Omkar Speciality Chemicals Ltd Auditor Reports

To the Members of,

Omkar Speciality Chemicals Limited

Report on the Audit of the Financial Statements

Opinion

We have audited the annual financial results of OMKAR SPECIALITY CHEMICALS LIMITED (hereinafter referred to as the Company") for the year ended March 31, 2021 and the Balance Sheet and the Statement of Cash Flows as at and for the year ended on that date, attached herewith, being submitted by the Company pursuant to the requirement of Regulation 33 and Regulation 52 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended (the Listing Regulations).

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial results:

i. are presented in accordance with the requirements of Regulation 33 and Regulation 52 of the Listing Regulations in this regard; and

ii. give a true and fair view in conformity with the recognition and measurement principles laid down in the applicable accounting standards prescribed under Section 133 of the Companies Act, 2013 (the "Act") and other accounting principles generally accepted in India, of net profit and other comprehensive income and other financial information of the Company for the year ended March 31, 2021 and the balance sheet and the statement of cash flows as at and for the year ended on that date.

Basis for Qualified Opinion

1. The Company has negative net worth of Rs.15,833.56Lacs as on 31stMarch 2021. The financial statements have been prepared assuming that the Company will continue as a going concern. Also, the financial results do not include any adjustments that might result from the outcome of the qualifications as per the succeeding paragraphs.

2. We draw attention to foot note of the accompanying Statement, regarding non-recognition of interest expense on borrowings and reversal of accrued and due interest expenses of the Company. Company bankers providing long term and working capital finance( Short term) namely Bank of Baroda and Axis Bank, has classified all the facilities being extended to the Company as ‘Non-Performing Assets. During the year ended 31st March 2021, the Company has not provided interest expenses amounting Rs.2,064.08Lacs for the year ended on 31st March 2021 respectively, on various credit facilities/ loans which is not in accordance with the requirement of Ind AS 23: ‘Borrowing Cost read with Ind AS 109: ‘Financial Instruments. Due to this, loss for year ended on 31st March 2021 has been understated by Rs.2,064.08 Lacs and Net Worth of the Company as on 31st March 2021 has been overstated by Rs. 2064.08Lacs.

3. Consequent upon NPA of accounts of company, the lender had auctioned the mortgaged properties and realisation of the proceeds amounting to Rs.2,016.68 has been adjusted towards unapplied interest. However, the Company is in discussion with its Bankers for settlement of the dues (inclusive of interest and other charges, if any) by way of suitable structures which is under discussion and delayed due to current Covid-19 pandemic. Hence the company has reported said realisation of proceeds from auctioned properties under current assets instead of adjusting the same with unapplied interest. Due to this, loss for year ended on 31st March 2021 has been understated by Rs.2,016.68 Lacs and Net Worth of the Company as on 31st March 2021 has been overstated by 2016.68 lacs.

4. The Internal Financial Control over Financial Reporting (IFCR) in the Company is required to strengthen significantly. Adequate IFCR policies and procedures should be laid down, made operational and overall internal controls and operating effectiveness needs to be strengthened.

5. Bank of Baroda has recovered an amount of Rs. 25.51 lacs from the Company in the year ended 31st March 2021. The Company has charged this amount to the statement of profit and loss and has classified this amount under Finance expenses during the year ended 31st March 2021. The Company has not provided us any documentary evidence to enable us to ascertain the nature of this amount. As the nature of this amount cannot be ascertained, we are unable to quantify its impact on the statement of profit and loss of the Company for the year ended 31st March 2021.

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. We have determined the matters described below to be key audit matters to be communicated in our report.

