nitco ltd share price Auditors report

To the members of Nitco Ltd

Report on the Audit of the Standalone Financial Statements

1. Qualified Opinion

We have audited the Separate financial statements (also known as Standalone Financial Statements) of NITCO 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 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, except for the effects of the matter described in the Basis for Qualified Opinion section of our report 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 (Ind AS) prescribed under Section 133 of the Act read with Companies (Indian Accounting Standards) Rules, 2015, as amended and other accounting principles generally accepted in India, of the state of affairs (financial position) of the Company as at 31st March 2023, and its losses (financial performance including Other Comprehensive Income), the Changes in Equity and its Cash Flows for the year ended on that date.

2. Basis for Qualified Opinion

Material Uncertainty Related to Going Concern

The Company continues to incur losses resulting in an erosion of its net worth and its current liabilities exceeds current assets as of 31st March 2023. statements as regards We drawyourattentiontoNote38(b)(iv)tothefinancial to revocation of the restructuring of existing facilities (excluding the NCD and RPS facility) by JM Financial Asset Restructuring Company Limited (acting in its capacity as trustee of JMFARC-LVB Ceramics September 2014 - Trust). – (Financial Creditor), vide letter dated 19th September 2022, whereby dues amounting to Rs. 2,42,762.93 Lakhs has been restated (the amount appearing in books as on 31st March 2023 is Rs. 66,082.26 Lakhs). On 15th November 2022, the Financial Creditor has made an Application under Section 7 of Insolvency and Bankruptcy Code, 2016 read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 with National Company Law Tribunal (NCLT) to initiate corporate insolvency resolution process. We are informed that the Company is seeking appropriate legal advice and will take all appropriate steps to protect its interest in the aforesaid matter. Accordingly, no adjustments have been made to the carrying values of the liabilities and their presentation and classifications in the financial statements and are accounted on going concern basis.

Based on our audit conducted, we have concluded that a material uncertainty exists relating to events or conditions that may cast significant doubt on the entitys ability to continue as a going concern and to that extent, the audit report is qualified. We conducted our audit of the Standalone Financial Statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditors Responsibilities for the Audit of the 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 independence requirements that are relevant to our audit of the Standalone Financial Statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAIs Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified opinion on the Standalone Financial Statements.

3. Emphasis of Matter i. We draw attention to Note no. 38 (b)(v) to the Standalone Financial Statement which states that the company has not provided for interest on the outstanding loan of LIC of Rs. 1,887.26 lakhs (Principal outstanding), as they are hopeful of its restructuring same in line of JMFARC. ii. We draw attention to Note no. 38 (b)(ii) to the Standalone Financial Statement which states that Additional Director General Foreign Trade (ADGFT) had levied penalty of Rs. 17,000.00 lakhs which is confirmed by the Appellate bench of DGFT, New Delhi.

No provision for the demand is made in the books. Management has received legal opinion that the order is bad in law. iii. We draw attention to Note no. 38 (b)(iii) to the Standalone Financial Statement which states that Revenue Department has raised a demand of Rs 5,105.88 lakhs. No provision for the demand is made in the books as company has received interim relief against the order from Bombay High Court. iv. We draw attention to Note no. 7 to the Standalone Financial Statement which states that Management has not made provision for impairment of Rs. 995.99 lakhs with respect to capital advance given to Saumya Buildcon Pvt Ltd.

v. We draw attention to Note no. 5 and Note 12 to the Standalone Financial Statement which states that Management has not done provision for impairment of Rs. 6,579.69 lakhs with respect to money advanced to Nitco Realties Private Limited by way of investments and loans.

Our opinion is not modified in respect of these matters.

4. 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 matter	Our Response
1) Assessment of impairment in valuation of investments and loan given to subsidiaries and Property, Plant and Equipment at Alibaug and Silvasa	Our audit procedures included, among others the following:
• The carrying values of the companys Investments in subsidiaries and Property, Plant and Equipment are assessed annually by management for potential indicators of impairment.	• We have evaluated the key judgements / assumptions underlying managements assessment of potential indicators of impairment;
• For the above impairment testing, management has determined the value in use and the fair value less cost to sell as applicable.	• We have studied available financial information including considerations of the economic conditions of the plant at Alibaug and audited financial statements of the subsidiaries;
• We have identified the assessment of potential impairment of investments and loans given to subsidiaries and Property, Plant and Equipment at Alibaug and Silvasa location as a key audit matter.	• We have evaluated the current approximate market price of the land, real estate properties at Alibaug and Silvasa and also where the subsidiaries have invested for computing the recoverable amount;
	• We have checked the Valuation report of underlying assets done by Independent Valuer;
• Impairment assessment involves significant degree of management judgement in determining the key assumptions and expected future cash flows.	• We evaluated the independence, competence of the independent valuer;
• Valuation of underlying assets especially land with subsidiaries were done from Independent Valuer.	• We read and assessed the relevant disclosures made within the standalone Ind AS financial statements.

