atul ltd Auditors report

TO THE MEMBERS OF ATLAS CYCLES (HARYANA) LIMITED Report on the Audit of Standalone Ind AS Financial Statements Qualified Opinion

We have audited the standalone Ind AS financial statements of Atlas Cycles (Haryana) Limited ("the Company") which comprise Balance Sheet as at 31^st March, 2023, the Statement of Profit and Loss, (including other comprehensive income), the Cash Flow Statement and statement of changes in equity for the year then ended, and a summary of the significant accounting policies and other explanatory information (hereinafter referred to as "the standalone financial statements").

In our opinion and to the best of our information and according to the explanations given to effects of the matters described in the‘Basis of Qualified Opinion section of our Report, the aforesaid standalone Ind AS financial statements give the information required by the companies Act 2013 (the Act) in the manner so required and give a true and fair view in conformity with the Indian accounting standards ("IND AS") prescribed under section 133 of the act read with the companies (Indian accounting Standards) Rules, 2015, as amended, and other accounting principles generally accepted in India, of the state of affairs of the company as at 31^st March 2023, of its Loss, total comprehensive income, changes in equity and its cash flows for the year ended on that date.

Basis of Qualified Opinion

As explained in notes to standalone financial statements for the year ended 31 ^st March 2023,

1. Refer Notes 8.1, 8.2 and 14.1 of the statement, we are unable to comment on the current status of suit filed for earlier year by the company for criminalandrecoveryproceedingsfiledfor above referred matters.

2. Refer Note 9 of the statement, the Physical Stock taking at Sonepat and Malanpur units have not been carried out as at the Balance Sheet date as the Sonepat unit was sealed by Municipal Committee Sonepat. Hence, we are unable to comment on the physical stock position at Sonepat unit amounting to Rs. 6,50,03,902/-.

3. Refer Note 9.1, Since the companyisnothavingitsmanufacturingactivities operationalas on the date of report, the stock in trade is valued at cost instead of valued at cost or net realizable value whichever is lower. Quantification of effect is not ascertainable in absence of Net realizable value, marketability and usability of stock.

4. Refer Note 11 of the statement, in absence of reconciliation with individual debtors and in absence of balance confirmations from debtors, we are unable to comment upon position of debtors of Rs 18,68,88,759/- considered as good.

5. Refer Note 23.1 and Note 40, The company has not provided for the interest on overdue outstanding payment of creditors including MSMEs and on suits filed by creditors in different courts. Exact quantum of liability is not ascertainable in absence of reconciliations with suppliers and balance confirmations by suppliers; however, the company has disclosed in contingent liability regarding claims of interest filed by creditors in different courts.

6. Refer Note 2 of the significant policies to the statement, we are unable to comment on certain current accounts with banks as we have not been provided with certain bank statements for the year under report claimed to be non- operative in books of the company.

7. Refer Note 5.1 of the statement, Special attention is brought on unquoted investment In equity shares and debentures.

8. Refer Note 20.1, we are unable to comment upon transaction relating Rs. 5,90,00,000/- as advance received against sale of non- core asset in absence of Proper Agreement to sell/ Sale deed or explanation provided to us.

9. Refer Note 7 of the statement, the company has not provided for deferred tax Liability/ Deferred tax asset during the year 2022-23 .

10. The company has not provided reconciliation of books with 26AS "ANNUAL TAX STATEMENT" as per Income Tax and further no liability was recognized or disclosed in contingent liability related to TDS interest and late fee amounting Rs. 77,689/- and 5050/- as reflecting 26AS statement.

11. Refer note 22.1, the company has defaulted in repayment of Inter corporate Loan within stipulated time as per the agreed terms. Further, the company has not recognized interest expense on the borrowings of the company. The accumulated interest not provided as on 31^st March 2023 is Rs. 2,97,00,000/-(including Rs. 99,00,000/- for the financial years 2022-23, Rs. 99,00,000/- for the financial years 2021-22 and Rs. 99,00,000/- 2020-21, calculated at simple interest rate) which is not in accordance with the requirement of Ind AS 23; Borrowing Cost. The company has understated losses to the tune of Rs. 99,00,000/- for FY 2022-23.

12. Refer Note 36.1 , the company has not provided for Statutory Audit fee during the financial year, hence understated losses to the tune of Rs. 29,00,000/- . The accumulated Statutory Audit fee not provided as on 31^st March 2023 is Rs. 87,00,000/- (including Rs. 29,00,000/- for the financial years 2022-23, Rs. 29,00,000/- for the financial years 2021-22 and Rs. 29,00,000/- 2020-21).

