chamanlal setia exports ltd share price Auditors report


TO THE MEMBERS OF CHAMAN LAL SETIA EXPORTS LIMITED

1. Opinion

We have audited the accompanying financial statements of CHAMAN LAL SETIA EXPORTS LTD.("the Company"), which comprises of Balance Sheet as at March 31st, 2023, the Statement of Profit and Loss (including other comprehensive income), Statement of Changes in Equity and Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information(hereinafter referred to as "the standalone financial statements").

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act,2013 (hereinafter referred to as "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 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 31st March 2023, its profits including other comprehensive income),changes inequity and its cash flows for the year ended on that date.

2. Basis for opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act and other applicable authoritative pronouncements issued by the Institute of Chartered Accountants of India. Our responsibilities under those Standards are further described in the ‘Auditor Responsibilities for the Audit of the Standalone 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 ("the ICAI") together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act 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 of our opinion on the Standalone Financial Statements.

Key Audit Matters: -

3. Key Audit matters are those matters that, in our professional judgment, were of most significant 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.

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
Revenue recognition - Sale of Goods procedures: Our audit work included, but was not limited to, the following
Refer Note 4 in the Summary of significant accounting policies and other explanatory information • Obtained an understanding of the process of each revenue stream, particularly of sale of rice and by products;
The Company recognised an amount of Rs. 138734.63 lacs revenue for the year ended 31st March, 2023, as disclosed in Note 17 to the standalone financial statements. • Evaluated the design and implementation and tested the operating effectiveness of controls over revenue recognition including around quantity sold, pricing and accounting of revenue transactions;
Revenue for the Company primarily comprises of ,,revenue from sale of rice either manufactured or traded. • Performed substantive analytical procedures on revenue which includes ratio analysis and region wise analysis;
• Evaluated the terms and conditions of the contracts, including incoterms, with customers to ensure that the revenue recognition criteria are assessed by the management in accordance with the accounting standards;
• On a sample basis, tested revenue transactions recorded during the year, and revenue transactions recorded in the period before and after year-end with supporting documents, such as invoices, agreements with customers, proof of deliveries, and subsequent collection of payment;
• Performed other substantive audit procedures including domestic debtor confirmations on a sample basis, reviewed the subsequent collection of payment and proof of deliveries document of such selected debtors. Further, reconciling revenue recorded during the year with statutory returns;
• Tested, on sample basis, manual journal entries recorded in revenue accounts, credit notes and claims, to the relevant approvals and the supporting documents;
• Evaluated disclosures made in the financial statements for revenue recognition from sale of goods for appropriateness in accordance with the accounting standards.
Inventory existence and valuation Our audit work included, but was not limited to the following procedures:
Refer Note 4 in the Summary of significant accounting policies and other explanatory information. Existence:
Inventory of the Company consists primarily of variety of rice, paddy and their byproducts, manufactured during the process of conversion of paddy into rice. • Obtained an understanding of the managements process of inventory management and inventory physical verification performed subsequent to year-end;
The Company held inventories amounting to Rs. 41444.03lacs as at 31st March 2023. Which represent 61% of total Current Assets of the company and 51% Total Assets of The Company. The inventory primarily comprises of Paddy as raw material, packing such as Bardana/Empties material and finished goods in the form of rice and by-products. Inventory holding is generally significant considering the finished goods are aged for 6-9 months and also due to seasonality of the purchase of paddy. Such inventory is stored in plinths, godown, warehouses, silos, and storage bags. High quantity of inventory makes inventory physical verification an extensive procedure for the management, at the year end. • Evaluated the design effectiveness of controls over inventory management process/ inventory physical verification and tested key controls for their operating effectiveness;
The valuation of finished rice and by products is a comprehensive exercise and is carried out manually with the help of computer aided devices. The valuation process involves estimation around determination of - • Reviewed the instructions given by senior management to stock count teams, including ensuring proper segregation of stock, use of calibration scales/charts, identification of damaged inventory, if any, etc.;
Determination of Weighted average Cost • Obtained inventory records and results of management conducted count;
• Allocable overheads and their absorption rates; • Reviewed reconciliation of differences, if any, between management physical count and inventory records, and tested the necessary adjustment made in the inventory records by the management;
• Determination of net realisable value of by products such as husk, bran, etc, and • Reviewing the Stock Auditor Report of an Independent Chartered Accountant M/s Kumar Sunil & Associates on 31.03.2023 along with its valuation .
• Determination of net realisable value of the different variety of finished product. Valuation:
Accordingly, existence and valuation of the yearend inventory balance, which is significant with respect to the total assets held by the Company, is considered to be one of the areas which required significant auditor attention owing to the complexity and judgements involved in the process of physical • Obtained an understanding of management process of inventory valuation;
• Evaluated design effectiveness of controls over inventory valuation process and tested key controls for their operating effectiveness;
• Tested inputs into the valuation process from source documents general ledger accounts;
• Tested reconciliation of opening inventory, purchase/ production, sales and year-end inventory to validate the amount of yield during the year and to identify any abnormal production loss;
• Compared key estimates, including those involved in computation of allocable overheads and their absorption rate, to prior years and enquired reasons for any significant variations,
• Checked net realisable value of by-products from actual sale proceeds near/ subsequent to the year-end;
• Tested arithmetical accuracy of valuation calculations; and
• Evaluated appropriateness of disclosure of inventory year-end balance in the financial statements.

