Lords Chemicals Ltd Auditor Reports

To the Members of

LORDS CHEMICALS LIMITED

Report on the Audit of the Standalone Financial Statements

We have audited the accompanying standalone financial statement of LORDS CHEMICALS LIMITED ("the Company"), which comprises the Balance Sheet as at March 31, 2022, and the

Statement of Profit and Loss and the statement of cash flows for the year ended on that date, and a summary of significant accounting policies and other explanatory information.

Opinion

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 Company

Act2013 ("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 of the state of affairs of the Company as at March 31, 2022; and of the loss, its cash flows for the year ended on that date;

Basis for opinion

We conducted our audit 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 responsibilities for the audit of the Standalone financial statement section of our report. We are independent of the Company in accordance with the code of ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the Standalone financial statement 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 ICAIs code of ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion on the standalone financial statements except below:

Basis for Qualified opinion

* In the Financial Statements where in management has considered outstanding trade receivables for Rs 6,54,74,368/- , advance to Party for Rs 83,65,07,375/- and advance to suppliers for Rs 2,87,04,357/- as good and fully recoverable as at the balance sheet date. Out of them Trade receivables for Rs 6,02,81,620/- , Advance to Related Party Rs 82,38,72,375/- and advance to suppliers for Rs 2,68,62,367/- respectively for period more than one year. Due to confirmations being not available and pending reconciliation adjustments of most of the party we are unable to comment on their recoverability of these receivable advance and its consequential effect on these financial statements. This Matter was also qualified in report on the financial statements for the year ended March 2021.

* We draw your attention to Note no 15 to the Ind AS financial statements regarding substantial amount of statutory due related to income tax, Excise duty, dividend tax, amounting to Rs 1,27, 22,697/- have become overdue and remain unpaid, Interest penalty if any in respect of the same has remained unascertained and unaccounted for.

* We draw attention to note no 19to the Ind AS Financial statements regarding written off the inventory for Rs 48,18,215/-. In the absence of necessary records and the valuation report we are unable to comment on realizable value of this inventory together with consequential impact.

* We draw attention to note no 18 to the Ind AS Financial statements regarding opening stock for Rs 44,06,110.80 are carried in the balance sheet. The management has not provided the supporting document of existence. Upon request to provide the certificate of stock, the management refused to provide the same.

Emphasis of Matter

* We draw attention to note no 3 to the Ind AS Non-Current Investment for Rs.3,22,00,000/-Irrespective of having Associates Company viz. Mahabir Coke Industries Private Limited the holding company does not prepare a consolidated financial statement. However when asked about the proper document of the investment party has fails to provide the same also there is no management certification of the existence or value of the Investment.

* The final dividend declared for FY 2011-12 of Rs.62,65,000.00/- has not yet been transferred to Investors Education Protection fund Account as per the requirement of section 124(5) of the Company Act, 2013. Further the Company has not yet transferred the interest to Special Dividend account as per requirement of section 124(5) of the Companies Act, 1956.

* We draw your attention to Note No 6(a) to the Ind AS financial where company carrying bank balance but no documents received in support of this as below :-

Bank Name:-	Closing Balance(As on 31/03/2022)
1.BANK OF INDIA	11000.00
2.BANK OF INDIA	10000.00
3.BANK OF INDIA	4382.16
4.HDFC BANK	15.85
5.HDFC BANK(DIVIDEND A/C)	66808.50
6.HDFC BANK(DIVIDEND A/C)	134117.60
7.SOUTH INDIAN BANK	410.18
8.THE FEDERAL BANK LTD	5792.06

* We draw your attention to Ind AS financial statements that company having relationship with Strike off the Company : -

Name of the Company:-		Amount
Avaneesh Tradevin Private Limited	3,37,84,867.50	(Receivable)
Bhomiya Vyapaar Private Limited	18,35,000.00	(Receivable)

Key audit matters

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 in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matter described below to be the key audit matter to be communicated in our report.

