jai balaji industries ltd share price Auditors report


To The Members of JAI BALAJI INDUSTRIES LIMITED

Report on the audit of the Standalone Financial Statements Opinion

We have audited the accompanying Standalone Financial Statements of Jai Balaji Industries Limited (‘‘the Company), which comprise the Balance Sheet as at 31st March, 2023, 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 a summary of the significant accounting policies and other explanatory information.

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Standalone Financial Statements give the information required by the 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 31st March, 2023, and its profit, total comprehensive income, its cash flows and the changes in equity for the year ended on that date.

Basis for Opinion

We conducted our audit of the Standalone Financial Statements in accordance with the Standards on Auditing specified under section 143(10) of the Act (SAs). Our responsibilities under those Standards are further described in the Auditors Responsibility 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 (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 made thereunder, 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 obtained by us is su fficient and appropriate to provide a basis for our opinion on the Standalone Financial Statements.

Emphasis of Matter

  1. We draw attention to Note no. 54 to the Standalone Financial Statements in relation to outstanding balances of trade receivables, trade payables and loans and advances which are subject to confirmation and subsequent adjustments, if any.
  2. We draw attention to Note no. 58 of the accompanying Standalone Financial Statement, which states that the company has entered into settlement and restructuring of various credit facilities and gain on such settlement and restructuring for 1,93,510.90 lacs has been transferred to Capital Reserve for the year ended 31 st March, 2023.

Our opinion is not modified in respect of this matters.

Key Audit Matter

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Standalone Financial Statements of the current period. These matters were addressed in the context of our audit of the Standalone Financial Statements as a whole, and informing 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.

S. NO.

THE KEY AUDIT MATTERS

HOW THE MATTER WAS ADRESSED IN OUR AUDIT

1.

LOAN CLASSIFIED as Non Performing Assets (NPA), TRANSFERRED TO ASSET RECONSTRUCTION COMPANIES (ARC)

OUR AUDIT PROCEDURES INCLUDE THE FOLLOWING:

(Refer Note 20 to the Standalone Financial Statements)

  1. The company has taken Rupee Loan from Banks and financial institutions and due to default in repayment, they had been classified as NPA. Thus, these Banks and FIs have already assigned their entire exposure to the Assets Reconstruction Companies in previous years. The Company had made payments to the above ARCs which has been adjusted against the total outstanding loan liability.
  2. The Company has negotiated with Corporation Bank and Punjab National Bank (combined with erstwhile Oriental bank of Commerce) to restructure its debts. The Company had made payment to the above banks as per the repayment schedule which has been adjusted against the total outstanding loan liability.

We reviewed the correspondence of the company with the relevant Asset reconstruction companies and we have examined the agreement made with them.

We reviewed the proposal of the company with the Bank.

We obtained the understanding of these reconstruction schemes through meetings with management and review of the minutes of the Board of Directors.

We reviewed the further correspondences of the Company with the relevant Banks/ARCs.

2.

THE COMPANYS EXPOSURE TO LITIGATION RISK

OUR AUDIT PROCEDURES INCLUDE THE FOLLOWING:

(Refer Note 35A to the Standalone Financial Statements)

The Company is exposed to different laws, regulations and interpretations thereof and hence, there is a litigation risk. Consequently, the Company has significant litigation cases pending with Custom Authorities, Excise Authorities, Service tax Authorities and Income tax Authorities. Given the nature and amounts involved in such cases and the appellate forums at which these are pending, the ultimate outcome and the resultant accounting in the financial statements is subject to significant judgement, which can change over time as new facts emerge and each legal case progresses, and therefore, we have identified this as key audit matter.

We obtained details of completed tax assessments and demands for the year ended March 31, 2022 from management.

We examined the assumptions used in estimating the tax provision and the possible outcome of the disputes.

We considered legal precedence and other rulings in evaluating managements position on these tax positions.

3.

THE COMPANY HAS ISSUED CONVERTIBLE SHARE WARRANT DURING THE YEAR

OUR AUDIT PROCEDURES INCLUDE THE FOLLOWING:

(Refer Notes 17 and 18 to the Standalone Financial Statements.)

