terms or period of repayment (B)|
|Percentage of loans/ advances in nature of loans to the total loans||100%|
iv. According to the information and explanations given to us and the records of the Company examined by us, the provisions of section 185 and 186 of the Companies Act, 2013, have been complied with in respect of loans, investments, guarantees and securities given by the Company.
v. The Company has not accepted any deposits or amounts which are deemed to be deposits within the meaning of Sections 73 to 76 of the Act and the rules framed there under. Further, no orders have been passed by Company
Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other tribunal which could impact the Company.
vi. We have broadly reviewed the books of accounts maintained by the Company pursuant to the order made by the Central Government for the maintenance of cost records under section 148(1) of the Act and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have not, however, carried out any detailed examination of such records and accounts.
vii. (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is regular in depositing the undisputed statutory dues including provident fund, employees state insurance, income-tax, duty of customs, goods and services tax, cess and any other statutory dues, as applicable, with the appropriate authorities.
(b) According to the information and explanations given to us and the records of the Company examined by us, the particulars of dues of Customs, Central Excise, Service Tax, Entry Tax, Income Tax and Value Added Tax as at 31st March 2022 which have not been deposited on account of a dispute are as follows:
|Name of the statute||Nature||Amount (J in lakhs)||Period to which the amount relates||Forum where the dispute is pending|
|Customs Act, 1962||Custom||111.67||01/12/1998 to 30/06/2000||Commissioner CE.|
|The Central Excise Act, 1944||Excise||686.19||1986-87 to 2014-15||Appeal filed before the CESTAT|
|The Central Excise Act, 1944||Excise||162.35||2015-16 to 2017-18||The Assistant Commissioner of Central GST & CX|
|The Central Excise Act, 1944||Excise||1,008.91||1995-96 to2007-08||Supreme Court|
|Finance (Service Tax) Act, 1994||Service Tax||25.69||2012-13 to 2013-14||Commissioner (Appeal), KOL|
|Entry Tax Act||Entry Tax||41.81||2011-12 to 2016-17||Commissioner Appeal|
|Income Tax Act, 1961||Income Tax||166.02||AY 2009-10 to 2018-19||Commissioner Appeal|
|Value Added Tax Act||Vat||204.71||2003-04 to 2005-06||Addl. Commissioner|
|Value Added Tax Act||Vat||4,578.23||2008-09 to 2009-10||Appellate and Revisional Board.|
|Value Added Tax Act||Vat||2,236.81||2012-13 to 2015-16||West Bengal Taxation Tribunal.|
|Central Sales Tax Act||CST||245.02||2003-04 to 2005-06||Addl. Commissioner|
|Central Sales Tax Act||CST||1,312.44||2006-07 to 2009-10||Appellate and Revisional Board.|
|Maharashtra Value Added Tax Act 2002||Sales Tax||317.51||2012-13 to 2013-14||Dy. Commissioner of Sales, Tax Mumbai|
|Odisha VAT ACT 2004||Sales Tax||6.51||2013-14 to 2016-17||Sales Tax, Bhubaneshwar-III Circle|
|West Bengal Value Added Tax Act, 2003||Sales Tax||75.25||2012-13||Senior Joint Commissioner, Commercial Taxes, Kolkata South Circle|
|West Bengal Value Added Tax Act, 2003||Sales Tax||15.75||2014-15||Deputy Commissioner, Commercial Taxes, Ballygunge Charge, Kolkata|
|Income Tax Act, 1961||Income Tax||30.57||AY 2009-10||High Court, Bombay|
|The West Bengal VAT Act, 2003||Vat||12.63||AY 2012-13||Appellate Authorities, West Bengal|
|MP VAT Act, 2002||Entry Tax||2.53||AY 2009-10||Appellate Authorities, Bhopal|
|Value Added Tax Act||Vat||33.03||AY 2009-10 and AY 2015-16||Appellate Authorities, Bhopal|
|Value Added Tax Act||Vat||3.13||AY 2009-10||Second Appellate Authorities, Bhopal|
|Value Added Tax Act||Vat||442.74||AY 2016-17 and 2017-18||West Bengal Taxation Tribunal|
|Value Added Tax Act||Vat||-||AY 2018-19||ETO, Gurgaon North|
|Value Added Tax Act||Vat||95.78||2021-22||Section 11 of U P Trade Tax Act|
|Central Sales Tax Act||Sales Tax||(0.45)||AY 2011-12||DCCT, Singhbhum, Circle, Jamshedpur|
|Value Added Tax Act||Vat||166.63||2021-22||Deputy Commissioner OF Commercial Taxes (Audit)-5.7, DGSTO -5, Bengaluru|
|Tamil Nadu VAT Act,2006||Sales Tax||175.39||AY 2010-11 to 2012-13||Commercial Tax officer (Enforcement) Group-1, Office of the Asst. Commissioner (CT) (Enforcement) Cuddalore|
|Goods and Services Tax Act||Service Tax||11.10||Oct 16 to June 17||Deputy Commissioner, East – II, Division CGST, Gurugram|
|Central Sales Tax Act||Sales Tax||79.92||2017-18||Assistant Commissioner Sales Tax|
|The Chhattisgarh Value Added Tax Act, 2005||VAT||81.78||2015-2016||Assistant Commissioner Raipur|
|Finance (Service Tax) Act, 1994||Service Tax||7.11||FY 2014-18 (Oct.2014 Onwards to June 17)||Assistant Commissioner Raipur|
|The Customs Act,1986||Custom||75.99||2002-03 to 2006-07||Commissioner of Customs (Appeals)|
viii. 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).
ix. (a) According to the information and explanations given to us and the records of the Company examined by us, the Company has not defaulted in repayment of loans or in the payment of interest to lenders during the year.
