TO THE MEMBERS OF
INDIA EXPOSITION MART LIMITED
Report on the Financial Statements
We have audited the accompanying financial statements of INDIA EXPOSITION MART LIMITED
("the Company") which comprise the Balance Sheet as at March 31, 2021, the
Statement of Profit & Loss Account and Cash Flow Statement for the year then ended,
and a summary of significant accounting policies and other explanatory information.
Managements Responsibility for the Financial Statements
The Companys Management 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, read with Rule 7 of the Companies (Accounts) Rules, 2014. 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 financial statements that
give a true and fair view and are free from material misstatement, whether due to fraud or
error.
Auditors Responsibility
Our responsibility is to express an opinion on these financial statements based on our
audit.
We have taken into account the provisions of the Act, the accounting and auditing
standards and matters which are required to be included in the audit report under the
provisions of the Act and the Rules made thereunder.
We conducted our audit in accordance with the Standards on Auditing specified under
Section 143 (10) of the Act. Those Standards require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and
the disclosures in the financial statements. The procedures selected depend on the
auditors judgment, including the assessment of the risks of material misstatement of the
financial statements, whether due to fraud or error. In making those risk assessments, the
auditor considers internal financial control relevant to the Companys preparation of the
financial statements that give a true and fair view in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on whether the Company has in place an adequate internal financial controls system
over financial reporting and the operating effectiveness of such controls. An audit also
includes evaluating the appropriateness of the accounting policies used and the
reasonableness of the accounting estimates made by the Companys Management, as well as
evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our audit opinion on the financial statements
Opinion
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 Act
in the manner so required and give a true and fair view in conformity with the accounting
principles generally accepted in India, of the state of affairs of the Company as at March
31, 2021, and its Statement of Profit & Loss Account and its Cash Flow for the year
ended on that date.
Managements Responsibilities for the Consolidated Financial Statements
The Companys Board of Directors is responsible for the matters stated in section
134(5) of the Act with respect to the preparation and presentation of these consolidated
financial statements that give a true and fair view of the consolidated financial
position, consolidated financial performance including other comprehensive income,
consolidated changes in equity and consolidated cash flows of the Group in accordance with
the Ind AS and other accounting principles generally accepted in India. The respective
Boards of Directors of the companies included in the Group are responsible for maintenance
of adequate accounting records in accordance with the provisions of the Act for
safeguarding the assets of the Group 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, which have been
used for the purpose of preparation of the consolidated financial statements by the
Directors of the Company, as aforesaid. In preparing the consolidated financial
statements, the respective Boards of Directors of the companies included in the Group are
responsible for assessing the ability of the respective entities to continue as a going
concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless the respective Boards of Directors either intend to
liquidate their respective entities or to cease operations, or have no realistic
alternative but to do so. The respective Boards of Directors of the companies included in
the Group are also responsible for overseeing the financial reporting process of the
Group.
Auditors Responsibilities for the Audit of the Consolidated Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated
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 consolidated 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 consolidated 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 and its subsidiary companies which are companies incorporated in India, has
adequate internal financial controls system 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 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 ability of
the Group 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 consolidated 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 Group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the consolidated
financial statements, including the disclosures, and whether the consolidated financial
statements represent the underlying transactions and events in a manner that achieves fair
presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information
of the entities within the Group to express an opinion on the consolidated financial
statements. We are responsible for the direction, supervision and performance of the audit
of the financial statements of such entities included in the consolidated financial
statements of which we are the independent auditors.
Materiality is the magnitude of misstatements in the consolidated financial statements
that, individually or in aggregate, makes it probable that the economic decisions of a
reasonably knowledgeable user of the consolidated 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 consolidated financial statements. We communicate
with those charged with governance of the Company and such other entities included in the
consolidated financial statements of which we are the independent auditors 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 consolidated 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.
Emphasis of Matter
1. Balances under Sundry Debtors/Claims Recoverable/Loans & Advances/Sundry
Creditors/Other Liabilities in many cases have not been confirmed and consequent
reconciliation/adjustments if any, required upon such confirmation are not ascertainable.
(Refer note no. 12)
2. It is observed that due to pending reconciliation between commercial department
& financial books mart dues recoverable on account of maintenance, interest,
electricity etc. and its subsequent impact on both Service Tax & GST cannot be
ascertained.
3. The subsidiary company Expo Digital India Pvt. Ltd. Financials are unaudited and
are merged based upon the management representation/certificate for March 31, 2021. (Refer
note no. 31)
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors Report) Order, 2016 ("the Order"),
as amended, 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.
