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AUDITOR'S REPORT

Prakash Steelage Ltd.

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Market Cap. (₹) 4.38 Cr. P/BV -0.02 Book Value (₹) -15.32
52 Week High/Low (₹) 1/0 FV/ML 1/1 P/E(X) 0.32
Bookclosure 28/09/2018 EPS (₹) 0.79 Div Yield (%) 0.00
Year End :2015-03 
Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements of PRAKASH STEELAGE LIMITED ('the Company'), which comprise the Balance Sheet as at March 31, 2015, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of the 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 and presentation of these standalone 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 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, 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 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 we have obtained is sufficient and appropriate to provide a basis fo r our audit opinion on the standalone 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, of the state of affairs of the Company as at March 31, 2015, and its profit and its cash flows for the year ended on that date.

Emphasis of matter

We draw attention to note no. 40 of the financial statements regarding non-disclosure of initial disclosures namely total assets, total liabilities, revenue, expenses, net cash flows and pre-tax profit or loss in respect of the ordinary activities attributable to the discontinuing operation and the income tax expense related thereto as required by Accounting Standard (AS) 24 'Discontinuing Operations' in respect of proposed transfer of its seamless business. As stated in aforesaid note, the company is unable to determine the income, expenses, assets and liabilities clearly attributable to the discontinued operations and the management is of the view that the seamless business, a component of the enterprise, cannot be distinguished operationally and for financial reporting purposes for the reasons mentioned therein.

Our opinion is not 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'), 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 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 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

(e) On the basis of the written representations received from The directors as on March 31, 2015 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2015 from being appointed as a director in terms of Section 164 (2) of the Act.

(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:

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note 41 to the financial statements;

ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts - Refer Note 42 to the financial statements;

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company - Refer Note 43 to the financial statements.

Annexure to the Independent Auditors' Report

Annexure referred to in paragraph 1 under the heading of 'Report on Other Legal and Regulatory Requirements' of Independent Auditors' Report to the members of PRAKASH STEELAGE LIMITED ("the Company") for the year ended March 31, 2015. We report that:

(i) a) The Company has maintained proper records showing full particulars including quantitative details and situation of Fixed Assets.

b) The fixed assets have been physically verified by the management during the year. In our opinion, the frequency of verification of fixed assets by the management, as informed to us, is at reasonable intervals, having regard to the size of the Company and the nature of the assets physically verified. As explained to us no material discrepancies were noticed on such verification.

(ii) a) Inventory have been physically verified by the management at reasonable intervals. In our opinion, the frequency of verification is reasonable.

b) In our opinion and according to the information and explanations given to us, the procedures of physical ve rification of inventory followed by the management are generally reasonable and adequate in relation to the size of the Company and the nature of its business.

c) In our opinion and according to the information and explanation given to us, the Company is maintaining proper records of inventory. Discrepancies noticed on verification by management between the physical stocks and the book records were not material and the same have been properly dealt with in The books of account.

(iii) The Company has not granted any loans, secured or unsecured, to companies, firms or other parties covered in the register maintained under Section 189 of the Act. Therefore, the provisions of clause 3(iii) of Companies (Auditor's Report) Order, 2015 are not applicable to the Company.

(iv) 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, for purchase of inventory, fixed assets and for sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weakness in the internal control systems.

(v) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits during the year from the public within the meaning of the provisions of Section 73 to 76 or any other relevant provisions of the Companies Act, 2013 and the rules made thereunder.

(vi) According to information and explanations given to us, the Company has maintained books of account and records required to be maintained pursuant to the rule prescribed by the Central Government for the maintenance of cost records under section 148(1) of the Companies Act, 2013 and are of the opinion that prima facie the prescribed accounts and records have been made and maintained. The contents of these accounts and records have not been examined by us.

