To the Members
Khemani Distributors & Marketing Limited
Opinion
We have audited the standalone financial statements of Khemani Distributors &
Marketing Limited (“the Company”), which comprise the Balance Sheet as at 31st
March 2023, and the statement of Profit and Loss, and Statement of 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 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, 2023, and profit, and its cash flows for the year ended on that 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 Auditors Responsibilities for the Audit of the
Financial Statements section of our report. We are independent of the Company in
accordance with the Code of Ethics issued by the Institute of Chartered Accountants of
India together with the ethical requirements that are relevant to our audit of the
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.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most
significance in our audit of the financial statements of the 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.
Managements Responsibility for the Standalone Financial Statements
The Companys Board of Directors is responsible for the matters stated in section 134
(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of
these 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. This responsibility also includes maintenance of
adequate accounting records in accordance with the provisions of the Act for safeguarding
of the assets of the Company and for preventing and detecting frauds and other
irregularities; selection and application of appropriate implementation and maintenance of
accounting policies; making judgments and estimates that are reasonable and prudent; and
design, implementation and maintenance of adequate internal financial controls, that were
operating effectively for ensuring the accuracy and completeness of the accounting
records, relevant to the preparation and presentation of the financial statement that give
a true and fair view and are free from material misstatement, whether due to fraud or
error.
In preparing the financial statements, management is responsible for assessing the
Companys ability to continue as a going concern, disclosing, as applicable, matters
related to going concern and using the going concern basis of accounting unless management
either intends to liquidate the Company or to cease operations, or has no realistic
alternative but to do so. Those Board of Directors are also responsible for overseeing the
Companys financial reporting process.
Auditors 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 auditors report that includes our opinion. Reasonable assurance is a high
level of assurance, but is not a guarantee that an audit conducted in accordance with SAs
will always detect a material misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually or in the aggregate, they
could reasonably be expected to influence the economic decisions of users taken on the
basis of these financial statements.
An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the financial statements. The procedures selected depend on the auditors
judgment, including the assessment of the risks of material misstatement of financial
statements, whether due to fraud or error. In making those risk assessments, the auditor
considers internal financial control relevant to the Companys preparation of the
financial statements, that give a true and fair view, in order to design audit procedures
that are appropriate in circumstances. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of the accounting
estimates made by the Companys 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 financial
Statements.
Report on Other Legal and regulatory Requirements
1. As required by required by the Companies (Auditors Report) Order, 2020
(“the Order”) issued by 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 paragraph 3 & 4 of the Order.
2. As required by section 143(3) of the Act, we further 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 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 Account, Cash Flow Statement and
Statement of dealt with this report are in agreement with the books of Accounts;
d. In our opinion, the aforesaid financial statements comply with the applicable
Accounting Standards specified under Section 133 of the Act, read with relevant rules
thereunder as amended;
e. On the basis of written representation received from the directors as on March 31,
2023 and taken on record by the Board of Directors, none of the directors is disqualified
as on March 31, 2023 from being appointed as the directors in terms of Section 164(2) of
the Act; f. With respect to the adequacy of the internal financial control over financial
reporting of the Company and the operating effectiveness of such controls, refer to our
separate report in “Annexure B”;
g. According to information and explanations given to us and based on our examination
of the records of the Company, the Company had provided managerial remuneration with
requisite approvals mandated by the provisions of Sec 197 of the Act;
h. 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
Auditors Report in accordance with Rule 11 of the Companies (Audit & Auditors) Rules,
2014:
1) The Company have pending litigation which is pending before Appellant
Authorities.
2) The company did not have any long-term contracts including derivative
contracts; as such the question of commenting on any material foreseeable losses thereon
does not arise.
3) There has not been an occasion in case of the Company during the year under
report to transfer any sums to the Investor Education & Protection Fund. The question
of delay in transferring such sums does not arise.
For B Chordia & Co.
