ARSS Infrastructure Projects Ltd Auditor Reports

<dhhead>Independent Auditor?s Report</dhhead>

To

The Resolution Professional

In the matter of ARSS Infrastructure Projects Limited (CIN :- L14103OR2000PLC006230) Reg.No IBBI/IPA-001/IP-P00793/2017-18/11360) Report on the Audit of the Standalone Financial Statements Qualified Opinion

We have audited the accompanying standalone financial statements of ARSS Infrastructure Projects Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2024, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity, and the Statement of Cash Flows for the year ended on that date and notes to the financial statements, including a summary of material 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 us, except for the possible effects of the matter described in the Basis for Qualified Opinion paragraph, the aforesaid Standalone 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 prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, ("Ind AS") and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2024, the loss and total comprehensive income, changes in equity and its cash flows for the year ended on that date.

The Hon?ble National Company Law Tribunal, Cuttack Bench (NCLT) under the provisions of the Insolvency and Bankruptcy Code, 2016 has admitted the petition of the Financial Creditors vide the order no. CP(IB) No. 34/CB/2021 dated November 30, 2021. Pursuant to the order, the powers of the Board of Directors stand suspended and are vested with Mr. Uday Narayan Mitra (having Reg. No. IBBI/IPA-001/IP-P00793/2017-18/11360), has been appointed as Resolution Professional (RP). In view of the on-going CIRP and suspension of powers of Board of Directors and as explained to us, the powers of adoption of the statement?s vests with RP. Material Uncertainty related to Going Concern Attention is invited to Note No. 14 & 15 in the standalone financial statements which indicate that the company has incurred losses during the current and past years, the company has accumulated losses and its net worth has been fully eroded. These conditions indicate the existence of a material uncertainty that may cast significant doubt about the company?s ability to continue as a going concern. However, the financial statements of the Company have been prepared on a going concern basis for the reasons stated in the said note in respect of initiation of Corporate Insolvency Resolution Process (CIRP).

Basis for Qualified Opinion

In absence of relevant records, Contract-wise surplus/loss has neither been ascertained nor recognized in compliance with IND AS-115 ‘Revenue from contract with customers.

We conducted our audit in accordance with Standards on Auditing (SAs) specified under section 143(10) of the Companies Act, 2013. Our responsibilities under those Standards are further described in the Auditor?s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act and the Rules there under, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAI?s Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified opinion.

Emphasis of Matter

We draw attention to the following matter to the Standalone Financial Statements:-

We draw attention to para - 3 of the qualified opinion of this report, Corporate Insolvency Resolution Process under section-7 of the Insolvency and Bankruptcy Code 2016 has been initiated against the company by State Bank of India (Financial Creditor) which has been admitted vide the order no. CP(IB) No. 34/CB/2021 dated November 30, 2021 of the Hon?ble National Company Law Tribunal, Cuttack Bench (NCLT) under the provisions of the Insolvency and Bankruptcy Code, 2016. Pursuant to the order, the powers of the Board of Directors stand suspended and are vested with Mr. Uday Narayan Mitra (having Reg. No. IBBI/IPA-001/IP-P00793/2017-18/11360), has been appointed as Resolution Professional (IRP). The Company continues to operate as a going concern.

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. In addition to the matter described in the Basis for Qualified Opinion section, we have determined the matters described below to be the key audit matters to be communicated in our report.

Key Audit Matter:	How our audit addressed the key audit matter:
1. Claim receivable amounting to Rs 121567.58 Lakhs are under dispute/ arbitration.	Evaluate the reasonableness of management?s assessment and judgement considering the relevant sector and industry specific phenomenon.
	Assessed the individual project wise and case wise outstanding claim receivable.
Same are subject to the outcome of arbitration and/ or reconciliation proceedings arising out of various contractual obligations. Recognition and measurement of the same	Discussed the status of significant arbitration claims with the Company?s in house legal counsel and other senior management personnel and assessing their responses.
is based on management evaluation. [Refer note to Note 9: Other Financial Assets]	Verified documentation of claim receivable under arbitration.
	Checked the arithmetical accuracy of the essential calculations of the management estimate and judgement.
	Reviewed the adequacy of disclosures made in the financial statements with this regard.
	Based on the above procedures performed by us, we considered the management?s assessment of recoverability of claims receivable to be reasonable.

