| We have audited the accompanying standalone financial statements
of Kamanwala Housing Construction Limited ('the Company') which
comprise the Balance Sheet as at 31 March 2015, 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 Standalone 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 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. This responsibility also includes 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;
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.
Auditor's Responsibility
Our responsibility is to express an opinion on these standalone
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 the
Act 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 misstatements.
An audit involves performing procedures to obtain audit evidence
about the amounts and 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, but not for the purpose of expressing an opinion
on whether the Company has in place an adequate internal
financial controls system over financial reporting and the
operating effectiveness of such controls. An audit also
includes evaluating the appropriateness of 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 we have 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 standalone
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:
(i) in the case of the balance sheet, of the state of affairs of
the Company as at 31st March, 2015;
(ii) in the case of the statement of profit and loss, of the
profit for the year ended on that date; and
(iii) in the case of the cash flow statement, of the cash flows
for the year ended on that date.
Emphasis of Matters
We draw your attention to -
1. Note No. 1.8 relating to recognition of Rs. 110.75 lacs as
compensation receivable from related party Aspen Properties Pvt.
Ltd. However, the same is subject to confirmation from the
party.
2. Note No. 1.9 relating to reconciliation of Service tax
input credit and other amounts as per the records with the
Service Tax returns.
Our opinion is not qualified / modified in respect of this
matter.
Other Matters
The financial statements and other financial information include
the company's proportionate share in jointly controlled assets
of Rs. 25.42 lacs in respect of an Unincorporated Joint venture
which is certified by the management.
Our opinion is not qualified / modified in respect of this
matter.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order, 2015
("the Order"), as amended, 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 statement on the matters specified in
paragraphs 3 and 4 of the Order.
2. As required by Section 143 (3) of the Act, we report that:
a. we have obtained all the information and explanations which
to the best of our knowledge and belief were necessary for the
purpose of our audit;
b. in our opinion proper books of account as required by law
have been kept by the Company so far as appears from our
examination of those books;
c. the Balance Sheet, 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 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 31 March 2015 taken on record by the Board
of Directors, none of the Directors is disqualified as on 31st
March, 2015 from being appointed as a Director in terms of
Section 164 (2) of the Act; and
f. 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, in our opinion and to the best
of our information and according to the explanations given to
us:
- the Company has disclosed the impact of pending litigations on
its financial position in its financial statements - Refer Note
1.12.5, 1.12.6 & 1.12.7 to the financial statements;
- the Company has made provision, as required under the
applicable law or accounting standards, for material foreseeable
losses on long-term contracts - Refer Note 1.7, 1.10 & 1.11 to
the financial statements; and
- There has been no delay in transferring amounts, required to
be transferred, to the Investor Education and Protection Fund by
the Company.
ANNEXURE TO THE INDEPENDENT AUDITORS' REPORT
The Annexure referred to in Paragraph 1 under heading of "Report
on Other Legal and Regulatory Requirements" our report to the
Members of M/s. Kamanwala Housing Construction Limited ('the
Company') for the year ended 31st March, 2015. We report that:
1. (a) The Company has maintained proper records
showing full particulars, including quantitative details and
situation of fixed assets.
(b) As per the Information and Explanation provided to us, the
Company has a regular programme of physical verification of its
fixed assets by which fixed assets are verified in a phased
manner over a period of three years. In accordance with this
programme, certain fixed assets were verified during the year
and no material discrepancies were noticed on such verification.
In our opinion, this periodicity of physical verification is
reasonable having regard to the size of the Company and the
nature of its assets.
2. (a) As per the Information and Explanation given
to us, the inventories have been physically verified during the
year by the management. In our opinion, the frequency of
verification is reasonable.
(b) In our opinion, the procedure followed by the management for
such physical verification is reasonable and adequate in
relation to the size of the Company and nature of its business.
(c) In our opinion and according to information and explanation
given to us, the Company is maintaining proper records of
Inventory. No discrepancies were noticed on verification between
physical inventory and the books records.