(vii) a) Undisputed Statutory dues including Employees' Provident Fund, Employees' State Insurance (ESIC), Value Added Tax, Central Sales Tax, Entry Tax, Tax Deducted at Source (TDS), Wealth Tax, Service Ta x and Profession Tax have generally been regularly deposited with the appropriate authorities except for dues in respect of income- tax where considerable delay has been observed in depositing such dues with the appropriate authorities. According to the information and explanations given to us, there were no undisputed statutory dues which have remained outstanding as at March 31, 2015 for the period of more than six months from the date they became payable.

b) According to the information and explanations given to us, and the records examined by us, the dues in respect of Sales-Tax, Income-Tax, Duty of Customs, Wealth-tax, Service Tax, entry tax, Value Added Tax, Central Sales Tax, Duty of Excise, Cess as at March 31, 2015 that have not been deposited with the appropriate authority on account of any disputes and the forum where the dispute is pending are as under:

c) According to the information and explanations given to us, there were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made thereunder.

Sr.  Name of             Nature of               Financial Year
No.  the Statute         the Dues                to which
                                                 amount relates

1    Bombay Sales        Sales Tax               1994-95 
     Tax Act

2    Bombay Sales        Sales Tax               1995-96 
     Tax Act

3    Central Sales       Central                 1995-96 
     Tax Act             Sales Tax

4    Central Sales       Central                 2009-10 
     Tax Act, 1958       Sales Tax

5    Maharashtra         Maharashtra             2009-10 
     VAT Act, 2002       Value Added Tax

6    Maharashtra         Maharashtra             2005-06
     VAT Act, 2002       Value Added Tax

7    Central Sales       Central Sales           2005-06 
     Tax Act, 1958       Tax

8    Maharashtra         Maharashtra             2008-09 
     VAT Act, 2002       Value Added Tax

9    Central Sales       Central Sales           2008-09 
     Tax Act, 1958       Tax

10   Central Excise      Cenvat Credit           April 2007 to
     Act,1944            & Penalty               August 2009

Name of the Statute           Amount      Forum where dispute
                               (Rs.)      is Pending

Bombay Sales Tax Act          79,202/-    Dy. Comm. Sales Tax (Appeal)
                                          IV, Mumbai

Bombay Sales Tax Act          59,317/-    Dy. Comm. Sales Tax (Appeal) 
                                          IV, Mumbai

Central Sales Tax Act       2,85,360/-    Dy. Comm. Sales Tax (Appeal) 
                                          IV, Mumbai

Central Sales Tax Act      42,53,968/-    Joint Comm. Sales Tax (Appeal)
                                          IV, Mumbai

Maharashtra VAT 
Act, 2002                1,07,56,527/-    Joint Comm. Sales Tax (Appeal)
                                          IV, Mumbai

Maharashtra VAT 
Act, 2002                1,14,78,701/-    Joint Comm. Sales Tax (Appeal)
                                          IV, Mumbai

Central Sales Tax
Act, 1958                1,25,90,800/-    Joint Comm. Sales Tax (Appeal)
                                          IV, Mumbai

Maharashtra VAT 
Act, 2002                   3,76,000/-    Joint Comm. Sales Tax (Appeal)
                                          IV, Mumbai

Central Sales Tax
Act, 1958                3,82,78,500/-    Joint Comm. Sales Tax (Appeal)
                                          IV, Mumbai

Central Excise
Act, 1944                  17,23,624/-    Customs Excise & Service Tax
                                          Appellate Tribunal, Ahmedabad
(viii) The Company has no accumulated losses at the end of the financial year and has not incurred cash loss in the current financial year or in the immediately preceding financial year.

(ix) In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to a financial institution or bank.

(x) According to the information and explanations given to us, the company has not given any guarantee for loans taken by others from bank or financial institutions.

(xi) In our opinion and according to the information and explanation given to us, the term loans raised during the year have been applied for the purpose for which they were raised.

(xii) Based upon the audit procedures performed and information and explanations given by the management, we report that no fraud on the Company or by the Company has been noticed or reported during the course of our audit.

FOR KHANDELWAL JAIN & CO. FOR BATLIBOI & PUROHIT

Chartered Accountants Chartered Accountants

Firm's Registration No. 105049W Firm's Registration No. 101048W

sd/-                               sd/-

(NARENDRA JAIN)                   (R.D.HANGEKAR)

PARTNER                            PARTNER

Membership No. 048725              Membership No. 030615
Place: Mumbai

Date: May 30, 2015

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