Chartered Accountants
F.R.N. 121083W
Vikas Chordia
(Partner)
M.N. 158536
DATE: 29/05/2023
PLACE: Surat
UDIN: 23158536BGWOJR2983
ANNEXURE “A” TO THE AUDITORS REPORT
On the basis of such checks as we considered appropriate and accordingly to the
information and explanations given to us during the course of our audit, we report that:
Particulars |
Auditors |
|
Remark |
(i) (a) (A) whether the company is maintaining proper records
showing full particulars, including quantitative details and situation of Property, Plant
and Equipment; |
Yes |
(B) whether the company is maintaining proper records showing full
particulars of intangible assets; |
Not Applicable |
(b) whether these Property, Plant and Equipment have been
physically verified by the management at reasonable intervals; whether any material
discrepancies were noticed on such verification and if so, |
Yes |
whether the same have been properly dealt with in the books of
account; |
|
(c) whether the title deeds of all the immovable properties (other
than properties where the company is the lessee and the lease agreements are duly executed
in favour of the lessee) disclosed in the financial statements are held in the name of the
company, if not, provide the details thereof in the format below:- |
Not Applicable |
Description of property |
Gross carrying value |
Held in the name of |
Whether promoter, directors or their relative or employee |
Period held indicate range, where appropriate |
Reason for not being held in the name of Company* |
- |
- |
- |
- |
- |
*also indicate if in dispute |
(d) whether the company has revalued its Property, Plant and |
Not Applicable |
Equipment (including Right of Use assets) or intangible assets or
both during the year and, if so, whether the revaluation is based on the valuation by a
Registered Valuer; specify the amount of change, if change is 10% or more in the aggregate
of the net carrying value of each class of Property, Plant and Equipment or intangible
assets |
|
(e) whether any proceedings have been initiated or are pending
against the company for holding any Benami property under the Benami |
Not Applicable |
Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made
thereunder, if so, whether the company has appropriately disclosed the details in its
financial statements |
|
(ii) (a) whether physical verification of inventory has been
conducted at reasonable intervals by the management and whether, in the opinion of the
auditor, the coverage and procedure of such verification by the management is appropriate;
whether any discrepancies of 10% or more in the aggregate for each class of inventory were
noticed and if so, whether they have been properly dealt with in the books of account; |
Yes |
(b) whether during any point of time of the year, the company has
been sanctioned working capital limits in excess of five crore rupees, in aggregate, from
banks or financial institutions on the basis of security of current assets; whether the
quarterly returns or statements filed by the company with such banks or financial
institutions are in agreement with the books of account of the Company, if not, give
details; |
Not Applicable |
(iii) whether during the year the company has made investments in,
provided any guarantee or security or granted any loans or advances in the nature of
loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or any
other parties, if so,- |
Investments in Quoted Shares / Unquoted Shares |
(a) whether during the year the company has provided loans or
provided advances in the nature of loans, or stood guarantee, or provided security to any
other entity [not applicable to companies whose principal business is to give loans], if
so, indicate- |
Yes |
(A) the aggregate amount during the year, and balance outstanding
at the balance sheet date with respect to such loans or advances and guarantees or
security to subsidiaries, joint ventures and associates; |
Not Applicable |
(B) the aggregate amount during the year, and balance outstanding
at the balance sheet date with respect to such loans or advances and guarantees or
security to parties other than subsidiaries, joint ventures and associates; |
Annex-1 |
(b) whether the investments made, guarantees provided, security
given and the terms and conditions of the grant of all loans and advances in the nature of
loans and guarantees provided are not prejudicial to the companys interest; |
No |
(c) in respect of loans and advances in the nature of loans,
whether the schedule of repayment of principal and payment of interest has been stipulated
and whether the repayments or receipts are regular; |
Not Applicable |
(d) if the amount is overdue, state the total amount overdue for
more than ninety days, and whether reasonable steps have been taken by the company for
recovery of the principal and interest; |
Not Applicable |
(e) whether any loan or advance in the nature of loan granted which
has fallen due during the year, has been renewed or extended or fresh loans granted to
settle the overdues of existing loans given to the same parties, if so, specify the
aggregate amount of such dues renewed or extended or settled by fresh loans and the
percentage of the aggregate to the total loans or advances in the nature of loans granted
during the year [not applicable to companies whose principal business is to give loans]; |
Not Applicable |
(f) whether the company has granted any loans or advances in the
nature of loans either repayable on demand or without specifying any terms or period of
repayment, if so, specify the aggregate amount, percentage thereof to the total loans
granted, aggregate amount of loans granted to Promoters, related parties as defined in
clause (76) of section 2 of the Companies Act, 2013; |
Annex-1 |
(iv) in respect of loans, investments, guarantees, and security,
whether provisions of sections 185 and 186 of the Companies Act have been complied with,
if not, provide the details thereof |
Yes |
(v) in respect of deposits accepted by the company or amounts which
are deemed to be deposits, whether the directives issued by the Reserve Bank of India and