During the financial year 2022-2023, the Company has issued 5,00,00,000 and 2,20,00,000 convertible Share warrant on preferential basis at Rs. 52 and Rs. 45 each respectively, out of which 3,50,00,000 share warrant has been converted into equity share during the year and the balance 3,70,00,000 share warrant is pending for conversion. Consideration received towards these warrants which are pending for conversion (25% of Issue price, i.e, Rs. 52/- for 1.5 crore warrant and Rs. 45/- for 2.2 crore warrant) was depicted in ‘Other Equity which subsequently will be utilized for conversion into equity. As the conversion of Share warrants by the company during the financial year 2022-2023, has the effect of enhancing the Equity of the Company the same is considered to be a key audit matter.

Our audit procedure includes gaining an understanding of the process of issue of share warrants followed by the company, to include amongst others:

  1. Authorization by the Memorandum and Articles of Association of the Company;
  2. Passing of resolution in a validly convened and constituted Board meeting of the company.
  3. Passing of resolution in a validly convened and constituted general meeting of the company and necessary regulatory filing done by the Company. Obtaining permission from the NSE/BSE Ltd. under SEBI (Listing obligations and Disclosure requirements) Regulations, 2015.
  4. We assessed the adequacy of disclosures in the financial statements.
  5. We checked that allotment money are received in full and in a separate bank account. Also, checked the outflow of fund from the bank account of allottee on the same date.

Information Other than the Standalone Financial Statements and Auditors Report

Thereon

The Companys Board of Directors is responsible for the preparation of the other information. The other information comprises the information included in the Annual Report does not include the Standalone Financial Statements and our auditors report thereon. The Annual Report is expected to be made available to us after the date of this auditors report. 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.

When we read Annual Report, if we conclude that there is a material misstatement there in we are required to communicate the matter to those charged with Governance.

Managements Responsibility for the Standalone 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 of these Standalone Financial Statements that give a true and fair view of the financial position, financial performance, total comprehensive income, Statement of Changes in Equity and cash flows of the Company in accordance with the Ind AS and other accounting principles generally accepted in India. 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 is responsible for assessing the Companys ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

The Board of Directors are responsible for overseeing the Companys financial reporting process.

Auditors 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 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 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 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 management.
  • Conclude on the appropriateness of managements use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material

uncertainty exists related to events or conditions that may cast significant doubt on the Companys ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors report to the related disclosures in the 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 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 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.
  • Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the group to express an opinion on the Consolidated Financial Statement. We are also responsibile for the direction, supervision and performance of the audit of othe Consolidated Financial Statements of such entities included in the Consolidated Financial Statement of which we are the independent auditors. For the other entities included in the Consolidated Financial Statement, which have been auditied by other auditors, such other auditors remain responsible for the direction, supervision and performance of the audits out by them. We remain solely responsible for our audit opinion.

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 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 Standalone 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.

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 ‘‘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:
    1. We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
    2. In our opinion proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
    3. The Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, Statement of Changes in Equity and the Statement of Cash Flow dealt with by this Report are in agreement with the relevant books of account.
    4. In our opinion, the aforesaid Standalone Financial Statements comply with the Ind AS specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
    5. On the basis of the written representations received from the directors as on 31 st March 2023 taken on record by the Board of Directors, none of these directors is disqualified as on 31 st March 2023 from being appointed as a director in terms of Section 164(2) of the act.
    6. With respect to the adequacy of the internal financial controls over financial reporting 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 Companys internal financial controls over financial reporting.
    7. 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:
    8. In our opinion and to the best of our information and according to the explanations given to us, the remuneration paid by the Company to its directors during the year is in accordance with the provisions of section 197 of the Act.