REVENUE RECOGNITION

See note 1 (V), and note 16 to the standalone financial statements

The key audit matter	How the matter was addressed in our audit
We identified revenue recognition as a key audit matter because the Company and its external stakeholders focus on revenue as a key performance indicator.	Our audit procedures in this area included the following :
	1. We assessed the appropriateness of the revenue recognition accounting policies by comparing with applicable accounting standards.
	2. We evaluated the design of key controls and operating effectiveness of the relevant key controls with respect to revenue recognition on selected transactions.
	3. We performed substantive testing by selecting samples of revenue transactions,
	4. We carried out analytical procedures on revenue recognized during the year to identify unusual variances.
	5. We tested, on a sample basis, specific revenue transactions recorded before and after the financial year end date to determine whether the revenue had been recognized in the appropriate financial period.

Related party transactions

See note 25 to the standalone financial statements

The key audit matter	How the matter was addressed in our audit
We identified the accuracy and completeness of disclosure of related party transactions as set out in respective notes to the standalone Ind AS financial statements as a key audit matter due to:	Our procedures in relation to the disclosure of related party transactions included:
The significance of transactions with related parties during the year ended March 31,2022.	Obtaining an understanding of the Companys policies and procedures in respect of the capturing of related party transactions and how management ensures all transactions and balances with related parties have been disclosed in the standalone IndAS financial statements.
	1. Obtaining an understanding of the Companys policies and procedures in respect of evaluating arrns- length pricing and approval process by the audit committee and the board of directors.
	2. Agreeing the amounts disclosed to underlying documentation and reading relevant agreements, evaluation of anns-length, on a sample basis, as part of our valuation of tire disclosure.

Tax litigations provisions and contingencies

See note 26 to the standalone financial statements

The key audit matter	How the matter was addressed in our audit
The Company is involved in several ongoing direct and indirect tax litigations A disclosure for contingent liabilities is made where there is a possible obligation or a present obligation that may probably not require an out flow of resources. When there is a possible or a present obligation where the likelihood of outflow of resources is remote, no provision or disclosure is made.	We have applied the following audit procedures in this area, among others to obtain sufficient appropriate audit evidence:
	1. We tested the effectiveness of key controls around the recording and assessment of tax provisions and contingent liabilities.
We have identified tax litigations, provisions and contingencies as a key audit matter because it requires the management to make judgements and estimates in relation to the exposure arising out of litigations. The key judgement lies in the estimation of provisions where they may differ from the future obligations. The Company operates under several tax law sand some of these have a significant impact on the financial statements of the Company.	2. We assessed the value of the provision sand nature of the exposures, applicable regulations and related correspondences with the authorities.
	3. We assessed the relevant historical and recent judgments passed by the court authorities.
	4. Obtained Managements assessment of the open cases and compared to assess the reasonableness of the provision or contingency.
	5. Considered the adequacy of the Companys disclosures made in relation to taxation related provisions and contingencies in the financial statements.

Information other than the 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 Boards Report including Annexures to Boards Report, Business Responsibility Report but does not include the IND AS financial statements and our auditors report thereon.

Our opinion on the IND AS financial statement does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the IND AS financial statement, 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 the Directors report including the annexure to Directors report, Corporate

Governance and management Discussion and analysis, if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance as required under SA720 The Auditors responsibility relating to other information.

Managements Responsibility and Those charged with Governance for the Financial Statement

The Companys Board of Directors is responsible for the matters 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 the maintenance of adequate accounting records in accordance with the provision of the Act for safeguarding of the assets of the Company and for preventing and detecting the 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 internal financial control, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the IND AS financial statement, 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 also responsible for overseeing the Companys financial reporting process.

Auditors Responsibility for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the IND AS financial statement 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 IND AS financial statement.

As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

* Identify and assess the risks of material misstatement of the IND AS financial statement, 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 Companies Act, 2013, 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 IND AS financial statement 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 IND AS financial statement, including the disclosures, and whether the IND AS financial statement 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 evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the 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 IND AS financial statement 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 the 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 Companies Act 2013, We give in the Annexure A on the matters specified in paragraph 3 & 4 of the order.

