To the Members of Linaks Microelectronics Limited Report on the Audit
of Financial Statements
Opinion We have audited the financial statements of Linaks
Microelectronics 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 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 March 31, 2023,
and its financial performance, 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.
Emphasis of Matters
1) As per Note No. m (v) of notes on account, Corporate Insolvency
Resolution Process(CIRP) is initiated by CANARA BANK ( erstwhile known as Syndicate Bank)
against Clarin Township Pvt. Ltd., and the company M/s Linaks Microelectronics Limited.
M/s. Clarion Town Ship Pvt . Ltd., is the principal borrower and the
company M/S. Linaks Microelectronics Ltd. is a guarantor and its land is mortgaged with
the bank for a loan disbursed by bank for Rs. 16,50,00,000/- (Rs sixteen crore and Fifty
Lac) principal and an interest thereon for Rs. 9,07, 98,566/= (Rs. Nine Crore Seven Lac
Nintyeight Thousand Five Hundred Sixty Six).
An Insolvency Resolution Professional (IRP)is appointed under
insolvency & Bankruptcy Code,2016.
2. No contingent Liability is Provided for disputed cases Under
Taxation, as well as, under Insolvency and Bankruptcy code,2016. (refer Note No.m4 &
n5), Significant management judgement is required to assess such matters to determine the
probability of occurrence of material outflow of economic resources and whether a
provision should be recognised or a disclosure should be made. The management judgement is
also supported with legal advice in certain cases as considered appropriate, Information
other than the Financial Statements and Auditors Report thereon The Companys
management and Board of Directors are responsible for the other information. The other
information comprises the information included in the Companys annual report, but
does not include the financial statements and our auditors 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 auditors 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 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 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 accounting policies; making
judgments and estimates that are reasonable and prudent; and design, implementation and
maintenance of adequate internal financial controls, that were operating effectively for
ensuring the accuracy and completeness of the accounting records, relevant to the
preparation and presentation of the financial statements that give a true and fair view
and are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the Board of Directors 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 the Board of Directors either intends to liquidate the Company
or to cease operations, or has no realistic alternative but to do so.
The 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.
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.
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 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
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.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors Report) Order, 2020
(“the Order”), issued by the Central Government of India in terms of subsection
(11) of section 143 of the Companies Act, 2013, we give in the “Annexure A” a
statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent
applicable.
2. As required by Section 143(3) of the Act, we report that:
(1) 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.
(2) 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.
(3) The Balance Sheet, the Statement of Profit and Loss, and the Cash
Flow Statement dealt with by this Report are in agreement with the books of account.
(4) 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.
(5) 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 is disqualified as on 31st March, 2023 from being appointed as a director in
terms of Section 164(2) of the Act. (6) 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, the company is exempt from getting an audit opinion on
internal financial control.
(7) 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: a) The Company has disclosed details regarding pending
litigations in note (m iv m v) of financial statements, which would impact its financial
position. b) The company has a Developers agreement with the M/S Clarion Township Pvt.
Ltd., under which has the Company stood as guarantor and has mortgaged its land to Canara
Bank ( erstwhile Syndicate Bank). M/s Clarion Township Pvt. Ltd. Has defaulted and Canara
Bank has initiated Corporate Insolvency Resolution Process.
The company is filing appeal against this order. There may be
unforeseen losses.
c) There were no amounts which were required to be transferred to the
Investor Education and Protection Fund by the Company. d) (i) The management has
represented that, to the best of its knowledge and belief, other than as disclosed
in the notes to the accounts, no funds have been advanced or loaned or invested (either
from borrowed funds or share premium or any other sources or kind of funds) by the company
to or in any other person(s) or entity(ies), including foreign entities
(“Intermediaries”), with the understanding, whether recorded in writing or
otherwise, that the Intermediary shall, whether, directly or indirectly lend or invest in
other persons or entities identified in any manner whatsoever by or on behalf of the
company (“Ultimate Beneficiaries”) or provide any guarantee, security or the
like on behalf of the Ultimate Beneficiaries; (ii) The management has represented, that,
to the best of its knowledge and belief, other than as disclosed in the notes to the
accounts, no funds have been received by the company from any person(s) or entity(ies),
including foreign entities (“Funding Parties”), with the understanding, whether
recorded in writing or otherwise, that the company shall, whether, directly or indirectly,
lend or invest in other persons or entities identified in any manner whatsoever by or on
behalf of the Funding Party (“Ultimate Beneficiaries”) or provide any guarantee,
security or the like on behalf of the Ultimate Beneficiaries; and (iii) Based on audit
procedures which we considered reasonable and appropriate in the circumstances, nothing
has come to their notice that has caused them to believe that the representations under
sub-clause (i) and (ii) contain any material mis-statement. e) The company has not
declared or paid any dividend during the year in contravention of the provisions of
section 123 of the Companies Act, 2013.