4. Information other than the Standalone 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 Standalone Financial Statements and our auditors 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 in the audit or otherwise appears to be materially misstated.

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

5. MANAGEMENTS RESPONSIBILITY FOR THE IND AS FINANCIAL STATEMENTS

The Companys Board of Directors is responsible for the matters stated in sub-section (5) of Section 134 of the Companies Act, 2013 ("the Act") with respect to the preparation and presentation of these Ind AS Financial Statements that give a true and fair view of the State of affairs, profit (including other comprehensive income), changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards prescribed 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 the ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Ind AS 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 Management and Board of Directors are 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 is also responsible for overseeing the Companys financial reporting process.

6 AUDITORS RESPONSIBILITY 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 Standards on Auditing 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 Standards on Auditing, we exercise professional judgment and maintain professional skepticism 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 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 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 in the financial statements made by the Management and Board of Directors.

• Conclude on the appropriateness of the Management and Board of Directors 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.

Materiality is the magnitude of misstatements in the financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the 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 control that we identify during our audit.

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

7 Report

We conducted our audit in accordance with the Standards on Auditing specified under section 143(10) of the Act. 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 (‘ICAI) together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act 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.

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Ind AS 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 Ind AS and other accounting principles generally accepted in India. Except the Impact of Disputed Trade Receivables -Considered Doubtfull which are considered Doubtfull to Rs226.13 Lacs which were not writeoff in Current Year.

(a) In the case of the Balance sheet, of the state of affairs of the Company as at March 31st,2023

(b) In the case of the Statement of profit and loss , of the profit for the year ended on that date (including other comprehensive income) ,

(c) Changes in equity for the year ended on that date.

(d) In the case of Cash Flow Statement, of the cash flows for the year ended on that date.

8 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 sub-section (11) of Section 143 of the Act, we give in the Annexure A, a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

2. As required by Section 143(3) of the Act, we report to the extent applicable 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 it appears from our examination of those books;

c. The Balance Sheet, the Statement of Profit and Loss (including other comprehensive income), Statement of changes in Equity and the Cash Flow Statement and dealt with by this Report are in agreement with the books of account;

d. In our opinion, the aforesaid Ind AS financial statements comply with the Ind AS prescribed under section 133 of the Act, read with relevant rules issued thereunder;

e. On the basis of written representations received from the Directors as on March 31st, 2023, taken on record by the Board of Directors, none of the Directors are disqualified as on March 31st , 2023, from being appointed as a Director in terms of Section 164(2) of the Act;

f. With respect to the adequacy of the internal financial controls over the financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in "Annexure B" to this report;

g. With respect to the other matters to be included in the Auditors Report in accordance with the requirements of Section 197(16) of the Act, as amended: In our opinion, the managerial remuneration for the year ended 31.03.2023 has been paid/provided by the Company to its directors in accordance with the provisions of section 197 read with Schedule V to the Act.