Information Other than the Standalone Financial Statements and Auditor?s Report Thereon

The Company?s Board of Directors/ Resolution Professional is responsible for the other information. The other information comprises the information included in the Management Discussion and Analysis, Board?s Report including Annexures to Board?s Report, Business Responsibility and Sustainability Report, Corporate Governance and Shareholder?s Information, but does not include the consolidated financial statements, Standalone Financial Statements and our auditor?s report thereon.

Our opinion on the Standalone 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 Standalone Financial Statements, 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 during the course of our 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.

Management?s and Board of Directors?/ Resolution Professional Responsibilities for the Standalone Financial Statements

The Company?s Management and Board of Directors/ Resolution Professional are responsible for the matters stated in section 134(5) of 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, including other comprehensive income, changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including Ind AS 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 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 Standalone 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, management and Board of Directors/ Resolution Professional is responsible for assessing the Company?s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

The Company?s Board of Directors/ Resolution Professional is also responsible for overseeing the Company?s financial reporting process.

Auditor?s 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 auditor?s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these 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 control 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 controls with reference to Standalone Financial Statements 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 the management.

Conclude on the appropriateness of management?s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company?s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor?s report to the related disclosures in the 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 auditor?s report. However, future events or conditions may cause the Company to cease to continue as a going concern.

Evaluate the overall presentation, structure and content of the Standalone Financial Statements, including the disclosures, and whether the Standalone Financial Statements represent the underlying transactions and events in a manner that achieves fair presentation.

Materiality is the magnitude of misstatements in the Standalone Financial Statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the Standalone Financial Statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the Standalone Financial Statements. 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 financial controls 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 auditor?s 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

1. As required by the Companies (Auditor?s Report) Order, 2020 (the "Order") issued by the Central Government of India in terms of Section 143(11) of the Act, we give in "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, based on our audit we report that: a) We have sought and obtained, except for the matter described in the ‘Basis for Qualified Opinion? paragraph above, all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit. b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books except for the possible effect of the matter described in the para above of the ‘Basis for Qualified Opinion?. c) The Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, Statement of Changes in Equity and the Statement of Cash Flows 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 except for the possible effect of the matter described in the para above of the ‘Basis for Qualified Opinion?. e) On the basis of the written representations received from the directors as on March 31, 2024 taken on record by the Board of Directors/ Resolution Professional, none of the directors is disqualified as on March 31, 2024 from being appointed as a director in terms of Section 164(2) of the Act. f) With respect to the adequacy of the internal financial controls with reference to Standalone Financial Statements of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure B". Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Company?s internal financial controls with reference to Standalone Financial Statements. g) With respect to the other matters to be included in the Auditor?s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended, in our opinion and to the best of our information and according to the explanations given to us: i. The Company has disclosed the impact of pending litigations on its financial position in its Standalone Financial Statements- Refer Note 9 and Note 57 to the financial statements. ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses. iii. There were no amounts which were required to be transferred, to the Investor Education and Protection Fund by the Company.

iv. (a) The Management/RP has represented that, to the best of its knowledge and belief, no funds (which are material either individually or in the aggregate) 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 or entity, including foreign entity ("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; (b) The Management/RP has represented, that, to the best of its knowledge and belief, no funds (which are material either individually or in the aggregate) have been received by the Company from any person or entity, including foreign entity ("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; (c) Based on the audit procedures that have been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (i) and (ii) of Rule 11(e), as provided under (a) and (b) above, contain any material misstatement. v. As per standalone financial statements (a) No dividend proposed in the previous year, declared and paid by the Company during the year. (b) No interim dividend declared and paid by the Company during the year.