(8) With respect to the matter to be included in the Auditors
Report under Section . . .
197(16) of the Act, we hereby state that no managerial remuneration is
paid by the Company.
For S.R. Gupta & Co. Chartered Accountants Firm Registration
Number-001939C
( CA V.K. Gupta) Partner Membership Number- 014745 UDIN No.
23014745BGWOPL5091
Date: 29.05.2023 Place: Lucknow
ANNEXURE A TO THE INDEPENDENT AUDITORS REPORT
Report as required by the Companies (Auditors Report) Order, 2020
(“the Order”), issued by the Central Government of India in terms of sub-section
(11) of section 143 of the Companies Act, 2013 (Refer to in paragraph 1 under ‘Report
on Other Legal and Regulatory Requirements section of our report of even date) With
reference to the Annexure A referred to in the Independent Auditors Report to the
members of the Company on the financial statements for the year ended March 31, 2023, we
report the following: (i) (a) (A) The Company has proper records related to full
particulars including quantitative details and situation of Property, Plant and Equipment
company.
(B) the company is not having any intangible asset. Therefore, the
provisions of Clause (i)(a)(B) of paragraph 3 of the order are not applicable to the
company.
(i) No proceedings have been initiated or are pending against the
company for holding any benami property under the Benami Transactions (Prohibition) Act,
1988 (45 of 1988) and rules made thereunder.
Therefore, the provisions of Clause (i)(e) of paragraph 3 of the order
are not applicable to the company.
(ii) (a) In our opinion, physical verification of inventory has been
conducted at reasonable intervals by the management and the coverage and procedure of such
verification by the management is appropriate. No material discrepancies were noticed on
such verification.
(a) During any point of time of the year, the company has not been
sanctioned any working capital limits, from banks or financial institutions on the basis
of security of current assets. Therefore, the provisions of Clause (ii)(b) of paragraph 3
of the order are not applicable to the company. (iii) During the year, the company has not
made any 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. Therefore, the provisions of clause 3(iii) of
the said Order are not applicable to the company.
(iv) The company has not made any loans, investments, guarantees and
security on which provisions of section 185 and 186 of the Companies Act 2013 are
applicable. Therefore, the provisions of clause 3(iv) of the said Order are not applicable
to the company.
(v) In our opinion and according to the information and explanations
given to us, the Company has not accepted any deposits from public. Therefore, the
provisions of Clause (v) of paragraph 3 of the order are not applicable to the Company.
(vi) As explained to us, the Central Government of India has not
specified the maintenance of cost records under sub-section (1) of Section 148 of the Act
for any of the products of the Company. Therefore, the provisions of Clause (vi) of
paragraph 3 of the order are not applicable to the Company.
(vii) (a) The Company is generally regular in depositing undisputed
statutory dues including Provident Fund, Employees State Insurance, Income tax, Sales Tax,
Wealth tax, Service tax, Duty of Customs, duty of Excise, Value Added Tax, GST, Cess and
other statutory dues with the appropriate authorities to the extent applicable to it.
There are no undisputed amounts payable in respect of income tax, wealth tax, service tax,
sales tax, value added tax, duty of customs, duty of excise or cess which have remained
outstanding as at March 31, 2023 for a period of more than 6 months from the date they
became payable.
(b) According to the information and explanations given to us, there
are following statutory dues referred in sub- clause (a) which have not been deposited on
account of any dispute.
(i) Details of litigated Sales Tax assessments under appeal and
finalization (Rs. in 000)
| Serial Number |
F inancial Year |
Provincial Disputed Amount |
Central Disputed Amount |
| 1 |
1993-94 |
Nil |
Rs 153 |
| 2 |
1994-95 |
Rs 142 |
Rs 75 |
| 3 |
1996-97 |
Rs 383 |
Rs 102 |
| 4 |
1997-98 |
Rs 458 |
Rs 494 |
| 5 |
1999-00 |
Rs 92 |
Rs 88 |
| 6 |
2000-01 |
Rs 482 |
Rs 781 |
| 7 |
2001-02 |
Rs 92 |
Rs 9 |
| 8 |
2002-03 |
Nil |
Rs 285 |
(viii)In our opinion and according to the information and explanations
given to us, there is no any transaction 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). (ix) (a) In our opinion and according to the information and
explanations given to us, the Company has not defaulted in repayment of any loan or other
borrowings or any interest due thereon to any lender. (b) In our opinion and according to
the information and explanations given to us, the company has not been a declared wilful
defaulter by any bank or financial institution or other lender. Subject to “emphafect
of matters” point no one.
