To
The Members of
NAGARJUNA AGRI TECH LIMITED Report on the Audit of Financial Statements
Opinion
We have audited the financial statements of NAGARJUNA AGRI TECH LIMITED ("the
Company"), which comprise the balance sheet as at 31st March, 2023, the statement of
profit and loss (including other comprehensive Income), statement of changes in equity and
statement of cash flows for the year then ended, and notes to the financial statements,
including a summary of 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 financial statements give the information required by the
Companies Act, 2013("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, as amended,
("Ind AS") and other accounting principles generally accepted in India, of the
state of affairs of the Company as at March 31, 2023, and its loss, total comprehensive
income, the changes in equity and its cash flows for the year ended on that date.
Basis for Opinion
We conducted our audit in accordance with the Standards on Auditing (SAs) specified
under section 143(10) of the Act. Our responsibilities under those Standards are further
described in the Auditors Responsibilities for the Audit of the Financial Statements
section of our report. We are independent of the Company in accordance with the Code of
Ethics issued by the Institute of Chartered Accountants of India together with the ethical
requirements that are relevant to our audit of the financial statements under the
provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical
responsibilities in accordance with these requirements and the Code of Ethics. We believe
that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most
significance in our audit of the financial statements of the current period. These matters
were addressed in the context of our audit of the financial statements as a whole, and in
forming our opinion thereon, and we do not provide a separate opinion on these matters.
| Key audit matters |
How the matter was addressed in our audit |
| Provision for contingent liabilities |
We evaluated the litigation and r e g u l a t o r y p r o c e d u r e s summarised by
legal experts, which we found to be satisfactory for the purposes of our audit. |
| The Company is facinglegal and regulatory proceedings. The determination of the
provision and the level of disclosure required in respect of the said matter, involves a
high degree of judgement to decide on making a provision or resulting in contingent
liabilityand being considered as a key audit matter, disclosed in note 26 of the financial
statements. |
Our procedures include the following: |
|
• We read the summary of litigation matters provided by the Companys legal team
and discussed each of the material cases noted in the report to determine the Companys
assessment of the likelihood and magnitude of any liability that may arise. |
|
• We read, where applicable, external legal or regulatory advice sought by the
Company a n d r e v i e w e d r e l a t e d correspondence. |
Other Information
The Companys management and Board of Directors are responsible for the other
information. The other information comprises the information included in the Companys
annual report, but does not include the financial statements and our auditors report
thereon.
Our opinion on the 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 financial statements, our responsibility is to read
the other information and, in doing so, consider whether the other information
ismaterially inconsistent with the financial statements or our knowledge obtained in the
audit or otherwise appears to be materially misstated.
When we read the Annual report, if we conclude that there is a material misstatement
there in we are required to communicate the matter to those charged with the governance.We
have nothing to report in this regard.
Responsibilities of Management and those charged with governance for the financial
statements
The Companys Board of Directors are responsible for the matters stated in Section
134(5) of theAct with respect to the preparation of these financialstatements that give a
true and fair view of the financial position, financial performance including other
comprehensive income, cash flows and changes in equity of the Company in accordance with
the accounting principles generally accepted in India, including the accounting Standards
specified under section 133 of the Act.
This responsibility also includes maintenance of adequate accounting records in
accordance with the provisions of the Act for safeguarding of 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 statement that give a true and fair view and are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements, the Board of Directorsare responsible for
assessing the Companys ability to continue as a going concern, disclosing, as applicable,
matters related to going concern and using the going concern basis of accounting unless
the Board of Directors either intends to liquidate the Company or to cease operations, or
has no realistic alternative but to do so.
The Board of Directors are also responsible for overseeing the companys financial
reporting process.
Auditors Responsibilities for the Audit of Financial Statement
Our objectives are to obtain reasonable assurance about whether the financial
statements as a whole are free from material misstatements, 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 expectedto influence the economic decisions of users taken on the
basis of these Ind AS financial statements.
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 financial
statements, whether due to fraud or error, design and perform audit procedures responsive
to those risks, and obtain audit evidence that is sufficient and appropriate to provide a
basis for our opinion. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion,
forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to
design audit procedures that are appropriate in the circumstances. Under section 143(3)(i)
of the Act, we are also responsible for expressing our opinion on whether the company has
adequate internal financial controls 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, a material uncertainty exists
related to events or conditions that may cast significant doubt on the Companys ability
to continue as a going concern. We hereby draw attention in our auditors report to the
related disclosures in the financial statements i.e. Note no.22 current ratio i.e meeting
the short term commitments by the company is uncertain. However, future events or
conditions may changeour opinion on the Companys a going concern.