2) 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 purposes of our audit.

b) Except for the possible effects of the matters described in basis of opinion section above, in our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books.

c) The Balance Sheet and the Statement of Profit and Loss, and the cash flow statement dealt with by this Report are in agreement with the books of account.

d) Except for the possible effects of the matters described in basis of opinion section above, in our opinion, the aforesaid standalone 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 directors as on 31 March, 2022, taken on record by the Board of Directors, none of the directors is disqualified as on 31 March, 2022, 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 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.

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 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.

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) 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 litigation on its financial position in its standalone financial statement.(Refer Note No 26 to the financial statements)

ii. The Company did not have any long term contracts including derivative contracts for which there were any material foreseeable losses.

iii. The final dividend declared of Rs.62,65,000.00/- has not yet been transferred, to the Investor Education and Protection Fund by the Company.

	For Rajesh Jalan & Associates
	Chartered Accountants
Place : Kolkata	(Rajesh Jalan)
Date : 30/05/2022
	Partner
	(Firm Registration No. : 326370E)
	(UDIN-22065792AJWSAX6383)

The Annexure A referred to in paragraph 1 of the Our Report of even date to the members of M/s LORDS CHEMICALS LIMITED on the accounts of the company for the year ended 31^st March, 2022.

On the basis of such checks as we considered appropriate and according to the information and explanation given to us during the course of our audit, we report that:

1) (a) (i) The Company has maintained proper records showing full particulars including quantitative details and situation of Property, Plant and Equipments and relevant details of right of use assets.

(ii) The Company is not having any intangible assets. Therefore, the provision of Clause is not applicable to the company.

(b) As explained to us, and the record of the company examined by us, the property, plant and equipment have been physically verified by the management in periodical manners reasonable intervals; no material discrepancies were noticed on such verification.However company has written off some of the fixed assets during the year. In our opinion and according to the information and explanations the information and explanations given to us,the plant and machinery written off during the year were acquired long back in merger with Jagati Cokes Private Limited and at present not usable.

However no valuation report obtained.

(c) Based on our examination of registered sale deeds and other documents, Company does not held Immovable property so this clause is not applicable.

(d) The Company has not revalued any of its Property, Plant and Equipment (including right-of-use assets) and intangible assets during the year.

(e) No proceedings have been initiated during the year or are pending against the Company as at March 31, 2022 for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 and rules made thereunder.

2) (a) As explained to us, inventories were physically verified after the year end by the management. While further discussion with the party about the physical presence of opening stock for Rs.44,06,110./- (Chrome ore) we did not get proper document and certificate on this and also some of Chrome ore stock for Rs.19,81,968/- written off during the year and such valuation report and supporting document does not maintained by the company.

(b) During any point of time of the year, the company has not been sanctioned any working capital limits, from banks or financial institutions on the basis of security of current assets.

Therefore, the provisions of Clause are not applicable to the company.

3) (a) During the year the company has not made any investment and provided any guarantee or security.However the company has given some Loans, which is interest free and prejudicial to the interest of the company as detailed hereunder :-

Name of the party	Amount Paid (Rs.)	Refund (Rs.)	Closing (Rs.)	Nature
Nirmal Kumar Choubey	4,00,000		4,00,000/-	Advance
BhomiyaVyapaar Pvt Ltd	28,35,000	10,00,000	18,35,000/-	Advance
Ajay kumar Jain	7,07,200	5,07,200	2,00,000/-	Advance
AKJ Minerals Ltd	6,20,517	56,73,280	3,49,32,427/-	Advance

(b) The company has granted loans during the year which are interest free and are prejudicial to the interest of the company.

(c) There is no agreement for loans granted/provided and hence we are not able to comment.

(d) The total amount outstanding which is not regular in serving interest is Rs.82.19 Crores. Out of the above include opening balance Rs. 81.93 Crores.

(e) In absence of agreement we are not able to comment.

(f) During the year Amounting to 4562000/- have been granted without any agreement and terms.

As we have not been provided any agreement hence we are not able to comment on terms.