    9. 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, in our opinion and to the best of our information and according to the explanations given to us:
  1. The Company has disclosed the impact of pending litigations which would impact financial position. (Refer Note 35A to the financial statement)
  2. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.
  3. There has been no delay in transferring amounts
  4. (a) The Management has represented that, to the best of its knowledge and belief, other than as referred to Note No. 6 to the Financial Statement, 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;
    1. The Management has represented, that, to the best of its knowledge and belief, other than as referred to Note No. 24 to the Financial Statement, no funds (which are material either individually or in the aggregate) have been received by the Company fro many 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;
    2. 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
  1. The company has not declared dividend in the previous year and nor during the current year ended March 31, 2023, since the company is not required to comply with section 123 of Companies Act, 2013.
  2. 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 with effect from 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.

For S K Agrawal And Co. Chartered Accountants LLP

Chartered Accountants Firms Registration Number-306033E/E300272

Sd/- CA J. K. Choudhury

Partner

which were required to be transferred to the Investor Education and Protection Fund by the Company.

Place: Kolkata Date: 30.05.2023

Membership No: 009367 UDIN : 23009367BGWVBS1097

ANNEXURE "A" TO THE INDEPENDENT AUDITORS REPORT

(Referred to in paragraph 1 under ‘Report on Other Legal and Regulatory Requirements section of our report to the Members of Jai Balaji Industries Limited of even date)

  1. (a) (A) The Company has maintained proper records showing full particulars, including quantitative details and quantitative details and situation of property, plant and equipment and relevant details of right-of-use assets.

(B) The Company has maintained proper records showing full particulars of intangible assets.

  1. According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has a regular programme of physical verification of its property, plant and equipment and right-of-use assets by which fixed assets are verified in a phased manner. According to information and explanation given to us no fixed assets were physically verified during the year and therefore no material discrepancies were noticed.
  2. 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.
  3. According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has not revalued any of its Property, Plant and Equipment (including right- of-use assets) and intangible assets during the year.
  4. According to the information and explanations given to us and on the basis of our examination of the records of the Company, 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.
  1. (a) As per the examination of the records of the Company and the information provided to us, the physical verification of inventory, other than stock in transit, has been conducted at reasonable intervals by the management and in our opinion 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 discrepancy of
  2. 10% or more in the aggregate for each class of inventory were noticed during such physical verification.

    (b) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has not been sanctioned working capital limits in excess of 5 crore, in aggregate, at any points of time during the year, from banks or financial institutions on the basis of security of current assets and hence reporting under clause 3(ii)(b) of the Order is not applicable.

  3. According to the information and explanations given to us and on the basis of our examination of the records of the Company, company has not provided any security or grant any loan, advance in the nature of loan secured or unsecured to any companies, firms, Limited Liability Partnerships and other parties, during the year.
    1. The company has not provided any loans or provided advances in the nature of loans or stood gurantee or provided security during the year to any other entity and hence raporting under clause 3(iii)(a) of the order nto applicable.
    2. According to information and explanations given to us and on the basis of our examination of the records of the Company, no investments made or loans granted during the year, therefore reporting under clause 3(iii)(b) of the Order not applicable.
    3. According to information and explanations given to us no loans granted by the Company, therefore reporting under clause 3(iii)(c) of the Order not applicable.
    4. As no loans granted by the Company, there is no overdue amount remaining outstanding as at the balance sheet date, therefore reporting underclause 3(iii)(d) of the Order not applicable.
    5. No loan granted by the Company which has fallen due during the year or has been renewed or extended or fresh loans granted to settle the overdue of existing loans, therefore reporting under clause 3(iii)(e) of the Order is not applicable.
    6. The Company has not granted any loans or advances in the nature of loans either repayable on demand or without specifying any terms or period of repayment during the year. Hence, reporting under clause 3(iii)(f) of the Order is not applicable.
  4. According to the information and explanations given to us and on the basis of our examination of the records of the Company, there are no loans, investments,
  5. guarantees, and security in respect of which provisions of sections 185 and 186 of the Companies Act, 2013 are applicable and accordingly, reporting under clause 3(iv) of the Order is not applicable to the Company.