the provisions of sections 73 to 76 or any other relevant provisions of the Companies Act
and the rules made thereunder, where applicable, have been complied with, if not, the
nature of such contraventions be stated; if an order has been passed by Company Law Board
or National Company Law Tribunal or Reserve Bank of India or any court or any other
tribunal, whether the same has been complied with or not; |
Not Applicable |
(vi) whether maintenance of cost records has been specified by the
Central Government under sub- section (1) of section 148 of the Companies Act and whether
such accounts and records have been so made and maintained; |
Not Applicable |
(vii) (a) whether the company is regular in depositing undisputed
statutory dues including Goods and Services Tax, provident fund, employees state
insurance, income-tax, sales-tax, service tax, duty of customs, duty of excise, value
added tax, cess and any other statutory dues to the appropriate authorities and if not,
the extent of the arrears of outstanding statutory dues as on the last day of the
financial year concerned for a period of more than six months from the date they became
payable, shall be indicated |
Yes |
(b) where statutory dues referred to in sub-clause (a) have not
been deposited on account of any dispute, then the amounts involved and the forum where
dispute is pending shall be mentioned (a mere |
A.Y. 16-17 10,48,416/- A.Y. 15-16 |
representation to the concerned Department shall not be treated as
a dispute); |
86,13,007/- A.Y. 17-18 |
|
90,99,530/- A.Y. 18-19 |
|
37,40,677/- Income Tax |
(viii) whether any transactions not recorded in the books of
account have been surrendered or disclosed as income during the year in the tax
assessments under the Income Tax Act, 1961 (43 of 1961), if so, whether the previously
unrecorded income has been properly recorded in the books of account during the year |
No |
(ix) (a) whether the company has defaulted in repayment of loans or
other borrowings or in the payment of interest thereon to any lender, if yes, the period
and the amount of default to be reported as per the format below |
No |
Nature of borrowing, including debt securities |
Name of lender* |
Amount not paid on due date |
Whether principal or interest |
No. of days delay or unpaid |
Remarks, if any |
|
*lender wise details to be provided in case of defaults to banks,
financial institutions and Government. |
|
|
|
|
(b) whether the company is a declared wilful defaulter by any bank
or financial institution or other lender; |
No |
(c) whether term loans were applied for the purpose for which the
loans were obtained; if not, the amount of loan so diverted and the purpose for which it
is used may be reported; |
No |
(d) whether funds raised on short term basis have been utilized for
long term purposes, if yes, the nature and amount to be indicated |
No |
(e) whether the company has taken any funds from any entity or
person on account of or to meet the obligations of its subsidiaries, associates or joint
ventures, if so, details thereof with nature of such transactions and the amount in each
case; |
No |
|
(f) whether the company has raised loans during the
year on the pledge of securities held in its subsidiaries, joint ventures or associate
companies, if so, give details thereof and also report if the company has defaulted in
repayment of such loans raised; |
No |
(x) |
(a) whether moneys raised by way of initial public
offer or further public offer (including debt instruments) during the year were applied
for the purposes for which those are raised, if not, the details together with delays or
default and subsequent rectification, if any, as may be applicable, be reported; |
Not Applicable |
|
(b) whether the company has made any preferential
allotment or private placement of shares or convertible debentures (fully, partially or
optionally convertible) during the year and if so, whether the requirements of section 42
and section 62 of the Companies Act, 2013 have been complied with and the funds raised
have been used for the purposes for which the funds were raised, if not, provide details
in respect of amount involved and nature of non-compliance; |
Not Applicable |
(xi) |
(a) whether any fraud by the company or any fraud on
the company has been noticed or reported during the year, if yes, the nature and the
amount involved is to be indicated; |
No |
|
(b) whether any report under sub-section (12) of
section 143 of the Companies Act has been filed by the auditors in Form ADT-4 as
prescribed under rule 13 of Companies (Audit and Auditors) Rules, 2014 with the Central
Government; |
No |
|
(c) whether the auditor has considered whistle-blower
complaints, if any, received during the year by the company; |
Not Applicable |
(xii) |
(a) whether the Nidhi Company has complied with the
Net Owned Funds to Deposits in the ratio of 1: 20 to meet out the liability; |
Not Applicable |
|
(b) whether the Nidhi Company is maintaining ten per
cent. unencumbered term deposits as specified in the Nidhi Rules, 2014 to meet out the
liability; |
Not Applicable |
|
(c) whether there has been any default in payment of
interest on deposits or repayment thereof for any period and if so, the details thereof; |
Not Applicable |
(xiii) |
whether all transactions with the related parties are
in compliance with sections 177 and 188 of Companies Act where applicable and the details
have been disclosed in the financial statements, etc., as required by the applicable
accounting standards |
Yes |
(xiv) |
(a) whether the company has an internal audit system
commensurate with the size and nature of its business; |
Yes |
|
(b) whether the reports of the Internal Auditors for
the period under audit were considered by the statutory auditor; |
Yes |
(xv) |
whether the company has entered into any non-cash
transactions with directors or persons connected with him and if so, whether the
provisions of section 192 of Companies Act have been complied with; |
No |
(xvi) |
(a) whether the company is required to be registered
under section 45-IA of the Reserve Bank of India Act, 1934 (2 of 1934) and if so, whether
