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Felicitation of Smt. Sumitra Mahajan for Constitution of NCLT Bench at Indore Vol. 02 No. 2 June 2019 Price ` 20

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Page 1: Felicitation of Smt. Sumitra Mahajan for Constitution of NCLT …indore-icai.org/nl-June-2019.pdf · 2020. 6. 7. · Felicitation of CS. Ranjit Pandey (President- ICSI) & CS. Ashish

Felicitation of Smt. Sumitra Mahajan forConstitution of NCLT Bench at Indore

Vol. 02 No. 2 June 2019 Price ` 20

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CA. Rohini Agrawal(Delhi)

CA. Avinash Poddar(Surat)

CA. Sunil Jain(Indore)

CA. Ankit Somani(Ajmer)

CA. Aseem Trivedi(Indore)

National Conference

on Interplay of Audit with

GST

Member's interaction at conclave

0360 CONCLAVEON REAL ESTATE

CA. Anil Sathe(Past President- BCAS)

CA. Naresh Seth(Mumbai)

Adv. Pankaj Wadhwani(Indore)

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Managing Committee Orientation Programme at Ghaziabad

ITAT Vice President CA. Pramod Kumar withShri Kulbharat (JM) and CA. Manish Borad (AM)

visited the branch with senior members

Felicitation of CS. Ranjit Pandey (President- ICSI) & CS. Ashish Garg (VP- ICSI) at branch

CA. Ranjeet Agrawal, (Convener - UDIN Monitoring Group) and CA. Kemisha Soni, (Chairperson, BOS)

interacting in UDIN Awareness Program

Ethical Standard Board Sub Group formed in Indore

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Seminar on KEY AUDIT MATTERS

by CA. Gautam Jain

CA. Pratik Tripathi speaking on Filing of

DPT-3 forms

Seminar on INNER ENGINEERING

by Swami Guruvanandjee jointly organised with IMA

FCRA, Income Tax and Accounting aspects of NGO's

0 360 Seminar onCHARITABLETRUSTS

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1 The key to success is to focus on goals, not obstacles.

CA. Gaurav Maheshwari(Treasurer)

CA. Samkit Bhandari(Secretary)

CA. Harsh Firoda(Vice-Chairman)

CA. Kirti Joshi (CPE Comm. Chairman)

CA. Anand Jain(Executive Member)

Ex. Offico Member :

CA. Kemisha Soni (CCM)

CA. Churchill Jain (RCM)

CA. Nilesh Gupta (RCM)

MANAGINGCOMMITTEE

OF BEST BRANCH OF INDIA

CA. Ankush Jain(CICASA Chairman)

Chairman’s Communiqué

Dear Members,The month of June has come with a new light with the forming of government with a more clear majority giving it all it needs to take firm decisions. The decision of Government in the first month of its new term to compulsorily retire senior IRS officers and demote some officers has sent a strong message indicating the will to combat corruption and intentions and road map of future. Its tickling to guess what all is still to unveil from pandoras box of the Modi Government. Last month we have organized 5 seminars and National Conference on GST Audit and Annual return to explore the nuances and smoothen the process. It is also pertinent to note that our Institute has issued a suggestive guidance on minimum fee to be charged for such Audit which should be adhered considering the onerous responsibilities casted on us in such Audit. We at Indore branch have also represented to the Institute for revision of GST verification forms being inconsistent with the CGST Act and the definition of audit therein. This month also marks the Golden Jubilee Celebrations of Income tax Appellate Tribunal Bench at Indore which have been celebrated with a Full day Symposium wherein ITAT President and Vice Presidents interacted along with brainstorming sessions of Feroze Andhyarujina, CA. Dhinal Shah and CA. Manish Dafria. Indore has also got an E-court in ITAT so that the Bench at Indore can hear the cases of other cities and other non functional benches.We have also organized some non conventional seminars for the members to reduce the stress and are organizing CA Week in the month of July wherein our focus would be health and happiness because as much as gaining knowledge is important for our profession, maintaining a work life balance and getting recreation is equally important. Last but not the least I would like to thank CA. Aseem Trivedi, CA. Anand Seksaria, CA. Gautam Jain, CA. Mausam Rathi, CA. Ajay Sharma and CA. Vinamra Patodi for their contribution in branch activities last month.Keep reading and contributing to YOUR newsletter!Pranam

CA. Pankaj G. Shah (Chairman)

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2 Sometimes later becomes never ... DO IT NOW.