(b) The Company has not been declared wilful defaulter by any bank or financial institution or government or any government authority.
(c) According to the information and explanations given to us the Company has applied the term loans for the purpose for which the loans were obtained.
(d) On an overall examination of the financial statements of the Company, funds raised on short-term basis have, prima facie, not been used during the year for long-term purposes by the Company.
(e) According to the information and explanations given to us the Company has not taken any funds from any entity or person on account of or to meet the obligations of its subsidiaries, associates or joint ventures, hence reporting under this clause is not applicable.
(f) According to the information and explanations given to us the Company has not raised loans during the year on the pledge of securities held in its any subsidiaries, associates or joint ventures, hence reporting under this clause is not applicable.
x. (a) The Company has raised moneys by way of rights issue of shares during the year and the amount raised were applied for the purposes for which those are raised.
(b) During the year, the Company has not made any preferential allotment or private placement of shares or convertible debentures (fully or partly or optionally) and hence reporting under this clause is not applicable.
xi. (a) 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.
(b) No report under sub-section (12) of section 143 of the Companies Act has been filed in Form ADT-4 as prescribed under rule 13 of Companies (Audit and Auditors) Rules, 2014 with the Central Government, during the year and up to the date of this report.
(c) According to the information and explanations given to us and the records of the Company examined by us, the Company has not received any complaints from any whistle-blower during the year (and up to the date of this report) and hence reporting under this clause is not applicable.
xii. The Company is not a Nidhi Company and hence reporting under this clause is not applicable.
xiii. According to the information and explanations given to us and the records of the Company examined by us, the company has complied with the requirements of sections 177 and 188 of the Act with respect to its transactions with the related parties. Pursuant to the requirement of the applicable Accounting Standard, details of the related party transactions have been disclosed in Note 1.40 of the standalone financial statements for the year under audit.
xiv. (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 reports for the year under audit, issued to the Company during the year and till date, in determining the nature, timing and extent of our audit procedures.
xv. In our opinion during the year the Company has not entered into any non-cash transactions with its directors or persons connected with its directors and hence provisions of section 192 of the Companies Act, 2013 are not applicable to the Company.
xvi. (a)&(b) In our opinion, the Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934. Hence, reporting under clauses 3(xvi) (a) & (b) is not applicable.
(c) In our opinion, there is no core investment company within the Group (as defined in the Core Investment Companies (Reserve Bank) Directions, 2016) and hence reporting under this clause is not applicable.
xvii. The Company has not incurred cash losses during the current and the immediately preceding financial year.
xviii.There has been no resignation of the statutory auditors of the Company during the year.
xix. 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.
xx. (a) &(b) According to information and explanation given to us and records of the Company examined by us, there is no fund lying unspent, hence reporting under clause 3(XX) (a) & ( b) is not applicable.
xxi. According to information and explanation given to us , and based on reports of components auditors there has been no qualification or adverse report in CARO 2020 in any of the subsidiary , associate and joint venture.
|For L. B. Jha & Co.|
|Firm Registration No: 301088E|
|Place: Kolkata||Membership No. 300389|
|Date: 20.05.2022||UDIN: 22300389AJHFRV9841|
ANNEXURE- B TO THE INDEPENDENT AUDITORS REPORT to the Members of TEXMACO RAIL & ENGINEERING LIMITED
[Referred to in paragraph 19 (g) of the Independent Auditors Report of even date]
Report on the Internal Financial Control under Clause (i) of Sub –sections 3 of Section 143 of the Companies Act, 2013("the Act")
1. We have audited the internal financial controls over financial reporting of Texmaco Rail & Engineering Ltd.
("the Company") as of 31st March, 2022 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.
Managements Responsibility for Internal Financial Control
2. The Companys 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 (the "Guidance Note") 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 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.
3. 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" and the Standard on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Act, to the extent applicable. 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.
4. 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 includes obtaining an understanding of internal financial control over financial reporting, assessing the risk that a material Weakness exists, and testing and evaluating the design and operating effectiveness of internal controls based on the assessed risk. The procedure selected depends on the auditors judgment, including the assessment of the risk of material misstatement of the financial statement, whether due to fraud or error.
5. 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 Control over Financial Reporting
6. 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 the records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;
2) provide reasonable assurance that the transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditure of the Company are being made only in accordance with authorization of management and directors of 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 Control over Financial Reporting
7. Because of inherent limitation of internal financial control over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to errors or fraud may occur and not be detected. Also, projections of any evaluations of the internal financial control 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.
8. In our opinion, the Company has, in all material respect, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31st March 2022, 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 Control Over Financial Reporting, issued by ICAI.
9. Our aforesaid reports under section 143(3)(i) of the Act on the adequacy and operating effectiveness of the Internal Financial Controls over financial reporting in so far as it relates to the Kalindee unit is based on the corresponding report of the branch auditor.
|For L. B. Jha & Co.|
|Firm Registration No: 301088E|
|Place: Kolkata||Membership No. 300389|
|Date: 20.05.2022||UDIN: 22300389AJHFRV9841|