13. Refer Note 25.2 and Note 11.1, The company has neither exported goods nor disclosed advance against export sales as per FEMA regulations amounting Rs.22,84,620/- in Sahibabad unit and Rs. 53,57,299/- in Sonepat unit respectively.

14. The company has not provided for Gratuity liability as per IND-AS 19 as on Balance Sheet date and further we are unable to quantify the effect of the same due to unavailability of Actuarial valuations and 15. The company has not filed the annual return of GST for the year. non- payment/ non- filing of return, the GSTN of Sonepat unit has been suspended by the department. We conducted our audit of the standalone financial statements in specified under Section 143(10) of the Institute of Chartered Accountants of India. Those Standards and pronouncements require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone financial statements are free from material misstatement. We are independent of the company in accordance with the code of ethics issued by The Institute of Chartered Accountants of India and we have fulfilled our ethical responsibilities in accordance with the provisions of the act. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our Qualified opinion.

Emphasis on Matter

1. We draw attentionto the preparation of Financial Statements on a Going Concern basis, for the reasons as under. The company has accumulated Losses of Rs. 12,29,87,807 but has incurred loss of Rs. 23,24,80,379/- during the year ended 31^st March 2023. As on date the companyscurrentliabilitiesare substantially higher than its current assets and the companys Net worth as per books has been fully eroded as on the reporting year to negative Rs. 32.29 crores.

These conditions indicate the existence of material uncertainty that may cast significant doubt on companys ability to continue as Going concern and therefore it may be unable to realize its assets and discharge its liabilities including potential liabilities in normal course of business. Further, the completely closed therefore the concept of going concern is also doubtful.

The appropriateness of assumption of concept of Going concern is critically dependent upon the Companys ability to raise requisite finance, generate cash flows in future to meet its obligations and to earn profits in future. ability of the company to continue as Going concern is solely dependent on the successful outcome of these conditions, which are not wholly in control of the company.

The honble NCLT Delhi vide order dated 06.12.2022 removed the existingDirectors and management committees members of the company and appointed six new directors on the Board and the newly appointed Board shall be stepping into and responsible for all decisions, reporting, signing, finalizing and authorizing Financial statement for year ending as at 31^st March 2023. However, the present new management has resolved on 22-04-2023 that the financial statements shall be prepared on going concern basis based on their assessment of successful outcome of revival plan , which shall enhance Companys viability accordingly no adjustments have been made to the carrying value of the Assets and Liabilities. Further we have been informed that honble NCLAT Delhi bench has vide order dated 02.08.2023 set aside for review the earlier order of NCLT order dated 06.12.2022 and next date of hearing is fixed for 16.08.2023.

2. Special attention brought to the fact that the accounting record ERP System related to Sonepat and Malanpur units were incomplete due to sealing by municipal committee of Sonepat and server problem of Malanpur unit and management decided to shift all accounting from ERP to Tally software for the year under reporting. We have relied upon the judgement of management for shifting of accounting software from ERP to tally for sonepat and Malanpur unit for the FY 2022-23.

Our opinion is not modified in respect of this matter 1 and 2 .

Key Audit matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of current period. These matters were addressed in the context of our audit of the 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 are key audit matters to be communicated in our report.