h. With respect to the other matters to be included in the Auditors Report in accordance with Rule 11 of the Companies (Audit and Auditors), 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 as at 31.03.2023 on its financial position in its financial statements. Refer Note No. 8 to Notes of Accounts.

ii. In our opinion and as per the information and explanations provides to us, the Company has not entered into any long-term contracts including derivative contracts, requiring provision under applicable laws or accounting standards, for material foreseeable losses.

iii. There has been no delay in transferring the amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended 31st March, 2023.

iv. (a) The management has represented that, to the best of its knowledge and belief, 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 persons or entities, including foreign entities ("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, 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 has represented, that, to the best of its knowledge and belief, no funds have been received by the Company from any persons or entities, including foreign entities ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company shall, 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 performed 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) contain any material misstatement.

(v) As stated in note no. 10 to the standalone financial statements, the Board of Directors of the Company has proposed final dividend for the year which is subject to the approval of the members at the ensuing Annual General Meeting. The dividend proposed is in accordance with Section 123 of the Act, as applicable.

(vi) Proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 for maintaining books of account using accounting software which has a feature of recording audit trail (edit log) facility is applicable to the Company w.e.f. April 1, 2023, and accordingly, reporting under Rule 11(g) of Companies (Audit and Auditors) Rules, 2014 is not applicable for the financial year ended March 31,2023.

Annexure A to the Independent Auditors Report

With reference to the Annexure referred to in Independent Auditors Report to the members of the Company on the Ind AS financial statements for the year ended 31 March 2023, we report the following: -

(1) In respect of the Companys Property, Plant and Equipment and Intangible Assets:

(a) The Company has maintained proper records showing full particulars, including quantitative details and situation of Property, Plant and Equipment at karnal unit only.

(b) The Company has maintained proper records showing full particulars of intangible assets;

(c) The Major Property, Plant and Equipment in a phased manner, which, in our opinion, is have been physically verified by the Management at reasonable intervals during the year and no material discrepancies were noticed on such verification.

(d) According to the information and explanations furnished to us, the records examined by us and based on the examination of the conveyance deeds provided to us, we report that the Title Deeds, comprising of all the immovable properties are held in the name of the Company as at the Balance Sheet date.

(e) The Company has revalued its existing Land have book value of Rs 1582.46 from Registered valuer at Rs 9563.67 .Further the difference arises due to revaluation has been duly recognized in books of accounts amounting Rs 7980.81 and shown under the Head Other Equity.

(f) No proceedings have been initiated during the year or are pending against the Company as at March 31,2023 for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (as amended in 2016) and Rules made thereunder.

(2) (a) The inventories were physically verified during the year by the Management at reasonable intervals. In our opinion and according to the information and explanations given to us, the coverage and procedure of such verification by the Management is appropriate having regard to the size of the Company and the nature of its operations. No discrepancies of 10% or more in the aggregate for each class of inventories were noticed on such physical verification of inventories when compared with books of account

(b) According to the information and explanations given to us, during the year, the Company has been sanctioned working capital limits in excess of 5 crores, in aggregate, from banks or financial institutions on the basis of security of current assets. The quarterly returns or statements filed by the Company with such banks or financial institutions on aggregate basis, are in agreement with the unaudited books of account of the Company, for the respective quarters, except very minor differences which are no material and hence not reported.

(3) According to the information explanation provided to us, 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. Hence, the requirements under paragraph 3(iii) of the Order are not applicable to the Company.