As required by section 143 (3) of the Act, we report that:
a. we have sought and obtained all the information and explanations which to the best
of our knowledge and belief were necessary for the purpose of our audit;
b. in our opinion proper books of account as required by law have been kept by the
Company so far as it appears from our examination of those books;
c. the Balance Sheet, Profit & Loss Account and the Cash Flow Statement dealt with
by this Report are in agreement with the books of account maintained by company.
d. 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.
e. on the basis of written representations received from the Director as on March 31,
2021 taken on record by the Board of Directors, none of the Directors is disqualified as
on March 31, 2021 from being appointed as a Director.
f. with respect to the adequacy of the internal financial controls over financial
reporting of the Company and the operating effectiveness of such controls, refer to our
separate Report in "Annexure B".
g. with respect to the other matters to be included in the Auditors Report in
accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion
and to the best of our information and according to the explanations given to us:
(i) The Company has disclosed the impact of pending litigations on its financial
position in its financial statements- Refer to Note No. 26 of the financial statements.
(ii) The Company did not have any long-term contracts including derivative contracts
for which there were any material foreseeable losses.
(ii) There were no amounts which were required to be transferred to the Investor
Education and Protection Fund by the Company.
|
For SARVAM & ASSOCIATES |
|
Chartered Accountants |
|
(Firm Registration No. 007146N) |
|
Sd/- |
| Place: New Delhi |
Arun Jain |
| Date: August 31, 2021 |
Partner |
| UDIN : 21091916AAAABT4082 |
M. No. 091916 |
"Annexure A" to the Independent Auditors Report of even date on the
Financial Statements of INDIA EXPOSITION MART LIMITED
1. Referred to in paragraph 1 under the heading Report on Other Legal & Regulatory
Requirement of our report of even date to the financial statements of the Company for the
year ended March 31,2021:
(a) The Company has maintained proper records showing full particulars, including
quantitative details and situation of fixed assets;
(b) The Fixed Assets have been physically verified by the management in a phased
manner, designed to cover all the items over a period of three years, which in our
opinion, is reasonable having regard to the size of the company and nature of its
business. Pursuant to the program, a portion of the fixed asset has been physically
verified by the management during the year and no material discrepancies between the books
records and the physical fixed assets have been noticed.
(c) According to the information and explanations given to us and on the basis of our
examination of the records of the Company, the title deeds of immovable properties are
held in the name of the company.
2. As explained to us,
(a) Management has conducted the physical verification of inventory at reasonable
intervals.
(b) The discrepancies noticed (if any) on physical verification of the inventory as
compared to books records which has been properly dealt with in the books of account were
not material.
3. The Company has not granted any loans, secured or unsecured to companies, firms,
Limited Liability partnerships or other parties covered in the Register maintained under
section 189 of the Act. Accordingly, the provisions of clause 3 (iii) (a) to (C) of the
Order are not applicable to the Company and hence not commented upon.
4. In our opinion and according to the information and explanations given to us, the
company has complied with the provisions of section 185 and I86 of the Companies Act, 2013
in respect of loans, investments, guarantees, and security.
5. The Company has not accepted any deposits from the public and hence the directives
issued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any other
relevant provisions of the Act and the Companies (Acceptance of Deposit) Rules, 2015 with
regard to the deposits accepted from the public are not applicable.
6. As informed to us, the maintenance of Cost Records has not been specified by the
Central Government under sub-section (1) of Section 148 of the Act, in respect of the
activities carried on by the company.
7. (a) According to information and explanations given to us and on the basis of our
examination of the books of account, and records, the Company has been generally regular
in depositing undisputed statutory dues including Provident Fund, Employees State
Insurance, Income-Tax, Sales tax, Service Tax, Duty of Customs, Duty of Excise, Value
added Tax, Cess and any other statutory dues with the appropriate authorities. According
to the information and explanations given to us, no undisputed amounts payable in respect
of the above were in arrears as at March 31, 2021 for a period of more than six months
from the date on when they become payable.
(b) According to the information and explanation given to us, there are following dues
of income tax, sales tax, service tax value added tax outstanding on account of dispute.