KEY AUDIT MATTERS	HOW OUR AUDIT ADDRESSED THE KEY AUDIT MATTERS
Refer Note 9.1 , read with point no. 3 of Basis of Qualified opinion ,the valuation of stock in trade is taken at cost as certified by the management.	Principal Audit Procedures performed:
Considering the significant judgement involved , increased complexities due to closed down of operations of Plant,- uncertainty and materiality of the amount involved, we have identifiedvaluation of Stock at cost as Key Audit Matter for current year Audit.	- Obtained complete list of quantitative Stock items and its current status of valuation.
	We held discussions with key personnel to identify itemized stock which were valued at cost and its justification.
	- Verified related disclosures , its judgement.
Refer Note 11, read with point no. 4 of Basis of Qualified opinion, the unsecured trade receivable exceeding 6 months amounting to Rs.18,68,88,759/- considered as good have regard to valuation and testing not been realized as on the date of the report, however no provision has been created on the same.	Principal Audit Procedures performed:
The company has created a provision for doubtful Trade Receivables amounting Rs. 2,35,50. year 323/- during the year	- Understanding the trade receivables process with and implemented by the management.
The company has PAN India Dealer net work with defined credit period for Trade receivables which has now long outstanding receivable amount for which appropriate loss allowance is required to be created for expected credit losses using simplifiedapproach in accordance with the requirement of Ind AS 109 measuring the Loss allowance equal to credit losses.	- Testing the accuracy of year end on sample basis.
Only Sahibabad unit has Circularized balance confirmation directly to the address of the Statutory Auditors. No parties has responded even their balances were not reconciled.	- Obtained a list of outstanding receivables and discussed plan of recovery with the management.
Considering the significant judgement involved , increased complexities due to closed down of operations of Plant, uncertainty and materiality of the amount involved, we have identifiedrealization of the Trade Receivables as Key Audit Matter for current year Audit.	- Circularized balance confirmation directly to address of the Statutory Auditors and discussed any variation if any.
	- Tested subsequent settlement of trade receivable after the Balance Sheet date on a sample basis.
	- Verified the related disclosures made in notes to financial statements in accordance with IND AS 115 and IND AS 109.
	- The company has not followed IND-AS 109 for impairment loss of Trade Receivables
Refer Note 23.1 read with point no. 5 of Basis of Qualified opinion on Litigations, claims and Contingent Liabilities - regarding interest liability totaling Rs. 15,63,35,087 on cases pending at MSME, NCLT and district courts amounting Rs. 4,24,51,993, Rs. 10,16,70,398 and Rs. 1,22,12,696 respectively.	Principal Audit Procedures performed:
Considering the significant judgement involved , increased complexities due to closed down of operations of Plant, uncertainty and materiality of the amount involved, we have identified Litigations , claims and Contingent Liabilities as Key Audit Matter for current year Audit.	Understanding the process, evaluated the design and implementationwith regard to recording of provisioning, claims and contingent Liabilities.
	- For those matters where Management concluded that no provision should be recorded, we also considered the adequacy and completeness of disclosures made in relation to contingent liabilities.
Refer Note 25 read with point 7 of Annexure A of the report, of Basis of Qualified opinion the company has significantly - defaulted in payment of statutory dues as on the Balance Sheet date and as on the date of the report amounting to Rs. 1,65,90,785/- which included EPF of Rs. 1,49,03,083/-, ESI of Rs. 9,91,167/-, TDS of Rs. 6,88,588/-, and GST of Rs. 7,947/- . Considering the significant judgement involved , increased complexities due to closed down of operations of Plant, uncertainty and	Principal Audit Procedures performed:
materiality of the amount involved, we have identified shall be paid on preferential basis. defaulted in payment of statutory dues as Key Audit Matter for current year Audit.	Understanding the process, evaluated the design and implementationwith regard to recording of payment of statutory dues.
	- The statutory dues regarding PF, ESI, Gratuity, GST, TDS were outstanding as on Balance Sheet date and as on the signing date.
	- The management is of view that the statutory dues shall be paid on preferential basis

Other Information

The Companys management and Board of Directors are responsible forthe.The other information comprises the information included in the Companys Annual Report, but does not include the financial our auditors report thereon.

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

In connection with our audit of the standalonefinancialstatements, our responsibility is to read the other information 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.

If, based on the work we have performed, 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.

Managements Responsibilitiesfor the Standalone Financial Statements

The Companys Management and Board of Directors are responsible for the preparationand presentationof these standalone financial statements in terms of the requirements of the Companies Act, 2013 (hereinafter referred to as "the Act") that give a true andfairviewofthestandalonefinancialposition, standalone financial cash flows and changes in equity of the Company in accordance with accounting principles generally accepted in India including the Indian Accounting Standards specified in the Companies (Indian Accounting Standards) Rules, 2015 (as amended) under Section 133 of the Act. The Companys Board of Directors are also responsible for ensuring accuracy of records including financial information considered necessary for the preparation of the standalone financialstatements. The Board of Directors of the company are responsible for maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; the selectionand application of appropriate accounting policies; making judgements and estimates that are reasonable and prudent; and the design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the standalone financial statements, the management and Board of Directors of the Company are responsible for assessing the 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.

The Board of Directors of the Company is also responsible for overseeing the financial reporting process of the company.

Auditors Responsibility for the Audit of the Standalone Financial Statements

Our objectives are to obtain reasonable assurance about whether the standalone 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 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 standalone financial statements.

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

Identify and assess the risks of material misstatement of the standalone 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 financial controls relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i)of the Act, we are also responsible for expressing our opinion on whether the company has adequate internal financial control systems 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 standalone 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 standalone financial statements, inducing the disclosures, and whether the standalone 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 deficienciesin 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.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone 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 matter or when, in extremely rare circumstances, 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 .