In addition to general anti-avoidance measures, the Income Tax Act, 1961 ('Act') incorporates various provisions designed to prevent the flow of concealed or disguised income in the economy. Section 68 of the Act is one such provision, which empowers Indian Tax authorities to tax suspicious or dubious cash credits being share application money, loans etc. in the books of taxpayer, unless the assessee in respect of nature or source thereof provides any satisfactory explanation.In nutshell, section 68 of the Act casts an obligation on the taxpayer to provide 'satisfactory' explanation with respect to the nature of the credit in the books of accounts and the source of said credit.Additions under section 68 of the Act have been subject matter of myriad of litigation ever since the introduction of such section on various technical aspects, the primary issue being whether or not the taxpayer has discharged its obligation to avoid trigger of section 68 of the Act.The expression 'nature and source' in section 68 of the Act has been judicially interpreted to refer to the following key ingredients in respect of which the taxpayer should discharge his onus under section 68 of the Act:

· Identity of Investor;

· Credit worthiness of the investor; and

· Genuineness of the underlying transactionIn case the taxpayer fails to corroborate the above-mentioned aspects in toto with the support of cogent evidence, it will be open for the tax officer to treat such credit as income of the taxpayer.Also, an additional burden has been imposed on closely held companies (generally private companies) for proving source of source i.e. the investors/ lenders will be required to provide information in respect of the source of loans/ deposits made by them in the closely held company. The burden of obtaining the said information and sharing the same with tax officer lies with the taxpayer.

Certain specific aspects pertaining to section 68 as

promulgated through various judicial precedents are

briefly stated as under:

1. Issue involved : Coverage of section 68

Key Principle : All types of credit entries

Reference : [(1975) Gumani Ram Siri Ram v CIT

[TS-5041-HC-1973 (Punjab & Haryana)-O]

2. Issue involved : Parameters/ documents corroborating identity/existence of creditors/ share applicants Key Principle : Name of creditors, · Address, Bank details , PAN,

· Certificate of incorporation of investors, etc.

Reference : [(2010) CIT vs Dwarkadish Investment

[TS-5547-HC-2010(Delhi)-O], [(2007) CIT vs Divine Leasing & Finance Ltd. [TS-39-HC-2006(Delhi)-O]

3. Issue Involved : SSUEParameters/ documents corroborating genuineness of transaction Key Principle : Share Application/ Allotment Form, Allotment letters. · Shareholders' register, Board resolutions · Share purchase agreement, · Confirmation from investors, correspondence with investors/lenders, Affidavits etc. Reference : [(2008) CIT vs Lovely Exports (P) Ltd. [TS-85-SC-2008-O], [2014 CIT vs N.R. Portfolio (P) Ltd. [TS-5820-HC-2013(Delhi)-O] [(2011) CIT vs STL Extrusion (P) Ltd. [TS-5783-HC-2010 (Madhya Pradesh)-O]

4. Issue Involved : Situations corroborating credit worthiness of creditor/lender/investors Key Principle : Statement made by Director of Investee Company, · Bank statements of donors, · Income details of donors, · Gift deed, Affidavit furnished by creditors. Reference : [(2018) PCIT vs Chain House International (P) Ltd. [TS-7060-HC-2018(Madhya Pradesh)-O] [(2013) CIT vs Arun Kumar Kothari

Great things never comes from comfort zones.

[TS-5617-HC- 2012(Rajasthan)-O] [(2009) CIT vs Laul Transport Corp. [TS-5726-HC-2008(Punjab & Haryana)-O]

5. Issue Involved : Situations raising doubt on genuineness of the transaction Key Principle : Cash deposited in bank accounts of investors/ lenders before the transaction, Huge share premium in a company without net worth, · Inquiries and investigations conducted by tax authorities, · Non-compliances to notice issued u/s 133(6) and summons u/s 131 of the Act Reference : [(2019) NRA Iron & Steel [TS-5030-SC-2019-O] [(2012) CIT vs Kamdhenu Steel & Alloys Ltd. [TS-808-HC-2011(Delhi)-O] [(2019) PCIT vs NDR Promoters (P) Ltd. [TS-5023-HC-2019(Delhi)-O]

At this juncture it is also relevant to refer to the recent judgment of SC in the case of Pr. CIT v. NRA Iron & Steel (P.) Ltd. (supra), which is yet another ruling in the long list of precedents on the matter wherein SC has dealt with addition made u/s 68 because of high share premium received by the taxpayer.