• Evaluate the overall presentation, structure and content of the financial
statements, including the disclosures, and whether the financial statements represent the
underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the
planned scope and timing of the audit and significant audit findings, including any
significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied
with relevant ethical requirements regarding independence, and to communicate with them
all relationships and other matters that may reasonably be thought to bear on our
independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those
matters that were of most significance in the audit of the financial statements of the
current period and are therefore the key audit matters. We describe these matters in our
auditors report unless law or regulation precludes public disclosure about the matter or
when, in extremely rare circumstances, we determine that a matter should not be
communicated in our report because the adverse consequences of doing so would reasonably
be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors report) Order, 2016 ("the Order")
issued by the Central Government of India in terms of subsection (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.
2. As required by section 143(3) of the Act, based on our audit we report that:
a) we have sought and obtained all the information and explanations which to the best
of ourknowledge and belief were necessary for the purposes of our audit;
b) in our opinion, proper books of account as required by law have been kept by the
Company so far as it appears from our examination of those books;
c) 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 inagreement with the books of accounts;
d) in our opinion, the aforesaid financial statements comply with the Indian Accounting
Standards prescribed under section 133 of the Act; e) on the basis of the written
representations received from the directors of the Company as onMarch 31, 2023 taken on
record by the Board of Directors, none of the directors is disqualifiedas on March 31,
2023 from being appointed as a director in terms of Section 164(2) of the Act;
f) With respect to the adequacy of the internal financial controls with reference to
financial statements of the Company and the operating effectiveness of such controls,
refer to our separate report in" Annexure B". Our report expresses an unmodified
opinion on the adequacy and operating effectiveness of the Companys internal financial
controls with reference to financial statements;
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.The Ministry of Corporate Affairs
has not prescribed other details under section 197(16) which are required to be commented
upon by us.
h) with respect to the other matters to be included in the Auditors Report in
accordance with Rule11 of the Companies (Audit and Auditors) Rules, 2014, as amended, in
our opinion and to thebest 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 Note 26 to the Ind AS financial statements;
ii. the Company did not have any long-term contracts including derivative contracts; as
such there were no material foreseeable losses thereon;
iii. there are no amounts which are required to be transferred to the Investor
Education and Protection Fund; therefore, delay in transferring such sums does not
arise.
For KSS Gangadhar & Co Chartered Accountants, Firms Regn.No.008692S
Sd/-
KSS Gangadhar Partner
ICAI Membership No: 029100
Place: Hyderabad Date: 30.05.2023
ANNEXURE –A TO THE INDEPENDENT AUDITORS REPORT
(Referred to in paragraph 1 under ‘Report on Other Legal and Regulatory
Requirements section of our report of even date)
Statement on the Companies (Auditors Report) Order 2020
The Annexure referred to in Independent Auditors Report to the members of the Company
on the financial statements for the year ended 31 March 2023, we report that:
i. In respect of the companys Fixed Assets
(a) A) The Company has maintained proper records showing full particulars, including
quantitative details and situation of property plant and equipment.
B) The company does not possess any intangible assets.
(b) The Company has a program of verification to cover all the items of fixed assets in
a phased manner, which in our opinion, is reasonable having regard to the size of the
Company and the nature of its assets. Pursuant to the program, certain fixed assets were
physically verified by the management during the year. According to the information and
explanations given to us, no material discrepancies were noticed on such verification;
(c) According to the information and explanations given to us and based on our
examination of the records of the Company, the title deeds oftotal agricultural land in
the Assets,are held in the name of the several individuals and the company has entered
into an MoU accordingly. All the other assets are held in the name of company. The company
has collected a trust document in this regard to confirm the ownership rights of said land
and the company is in the possession of the original copies of said sale deeds.
| Description of property |
Gross carrying value (in Rs) |
Held in the name of |
Relation with Company |
Period held |
Reason for not held in the name of the company |
| Land |
13,13,000 |
B V Subbaraju |
Ex- Employee |
28 years |
As mentioned above |
| Land |
3,56,500 |
P R Somaraju |
Ex- Employee |
28 years |
. |
(d) The company has not revalued any of its property plant and equipment
(e) No proceedings has been initiated or are pending against the company for holding
any benami property under the Benami transactions (Prohibition) Act,1988(45 OF 1988) and
rules made thereunder.