Description of Key Audit Matters

The Key Audit Matter	How the matter was addressed in our audit
Revenue Recognition
Revenue is recognised when the control of the product being sold has transferred to the customer. Therefore, there is a risk of revenue being overstated on account of variation in the timing of transfer of control due to the pressure management may feel to achieve performance targets at the reporting period end.	In view of the importance of the matter we applied the following audit procedures in this area, among others to obtain sufficient audit evidence:
	• Evaluating the process followed by the company for revenue recognition including understanding and testing of key controls relating to recognition of revenue in correct period.
	• Inspecting documentation/records for sales transactions recorded both side of year-end to determine if revenue has been recognised in the correct period and
	• Critically assessing manual journals posted to revenue to identify unusual or irregular items.
Inventories
As of 31st March 2021, the company held Rs. 132.06 lacs of inventory. Given the size of the inventory balance relative to the total assets of the Company and the estimates and judgements described below, the valuation of inventory required significant audit attention.	We have performed the following procedures over the valuation of inventory:
As disclosed in Note to accounts, inventories are held at lower of cost or net realizable value using the FIFO method. At the year end, the valuation of inventory is reviewed by the Management and the cost of inventory is reduced where inventory is forecast to be sold below cost.	1. For a sample of inventory items, re- performed the First in First Out (FIFO) calculation and compared the FIFO cost to the last purchase invoices.
The determination of whether inventory will be realized for a value below cost requires management to exercise judgement and apply assumptions. Management undertakes the following procedures for determining the level of write down required:	2. We tested the ageing report used by management correctly aged inventory items by agreeing a sample of aged inventory items to the last recorded invoice.
1. Use Inventory ageing reports together with historical trends to estimate likely future saleability of slow moving and older inventory lines.	3. On a sample basis we tested the net realizable value of inventory lines to recent selling prices. 4. We re-performed the calculation of inventory write-down.
2. Perform a line-by-line analysis of remaining inventory to ensure it is stated at the lower of cost and net realizable value and a specific write down is recognized if required.	We also made enquiries of management, including those outside of the finance function, and considered the results of our testing above to determine whether any specific write downs were required. For the procedures performed we have no matters to report
Going Concern Assessment
The Group has current liabilities of Rs. 17,722.09 Lakhs and current assets of Rs. 4,632.18 Lakhs as of March 31, 2021. Current liabilities exceed current assets as at the year end. Given the nature of its business and a significant composition of cost-plus contracts leading to significant stability of cashflows and profitability, management is confident of refinancing and consider the liquidity risk as low and accordingly, the Group uses significant short-term borrowings to reduce its borrowing costs.	Our procedures, amongst others, included the following:
Management has made an assessment of the Groups ability to continue as a Going Concern as required by Ind AS 1 "Presentation of Financial Statements" considering all the available information and has concluded that the going concern basis of accounting is appropriate.	• Obtained an understanding of the process and tested the internal controls associated with the managements assessment of Going Concern assumption.
Going Concern assessment has been identified as a key audit matter considering the significant judgements and estimates involved in the assessment and its dependence upon managements ability to complete the planned divestments, raising long term capital and/or successful refinancing of certain current financial obligations.	• Discussed with management and assessed the assumptions, judgements and estimates used in assessment having regards to past performance and current emerging business trends affecting the business and industry.
	• Assessed the Groups ability to refinance its obligation based on the past trends, credit ratings, ability to generate cash flows and access to capital.
	• Assessed the adequacy of the disclosures in the consolidated Ind AS financial statements.

Emphasis of Matter

Consequent upon NPA of accounts of company, the lender had auctioned the mortgaged properties and realisation of the proceeds has been adjusted towards unapplied interest. However, the Company is in discussion with its Bankers for settlement of the dues (inclusive of interest and other charges, if any) by way of suitable structures which is under discussion and delayed due to current covid - 19 pandemic. Hence the company has reported said realisation of proceeds from auctioned properties under current assets instead of adjusting the same with unapplied interest.

Other Matters

The continuous spreading of COVID -19 across India has resulted in restriction on physical visit to the client locations and the need for carrying out alternative audit procedures as per the Standards on Auditing prescribed by the Institute of Chartered Accountants of India (ICAI). As a result of the above, the entire audit was carried out based on remote access of the data as provided by the management of the Company. This has been carried out based on the advisory on "Specific Considerations while conducting Distance Audit/ Remote Audit/ Online Audit under current Covid-19 situation" issued by the Auditing and Assurance Standards Board of ICAI. We have been represented by the management of the Company that the data provided for our audit purposes is correct, complete, reliable and are directly generated by the accounting system of the Company without any further manual modifications.

We bring to the attention of the users that the audit of the financial statements has been performed in the aforesaid conditions.

Our audit opinion is not modified in respect of the above.

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 is materially inconsistent with the financial statements or our knowledge obtained in the 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.

Managements Responsibility for the Standalone Financial Statements

These financial results have been prepared on the basis of the annual financial statements. The Companys Board of Directors are responsible for the preparation and presentation of these financial results that give a true and fair view of the net profit and other comprehensive income and other financial information of the Company and the balance sheet and the statement of cash flows in accordance with the recognition and measurement principles laid down in the Indian Accounting Standards prescribed under Section 133 of the Act read with relevant rules issued thereunder and other accounting principles generally accepted in India and in compliance with Regulation 33 and Regulation 52 of the Listing Regulations. The Board of Directors of the Company are responsible for 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 the design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error, which have been used for the purpose of preparation of the financial results by the Directors of the Company, as aforesaid.

In preparing the financial results, the Board of Directors of the Company are responsible for assessing the ability of the Company 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 of the Company are responsible for overseeing the financial reporting process of the Company.

Auditors Responsibilities for the Audit of the Standalone Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial results 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 financial results.

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

a. Identify and assess the risks of material misstatement of the financial results, 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.

b. 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 with reference to financial statements in place and the operating effectiveness of such controls.

c. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Board of Directors.

d. Conclude on the appropriateness of the Board of Directors 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 disclosur es in the financial results 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.

e. Evaluate the overall presentation, structure and content of the financial results including the disclosures, and whether the financial results 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.