  6. According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has not accepted any deposits or amounts which are deemed to be deposits within the meaning of sections 73 to 76 of the companies Act and the rules made there under during the year. Accordingly, clause (v) of paragraph 3 of the Order is not applicable.
  7. Pursuant to the rules made by the Central Government of India, the Company is required to maintain cost records as specified under Section 148(1) of the Act in respect of its products. We have broadly reviewed the same and are of the opinion that, prima facie, the
  8. prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.

  9. (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has been regular in depositing undisputed statutory dues, including Provident Fund, Employees State Insurance, Income Tax, Duty of Customs, Goods and Services Tax, Cess and other statutory dues with the appropriate authorities during the year.

According to the information and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as at 31st March, 2023 for a period of more than six months from the date of becoming payable.

  1. Details of statutory dues referred to in sub-clause (a) above which have not been deposited as on March 31, 2023 on account of disputes are given below :

Nature of Statute

Nature of dues

Period to which the matter pertains

Forum where matter is pending

Amount (in lakhs)

Pre-Deposit (in lakhs)

Net Amount (in lakhs)

The Central Excise Act, 1944

Excise Duty

2003-04, 2006-07 to

2017-18

Central Excise and Service Tax Appellate Tribunal, Commissioner

20,082.77

226.43

19,856.34

The Goods and Service Tax Act, 2017

GST

2017-18 to 1019-20

High Court (Kolkata, Bhilai), Commissioner (Appeal), West Bengal Appellate & Revisional Board

3,344.17

38.98

3,305.19

Customs Act, 1962

Custom Duty

2012-13

Central Excise and Service Tax Appellate Tribunal, Commissioner

362.32

0.00

362.32

The Income Tax Act, 1961

Income Tax

2009-10

DCIT/CIT(A)

5.70

0.00

5.70

The Finance Act, 1994

Service Tax

2004-05 to 2017-18

Central Excise and Service Tax Appellate Tribunal, Commissioner, High Court (Kolkata)

1,098.25

20.37

1,077.89

The Value Added Tax, 2005

Vat

2005-06. 2006-07,

2008-09, 2010-11,

2011-12, 2013-14,

2015-16, 2017-18

W.B.C.T. Appellate & Revisional Board, Large Taxpayer Unit

2,813.06

118.71

2,694.35

The Central Sales Tax Act, 1956

Central Sales Tax

2006-07, 2008-09,

2010-11 to 2013-14,

2015-16 to 2017-18

W.B.C.T. Appellate & Revisional Board, Large Taxpayer Unit

1,104.17

36.53

1,067.64

Entry Tax Act, 1976

Entry Tax

2012-13 to

2017-18

W.B.C.T. Appellate & Revisional Board

4,204.34

0.00

4,204.34

  1. According to the information and explanations given to us and on the basis of our examination of the books of account of the Company, 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).
  2. (a) According to the information and explanations given to us and on the basis of our examination of the books of account of the Company, the company has not defaulted in repayment of loans or other borrowings or in the payment of interest thereon to lender during the year.
    1. According to the information and explanations given to us and on the basis of our examination of the books of account of the Company, the Company has not been declared wilful defaulter by any bank or financial institution or government or any government authority.
    2. According to the information and explanations given to us and on the basis of our examination of the books of account of the Company, no term loans were obtained by the company during the year. Accordingly, clause 3(ix)(c) of the Order is not applicable.
    3. According to the information and explanations given to us and on the basis of our examination of the books of account of the Company, funds raised on short term basis have, prima facie, have not been used during the year for long-term purposes by the Company.
    4. According to the information and explanations given to us and on the basis of our examination of the books of account 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 subsidiary.
    5. According to the information and explanations given to us and on the basis of our examination of the books of account of the Company, the company has not raised loans during the year on the pledge of securities held in its subsidiaries associates or joint venturesas defined under the Companies Act, 2013.
  1. (a) The Company has not raised any money by way of initial public officer and further public offer (including debt instruments) during the year. Accordingly, clause 3(x)(a) of the Order is not applicable.
  2. (b) The company has issued Convertible Share Warrant on preferential basis during the year and the requirements of section 42 and section 62 of the Companies Act, 2013 have been complied with and the funds raised have been used for the purposes for which the funds were raised.