(4) In our opinion and according to the information and explanations given to us, the Company has not either directly or indirectly, granted any loan to any of its Directors or to any other person in whom the Director is interested, in accordance with the provisions of section 185 of the Act and the Company has not made investments through more than two layers of investment companies in accordance with the provisions of section 186 of the Act. Accordingly, provisions stated in paragraph 3(iv) of the Order are not applicable to the Company.

(5) The Company has not accepted any deposit or amounts which are deemed to be deposits. Hence, reporting under clause (v) of the Order is not applicable.

(6) The provisions of sub-section (1) of section 148 of the Act are not applicable to the Company as the Central Government of India has not specified the maintenance of cost records for any of the products of the Company. Accordingly, the provisions stated in paragraph 3 (vi) of the Order are not applicable to the Company.

(7) (a) According to the information and explanations given to us and the records of the Company examined by us,

in our opinion, undisputed statutory dues including goods and service tax, provident fund, employees state insurance, income-tax, sales-tax, service tax, duty of customs, duty of excise, value added tax, cess have been regularly deposited by the company with appropriate authorities in all cases during the year.

There were no undisputed amounts payable in respect of Goods and Service tax, Provident Fund, Income-tax, duty of Custom, cess and other material statutory dues in arrears as at March 31,2023 for a period of more than six months from the date they became payable.

(8) According to the information and explanation given to us and examination of records of the Company, the outstanding dues of income-tax, goods and service tax, customs duty, cess and any other statutory dues on account of any dispute, are as follows:

Name of the statute Nature of dues Amount(in lacs) Amount paid under protest(in lacs) Period to which relates (Financial Year) Forum which dispute is pending
Punjab Value Added Tax Act, 2005 Value Added Tax/Cental sale Tax 7.91 1.97 2009-10 Commissioner Excise and Taxation
Punjab Value Added Tax Act, 2005 Value Added Tax/ Cental sale Tax 19.25 4.81 2011-12 Commissioner Excise and Taxation
Punjab Value Added Tax Act, 2005 Value Added Tax/Cental sale Tax Not Determined Not Determined Honble Punjab and Haryana High Court
Custom Act,1962 Penalty 17.50 Nil 2013-14 Custom Authorities,kandla
PIDF PIDF 26.18 6.54 2009-2010 Commissioner Excise and Taxation
PIDF PIDF 0.33 0.08 2010-2011 Commissioner Excise and Taxation

(9) According to the information and explanations given to us, there are no transactions which are not accounted in the books of account which have been surrendered or disclosed as income during the year in Tax Assessment of the Company. Also, there are no previously unrecorded income which has been now recorded in the books of account. Hence, the provision stated in paragraph 3(viii) of the Order is not applicable to the Company.

(10) (a) In our opinion and according to the information and explanations given to us, the Company has not defaulted

in repayment of loans or borrowings or in payment of interest thereon to any lender.

(b) According to the information and explanations given to us and on the basis of our audit procedures, we report that the company has not been declared willful defaulter by any bank or financial institution or government or any government authority.

(c) In our opinion and according to the information explanation provided to us, no money was raised by way of term loans. Accordingly, the provision stated in paragraph 3(ix)(c) of the Order is not applicable to the Company.

(d) According to the information and explanations given to us, and the procedures performed by us, and on an overall examination of the standalone financial statements of the company, we report that no funds raised on short-term basis have been used for long-term purposes by the company.

(e) The Company does not have any subsidiary, associate or joint venture, hence reporting under the clause (ix)

(e) of the order is not applicable to the Company.

(f) The Company does not have any subsidiary, associate or joint venture, hence reporting under the clause (ix)(f) of the order is not applicable to the Company.

(11) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully, partly or optionally convertible debentures during the year. Accordingly, the provisions stated in paragraph 3 (x)(b) of the Order are not applicable to the Company

(12) (a) During the course of our audit, examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud by the Company nor on the Company.

b) No report under sub-section (12) of Section 143 of the Act has been filed in Form ADT-4 as prescribed under Rule 13 of Companies (Audit and Auditors) Rules, 2014 (as amended) with the Central Government, during the year and upto the date of this report, accordingly the provisions stated in paragraph (xi)(b) of the Order is not applicable to the Company.