In the said case the tax officer requested the taxpayer to furnish details of amount received towards share capital and provide evidence to establish the identity and creditworthiness of investor companies as well as genuineness of the transaction. In response to same, the taxpayer furnished the income tax return acknowledgment of investor companies. The tax officer proceeded diligently by issuing summons to representatives of the investors. However, nobody appeared. In certain cases, replies were received through post which further created suspicion in mind of the tax officer. Further, on the basis of independent field enquiries, tax officer found that in respect of none of the investors, the taxpayer fulfilled the conditions for avoiding section 68 of the Act. Accordingly, addition was made u/s 68 of the Act. The CIT(A) by placing reliance on decision of SC in case of Lovely Exports (supra), deleted the additions. Subsequently, the Tribunal and HC also ruled in favour of the taxpayer. Now, the tax department filed an appeal before SC wherein the question framed was whether the taxpayer had discharged the primary onus to establish the genuineness of transaction required under section 68 of the Act.

The Hon'ble SC while passing an ex-parte order annualized various judgements of different courts on subject issue and carved out the following principles:

Merely proving the identity of investor does not discharge the onus of the taxpayer, if the financial capacities or credit worthiness of investors has not been established;

Merely because the transaction has taken place through normal banking channel/cheque/ demand draft is not sufficient to discharge the burden;

The tax officer is duty bound to investigate the creditworthiness of subscriber, verify the identity of subscriber and ascertain whether or not the transaction is genuine;

Thus, based on the findings of tax officer, SC held that assessee has failed to discharge the onus required under section 68 of the Act and accordingly, upheld the action of tax officer. However, it is interesting to note that SC has neither distinguished nor overruled its earlier judgement in the case of Lovely Exports Ltd. (supra), the ratio laid in the said ruling appears to be contradictory to ruling in case of NRA Iron (supra). In Lovely Exports Ruling, the assessee had furnished the necessary details of the investors such as PAN, income-tax jurisdiction, ration card of the share applicants etc. The monies were received through proper banking channel. It was held that all such details constitute acceptable explanation. The SC held that tax department is free to proceed to reopen their individual cases, and even if share capital was bogus, the addition should be made in the hands of share applicants and not the assessee.

Prima facie, on reading both the rulings of the SC harmoniously, it appears that if the tax officer undertakes detailed investigation and has cogent evidence to support his allegation that the investors are not identifiable/ financially capable/ genuine, he is justified in making the addition under section 68 of the Act. On the other hand, in case the tax officer fails to make relevant inquiries into the investors, the taxpayer may take support of the SC ruling in Lovely Exports against the trigger of section 68 of the Act.

Thus, one would observe that despite numerous judgements on the said issue, the issue appears to be still alive and evolving. Accordingly, the taxpayer must maintain required documentation and devise a system to check credit worthiness of the creditors/ share applicants in order to avoid any adverse additions.

Cash Credits Taxability – Issue still alive and further evolving….

Amit Nayyar and Vipin Sharma

3

Congratulations to Pride of IndoreCA. Manoj Fadnis for being appointed as Independent Director of Federal Bank

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4 Dream it .... Wish it ..... Do it .......

Latest Income Tax Judgements

Snowtex Investment Limited vs. PCIT (Supreme Court)-

Speculation Loss: Law on when an amendment can be said to be clarificatory/ retrospective explained. The amendment to the Explanation to s. 73 by the Finance (No 2) Act 2014 with effect from 1 April 2015 is not clarificatory or retrospective. Consequently, loss occurred to the assessee as a result of its activity of trading in shares (a loss arising from the business of speculation) is not capable of being set off against the profits which it had earned against the business of futures and options since the latter did not constitute profits and gains of a speculative business

PCIT vs. State Bank Of India (Bombay High Court)

S. 40A(9): The provision is not meant to hit genuine expenditure by an employer for the welfare and the benefit of the employees. Even contributions to unapproved and unrecognized funds have to be allowed as a deduction if they are genuine in nature

Bharat Heavy Electricals Ltd vs. Mahendra Prasad Jakhmola (Supreme Court)

Entire law explained on (i) whether a litigant is bound by concessions of fact and law made by his Counsel/ Authorized representative during the hearing, (ii) tests to find out whether contract labourers are direct employees or not, (iii) meaning of "control and supervision", (iv) meaning of "master-servant" relationship & (v) when the findings in a judgement can be said to be "perverse" and such that no reasonable person could possibly arrive at