ii. In respect of Inventories:
a) The company conducts physical verification of inventories at reasonable intervals
and no material discrepancies noticed by the management in the course of their
verification.
b) The Company has not been sanctioned working capital limits in excess of ? 5 crore,
in aggregate, at any during the year, from banks or financial institutions on the basis of
security of current assets and hence reporting underclause 3(ii)(b) of the Order is not
applicable.
iii. According to the information and explanations given to us, the Company has not
granted any loans, secured or unsecured, to any company, firm, Limited Liability
Partnership or other parties listed in the register maintained under section 189 of the
Companies Act, 2013 (‘the Act), except for unsecured loan given to director.
a. No loans or advances have been provided by the company in the nature of loan or
stood asa guarantee or provided security to any other entity.
b. The said loan given is not prejudicial to the companys interest
c. In respect of loans granted by the Company, the schedule of repayment of principal
and payment of interest has been stipulated and the repayments of principal amounts and
receipts of interest are generally been regular as per stipulation.
d. In respect of loans granted by the company,there is no overdue amount remaining
outstanding at the balance sheet date.
e. No loan granted by the Company, which has fallen due during the year, has been
renewed or extended or fresh loansgranted to settle the over dues of existing loans given
to the same parties.
f. As at 31st March 2023, the Company has not grantedany loans or advances in the
nature of loans that isrepayable on demand or withoutspecifying any terms or period of
repayment during the year.
iv. In our opinion and according to the information and explanations given to us, the
Company has complied with the provisions of section 185 and 186 of the Act, with respect
to the loans and investments made.
v. According to the information and explanations given to us, the Company has not
accepted deposits within the meaning of Section 73 to 76 of the Act and the Companies
(Acceptance of Deposits) Rules, 2014 (as amended). Accordingly, the provisions of the
clause 3 (v) of the Order are not applicable.
The Company has not accepted any deposits from the public covered under section 73 of
Companies Act 2013. The company has sundry creditors outstanding beyond 1 year as at the
Balance sheet date, amounting to Rs.1880740/-
vi. The Central Government has not prescribed the maintenance of cost records under
section 148(1) of the Companies Act 2013, for any of the services rendered by the Company.
vii. (a) According to the information and explanations given to us and on the basis of
our examination of the records of the Company, amounts deducted/ accrued in the books of
account in respect of undisputed statutory dues including, income-tax, Goods and Service
Tax, other material statutory dues have been regularly deposited during the year by the
Company with the appropriate authorities. As explained to us, the Company the liability to
deduct Provident Fund does not arise as the employee count is below the statutory limit.
Further, the company does not provide for any compensated absences.
(b) According to the information and explanations given to us, no undisputed amounts
payable in respect of provident fund, income tax, sales tax, value added tax, duty of
customs, service tax, cess and other material statutory dues were in arrears as at 31
March 2023 for a period of more than six months from the date they became payable except
for the ones
disclosed below.
| Name of the Statute |
Nature of Dues |
Amount |
Period to which the amount relates |
Forum where dispute is pending |
| The Income Tax Act, 1961 |
Tax arising on disallowance of Depreciation Claimed |
15,31,797 |
AY 2009-10 |
Deputy Commisioner of Income tax 16(1), Hyderabad |
viii. There were no transactions relating to the previously unrecorded income that have
been surrendered or disclosed as income during the year in the tax assessments under the
Income tax act,1961(43 of 1961).
ix. (a) The Company has not taken any loan or borrowings from a financial institution
or bank andthe Government.
(b) The company has not been declared as wilful defaulter by any bank or financial
institution or any other lender
(c) The company has not taken any term loans during the year and there was no
outstanding at thebeginning of the year and hence reporting under clause 3(ix)(c) of the
order is not applicable.
(d) On an overall examination of the financial statements of the company,funds raised
on short term basis have,primafacie,not been utilised during the year for long term basis.
(e) On an overall examination of the financial statements of the company, the company
has not taken any funds from any entity or person on account of or to meet any other
obligations of its associates.
(f) The company has not raised any loans on the pledge of securities hence reporting
under Clause xi(f) of the order is not applicable.
x. (a) The Company did not raise any money by way of initial public offer or further
public offer (including debt instruments) and have not raised funds by way of term loans
during the year. Accordingly, paragraph 3 (ix) of the Order is not applicable.
(b) The company has not made any preferential allotment or private placement of shares
or convertible debentures during the year.
xi. (a) According to the information and explanations given to us, no material fraud by
the Company or on the Company by its officers or employees has been noticed or reported
during the course of our audit.