 

2) Litigation, Claims and Contingent Liabilities
• Company is exposed to variety of different laws, regulations and interpretations thereof. Consequently, in the normal course of business, Provisions and Contingent Liabilities may arise from legal proceedings, constructive obligations and commercial claims.	• We understood the processes, evaluated the design and implementation of controls and tested the operating effectiveness of the Companys controls over the recording and re-assessment of uncertain legal positions, claims and contingent liabilities.
• Management applies significant judgement when considering whether and how much to provide for the potential exposure of each matter.	• We held discussions with senior management including the person responsible for legal and compliance to obtain an understanding of the factors considered by management in classification of the matter as probable, possible and remote.
• These estimates could change substantially over time as new facts emerge as each legal case or matters progresses.	• Examined the Companys legal expenses on sample basis and read the minutes of the board meetings in order to ensure completeness.
• Given the different views possible, basis the interpretations, complexity and the magnitude of potential exposures and the judgement necessary to estimate the amount of provision required or determine required disclosures.	• With respect to tax matters (direct and indirect), discussed with the Companys tax officers and obtained their views and strategies on significant cases, as well as the related technical grounds relating to their conclusions based on applicable tax laws.
	• Assessing the decisions and rationale for provisions held or for decisions not to record provisions or make disclosures.
	• For those matters where management concluded that no provisions should be recorded, considering the adequacy and completeness of the Companys disclosures.

(b) According to the records of the Company, the statutory dues referred to in sub-clause (a) above which have not been deposited as on 31st March 2023 on account of any dispute, are as follows:

5. 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 Boards Report including Annexures to Boards Report, Management Discussion and Analysis, Report on Corporate Governance, but does not include the Standalone Financial Statements and our auditors report thereon. Our opinion on the Standalone Financial Statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the Standalone Financial Statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the Standalone Financial Statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated.

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

6. 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 financial position, financial true and fairview of the 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 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 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 is responsible for overseeing the Companys financial reporting process.

7. 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 judgement 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 controls relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under Section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to financial statements in place and the operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures 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 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.

• 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.

8. Other Matters

The standalone financial statements for the year ended 31st March 2022 have been audited by erstwhile auditor who have expressed an unmodified opinion on those statements based on their audit for the year ended 31st March 2022.

9. Report on Other Legal and Regulatory Requirements

As required by the Companies (Auditors Report) Order, 2020 ("the Order") issued by the Central Government in terms of Section 143(11) of the Act, we give in "Annexure A" a statement on the matters specified in paragraphs 3 and 4 of the Order.

As required by Section 143(3) of the Act, based on our audit, we report that:

a) We have sought and obtained all the information and explanations, except for the physical verification of inventory at Alibaug factory, which to the best of our knowledge 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, the Statement of Changes in Equity and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

d) In our opinion, the aforesaid Standalone Financial Statements comply with the Ind AS prescribed under section 133 of the Act.

e) On the basis of the written representations received from the directors as on 31st March, 2023 taken on record by the Board of Directors, none of the directors are disqualified as on 31st March, 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) As required by section 197(16) of the Act, based on our audit, we report that the Company has paid and provided for remuneration to its directors during the year in accordance with the provisions of and limits laid down under section 197 read with Schedule V to the Act.

h) With respect to the other matters to be included in the Auditors Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its Standalone – Refer Note 38 (b) to the Standalone Financial Statements;

ii. The Company did not have any long-term contracts including derivative contracts for which there were no material foreseeable losses; iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

iv. (a) As represented to us by the management and to the best of its knowledge and belief, no funds have been advanced or lend or invested during the year (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities (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 identifiedin 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; and