(c) As represented to us by the management, there are no whistle-blower complaints received by the Company during the year. Accordingly, the provisions stated in paragraph (xi)(c) of the Order is not applicable to company.

(13) According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with sections 177 and 188 of the Act where applicable and details of such transactions have been disclosed in the standalone financial statements as required by the applicable accounting standards except in case of following:

(a) The Company has identified all related parties and transactions with them during the year as follow :-

S.NO. Name of the Related Party Relationship Nature of Transaction Amount In Rs. (For year ended 31.03.2022) Amount outstanding as on 31.03.2022 (In Rs.) Amount in Rs. (For year ended 31.03.2023) Amount outstanding as on 31.03.2023 (In Rs.)
1. Mr. Vijay Kumar Setia Chairman cum Managing Director Remuneration, Perks & Interest 19758423 16996027 218629261 Cr 19766123 19028264 228434364 Cr
2. Mr. Rajeev Setia Joint Managing Director & CFO Remuneration, Perks & Interest 17632522 18773145 231073863 Cr 21449217 19287126 202104774 Cr
3. Mr. Sukarn Setia Executive Director Remuneration, Perks & Interest 1813457 506908 5856456 Cr 400004 Nil
4. Mr. Sankesh Setia Executive Director Remuneration, Perks & Interest 13644161 426147 12200204 Cr 20393623 1098018 13877064 Cr
5. Mr. Ankit Setia Executive Director Remuneration, Perks & Interest 11390270 5967011 77112083 Cr 22117226 3048784 39983700 Cr
6. Mrs. Shweta Setia Executive Director Remuneration, Perks N.A N.A 2229442 351714 Dr
7 Mrs. Isha Setia Directors ‘wife Remuneration 600000 32008Cr 600000 Nil
8 Mrs. Richa Setia Directors ‘wife Remuneration 480000 Nil 480000 Nil
9 Setia Rice Mills Sister Concern Lease Rent 300000 2820034 Dr 300000 27200034 Dr
10 S.A Exports Sister Concern Rice Sale/Job Work/Rent 694847 294393 Dr 42917849 2329912 Dr
11 AVN Group Sister Concern Lease Rent/Others 21183840 331000 Cr 32357080 153111 Cr
12 Star Exports Sister Concern Sales/Job work/ Rental Income 122799901 24950062 Dr 314387215 18038204 Dr
13 Virgo Overseas Sister Concern Basement Rent 240720 240720 Dr 240720 240720 Dr

(14) In our opinion and based on our examination, the Company has an internal audit system commensurate with the size and nature of its business. (b) We have considered internal audit reports of the Company issued by internal auditor, for the period under audit.

(15) According to the information and explanations given to us, in our opinion during the year the Company has not entered into non-cash transactions with directors or persons connected with its directors and hence, provisions of section 192 of the Act are not applicable to company. Accordingly, the provisions stated in paragraph 3(xv) of the Order are not applicable to the Company.

(16) In our opinion, the Company is not required to be registered under section 45 IA of the Reserve Bank of India Act, 1934 and accordingly, the provisions stated in paragraph clause 3 (xvi)(a) of the Order are not applicable to the Company. (b) In our opinion, the Company has not conducted any Non-Banking Financial or Housing Finance activities without any valid Certificate of Registration from Reserve Bank of India. Hence, the reporting under paragraph clause 3 (xvi) (b) of the Order are not applicable to the Company. (c) The Company is not a Core investment Company (CIC) as defined in the regulations made by Reserve Bank of India. Hence, the reporting under paragraph clause 3 (xvi)(c) of the Order are not applicable to the Company. (d) The Company does not have more than one CIC as a part of its group. Hence, the provisions stated in paragraph clause 3 (xvi)(d) of the Order are not applicable to the Company.

(17) Based on the overall review of standalone financial statements, the Company has not incurred cash losses in the current financial year and in the immediately preceding financial year. Hence, the provisions stated in paragraph clause 3 (xvii) of the Order are not applicable to the Company.