(c) The Board of Directors of the Company have not proposed final dividend for the year. vi. The reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 is applicable from 1 April 2023.

Based on our examination which included the test checks, The company has used accounting software for maintaining its books of accounts for the financial year ended march 31, 2024 which has a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software. Further during the course of our audit, we did not come across any instance of audit trail feature being tempered with.

As proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 is applicable from April 1, 2023, reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 on preservation of audit trail as per the statutory requirements for record retention is not applicable for the financial year ended March 31, 2024.

With respect to the matter to be included in the Auditor?s Report under Section 197(16) of the Act: In our opinion and according to the information and explanations given to us, No remuneration has been paid by the Company to its directors during the current year. The Ministry of Corporate Affairs has not prescribed other details under Section 197(16) of the Act which are required to be commented upon by us.

For M A R S &Associates Chartered Accountants Firm Registration No. 010484N

Sd/-

CA. Vipul Kumar Gupta Partner Membership No. 522310 UDIN: 24522310BKEDXN8956

Date: August 10, 2024

Place: Bhubaneswar

‘Annexure A? to the Independent Auditors? Report

(Referred to in Paragraph 1 under the Heading of "Report on Other Legal and Regulatory Requirements" of our Report of even date) To the best of our information and according to the explanations provided to us by the Company and the books of account and records examined by us in the normal course of audit, we state that:

i. In Respect of Property Plant & Equipment a. The Company has maintained proper records showing full particulars, including quantitative details and situation of Property, Plant and Equipment and relevant details of right of use assets. b. The Company has a program of physical verification of Property, Plant and Equipment and right-of-use assets so to cover all the assets in phased manner which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the program, certain Property, Plant and Equipment were due for verification during the year and were physically verified by the Management during the year. According to the information and explanations given to us, no material discrepancies were noticed on such verification. c. Based on our examination of the property tax receipts and lease agreement for land on which building is constructed, registered sale deed / transfer deed / conveyance deed provided to us, we report that, the title in respect of self-constructed buildings and title deeds of all other 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 included under Property, Plant and Equipment are held in the name of the Company as at the balance sheet date. d. The Company has not revalued any of its Property, Plant and Equipment (including right to use assets) and intangible assets during the year. e. No proceedings have been initiated during the year 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. ii. a. The inventory has been physically verified by the management during the year. In our opinion, the frequency of such verification is reasonable and procedures and coverage as followed by management were appropriate. No discrepancies were noticed on verification between the physical stocks and the book records that were 10% or more in the aggregate for each class of inventory. b. The Company has not availed working capital limit in excess of Rs 5 Crore during the year, in aggregate from banks or financial institution on the basis of security of current assets during the year. Hence, Monthly statements is not required to be filed with banks or financial institution. In past years, the company has availed the working capital limit in excess of 5 crore which was eventually declared NPA and the Monthly Statements for those limits have not been filed as the financial creditors have moved to National Company Law Tribunal and their application has been accepted by the Hon?ble National Company Law Tribunal and RP has been appointed for the company and now all powers have been vested with RP. iii. Based on our audit procedures and as per the information and explanations given by the management/RP, the company has not 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 during the year. Hence, reporting under clause (iii) of the order is not applicable. iv. In our opinion and according to the information and explanations given to us, the company has complied with the provisions of section 185 and 186 of the Companies Act, 2013 In respect of loans, investments, guarantees, and security given to directors or any other person in whom the director is interested. v. In our opinion and according to the information and explanations given to us, the company has not accepted any deposits and accordingly paragraph 3 (v) of the order is not applicable. vi. As informed to us, the maintenance of Cost Records is applicable to company based on required criteria for applicability on the company under sub-section (1) of Section 148 of the Act, in respect of the activities carried on by the company. We have broadly reviewed the books of account maintained by the Company pursuant the rules prescribed by the Central Government for maintenance of cost records under Section 148(1) of the Act and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the records.

vii. In respect of statutory dues:

1. In our opinion, the Company has generally been regular in depositing undisputed statutory dues, including Goods and Services tax, Provident Fund, Employees? State Insurance, Income Tax, Sales Tax, Service Tax, duty of Custom, duty of Excise, Value Added Tax, Cess and other material statutory dues applicable to it with the appropriate authorities. There were no undisputed amounts payable, except as mentioned below, in respect of Goods and Service tax, Provident Fund, Employees? State Insurance, Income Tax, Sales Tax, Service Tax, duty of Custom, duty of Excise, Value Added Tax, Cess and other material statutory dues in arrears as at March 31, 2024 for a period of more than six months from the date they became payable:-

(b) Details of statutory dues referred to in sub-clause (a) above which have not been deposited as on March 31, 2024 on account of disputes are given below:

Nature of the Statute	Nature of the Dues	Period to which the Amount Relates	Amount (Rs in Lakhs)	Forum where dispute is pending
Sales Tax Act	Sales Tax Assessment Demand u/s 12(8)	01.04.2003 to 31.03.2004	1.31	Commissioner of Commercial Taxes Cuttack, Odisha
	Sales Tax Assessment Demand u/s 12(4)	01.04.2004 to 31.03.2005	35.60	Commissioner of Commercial Taxes Cuttack, Odisha
	Sales Tax Assessment Demand u/s 12(8)	01.04.2004 to 31.03.2005	2.77	Joint Commissioner of Commercial Taxes Puri, Odisha
Odisha VAT Act	VAT Assessment Demand	01.04.2005 to 31.12.2007	14.52	Commissioner of Commercial Taxes Cuttack, Odisha
	VAT Assessment Demand (U/s-43)	01.04.2005 to 31.12.2007	7.79	Joint Commissioner of Commercial Taxes Angul, Odisha
	VAT Assessment Demand (U/s-43)	01.04.2010 to 31.03.2011	10.91	Joint Commissioner of Commercial Taxes, Bhubaneswar Range, Bhubaneswar, Odisha
Maharastra VAT Act	VAT Assessment Demand (U/s-23)	01.04.2012 to 31.03.2013	17.19	Asst. Commissioner of State Tax, Mumbai Nodal Div.-203, Mumbai
Odisha Entry Tax Act	ET Assessment Demand	01.04.2005 to 31.12.2007	9.84	Commissioner of Commercial Taxes Cuttack, Odisha
	ET Assessment Demand	01.04.2011 to 31.03.2014	109.15	Sales Tax Tribunal, Commissioner of Commercial Taxes, Cuttack, Odisha
	ET Assessment Demand	01.01.2008 to 31.03.2010	89.87	Sales Tax Tribunal, Commissioner of Commercial Taxes, Cuttack, Odisha
	ET Assessment Demand	01.04.2005 to 31.12.2007	24.60	Joint Commissioner of Commercial Taxes, Angul, Odisha

Central Sales Tax Act	CST Assessment Demand U/s-10-A)-ODISHA	01.04.2008 to 31.03.2009	500.16	Commissioner of Commercial Taxes Cuttack, Odisha
	CST Assessment Demand U/s-10-A)-ODISHA	01.04.2005 to 31.01.2008	290.95	Commissioner of Commercial Taxes Cuttack, Odisha
	CST Assessment Demand, TAMILNADU	01.04.2008 to 31.03.2009	15.05	State Tax Officer Royapetha Assessment Circle Chennai-600035
	CST Assessment Demand, TAMILNADU	01.04.2009 to 31.03.2010	5.16	State Tax Officer Royapetha Assessment Circle Chennai-600035
	CST Assessment Demand, TAMILNADU	01.04.2010 to 31.03.2011	13.62	State Tax Officer Royapetha Assessment Circle Chennai-600035
Goods & Service Tax	GST Annual Audit, ODISHA	01.07.2017 to 31.03.2018	240.13	Superintendent, Bhubaneswar Audit Circle (Gr.-2), Central GST & Central Excise, Bhubaneswar, Odisha
	GST Annual Audit ODISHA	01.04.2018 to 31.03.2019	470.72	Superintendent, Bhubaneswar Audit Circle (Gr.-2), Central GST & Central Excise, Bhubaneswar, Odisha
	Interest on delayed payment of tax on cash offset in GSTR-3B Return, ODISHA	01.07.2017 to 30.11.2021	41.90	Superintendent, Bhubaneswar IX Range, Bhubaneswar Cuttack, Odisha
Odisha Electricity Act	Electricity		47.00	Cuttack R D C
Income Tax	Income Tax	AY 2006-07 to AY 2010-11	4397.17	Odisha High Court
	Income Tax	AY 2012-13	76.99	CIT (Appeals)
	Income Tax	AY 2017-18	6911.58	CIT (Appeals)