(b) As represented to us by the management and to the best of its knowledge and belief, no funds have been received by the Company during the year from any person(s) or entity(ies), including foreign entities ("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; and

(c) Based on such audit procedures, we have considered reasonable and appropriate in the circumstances, nothing has come to our notice that causes us to believe that the above representations under sub-clause (i) and (ii) of Rule 11(e) as provided under (a) and (b) above, contain any material misstatement. v. The Company has not declared or paid any dividend during the year as per Section 123 of the Companies Act, 2013 and hence clause (f) of Rule 11 of the Companies (Audit & Auditors) Rules, 2014 is not applicable. vi. Proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 for maintaining books of account using accounting software which has a feature of recording audit trail (edit log) facility is applicable to the Company 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 ended March 31, 2023

"ANNEXURE A" TO THE INDEPENDENT AUDITORS REPORT OF EVEN DATE ON THE STANDALONE FINANCIAL STATEMENTS OF NITCO LIMITED.

i) (a) (A) The company has maintained proper records showing full particulars, including quantitative details and situation of Property, Plant and Equipment.

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

(b) As explained to us, the Property, Plant and Equipment, have been physically verifiedby the management in accordance with a phased programme of verification, which in our opinion is reasonable, considering the size and the nature of its business. The frequency of verification is reasonable, and no material discrepancies have been noticed on such physical verification.

(c) Based on our examination of the registered sale deed / transfer deed / conveyance deed / property tax paid documents (which evidences title) provided to us, we report that, the title in respect of self – constructed buildings and title deeds of all other immovable properties, (other than immovable properties where the Company is the lessee and the lease agreements are duly executed in favour of the Company) disclosed in the financialstatements included in property, plant and equipment are held in the name of the Company as at the balance sheet date, except for the following:

Description of Property & Period Held For	Gross Carrying Value (Rs. In Lakhs)	Held in the Name of	whether promoter, director or their relative Or employee	Reason for not being held in name of Company * indicate if in dispute
Leasehold Land at Thane	278.38	Mahalakshmi Tiles and Marble Company Pvt. Ltd.	Company controlled by relatives of Promoter	Mahalakshmi Tiles and Marble Company Pvt Ltd is merged with Nitco Tiles Ltd.
Period Held: 31st Dec 2005 onwards Land at Alibaug	15.85	Various Parties	No	Refer HC petition no 797 of 2001 Registration of agreement is under process
Period Held: 1995 onwards		(Refer note 45 of Standalone Financial Statement)
Land at Kanjurmarg (Held as Inventory- Real estate ) Period Held: 2011 onwards	15,000	Particle Boards India Limited	No	Particle Boards India Limited is merged with Nitco Ltd [Refer note no. 38 (b) (iii)]

(d) The Company has not revalued any of its property, plant and equipment and intangible assets during the year.

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

(ii)(a) The inventory, has been physically verified by the management during the year at reasonable intervals. 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 operation. No discrepancies of 10% or more in the aggregate for each class of inventory were noticed on such physical verification of inventory when compared with books of account. However due to closure of Alibaug Factory, the management could not conduct physical verification of inventory during the year and hence we are unable to comment on the reporting requirement.

(b) According to the information and explanations given to us, at any point of time of the year, the Company has not been sanctioned any working capital facility from banks or financial institutions in excess of Rs 5 crores and hence reporting under clause (ii)(b) of the Order is not applicable.

(iii) The Company has not made any investment or provided any loans or advances in the nature of loans or stood guarantee, or provided security to companies, firms, limited liability partnership or any other parties during the year.

(a) The Company has not provided any loans or advances in the nature of loans or stood guarantee, or provided security to any other entity during the year, and hence reporting under clause (iii)(a) and clause iii(b) of the Order is not applicable.

(b) in respect of loans and advances in the nature of loans given by the company in previous years the schedule of repayment of principal and payment of interest has not been stipulated and in the absence of such schedule, we are unable to comment on the regularity of the repayments of principal amounts and payment of interest. The outstanding balances of such loans and advances granted is reported as below:

Sr. No	Party Name	Amount Outstanding as on 31.03.2023
1	Nitco Relaties Pvt Ltd (NRPL)	5,885.10
2	Saumya Buildcon Pvt Ltd	995.99
3	Meghdoot Properties Pvt Ltd	0.57
4	Maxwealth Properties Pvt Ltd	0.57
5	Feel Better Housing Pvt Ltd	0.57
6	Silver Sky Real Estates Pvt Ltd	0.55

(c) As there is no stipulation of repayment of principle and interest, we are not in the position to comment on the status of overdue loan.