(b) No report under sub-section (12) of section 143 of the Companies Act has been filed
in Form ADT-4 as prescribed under rule 13 of Companies (Audit and Auditors) Rules, 2014
with the Central Government, during the year and upto the date of this report.
(c) We have taken into consideration the whistle blower complaints received by the
Companyduring the year (and upto thedate of this report), while determining the nature,
timing and extent of our audit procedures.
xii. The Company is not a nidhi company. Accordingly, paragraph 3(xii) of the
Order is not applicable.
xiii. According to the information and explanations given to us and based on our
examination of the records of the Company, transactions with the related parties are in
compliance with sections 177 and 188 of the Act where applicable and details of such
transactions have been disclosed in the financial statements as required by the applicable
accounting standards.
xiv. (a) In our opinion the Company has an adequate internal audit system commensurate
with the size and the nature of its business.
(b) We have considered, the internal audit reports for the year under audit, issued to
the company during the year and till date, in determining in the nature,timing and extent
of our audit procedures.
xv. 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
xvi. (a) The Company is not required to be registered under section 45-IA of the
Reserve Bank of India Act 1934 Hence, reporting under clause 3(xvi)(a),
(b) and (c) of the Order is not applicable.
(b) In our opinion there is no core investment company within the Group (as defined in
the Core Investment Companies(Reserve Bank) Directions, 2016) and accordingly reporting
under clause 3(xvi)(d) of the Order is not applicable.
xvii. The company has incurred cash losses during the financial year covered by our
audit and the immediately preceding financial year amounting to Rs.2,65,739 for the year
ending 31-03-2023 and Rs.25,90,454 for the year ending 31-03-2022.
xviii.There has been no resignation of the statutory auditors of the company during the
year.
xix. On the basis of the financial ratios, ageing and expected dates of realisation of
financial assets and payment of financialliabilities, other information accompanying the
financial statements and our knowledge of the Board of Directors andManagement plans and
based on our examination of the evidence supporting the assumptions, nothing has come to
ourattention, which causes us to believe that any material uncertainty exists as on the
date of the audit report indicating thatCompany is not capable of meeting its liabilities
existing at the date of balance sheet as and when they fall due within aperiod of one year
from the balance sheet date. We, however, state that this is not an assurance as to the
future viability ofthe Company. We further state that our reporting is based on the facts
up to the date of the audit report and we neither giveany guarantee nor any assurance that
all liabilities falling due within a period of one year from the balance sheet date, will
getdischarged by the Company as and when they fall due
xx. As per sec 135(1) of companies act 2013 the company is not obliged to form
corporate social responsibility committee and accordingly reporting under clause3(xx)
(a),(b) of the order is not applicable.
For KSS Gangadhar & Co Chartered Accountants, Firms Regn.No.008692S
Sd/-
KSS Gangadhar Partner
ICAI Membership No: 029100
Place: Hyderabad Date: 30.05.2023
ANNEXURE – B TO THE INDEPENDENT AUDITORS REPORT
(Referred to in paragraph 1 under ‘Report on Other Legal and Regulatory
Requirements section of our report of even date)
Report on the Internal Financial Controls under Clause (i) of Subsection 3 of Section
143 of the
Companies Act, 2013 ("the Act")
We have audited the internal financial controls over financial reporting of NAGARJUNA
AGRI TECH LIMITED ("the Company") as of 31st March 2023 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 Board of Directors of the Company is responsible for establishing and maintaining
internal financial controls based on the internal control over financial reporting
criteria established by the Company considering the essential components of internal
control stated in the Guidance Note on Audit of Internal Financial Controls over Financial
Reporting issued by the Institute of Chartered Accountants of India (‘ICAI). These
responsibilities include the design, implementation and maintenance of adequate internal
financial controls that were operating effectively for ensuring the orderly and efficient
conduct of its business, including adherence to companys policies, the safeguarding of
its assets, the prevention and detection of frauds and errors, the accuracy and
completeness of the accounting records, and the timely preparation of reliable financial
information, as required under the Companies Act, 2013.
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. 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 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 ofInd AS financial statements in accordance with generally accepted accounting
principles, and that receipts and expenditures of the company are being made only in
accordance with authorisations of management and directors of the company; and
3) provide reasonable assurance regarding prevention or timely detection of
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, 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 KSS Gangadhar & Co Chartered Accountants, Firms Regn.No.008692S
Sd/-
KSS Gangadhar Partner
ICAI Membership No: 029100
Place: Hyderabad Date: 30.05.2023
+91-9892691696