There can be no doubt that admission of a party is a relevant material. But can the statement made by the learned counsel of a party across the Bar be treated as admission of the party? Having regard to the requirements of Section 18 of the Evidence Act, on the facts of this case, in our view, the aforementioned statement of the counsel for the respondent cannot be accepted as an admission so as to bind the respondent. Equally, where a question is a mixed question of fact and law, a concession made by a lawyer or his authorised representative at the stage of arguments cannot preclude the party for whom such person appears from re-agitating the point in appeal

Deepak Nagar vs. DCIT (ITAT Delhi)

S. 68 Bogus Capital Gains from Penny Stocks:

The allegation that the Co is a penny stock co whose share price has been artificially rigged by promoters/brokers/operators to create non-genuine LTCG is not sufficient. The AO has failed to bring on record any evidence to prove that the transactions carried out by the assessee were not genuine or that the

documents were not authentic. No specific enquiry or investigation was conducted in the case of the assessee and/or his broker either by the INV Wing or by the AO during the course of assessment proceedings. The penny stock was also not subject to any action from SEBI (Udit Kalra 176 DTR 249 (Del) distinguished, Fair Invest Ltd 357 ITR 146 (Del) followed)

[TS-348-ITAT-2019(Kol)]

ITAT: Revaluation reserve not to be deducted while calculating share FMV as per Rule 11UA(2).

Kolkata ITAT dismisses Revenue’s appeal for AY 2015-16, rules that 'revaluation reserves need not be deducted while calculating the fair market value of share, as per rule 11UA(2) " of the I.T. Rules; On noting that the assessee had made allotment of shares in FY’s 2013-14 and 2014-15, at a price of Rs.42/share, while the book value of the share was approx. Rs.26/share, AO had held that the shares were allotted at a price which exceeded the FMV, and thus the provisions of Sec.56(2)(viib) were violated; Notes that the difference was only on account of revaluation reserve and thus dismisses Revenue's appeal.

[TS-352-ITAT-2019(ASR)]

ITAT: Denies Sec.12AA registration to assessee-society; Holds ‘playschool’ not an integral part of Education

ITAT denies registration to assessee (registered under the Societies

Registration Act,1860) u/s 12AA, holds that the ‘playschool’ is not an integral part of the term 'education' as envisaged u/s. 2(15), in view of SC ruling in case of Sole Trustee, Lok Sikshan Sansthan Trust; Assessee was a franchisee of a playschool chain, wherein the agreement did not provide for running a ‘primary school’ in the future, thereby Revenue opined that the stated objects of the assessee did not fit into the concept of ‘education’ as enunciated by the SC ruling; Takes note of the aforesaid SC decision which had explained that the word ‘education’ as per sec.2(15), connotes the process of training and developing the knowledge, skill, mind and character of students by normal schooling, thereby holds that a playschool cannot, by any stretch of imagination, be regarded as a scholastic instruction; Further states that, “Now, children would get ‘educated’ merely by playing with each other”, thereby rules that ‘Education’, though not to be understood pedantically, has to have the elements of structured courses, designed to impart knowledge/training; accreditation; examination, etc., and cannot be understood in a loose sense; Further rejects assessee’s reliance on P&H HC decision in case of Infant Jesus Education Society on facts, lastly concludes that the dominant objective of the assessee is to make profit, and cannot be regarded as ‘charitable’ per se.

[TS-347-ITAT-2019(DEL)]

ITAT: AO can't question Ace Investors’ wisdom; Tinkering with assessee’s DCF Valuation method unwarranted

LEGAL CORNER

Compiled by CA. Swapnil Jain

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5Don't stop when you're tired... Stop when you're done.

year in last year's report. It was a copy-paste as there was virtually no activity.Shrikrishna : Are you sure that no change was required?Arjun : Overall, I saw facts and figures were practically the same.Shrikrishna : My dear Arjun, are you aware that the format of company audit report has been changed?Arjun : No. When was it changed? Is the change applicable

stto accounts for the year ended on 31 March, 2019?Shrikrishna : It is very much applicable to accounts for the

styear ended on 31 March, 2019. The changes are not very significant. Three standards have been revised and one is newly introduced. Go rush and hold that report before it is released. Arjun, I never expected you to be so negligent.Arjun : What to do? My colleagues are enjoying their vacation. Senior articles are on exam leave. Exams were postponed due to LokSabha elections. I am fighting all alone.Shrikrishna : You must now gear up for the audits for the