4) The company has extended Loan to its Director for Rs 7,07,200/- during the year has violated the provision of section 185 of the Company Act 2013.Compnay also violate the provisos of Section 186 on which company has granted loan to related party and other in excess of the permission allowed in the Act as below: Total share capital Rs.125300000/- @ 60% = Rs.751800000, total Reserve Rs.860847549/- @ 100% Rs.860847549/- higher of them. Eligible amount Rs.86,08,47579/-

Total loan outstanding during the year for Rs.86,43,40,242/-

5) The Company has taken advances from customers which were outstanding for more than one year amounting to Rs.22,98,000/-, in terms of Section 73 of Companies Act, 2013 read together with Companies (Acceptance of Deposits) Rules, 2014, (Rule 2(1) (Xii) (a)), such advances are liable to be treated as deposits and hence the company is in violation of the same. Except for compliance with the aforesaid amount, 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) We have broadly reviewed the Turnover which is less than 35 Crore , hence the provision of the said order not applicable.

7) a) According to the information and explanations given to us, the Company is generally regular in depositing undisputed statutory dues, including provident fund, employees state insurance, sales tax, income tax, wealth tax, service tax, duty of customs, duty of excise, value added tax, cess and other statutory dues, as applicable, with the appropriate authorities except as below:

Nature of payment	Amount	Remarks
TDS	3500.00	Pending
GST	18146.00	Pending
Sales Tax	3348611.00	Pending
Central Excise Duty Service Tax & Interest	10479645.00	Pending
Dividend Tax	2032680.00	Pending
Entry Tax	210372.00	Pending
Dividend	6465926.10	Pending

b) The particulars of dues of sales tax, income tax, wealth tax, service tax, duty of customs, duty of excise, value added tax and cess as applicable as at 31st March 2022 which have not been deposited on account of a dispute are as follows :-

Name of the Statute	Nature of Dues	Amount Involved	Period to which the amount relates	Forum where Dispute is Pending
Income Tax Act, 1961	Income Tax	Rs. 37,41,820/-	FY 2016 17	Assessing Officer
Income Tax Act, 1961	Income Tax	Rs.93,59,240/-	FY 2013 14	CIT Appeal, Kolkata
Income Tax Act, 1961	Income Tax	Rs. 99,34,987/-	FY 2012 13	CIT Appeal, Kolkata
Income Tax Act, 1961	Income Tax	Rs.81,372/-	FY 2011 12	CIT Appeal , Kolkata
Income Tax Act, 1961	Income Tax	Rs.10,45,640/-	FY 2009 10	Rectification
Income Tax Act, 1961	Income Tax	Rs. 3,67,336/-	FY 2008 09	Assessing Officer
Income Tax Act, 1961	Income Tax	Rs. 1,32,211/- Rs. 3,84,510/-	FY 2007 -08	Assessing Officer
West Bengal Sales Tax Act,1994	Sales Tax		FY 2003-04	Appellate &Revisional Board

8) As explained and informed us there was no transactions unrecorded income that have been surrendered or disclosed as income during the year in the tax assessment under the Income Tax Act,1961 (43 of 1961).

9) a) According to the information and explanations given to us, the company has not taken any loans or advances in the current years.

b) Clause is not available.

c) In our opinion and according to the information and explanation given to us, the company has not raised any money by way of term loans during the year and there has been no utilization during the current years of the term loans obtained by the company during any previous years. Accordingly, reporting under clauses 3(ix)(d) of the order is not applicable to the company.

d) In our opinion and according to the information and explanation given to us, the company has not raised any funds on short term basis during the year or in any previous years. Accordingly, Reporting under clauses 3(ix)(d) of the order is not applicable to the company.

e) According to the information and explanations given to us and on an overall examination of the financial statements of the company, the Company has not taken any funds from any entity or person on account of or to meet the obligation of its subsidiaries.

f) According to the information and explanations given to us, the company has not raised any loans during the year on the pledge of securities held in its subsidiaries.

10) The company have not issued any fresh security by way of Initial public offer or private placement or Further Public offer, and hence clause not applicable.