(c) In our opinion and according to the information and explanations
given to us, the loans were applied for the purpose for which the loans were obtained.
(d) In our opinion and according to the information and explanations
given to us, there are no funds raised on short term basis which have been utilised for
long term purposes.
(e) In our opinion and according to the information and explanations
given to us, the company has not taken any funds from any entity or person on account of
or to meet the obligations of its subsidiaries, associates or joint ventures.
(f) In our opinion and according to the information and explanations
given to us, the company has not raised loans during the year on the pledge of securities
held in its subsidiaries, joint ventures or associate companies.
(x) (a) The Company has not raised money by way of initial public offer
or further public offer (including debt instruments). Therefore, the provisions of Clause
(x)(a) of paragraph 3 of the order are not applicable to the Company.
(b) In our opinion and according to the information and explanations
given to us, the company has not made preferential allotment or private placement of
shares during the year.
(xi) (a) We have not noticed any case of fraud by the company or any
fraud on the Company by its officers or employees during the year. The management has also
not reported any case of fraud during the year. (b) During the year no 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.
(c) As auditor, we did not receive any whistle- blower complaint during
the year.
(xii) The company is not a Nidhi Company. Therefore, the provisions of
Clause (xii) of paragraph 3 of the order are not applicable to the Company. (xiii)As per
the information and explanations received to us 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. Identification of related parties were made and provided
by the management of the company.
(xiv)The company has considered the internal auditors report appointed
u/s section 138 of the Companies Act, 2013.
(xv) The Company has not entered into any non-cash transactions with
directors or persons connected with him for the year under review.
Therefore, the provisions of Clause (xv) of paragraph 3 of the order
are not applicable to the Company.
(xvi)(a) The Company is not required to be registered under section
45-IA of the Reserve Bank of India Act, 1934.
(b) The company has not conducted any Non-Banking Financial or Housing
Finance activities during the year.
(c) The company is not a Core Investment Company (CIC) as defined in
the regulations made by the Reserve Bank of India.
(xvii)The company has incurred cash loss for Rs.10.00Laces in current
financial year.
(xviii) There has been no resignation of the previous statutory
auditors during the year.
(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, we are 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.
(xx) There is not liability of the company under the provisions of
section 135 of the Companies Act, relating to Corporate Social Responsibility.
Therefore, the provisions of Clause (xx) of paragraph 3 of the order
are not applicable to the Company.
(xxi)The company has not made investments in subsidiary company.
Therefore, the company does not require to prepare consolidated
financial statement. Therefore, the provisions of Clause (xxi) of paragraph 3 of the order
are not applicable to the Company.
ForS. R. Gupta & Co. Chartered Accountants
|
(CA V. K. Gupta) |
|
PARTNER |
|
M.No.014745 |
|
UDIN No. 23014745BGWOPL5091 |
| Date: 29.05.2023 |
|
“ANNEXURE B” TO THE INDEPENDENT AUDITORS REPORT OF THE
EVEN DATE ON THE STANDALONE FINANCIAL STATEMENTS OF LINAK S M ICROELECTRONICS LIM ITED ON
THE FINA NCIAL CONTROLS UNDER CLAUSE (i) OF SUB SECTION 3 OF SECTION 143 OF COMPANIES ACT
2013.
Section 143 of the Companies Act, 2013:
We have audited the internal financial controls over financial
reporting of
LINAKS M ICROELECTRONICS LIMITED as on March 31, 2023 in conjunction
with our audit of the standalone financial statements of the Company for the year ended on
that date.
Managements Responsibility for Internal Financial Controls:
The Company s 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”. These
responsibilities include 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 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 Reporting 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 judgement, 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 dispositions of the assets of the company; (2) provide reasonable
assurance that transactions are recorded as necessary to permit ofthecompany;and
accounting principles,andthatreceiptsandexpendituresofthecompanyarebeing
madeonlyinaccordancewithauthorizationsofmanagementanddirectors
preparationoffinancialstatementsinaccordancewithgenerallyaccepted statements.
ortimelydetection ofunauthorizedacquisition,use,or dispositionofthe companys assets
that could have a material effect on the financial (3)
providereasonableassuranceregardingprevention
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.
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 on March 31, 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 and on behalf of S. R. Gupta &Co. Chartered Accountant
|
CA. V. K. Gupta |
|
Partner |
|
Membership Number: 014745 |
| Place: Lucknow |
|
| Date:29.05.2023 |
|
+91-9892691696