Report on Other Legal and Regulatory Requirements

As required by the Companies (Auditors Report) Order, 2016 (The Order) issued by the Central Government of India in terms of section 143(11) of the Act, we give in "Annexure A" statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable

A. As required by Section 143 (3) of the Act, we report, to the extent applicable, that: which to the best of our knowledge and

(a) Wehavesoughtandobtainedall the information 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. Refer Para 3 of Emphasis of matter stated above, however our opinion is not modified in this regard.

(c) The Balance Sheet, the Statement of Profit and Loss (including other comprehensive income), Cash Flow

Statement and the Statement of Changes in Equity 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 IND AS specified under Section 133 of the Act read with companies (Indian Accounting Standard) Rules 2015 as amended except for the matters described in Basis for Qualified opinion paragraph.

(e) The matters described in Basis of Qualified opinion and Emphasis of matter paragraph, in our opinion may have adverse effect on the functioning, stability of the company and which may lead to change of controlling management.

(f) On the basis of the written representations received from the directors as on 31st March, 2023 taken on record by the Board of Directors, none of the directors disqualifiedas on 31st March 2023, 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 with reference to financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure B".

B. 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:

i. The Company, as explained by the management, has legal cases in MSMEs, NCLT and various District courts to tune of Rs. 93,86,00,067/- which includes Rs.26,84,92,362, 58,01,72,999 and Rs. 8,99,34,706 respectively as recovery claims by vendors and interest liability is likely to incur but is not provided for in books of accounts however appropriate disclosures have been provided.

Further, according to the explanation and information given to us, there are Outstanding Income tax pending with relevant tax department on account of disputes which are as follows:

NAME OF STATUE	NATURE OF LIABILITY	AMOUNT (Rs.)	PERIOD	FORUM WHERE DISPUTE IS PENDING
Income tax Act, 1961	Income tax	9,75,130/-	AY 2012-13	Commissioner of income tax appeals
Income tax Act, 1961	Addition to income	1,96,23,551/- (Income tax is NIL)	AY 2017-18	Commissioner of income tax appeals
Income tax Act, 1961	Addition to income	7,85,37,810/- (Income tax is NIL)	AY 2013-14	Commissioner of income tax appeals

ii. The Company did not have any long-term contracts including derivatives for which there were any material foreseeable losses.

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

C. under Section 197(16) With respect to the

In our opinion and according to the information and current year by the Company to its directors during the current year is in accordance with the provisions of Section 197 of the Act. The remuneration paid to any director Company and it is not in excess of the limit laid down under Section 197 of the Act. The Ministry of Corporate Affairs has not prescribed other details under Section 197(16) which are required to be commented upon by us.

"Annexure A" to the Independent Auditors Report

(Referred to in paragraph 1 under "Report on Other Legal and Regulatory Requirements" section of our report of even date to the members of ATLAS CYCLES (HARYANA) LTD.)

The Annexure referred to in our Independent Auditors Report to the members of the Company on the standalone Ind

AS Financial Statements for the year ended 31 March 2023, we report that:

1) (a) The Company has generally maintained proper records showing full particulars, including quantitative details except for Sonepat unit as the unit was sealed and operations were closed; andsituation of

(b) The company has a policy on physical verification of the fixed assets in a phased manner, designed to cover all the items over a period of three years, which in our opinion, was reasonable having regard to the size of the company and nature of its business. However, we have explained that due to , sealing of Sonepat unit and closure of operations of the company, fixed asset has not been physically verified by the management during the year.

(c) According to information and explanations given to us and on the basis of our examination of the records of the company, the title deeds of immovable properties are held in the name of the company.

2) (a) As explained to us, the inventories were physically verified during the year by the Management except for Sonepat unit , due to the Sonipat unit was under seal by municipal community/ corporation of

b) Thediscrepanciesonphysical compared to books records, which have been dealt with were not material.

3) The Company has notgrantedanyloans,securedorunsecuredtocompanies,firms,Limited Liability partnerships or other parties covered in the Register maintained under section 189 of the Act. Accordingly, the provisions of clause 3 (iii) (a) to (C) of the Order are not applicable to the Company and However, attention is drawn on Note No. 8.1, 8.2, 14.1 of the statement.

4) In our opinion and according to the information and explanations given to us, the company has complied with the provisions of section 185 and I86 of the Companies Act, 2013 In respect of loans, investments, guarantees, and security given.