viii. There were no transactions relating to previously unrecorded income that 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) Based on our Audit procedures and according to information and explanation given to us, The Company has defaulted in repayment of loans or other borrowings or in the payment of interest thereon in earlier years which was classified as NPA and the company is under CIRP. The details of Company overdue outstanding dues to financial institutions, banks as at 31^st March 2024 is as follows:-

Bank Name	Rs in Crores
State Bank of India	872.29
Punjab National Bank (CFM ARC P. Ltd)	358.96
ICICI Bank Ltd	14.85
IDBI Bank Ltd	120.53
Bank of India	59.88
EXIM Bank (Edelweiss ARC Ltd)	187.44
Kotak Mahindra Bank	13.93
Total	1627.88

(b) The Company has not been declared wilful defaulter by any bank or financial institution or other lender during the year. As informed in past years, the Company has been declared wilful defaulter by bank or financial institution, the documents for the same is not available during audit. (c) On an overall examination of the financial statements of the Company, the term loans were applied for the purpose for which the loans were obtained.

(d) The company has not raised any short term fund during the year; hence this clause is not applicable.

(e) On an overall examination of the financial statements of the Company, 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) The Company has not raised any loans during the year by pledging securities held in their subsidiaries, joint ventures or associate companies and hence reporting on clause 3(ix)(f) of the Order is not applicable. x. (a) The Company has not raised any money by way of initial public offer or further public offer (including debt instruments) during the year and hence reporting under clause 3(x)(a) of the Order is not applicable.

2. During the year, the Company has not made any preferential allotment or private placement of shares or convertible debentures (fully or partly optionally) and hence reporting under clause 3(x)(b) of the Order is not applicable.

xi. (a) To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company or no material fraud on the Company by its officers or employees has been noticed or reported during the year. (b) No report under sub-section (12) of Section 143 of the Companies Act has been filed in Form ADT-4 as prescribed under Rule 13 of Companies (Audit and Auditors) Rules, 2014 with the Central Government during the year and up to the date of this report.

3. According to the information and explanations given to us by the management, no whistle-blower complaints have been received by the company.

xii. The Company is not a Nidhi Company and hence reporting under clause (xii) of the Order is not applicable.

xiii. According to the information and explanations given to us and based on our examination the records of the company, transactions with the related parties are in compliance with Section 177 and 188 of Companies Act, 2013. Where applicable, the details of such transactions have been disclosed in the Financial Statement as required by the applicable accounting standards.

xiv. (a) In our opinion, the Company has an adequate internal audit system commensurate with the size and the nature of its business.

(b) We have considered the internal audit reports for the year under audit, issued to the Company during the year and till date, in determining the nature, timing and extent of our audit procedures. xv. According to the information and explanations given to us and based on our examination the records of the company, the company has not entered into any non-cash transaction with directors or persons connected with them. Accordingly, the paragraph 3(xv) of the Order is not applicable. xvi. (a). According to the information and explanations given to us and based on our examination the records of the company, the Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934. Hence, reporting under clause 3(xvi)(a), (b) and (c) of the Order is not applicable.