styear ended on 31 March, 2019. Please try to implement all those things which you have so far taken very lightly.Arjun : Like what?Shrikrishna : Writing for independent confirmations of balances of debtors, creditors, loans, banks and so on. Also you need to carefully maintain the working papers. Moreover, also ask the companies to update their registers of directors, shareholders; and also minutes of meetings.Arjun : I agree. We have been taking these things lightly. But now we cannot afford to continue to do so. Audit is becoming more demanding. We need to change. Thank you for opening my eyes.Shrikrishna : Take care. This dialogue is in the context of the recent changes in company audit reports; new SAs and general preparation for ensuring audits. Standard on Auditing 700, 705 and 706 have been revised and Standard on Auditing 701 is newly introduced.

Shrikrishna : Arrey Arjun, I am waiting for you for a long time. Why so much delay?Arjun : What to tell you, Bhagwan! A most disorganised client who has no discipline at all was with me.Shrikrishna : He must be in financial stress.Arjun : Exactly. He wants to apply for some loan and wanted

sthis balance sheet of 31 March, 2019 instantly!Shrikrishna : But are the accounts ready?Arjun : That's the main problem. Somehow, he has got it done. Volume is not much and it is a pvt. ltd. companyShrikrishna : Have you signed his balance sheet?Arjun : Yes, I was helpless.Shrikrishna : Did you obtain signatures of at least two directors?Arjun : It was a fire-fighting situation. I have signed in good faith. One of the directors has signed. The other one will sign it later.Shrikrishna : This good faith is very dangerous. There are cases where the other director refused to sign due to dispute between them. Result – the auditor was held guilty.Arjun : Oh my God! But these are nice people. They won't ditch me.Shrikrishna : Don't be overconfident. Don't take things for granted. This is kaliyug and anything can happen. What about the other directors of the private company?Arjun : Actually, there are four directors. But only two are active.Shrikrishna : That is an additional risk. What is important is the approval of accounts in the board meeting. Signing by two or three directors is consequential. The board approves the accounts and authorises two or three of them to sign the accounts on behalf of the company. This is extremely important. You must obtain a confirmation that the board has approved the accounts.Arjun : Oh, really? We have never obtained such confirmations.Shrikrishna : It has been held to be a misconduct. Another important thing, have you issued the audit report?Arjun : Yes, they wanted it. My assistant just changed the

Chandrashekhar Vaze (Chartered Accountant)

(Source : BCAJ)AUDITOR

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Wake up with determination. Go to bed with satisfaction. 7Do something today that your future self will thank you for.

Report on the Financial Statements

We have audited the standalone financial statements of …………… LIMITED (“the company”), which comprise the Balance Sheet as at 31 March 20xx, the Statement of Profit

1and Loss, statement of changes in equity , the statement

1of cash flows for the year then ended, and notes to the financial statements , including a summary of significant accounting policies and other explanatory information.

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013 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 31 March 20xx,

1 1and profit/loss, changes in equity and its cash flows for the year ended on this date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Companies Act, 2013. Our responsibilities under those Standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Companies Act, 2013 and 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.

Other Information

The Company's Board of Directors is responsible for the other information. The other information obtained at the date of this auditor's report is information included in the Annual report, but does not include the financial statements and our auditor's report thereon.

Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.

If, based on the work we have performed on the other information obtained prior to the date of this auditor's report, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of Management and Those Charged with Governance 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 financial statements that give a true and fair view of the financial position, financial

1 1performance, 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, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes the maintenance of adequate accounting records in accordance with the provision of the Act for safeguarding of the assets of the Company and for preventing and detecting the 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 control, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the Board of Directors is responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those Board of Directors are also responsible for overseeing the company's financial reporting process.

Auditor's Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

·Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and

appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

·Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Companies Act, 2013, we are also responsible for expressing our opinion on whether the company has adequate internal financial controls system in place and the operating effectiveness of such controls.

Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

Conclude on the appropriateness of management's 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 Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's 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 auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern.

·Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

1Other Matter

We did not audit the financial statements/ information of … branches included in the standalone financial statements of the company whose f inancial statements/financial information reflect total assets of Rs.

INDEPENDENT AUDITORS' REPORT

Format of Audit Report of Standalone Financial

Statement of Unlisted Company

Compiled by :

CA. Abhishek Gang

6

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It’s going to be hard, but hard does not mean impossible.8

…… as at 31st March 20xx and the total revenue of Rs. ……… for the year ended on that date, as considered in the standalone financial statements. The financial statements/information of these branches have been audited by the branch auditors whose reports have been furnished to us, and our opinion in so far as it relates to the amounts and disclosures included in respect of branches, is based solely on the report of such branch auditors.