5) The Company has not accepted deposits from the public and hence the directives issued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any other relevant provisions of the Act and the Companies

(Acceptance of Deposit) Rules, 2015 with regard to the deposits accepted from the public are not applicable

6) As informed to us, the maintenance of Cost Records has not been specified by the Central Government under subsection (1) of Section 148 of the Act, inrespect of the activities carried on by the company.

7) According to the information and explanation given to us, and the records of the company examined by us, the company is not regular in depositing with the appropriate authorities undisputed statutory dues including provident fund, employees state insurance, income-tax, goods and service tax, cess and other material statutory dues. However, according to the information and explanation given to us, undisputed material amounts payable in respect of statutory dues were in arrears as at 31st March, 2023 for a period more than six months from the date they became payable, on account of following:

Nature of liability	Amount of liability payable (In Rs.)
ESI	9,91,167/-
PF	1,49,03,083/-
TDS	6,88,588/-
Professional Tax	NIL
GST	7,947/-

8) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to banks. The Company has not taken any loan either from financial institutions or from the government and has not issued any debentures.

9) Based upon the audit procedures performed and the information and explanations given by the management, the company has not raised moneys by way of initial public offer or further public offer including debt instruments. However, the company has taken inter corporate loan from its associate concern Milton Cycle Industries Limited of Rs. 9,00,00,000/-(Rs Nine crores) which carries interest @ 11% p.a. The company has not honored repayment terms as stipulated terms of inter corporate loan agreement. Further point no. 11 of basis of qualified opinion of our report.

10) To the best of our knowledge and according to the information and explanations given to us, we report that no fraud by the Company or on the company by its officers or employees has been noticed or reported during the year. 11) To the best of our knowledge and according to the information and explanations given to us, the managerial remuneration has been paid or provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act;

12) In our opinion, the Company is not a Nidhi Company. Therefore, the provisions of clause 4 (xii) of the Order are not applicable to the Company.

13) In our opinion, all transactions with the related parties are in compliance with section 177 and 188 of Companies Act, 2013 and Refer Note 46 of financial statement for disclosures as required by the applicable Ind AS. 14) Based upon the audit procedures performed and the information and explanations given by the management, the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review. Accordingly, the provisions of clause 3 (xiv) of the Order are not applicable to the Company and hence not commented upon.

15) Based upon the audit procedures performed and the information and explanations given by the management, the company has not entered into any non-cash transactionswith directors or persons connected with him. Accordingly, the provisions of clause 3 (xv) of the Order are not applicable to the Company and hence not commented upon.

16) In our opinion, the company is not required to be registered under section 45 IA of the Reserve Bank of India Act,

1934 and accordingly, the provisions of clause 3 (xvi) of the Order are not applicable to the Company and hence not commented upon.

"Annexure B" to the Independent Auditors Report

(Referred to in paragraph 1(f) under Report on Other Legal and Regulatory Requirements section of our report of even date) Report on the Internal Financial Controls with reference to the aforesaid standalone financial statements under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act")

We have audited the internal financial controls over financial reporting of ATLAS CYCLES (HARYANA) LIMITED ("the Company") as of 31 March 2023 in conjunction with our audit of the Standalone Ind AS Financial Statements of the Company for the year ended on that date.

Opinion

In our opinion, to the best of our information and according to the explanations given to us, during the year most of the units were substantially non- operative and most of the employees were not available for explanation at the time of our audit, therefore, in absence of proper explanation and records, we are unable to comment on all material aspects however, an adequate internal financial controls system over financial reporting with reference to IND-AS financial statements and such internal financial controls over financial reporting were operating effectively as at 31 March 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 issuedby the Institute of Chartered Accountant of India".

Managements Responsibility for Internal Financial Controls

The respective Board of Directors of the Holding company and its subsidiary company, which are companies incorporated in India, are responsible for establishing and maintaining internal financial controls based on ,internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India (ICAI). These responsibilitiesinclude 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 the respective 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 Act.

Auditors Responsibility

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 on Audit of Internal Financial Controls over Financial Reporting (the "Guidance Note") and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditors judgment, including the assessment of the risks of material misstatement of the Ind AS Financial Statements, whether due to fraud or error.

Meaning of Internal Financial Controls over Financial Reporting

A companys internal financial control over financial reporting regarding the reliability of financial reporting and the preparation of Ind AS 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 records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactionsare recorded as necessary to permit preparation of Ind AS Financial Statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition companys assets that could have a material effect on the Ind AS Financial Statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

For Dinesh Nangru and Co

Chartered Accountants

Firm Registration No:

CA Dinesh Nangru

Partner

Membership No: 094779

Place: Delhi

Date: August 12, 2023