the registration has been obtained; |
Not Applicable |
|
(b) whether the company has conducted any Non-Banking
Financial or Housing Finance activities without a valid Certificate of Registration (CoR)
from the Reserve Bank of India as per the Reserve Bank of India Act, 1934 |
Not Applicable |
|
(c) whether the company is a Core Investment Company
(CIC) as defined in the regulations made by the Reserve Bank of India, if so, whether it
continues to fulfil the criteria of a CIC, and in case the company is an exempted or
unregistered CIC, whether it continues to fulfil such criteria; |
Not Applicable |
|
(d) whether the Group has more than one CIC as part of the Group, |
Not Applicable |
(xvii) |
if yes, indicate the number of CICs which are part of the Group;
whether the company has incurred cash losses in the financial year and in the immediately
preceding financial year, if so, state the amount of cash losses |
No |
(xviii) |
whether there has been any resignation of the statutory auditors
during the year, if so, whether the auditor has taken into consideration the issues,
objections or concerns raised by the outgoing auditors; |
No |
(xix) |
on the basis of the financial ratios, ageing and expected dates of
realisation of financial assets and payment of financial liabilities, other information
accompanying the financial statements, the auditors knowledge of the Board of Directors
and management plans, whether the auditor is of the opinion that no material uncertainty
exists as on the date of the audit report that company is capable of meeting its
liabilities existing at the date of balance sheet as and when they fall due within a
period of one year from the balance sheet date; |
Yes |
(xx) |
(a) whether, in respect of other than ongoing projects, the company
has transferred unspent amount to a Fund specified in Schedule VII to the Companies Act
within a period of six months of the expiry of the financial year in compliance with
second proviso to sub-section (5) of section 135 of the said Act; |
CSR amount upto the extent of Rs. 6,32,950/- as per CSR |
|
|
Liability is unspent during the F.Y. 2022- 23 and the
Company will transfer the amounts as mentioned in Schedule VII till 30-Sept-2023. |
|
(b) whether any amount remaining unspent under sub-section (5) of
section 135 of the Companies Act, pursuant to any ongoing project, has been transferred to
special account in compliance with the provision of sub-section (6) of section 135 of the
said Act; |
Not Applicable |
(xxi) |
whether there have been any qualifications or adverse remarks by the
respective auditors in the Companies (Auditors Report) Order (CARO) reports of the
companies included in the consolidated financial statements, if yes, indicate the details
of the companies and the paragraph numbers of the CARO report containing the
qualifications or adverse remarks. |
Not Applicable |
Annex-1
Name |
Aggregate |
Balance Outstanding |
1 Onyx Partners |
22,20,09,000 |
5,24,02,742 |
2 Onyx SaaS Private Limited |
13,46,00,000 |
13,97,50,000 |
For B Chordia & Co. |
|
Chartered Accountants |
|
F.R.N. 121083W |
|
Vikas Chordia |
|
(Partner) |
DATE: 29/05/2023 |
M.N. 158536 |
PLACE: Surat |
ANNEXURE “B” TO THE AUDITORS REPORT
Report on the Internal Financial Controls 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 M/s.
Khemani Distributors & Marketing Limited (“the Company”) as on 31st
March 2023 in conjunction with our audit of the financial statements of the Company for
the year ended on that date.
MANAGEMENT RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS
The Companys management is responsible for establishing and maintaining internal
financial controls 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
issued by the Institute of Chartered Accountants of India (‘ICAI). These
responsibilities include the designs, implementation and maintenance of adequate internal
financial controls that were operating effectively for ensuring the orderly and efficient
conduct of its business, including adherence to companys policies, the safeguarding of
its assets ,the prevention and detection of frauds and errors, the accuracy and
completeness of the accounting records, and the timely preparation of reliable financial
information , as required under the Companies Act, 2013.
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
Controlling(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 o
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 responsible 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, testing and evaluating and 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 financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our audit opinion on the Companys internal financial controls system
over financial reporting.
MEANING OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING
A companys internal financial control over financial reporting is a process designed
to provide reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with generally
accepted accounting principles. A companys internal financial control over financial
reporting includes those policies and procedures that (1) pertain to the maintenance of
records that in reasonable detail, accurately and fairly reflect the transactions and
disposition of the assets of the Company. (2) provide reasonable assurance that
transaction are recorded as necessary to permit preparation of 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 of the
companys assets that could have a material effect on the 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 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.
OPINION
In our opinion, the Company has, in all material respects, an adequate internal
financial controls system over financial reporting and such internal financial controls
over financial reporting were operating effectively as at 31st March 2023,
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 issued by the Institute of
Chartered Accountants of India.
For B Chordia & Co.
Chartered Accountants
F.R.N. 121083W
Vikas Chordia
(Partner)
M.N. 158536
DATE: 29/05/2023
PLACE: Surat
+91-9892691696