  3. (a) According to the information and explanations given to us and on the basis of our examination of the books of account of the Company, no fraud by the Company and no material fraud on the Company has been noticed or reported during the year.
  1. According to the information and explanations given to us, no report under sub-section (12) of Section 143 of the Companies Act, 2013 has been filed by the auditors in Form ADT-4 as prescribed under Rule 13 of Companies (Audit and Auditors) Rules, 2014 with the Central Government upto the date of this report.
  2. According to the information and explanation given to us no whistle blower complaints received by the Company during the year (and up to the date of this report), hence reporting under clause 3(xi)(c) of the Order is not applicable
  1. According to the information and explanations given to us, the company is not a Nidhi Company. Accordingly, clause (xii) of paragraph 3 of the Order is not applicable.
  2. According to the information and explanations given to us and the records examined by us, the transactions with related parties are in compliance with Sections 177 and 188 of the Companies Act, 2013, where applicable, and the details of the related party transactions have been disclosed in the standalone financial statements as required by the applicable Indian Accounting Standards.
  3. (a) Based on information and explanations provided to us and our audit procedures, in our opinion, the Company has an internal audit system commensurate with the size and nature of its business.
  4. (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.

  5. In our opinion and according to the information and explanations given to us, the Company has not entered into any non-cash transactions with its directors or persons connected to its directors and hence, provisions of Section 192 of the Companies Act, 2013 are not applicable to the Company.
  6. (a) The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, clause 3(xvi)(a) of the Order is not applicable.
  1. The Company has not conducted any Non-Banking Financial or Housing Finance activities without obtained a valid Certificate of Registration (CoR) from the Reserve Bank of India as per the Reserve Bank of India Act, 1934.
  2. The Company is not a Core Investment Company (CIC) as defined in the regulations made by the Reserve Bank of India. Accordingly, clause 3(xvi)(c) of the Order is not applicable.
  3. According to the information and explanations provided to us during the course of audit, the Group (as per the provisions of the Core Investment Companies (Reserve Bank) Directions, 2016) does not have any CIC.
  1. The company has not incurred cash losses in current financial year and in the immediately preceding financial year.
  2. There has been no resignation of the statutory auditors of the Company during the year. Accordingly, clause 3(xviii) of the Order is not applicable.
  3. According to the information and explanations given to us and 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 and management plans, and based on our examination of the evidence supporting the assumptions, nothing has come to our attention, which causes us to believe that material uncertainty exists as on the date of the audit report
  4. 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.

  5. The Company has during the year spent the amount of Corporate Social Responsibility as required under subsection (5) of Section 135 of the Act. Accordingly, reporting under clause 3(xx) of the Order is not applicable to the Company.

ANNEXURE "B" TO THE INDEPENDENT AUDITORS REPORT

(Referred to in paragraph 2(f) under ‘Report on Other Legal and Regulatory Requirements section of our report to the Members of Jai Balaji Industries Limited 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 with reference to Standalone Financial Statement of Jai Balaji Industries Limited ("the Company ") as of 31st March, 2023 in conjunction with our audit of the Standalone Financial Statements of the Company for the year ended on that date.

Managements Responsibility for Internal Financial Controls

The 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 prevent ion 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 judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Companys internal financial controls system over financial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

A companys internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of standalone 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 standalone financial statements in accordance with generally accepted accounting

management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the companys assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that 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, 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 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 Institute of Chartered Accountants of India.

For S K Agrawal And Co. Chartered Accountants LLP

Chartered Accountants Firms Registration Number-306033E/E300272

Sd/ CA J. K. Choudhury

Partner

principles, and that receipts and expenditures of the company are being made only in accordance with authorization of

Place: Kolkata

Date: 30.05.2023

Membership No: 009367

UDIN : 23009367BGWVBS1097