(d) No fresh loans or advances in the nature of loans given during the year which is used for repaying existing loans given to the same parties.

(e) 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, however as mentioned in clause iii(b) the company has granted in earlier years loans or advances in the nature of loans which are without specifying any terms or period of repayment details of which are given below:

Particulars	All Parties (A+B+C)	Promoter (A)	Related Parties (B)	other Parties (C)
The aggregate amount of loan/ advance in nature of loan :
Repayable on demand (A)	-	-	-	-
Agreement does not specify any terms or period of repayment (B)	-	-	-	-
No agreement (C)	5,887.35	-	5,887.35	-
Total (A+B+C)	5,887.35	-	5,887.35	-
Percentage of loans/advances in nature of loans to the total loans/advances	100.00%	-	100.00%	-

(iv) In our opinion, in respect of loans granted and investments made, the Company has complied with the provisions of Section 185 and 186 of the Act.

(v) 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 Act and the Companies (Acceptance of Deposits) Rules, 2014 as amended. Accordingly, the provisions of clause 3(v) of Para 3 of the Order are not applicable to the Company.

(vi) We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under section 148 (1) of the Act, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

(vii) (a) The Company is regular in depositing undisputed statutory dues, including Goods and Service Tax, Provident Fund, Employees State Insurance, Income Tax, Sales-Tax, Service Tax, Duty of customs, duty of excise, value added tax, cess and any other statutory dues with appropriate authorities, where applicable. There are no undisputed amounts payable in respect of such statutory dues which have remained outstanding as at 31st March, 2023 for a period of more than six months from the date they became payable.

(b) According to the records of the Company, the statutory dues referred to in sub-clause (a) above which have not been deposited as on 31st March 2023 on account of any dispute, are as follows:

Statute and nature of dues	Financial year to which the matter pertains	Forum where dispute is pending	Rs in Lakhs
Value Added Tax Act, 2005
VAT and Penalty	2004-05, 2013-14, 2014-15	Deputy commissioner of sales tax	46.89
	2008-09, 2009-10	Assistant Commissioner	5.05
	2009-10	KVAT Tribunal	6.74
	2013-14, 2014-15	Tribunal	1,430.57
	2014-15	JCCT - Appeal	0.58
	2015-16	Addl. Commissioner Grade 2	5.62
	Various Years	Jt. Comm of Sales Tax Appeal	1,563.65
Central Sales Tax Act, 1956
Pending C Form issues	2013-14	Addl. Com.-Grade-2	2.61
	2013-14, 2014-15, 2015-16, 2016-17, 2017-18	Deputy commissioner of sales tax	344.27
	2016-17	Joint Commissioner	17.70
Customs Act, 1962
Redemption Fine	Various Years	CESTAT	300
Service Tax
Penalty	Various Years	CESTAT, Mumbai	1,955.62
	Various Years	CESTAT, Ahmedabad	132.14

(viii) There were no transactions relating to previously unrecorded income that were surrendered or disclosed as income in the tax assessments under the Income Tax Act, 1961 (43 of 1961) during the year.

(ix) (a)The Company has defaulted in repayment of loans and in the payment of interest thereon to a financial institution as shown below:

				(Rs. in Lakhs)
Nature of Borrowing including debt securities	Name of Lender	Amount not on a due date	Due Date	No. days delay or Unpaid
Principal amount with respect to
Term Loan Rs. 20,000 lakhs	JMFARC	1,000	30Jun20	1004
		1,000	30 Sept 20	912
		1,000	31 Dec 20	820
		1,000	31 Mar 21	730
		1,328	31 Mar 21	730
		1,000	30 Jun 21	639
		1,000	30 Sept 21	547
		1,000	31 Dec 21	455
		1,000	31 Mar 22	365
		2,466	31 Mar 22	365
		2,400	30Jun22	274
		2,400	30 Sept 22	182
		2,400	31 Dec 22	90
		2,400	31 Mar 23	1
Interest amount with respect to
Term Loan Rs. 20,000 lakhs	JMFARC	480	30Jun20	1004
		515	30 Sept 20	912
		453	31 Dec 20	820
		573	31 Mar 21	730
		614	30 Jun 21	639
		657	30 Sept 21	547
		695	31 Dec 21	455
		717	31 Mar 22	365
		650	30Jun22	274
		714	30 Sept 22	182
		772	31 Dec 22	90
		813	31 Mar 23	1
Principle amount with respect to
Term Loan Rs. 30,000 Lakhs	JMFARC	6,954	31 Mar 20	1095
		1,500	31 Mar 21	730
		3,000	31 Mar 22	365
		16,105	31 Mar 23	1
Interest amount with respect to
Term Loan Rs. 30,000 Lakhs	JMFARC	2,544	31 Mar 21	730
		2,983	31 Mar 22	365
		3,949	31 Mar 23	1
Principle amount with respect to
LIC Loan	LIC	83	30Jun14	3196
		83	30 Sept 14	3104
		83	31 Dec 14	3012
		83	31 Mar 15	2922
		42	30Jun15	2831
		42	30 Sept 15	2739
		42	31 Dec 15	2647
		42	31 Mar 16	2556
		42	30Jun 16	2465
		42	30 Sept 16	2373
		42	31 Dec 16	2281
		42	31 Mar 17	2191
		63	30Jun17	2100
		63	30 Sept 17	2008
		63	31 Dec 17	1916
		63	31 Mar 18	1826
		42	30Jun18	1735
		42	30 Sept 18	1643
		42	31 Dec 18	1551
		42	31 Mar 19	1461
		42	30Jun19	1370
		42	30 Sept 19	1278
		42	31 Dec 19	1186
		42	31 Mar 20	1095
		42	30Jun20	1004
		42	30 Sept 20	912
		42	31 Dec 20	820
		42	31 Mar 21	730
		63	30 Jun 21	639
		63	30 Sept 21	547
		63	31 Dec 21	455
		63	31 Mar 22	365
		02	31 Dec 14	3012
		21	31 Mar 15	2922
		07	30Jun15	2831
		07	30 Sept 15	2739
		07	31 Dec 15	2647
		07	31 Mar 16	2556
		07	30Jun16	2465
		07	30 Sept 16	2373
		07	31 Dec 16	2281
		07	31 Mar 17	2191
		11	30Jun17	2100
		11	30 Sept 17	2008
		11	31 Dec 17	1916
		11	31 Mar 18	1826
		11	30Jun18	1735
		11	30 Sept 18	1643
		11	31 Dec 18	1551
		11	31 Mar 19	1461
		14	30Jun 19	1370
		14	30 Sept 19	1278
		14	31 Dec 19	1186
		14	31 Mar 20	1095

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

(c) The Company has not taken any term loan during the year and there are no unutilised term loans at the beginning of the year and hence, reporting under clause (ix)(c) of the Order is not applicable.

(d) The Company has not raised any funds during the year on short term basis. Therefore reporting under clause 3(ix)(d) of the Order is not applicable.

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

(f) According to the information and explanations given to us and procedures performed by us, we report that the Company has not raised any new loans during the year on the pledge of securities held in its subsidiaries.

(x) (a) The Company has not raised any moneys by way of Initial public offer or further Public offer (Including debt instruments), during the year and hence reporting under Clause (x) (a) of Para 3 of the Order is not applicable to the Company.

(b) The Company has not made any preferential allotment or private placement of share or fully convertible debentures (fully, partially or optionally convertible) during the year and accordingly provisions of clause (x)(b) of Para 3 of the Order are not applicable to the Company

(xi) (a) On the basis of our examination and according to the information and explanations given to us, no fraud by the Company or any material fraud on the Company has been noticed or reported during the year, nor have we been informed of any such case by the management.

(b) To the best of our knowledge, 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.

(c) As represented to us by the management, there are no whistle blower complaints received by the Company during the year.

(xii) The Company is not a Nidhi Company and accordingly provisions of clause (xii)of Para 3 of the order are not applicable to the Company.

(xiii) On the basis of our examination and according to the information and explanations given to us, we report that all the transaction with the related parties are in compliance with Section 177 and 188 of the Act, and the details have been disclosed in the Standalone Financial Statements in Note 34(b) as required by the applicable Indian 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 the nature, timing and extent of our audit procedures.