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, 2016 (“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.

2Or

Requirements of 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, are not 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, 1 the statement of changes in equity and the Cash Flow

1Statement 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 written representations received from the directors as on 31 March, 20xx, taken on record by the Board of Directors, none of the directors is disqualified as on 31 March, 20xx, from being appointed as a director in terms of Section 164(2) of the Act.

f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure A/B”.

2Or

The requirement under section 143(3)(i) with respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls is not applicable on the company.

g) In our opinion and to the best of our information and according to the explanations given to us, we report as under with respect to other matters to be included in the Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014:

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements

2Or

The Company does not have any pending litigations which would impact its financial position

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

2Or

The Company did not have any long-term contracts including derivatives contrcts for which there were

any material foreseeable losses.

iii There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company

2Or

Following are the instances of delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company

2Or

There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

For XXXXXXXX Chartered AccountantsFirm Registration No. xxxxxx

CA. Xxxxxxxx Xxxx]Proprietor/ PartnerMembership No.: xxxxxxPlace: xxxxxDate: / /20xx__________________________1. Mention if applicable2. Select applicable paragraph

Page 11: Felicitation of Smt. Sumitra Mahajan for Constitution of NCLT …indore-icai.org/nl-June-2019.pdf · 2020. 6. 7. · Felicitation of CS. Ranjit Pandey (President- ICSI) & CS. Ashish

House full Audience participation inIBC awarenessSeminar jointly with IICA (Ministry of Corporate Affairs)

House full Audience participation inIBC awarenessSeminar jointly with IICA (Ministry of Corporate Affairs)

Office bearers of Bar Council, Engineers, Architects, IMA, Doctors Asso., CBSE School Asso. & others participated in the meeting held at Indore branch.

Group Discussion on IND AS

Felicitation of Branch Chairman

& Committee by

ICSI President & Indore Chapter

Page 12: Felicitation of Smt. Sumitra Mahajan for Constitution of NCLT …indore-icai.org/nl-June-2019.pdf · 2020. 6. 7. · Felicitation of CS. Ranjit Pandey (President- ICSI) & CS. Ashish

Branch participate in Public Awareness Programme

Collector Indore Mr. Lokesh Jatav, IASappreciated participation of CA Fraternity

WALK FOR VOTE

Page 13: Felicitation of Smt. Sumitra Mahajan for Constitution of NCLT …indore-icai.org/nl-June-2019.pdf · 2020. 6. 7. · Felicitation of CS. Ranjit Pandey (President- ICSI) & CS. Ashish

Young CA Brigade sharing theirknowledge in Seminars 1. CA. Yash Khandelwal

2. CA. Neeraj Mishra

3. CA. Rajat Dhanuka

4. CA. Sanket Mehta

5. CA. Deepak Maheshwari

6. CA. Prerna Shah

7. CA. Pallavi Jain

8. CA. Isha Garg

Peer Review Training Programme

CA. Sarthak Jain

CA. Udesh Dassani

CA. Abhishek Parwal

3

5

1

4

6

2

7 8

Page 14: Felicitation of Smt. Sumitra Mahajan for Constitution of NCLT …indore-icai.org/nl-June-2019.pdf · 2020. 6. 7. · Felicitation of CS. Ranjit Pandey (President- ICSI) & CS. Ashish

Printed & Published by CA. Pankaj G. Shah, Chairman on behalf of the Indore Branch of Central India Regional Council of The Institute of Chartered Accountants of India, Plot No. 19-B, CA. Street Scheme No. 78, Part-II, Indore (M.P.) and Printed at Profiles, 639, Sneh Nagar, Indore - 452 001 Ph.: 4061632 and published from Indore.

Registered with the Registrar of Newspaper for India under No. MPBIL 01231/12/1/2008-TC

Printed Book-PostICAI, Indore News Letter

To,

Disclaimer - The views expressed in the articles or contents published in news letter do not necessarily represent the views of office bears the approval of the Council of the ICAI or any of its Committees or the concerned Regional office or its Committees or Branch Managing Committee or Committees.

If undelivered please return to :INDORE BRANCH OF CIRC OF ICAI

19-B, CA. Street,Scheme No. 78, Part-II, Indore (M.P.) Tel. : 0731-2570052-53, 4298198Mail : [email protected]. www.indore-icai.org

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