3. (a) The Company has granted loans to six parties
covered in the register maintained under section 189 of the
Companies Act, 2013 ('the Act').
(b) In the case of the loans granted to the parties listed in
the register maintained under Section 189 of the Act, the
borrowers have been regular in the payment of the interest as
stipulated. The terms of arrangements do not stipulate any
repayment schedule and the loans are repayable
on demand. Accordingly, paragraph (iii) (b) of the Order is not
applicable to the Company in respect of repayment of the
principal amount.
(c) There are no overdue amounts of more than Rupees one lakh in
respect of the loans granted to the bodies corporate listed in
the register maintained under Section 189 of the Act.
4. In our opinion and according to the information and
explanations given to us, there is an adequate internal control
system commensurate with the size of the Company and the nature
of its business with regard to purchase of fixed assets and sale
of goods and services. During the course of audit, we have not
observed any continuing failure to correct major weakness in the
internal control system.
5. The Company has not accepted any deposits from the public.
6. As per Companies (Cost Records and Audit) Rules, 2014,
provisions of Section 148(1) relating to cost records and cost
audit are not applicable to 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
provident fund, income tax, sales tax, wealth tax, service tax,
duty of customs, value added tax, cess and other material
statutory dues have been regularly deposited during the year by
the Company with the appropriate authorities. According to the
information and explanations given to us, no undisputed amounts
payable in respect of provident fund, income tax, wealth tax,
service tax, duty of customs, value added tax, cess and other
material statutory dues were in arrears as at 31s March, 2015
for a period of more than six months from the date they became
payable except Sales Tax (VAT) to the extent of Rs. 2,70,458/- and
Interest thereon of Rs. 8,08,745 which is outstanding for more
than 6 months.
(b) According to information and explanations given to us, the
following dues of Income Tax, Sales Tax, Service Tax and Value
Added Tax have not been deposited by the Company on account of
disputes:
Name of
Statute Nature ofdues Amount(Rs) Period to which ForumWhere
dispute is
pendingthe
amount(Rs)
relates (F.Y.)
MVAT Act,
2002 Sales Tax 20,93,373 2006-07 Commissioner
of Sales
Tax (Appeal)
MVAT Act,
2002 Sales Tax 14,53,613 2007-08 Commissioner
of Sales
Tax (Appeal)
MVAT Act,
2002 Sales Tax 4,64,699 2008-09 Commissioner
of Sales
Tax (Appeal)
MVAT Act,
2002 Sales Tax 23,68,921 2010-11 Commissioner
of Sales
Tax (Appeal)
Income Tax
Act, 1961 Income Tax 3,77,72,628 2010-11 Commissioner
of Income
Tax (Appeals)
Income Tax
Act, 1961 Income Tax 82,27,910 2011-12 Commissioner
of Income
Tax (Appeals)
(c) According to the information and explanations given to us
the amounts which were required to be transferred to the
Investor Education and Protection Fund in accordance with the
relevant provisions of the Companies Act, 1956 (1 of 1956) and
rules there under has been transferred to such fund within time.
8. The Company does not have any accumulated losses at the end
of the financial year and has not incurred cash losses in the
financial year and in the immediately preceding financial year.
9. The Company did not have any outstanding dues to financial
institutions, banks or debenture holders during the year.
10. In our opinion and according to the information and the
explanations given to us, the Company has not given any
guarantee for loans taken by others from banks or financial
institutions.
11. In our opinion and according to the information and
explanations given to us, the term loans taken were applied for
the purpose for which the loans were obtained.
12. According to the information and explanations given to us,
no material fraud on or by the Company has been noticed or
reported during the course of our audit.
For Majithia & Associates
Chartered Accountants
Firm Reg. No. 105871W
Bhavesh R. Majithia
Partner
Membership No. 048194
Place: Mumbai
Date: 29th May,2015.
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