(xv) According to the information and explanations given to us, in our opinion during the year the Company has not entered into any non -cash transactions with directors or persons connected with the directors and hence provisions of Sec 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 and accordingly, provisions of clause (xvi) of Para 3 of the Order are not applicable to the Company.

(b) During the year, the Company has not conducted any Non-Banking Financial or Housing Finance activities and accordingly, provisions of clause (xvi)(b) of Para 3 of the Order are not applicable to the Company.

(c) The Company is not a Core Investment Company (CIC) as definedin the Regulations made by the Reserve Bank of India and accordingly the provisions of clause (xvi) of Para 3 of the Order is not applicable to the Company.

(d) The group does not have any CIC as a part of the group and accordingly reporting under clause (xvi)(d) of Para 3 of the Order is not applicable to the Company.

(xvii) The Company has incurred cash losses during the financialyear amounting to Rs 11,399.39 lakhs covered by our audit and Rs 8,438.91 lakhs in the immediately preceding financial year.

(xviii) There has been no resignation of the statutory auditors of the Company during the year.

(xix) According to the information and explanations given to us and 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 our knowledge of the Board of Directors and Management plans and based on our examination of the evidence supporting the assumptions, we are of the opinion that material uncertainty exists as on the date of the audit report that Company may not be 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. (Refer ‘Material uncertainty related to going concern provided in the standalone audit report).

(xx) The Company was not having net worth of rupees five hundred crore or more, or turnover of rupees one thousand crore or more or a net profit of rupees five crore or more during the immediately preceding financial year and hence, provisions of Section 135 of the

Act are not applicable to the Company during the year. Accordingly, reporting under clause 3(xx) of the Order is not applicable for the year.

(xxi) According to the information and explanations given to us, and based on the CARO reports issued by the auditors of the subsidiaries, included in the consolidated financialstatements of the Company, to which reporting under CARO is applicable, provided to us by the Management of the Company and based on the identification of matters of qualifications or adverse remarks in their CARO reports by the respective component auditors and provided to us, we report that the auditors of such companies have not reported any qualifications or adverse remarks in their CARO report.

"ANNEXURE B" TO THE INDEPENDENT AUDITORS REPORT

OF EVEN DATE ON THE STANDALONE FINANCIAL STATEMENTS OF NITCO LIMITED.

REPORT ON THE INTERNAL FINANCIAL CONTROLS wITH REFERENCE TO FINANCIAL STATEMENTS UNDER CLAUSE (I) OF SUBSECTION 3 OF SECTION 143 OF THE COMPANIES ACT, 2013 (“the Act”)

1. Opinion

We have audited the internal financial controls with reference to Financial Statements of Nitco Limited ("the Company") as of March 31, 2023 in conjunction with our audit of the Standalone Financial Statements of the Company for the year ended on that date.

In our opinion, the Company has, financial controls with reference to Standalone Financial all material respects, adequate internal Statements and such controls were operating effectively as at March 31,2023, 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 issued by the Institute of Chartered Accountants of India (ICAI).

2. Managements Responsibility for Internal Financial Controls

The Companys management is responsible for establishing and maintaining internal financial controls based on the internal controls with reference to Standalone Financial Statements 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 Act.

3. Auditors Responsibility

Our responsibility is to express an opinion on the Companys internal financial controls with reference to Financial Statements 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") issued by Institute of Chartered Accountants of India and the Standards on Auditing 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 with reference to Financial Statements were 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 with reference to Financial Statements and their operating effectiveness. Our audit of internal financial controls with reference to Financial Statements includes obtaining an understanding of such internal financial controls, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.

The procedures selected depend on the auditors judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

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

4. Meaning of Internal Financial Controls with reference to Financial Statements

A Companys internal financial control with reference to Financial Statements 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 with reference to Financial Statements includes those policies and procedures that:

(1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorisations of management and directors of the Company; and

(3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the Companys assets that could have a material effect on the financial statements.

5. Inherent Limitations of Internal Financial Controls with reference to Financial Statements

Because of the inherent limitations of internal financial controls with reference to Financial Statements, 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 with reference to Financial Statements to future periods are subject to the risk that the internal financial control because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

For M M NISSIM & CO. LLP

Chartered Accountants

Firm Reg.No.107122W / W100672

N Kashinath

Partner

Membership No.036490

UDIN: 23036490BGXRZB1197

Place: Mumbai

Date: 30^th May, 2023.