The Company have following pending litigations:-
| S. No. |
Name of the Statue |
Nature of the dues |
Amount (INR in Lacs) |
Period |
Forum of Dispute |
| 1 |
Income Tax Act |
Expenses Disallowed |
170 |
2008-09 |
Appellate Tribunal |
| 2 |
Sales Tax Act |
WCT |
7.49 |
2006-07 |
Joint Commissioner (Appeal) |
|
|
Total |
177.49 |
|
|
An Amount INR 170.00 Lacs has been deposited with respect to income tax in which
litigation is pending before CIT Appellate.
An Amount INR 7.49 Lacs has been deposited with respect to sale tax in which litigation
is pending before Joint Commissioner Appeal.
8. In our opinion and according to the information and explanations given to us, the
Company has not defaulted in the repayment of dues to banks. The Company has taken a loan
from Federal Bank of which INR 2.94 Crores is outstanding as of March 31, 2021.
9. Based upon the audit procedures performed and the information and explanations given
by the management, the company has not raised moneys by way of initial public offer or
further public offer including debt instruments and term Loans. Accordingly, the
provisions of clause 3 (ix) of the Order are not applicable to the Company and hence not
commented upon.
10. Based upon the audit procedures performed and the information and explanations
given by the management, we report that no fraud by the Company or on the company by its
officers or employees has been noticed or reported during the year.
11. Based upon the audit procedures performed and the information and explanations
given by the management, the managerial remuneration has been paid or provided in
accordance with the requisite approvals mandated by the provisions of section 197 read
with Schedule V to the Companies Act;
12. In our opinion, the Company is not a Nidhi Company. Therefore, the provisions of
clause 4 (xii) of the Order are not applicable to the Company.
13. In our opinion, all transactions with the related parties are in compliance with
section 177 and 188 of Companies Act, 2013.
14. Based upon the audit procedures performed and the information and explanations
given by the management, the company has not made any preferential allotment or private
placement of shares or fully or partly convertible debentures during the year under
review. Accordingly, the provisions of clause 3 (xiv) of the Order are not applicable to
the Company and hence not commented upon.
15. Based upon the audit procedures performed and the information and explanations
given by the management, the company has not entered into any non-cash transactions with
directors or persons connected with him. Accordingly, the provisions of clause 3 (xv) of
the Order are not applicable to the Company and hence not commented upon.
16. In our opinion, the company is not required to be registered under section 45 IA of
the Reserve Bank of India Act, 1934 and accordingly, the provisions of clause 3 (xvi) of
the Order are not applicable to the Company and hence not commented upon.
|
For SARVAM & ASSOCIATES |
|
Chartered Accountants |
|
(Firm Registration No. 007146N) |
|
Sd/- |
| Place: New Delhi |
Arun Jain |
| Date: August 31, 2021 |
Partner |
| UDIN : 21091916AAAABT4082 |
M. No. 091916 |
"Annexure B" to the Independent Auditors Report of even date on the
Financial Statements of INDIA EXPOSITION MART LIMITED
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 INDIA
EXPOSITION MART LIMITED ("the Company") as of March 31,2021 in conjunction with
our audit of the 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". 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
(the "Guidance Note") and the Standards on Auditing, issued by ICAI and deemed
to be prescribed under section 143(10) of the Companies Act, 2013, to the extent
applicable to an audit of internal financial controls, both applicable to an audit of
Internal Financial Controls and, both issued by the Institute of Chartered Accountants of
India. Those Standards and the Guidance Note require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable assurance about whether
adequate internal financial controls over financial reporting was established and
maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of
the internal financial controls system over financial reporting and their operating
effectiveness. Our audit of internal financial controls over financial reporting included
obtaining an understanding of internal financial controls over financial reporting,
assessing the risk that a material weakness exists, and testing and evaluating the design
and operating effectiveness of internal control based on the assessed risk. The procedures
selected depend on the auditors 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 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 of the company; and (3) provide reasonable assurance regarding prevention or
timely detection of unauthorised acquisition, use, or disposition of the companys assets
that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls Over Financial Reporting
Because of the inherent limitations of internal financial controls over financial
reporting, including the possibility of collusion or improper management override of
controls, material misstatements due to error or fraud may occur and not be detected.
Also, projections of any evaluation of the internal financial controls over financial
reporting to future periods are subject to the risk that 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 March 31, 2021, 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 SARVAM & ASSOCIATES |
|
Chartered Accountants |
|
(Firm Registration No. 007146N) |
|
Sd/- |
| Place: New Delhi |
Arun Jain |
| Date: August 31, 2021 |
Partner |
| UDIN : 21091916AAAABT4082 |
M. No. 091916 |
+91-9892691696