(18) There has been no resignation of the statutory auditors during the year. Hence, the provisions stated in paragraph clause 3 (xviii) of the Order are not applicable to the Company.

(19) According to the information and explanations given to us and based on our examination of financial ratios, ageing and expected date of realisation of financial assets and payment of liabilities, other information accompanying the standalone financial statements, our knowledge of the Board of Directors and management plans, we are of the opinion that no material uncertainty exists as on the date of audit report and the 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.

(20) According to the information and explanations given to us, the provisions of section 135 of the Act are applicable to the Company. The Company has made the required contributions during the year and there are no unspent amounts which are required to be transferred either to a Fund or to a Special Account as per the provisions of section 135 of the act read with schedule VII. Accordingly, reporting under clause 3(xx)(a) and clause 3(xx)(b) of the Order is not applicable to the Company.

(b) In respect of ongoing projects, the Company has transferred unspent amount to a designated bank account within a period of thirty days from the end of the financial year in compliance section 135(6) of the said Act, except in respect of the following:

(c) Details of CSR amount against ongoing projects for the financial year:

1 2 3 4 5 6 7 8 9 10 11
S. No. Name of the Project Item from the list of activities in Schedule VII to the Act Local area (Yes/ No) Location of the project Project duration Amount allocated for the project Amount spent in the current financial Year Amount transferred to Unspent CSR Account for the project as per Section 135(6) Mode of Implementation - Direct (Yes/No) Mode of Implementation - Through Implementing Agency
State District (A) (A) (A)
1. CLSEL Swachh bharat abhiyan project (Project of providing cleaning services in city and village areas) Promoting Social Welfare YES HARYANA, KARNAL 3 2700000 NIL 2700000 YES
2. CLSEL IIT Project for providing toilet services for people Promoting Healthcare and social welfare YES HARYANA Gumgram 3 2000000 NIL 2000000 YES
3. CLSEL Swachh Bharat Abhiyan project (preparing & maintenance of toilets in needed schools and other backward areas Promoting Social Welfare & Healthcare YES HARYANA& PUNJAB Karnal & Amritsar 3 2000000 NIL 2000000 YES
4. CLSEL Swachh bharat abhiyan project (Project of providing cleaning services in various parks of city for welfare of people) Promoting Social Welfare & Healthcare YES HARYANA& PUNJAB Karnal & Amritsar 3 1467943 NIL 1467943 YES
Total 8167943 NIL 8167943

(21) The Company has not issued any of its securities (including debt instruments) during the year and hence reporting under clause (x)(a) of the Order is not applicable.

(22) The Company is not a Nidhi Company and hence reporting under clause (xii) of the CARO 2020 Order is not applicable

(23) According to the information and explanations given to us, the Company does not have any Subsidiary, Associate or Joint Venture. Accordingly, reporting under clause 3(xxi) of the Order is not applicable.

ANNEXURE B TO THE INDEPENDENT AUDITORS REPORT - 31st MARCH 2023

(Refer to in 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 Chaman Lal Setia Exports Ltd. ("the Company") as of 31st March, 2023 in conjunction with our audit of the Ind AS financial statements of the Company for the year ended on that date.

Managements 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 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.("the Act").

Auditors Responsibility

Our responsibility is to express an opinion on the Companys internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the "Guidance Note") and the Standards on Auditing, as specified under Section 143 (10) of the Companies Act, 2013 issued by ICAI and deemed to be prescribed under Section 143(10) of the Act, 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 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 IND AS financial statements for external purposes in accordance with generally accepted accounting principles. A companys internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2) provide reasonable assurance that 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 authorisations 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 Ind AS financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

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

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 31 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 ICAI.

For Rajesh Kapoor & Co.
Chartered Accountants
sd/-
Rajesh Kapoor
Prop.
M.No.:- 092692
Place: Amritsar FRN NO.13527N
Date: 26.05.2023 UDIN:23092692BGWMMV9932