(b). According to the information and explanations given to us and based on our examination the records of the company, there is no core investment company within the Group (as defined in the Core Investment Companies (Reserve Bank) Directions, 2016) and accordingly reporting under clause 3(xvi)(d) of the Order is not applicable. xvii. The Company has incurred cash losses amounting to Rs 846.14 lakhs during the financial year covered by our audit and there was no cash loss in the immediately preceding financial year. xviii. There has been resignation of the statutory auditors of the Company during the year and there was no objections, issues or concerns raised by the outgoing auditors. 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 and our knowledge of the Board of Directors/Management and Resolution Professional plans and based on our examination of the evidence supporting the assumptions, nothing has come to our attention, except the liabilities up to the date of institution of CIRP i.e. 30/11/2021, which causes us to believe that any material uncertainty exists as on the date of the audit report indicating that Company is not 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. We, however, state that this is not an assurance as to the future viability of the Company. We further state that our reporting is based on the facts up to the date of the audit report and we neither give any guarantee nor any assurance that all liabilities falling due within a period of one year from the balance sheet date, will get discharged by the Company as and when they fall due. xx. (a) There are no unspent amounts towards Corporate Social Responsibility (CSR) on other than ongoing projects requiring a transfer to a Fund specified in Schedule VII to the Companies Act in compliance with second proviso to sub-section (5) of Section 135 of the said Act. Accordingly, reporting under clause 3(xx)(a) of the Order is not applicable for the year.

(b) There are no remaining unspent amounts under sub-section (5) of section 135 of the Companies Act, pursuant to any ongoing project, required to be transferred to special account in compliance with the provision of sub-section (6) of section 135 of the said Act. Accordingly, reporting under clause 3(xx)(b) of the Order is not applicable for the year. xxi. The reporting under clause 3(xxi) of the Order is not applicable in respect of audit of standalone financial statements of the Company. Accordingly, no comment has been included in respect of said clause under this report.

For M A R S & Associates Chartered Accountants Firm Registration No. 010484N

Sd/-

CA. Vipul Kumar Gupta Partner Membership No. 522310 UDIN: 24522310BKEDXN8956

Date : August 10, 2024

Place : Bhubaneswar

‘Annexure – B? to the Independent Auditor?s Report

(Referred to in paragraph 2(f) under ‘Report on Other Legal and Regulatory Requirements? section of our report of even date)

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 ARSS Infrastructure Projects Limited ("the Company") as of 31^st March 2024 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.

Management?s and Board of Directors? Responsibilities for Internal Financial Controls

The Company?s Management and the Board of Directors are responsible for establishing and maintaining internal financial controls with reference to standalone financial statements 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 (the "ICAI"). 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 company?s 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 Company?s internal financial controls with reference to standalone financial statements 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") issued by the ICAI and the Standards on Auditing prescribed under Section 143(10) of the Act, to the extent applicable to an audit of internal financial controls with reference to standalone financial statements. 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 with reference to standalone financial statements 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 with reference to standalone financial statements and their operating effectiveness. Our audit of internal financial controls with reference to standalone financial statements included obtaining an understanding of internal financial controls with reference to standalone financial statements, 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 auditor?s 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 Company?s internal financial controls with reference to standalone financial statements.

Meaning of Internal Financial Controls with Reference to Financial Statements

A company?s internal financial control with reference to standalone financial statements 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 company?s internal financial control with reference to standalone financial statements 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 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 Company?s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls with reference to Financial Statements

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 with reference to standalone financial statements to future periods are subject to the risk that the internal financial control with reference to standalone financial statements 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, to the best of our information and according to the explanations given to us, the Company has, in all material respects, an adequate internal financial controls with reference to standalone financial statements and such internal financial controls with reference to standalone financial statements were operating effectively as at March 31, 2024, based on the criteria for internal financial control with reference to standalone financial statements 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 ICAI.

For M A R S & Associates Chartered Accountants Firm Registration No. 010484N

Sd/-

CA. Vipul Kumar Gupta Partner Membership No. 522310 UDIN: 24522310BKEDXN8956

Date : August 10, 2024

Place : Bhubaneswar