11) (a) Based upon the audit procedures performed and the information and explanations given to us, no fraud by the Company and no material fraud on the company by its officers or employees has been noticed or reported during the year.

(b)As per clause (a)&(b) is not applicable.

(c) As informed by the management no whistleblower complaints received by the company during the year.

12) In our opinion, the Company is not a Nidhi Company. Therefore, the provisions of clause (12) of the Order are not applicable to the Company.

13) In our opinion, and according to the information and explanation given to us, company has not compliedwith section 177of Companies Act, 2013. Disclosure of related party transaction under section 188 of Companies Act, 2013 has been given in financial statement as per the applicable accounting standards.

14) a)In our opinion and according to the information and explanations given to us,the company has an internal audit system as required under section 138 of the Act which is Commensurate with the size and nature of its business. b)We have considered the reports issued by the internal auditors of the company till date for the period under audit.

15) In our opinion during the year the Company has not entered into any non-cash transactions with its Directors or persons connected with its directors and hence provisions of section 192 of the Companies Act, 2013 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 of clause (a),(b)&( c) of the Order are not applicable to the Company and hence not commented upon. d) As informed to us there is no core Investment company within the group, hence provisions of the clause not applicable.

17) The company have incurred cash loss during the year and also in immediately preceding financial year.

18) a) During the year and P D Rungta & Co. & S Gattani & Co. have been resigned during the year. b) We have received the NOC, and considered all the objection if any raised by the previous year.

19) On the basis of the financial ratios, ageing and expected dates of realization 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 any material uncertainty exists as on the date of the audit report indicating that Company is not capable of meeting its liabilities existing at the date of balance sheet as and when they fall due within a period of one year from the balance sheet date.We, however, state that this is not an assurance as to the future viability of the Company.We further state that our reporting is based on the facts up to the date of the audit report and we neither give any guarantee nor any assurance that all liabilities falling due within a period of one year from the balance sheet date, will get discharged by the Company as and when they fall due.

20) According to the information and explanations given to us, the Company does not have any unspent amount in respect of any ongoing or other than ongoing project as at the expiry of the financial year. Accordingly, reporting under clause 3(xx) of the Order is not applicable to the Company.

21) The reporting under clause 3(xxi) of the Order is not applicable in respect of audit of standalone financial statements of the Company. Accordingly, no comment has been included in respect of said clause under this report.

	For Rajesh Jalan& Associates
	Chartered Accountants
	Firm Regd. No-326370E
	( RajeshJalan )
	Partner
	(Firm Registration No. : 326370E)
	(UDIN-22065792AJWSAX6383)
Place : Kolkata
Date : 30/05/2022

"Annexure B" to the Independent Auditors Report of even date on the Financial Statements of

M/s LORDS CHEMICALS 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 LORDS CHEMICALS LIMITED("the Company") as of March 31, 2022 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". 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 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 except note given in Audit Report in opinion paragraph and emphasis of Matter.

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 authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the 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.

Basis for Opinion

According to information and explanation given to us and based on our audit, the following material weakness have been identified in the effectiveness of the Companys internal financial controls over financing reporting as at March 31,2022:

a) Refer to Note 5 and 7 of the financial statements, in respect of long outstanding overdue trade receivables and advance, whereby evidences of control over monitoring / assessing recoverability of such over dues, including assessment of provision of provision for doubtful trade receivables and advances were not operation effectively. This could potentially result in the company not recognizing a provision for doubtful / old overdue trade receivables.

b) The Companys internal controls over updating the customers/ vendors master data with present addresses wire not operating effectively. c) The Companys internal financial controls over timely recording of journal entries were not operating effectively. We have observed delays in recording of the entries which potentially results in delay of preparation of financial statements. 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, 2022, 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 Rajesh Jalan& Associates
	Chartered Accountants
	Firm Registration No. : 326370E
	(Rajesh Jalan)
	Partner
	(UDIN-22065792AJWSAX6383)
Place : Kolkata
Date : 30/05/2022