Report on Other Legal and Regulatory Requirements

As required by the Companies (Auditors Report) Order, 2016 (‘the Order) issued by the Central Government of India in terms of Section 143(11) of the Act, we give in the "Annexure 1" a statement on the matters specified in paragraphs 3 and 4 of the Order.

1. As required by Section 143(3) of the Act, we report that:

a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit.

b) In our opinion, proper books of accounts 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 change in equity and the Cash Flow Statement dealt with by this Report are in agreement with the relevant books of account.

d) In our opinion, the aforesaid financial statements comply with Ind AS specified under Section 133 of the Act.

e) On the basis of the written representations received from the directors and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2021, from being appointed as a director 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 2" to this report.

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

a) The Company has disclosed the impact of pending litigations as at March 31, 2020 on its financial position in its standalone financial statements.

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

c) There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company

2. 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.

1) In our opinion and to the best of our information and according to the explanation given to us, the remuneration paid/ provided by the company to its directors during the year is in accordance with the provisions of Section 197 of the Act. The remuneration paid to any directors is not in excess of the limit laid down U/s 197 of the IT Act. The Ministry of Corporate Affairs has not prescribed other details U/s 197 (16) which requires to be commented by us.

	For P S V Jain & Associates
	Chartered Accountants
	Firms Registration no. 131505W
	Sd/-
Mumbai	CA Dularesh Kumar Jain
Date: June 30, 2021	Partner
	Membership no. 137264

ANNEXURE A TO THE INDEPENDENT AUDITORS REPORT:

The Annexure referred to in Independent Auditors Report to the members of the Company on the financial statements for the year ended March 31, 2021, we report that:

1. In respect of the Companys property, plant and equipment:

a. The Company has maintained proper records showing full particulars, including quantitative details and situation of its fixed assets.

b. The Company has a regular programme of physical verification of its property plant and equipment by which fixed assets are verified in a phased manner over a period of three years. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets. In accordance with this programme, certain property plant and equipment were verified during the year and no material discrepancies were noticed on such verification.

c. According to the information and explanations given to us and on the basis of our examination of the records of the company, the title deeds of immovable properties are held in the name of the Company, other than those mentioned below.

			(Rs. in lakhs)
Sr. no,	Particulars	Original Cost	Written down value
1	Land	111.45	103.94

2. The management has conducted physical verification of inventory at reasonable intervals during the year. As explained to us, the discrepancies noticed on verification between the physical stocks and the book records were not material and have been properly dealt with in the books of account.

3. According to the information and explanations given to us, the Company has not granted any loans, secured or unsecured, to companies, firms or other parties covered in the register maintained under sec 189 of the Companies act, 2013.

4. In our opinion and according to the information and explanations given to us, the Company has not granted any loans, secured or unsecured or provided any guarantees or security to parties covered under section 185 of the Act. The Company has not granted loans, no investments has been made, no guarantees or security are given to parties covered under section 186 of the Act. Accordingly, paragraph 3 (iv) of the Order is not applicable to the Company.

5. The Company has not accepted any deposits from the public. Hence the provisions of Sections 73 to 76 of the Act and rules framed there under are not applicable to the company.

6. We have broadly reviewed the books of accounts and records maintained by the Company pursuant to the Rules prescribed by the Central Government under sub section (1) of section 148 of the Act and are of the opinion that prima facie the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the records.

7. 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 Provident fund, Employees State Insurance, Income-tax, Sales tax, Service tax, Goods and Services tax, duty of Customs, duty of Excise, Value added tax, Cess and other material statutory due, there have been delay in payment of these dues in some cases.

According to the information and explanations given to us, no undisputed amounts payable in respect of Provident fund, Employees State Insurance, Income-tax, Sales tax, Service tax, Goods and Services tax, duty of Customs, duty of Excise, Value added tax, Cess and other material statutory dues were in arrears as at 31 March 2021, for a period of more than six months from the date they became payable.

Particulars	Amount (in Rs.)
TDS (Income Tax)	1,97,735
Provident Fund	5,50,044
Profession Tax	41,996
ESIC	31,580

b. According to the information and explanations given to us, there are no material statutory dues which have not been deposited with the appropriate authorities on account of any dispute, other than the following dues of Income Tax, Excise Duty and Value Added Tax:

Sr. no.	Name of the statute	Nature of the dues	Financial year	Forum where dispute is pending	Amount (Rs. in lakhs) including interest and penalty
1	Income Tax Act 1961	Income Tax	2009-10	Commissioner of Income Tax (A)	10.89
2	Income Tax Act 1961	Income Tax	2010-11	Commissioner of Income Tax (A)	779.76
3	Income Tax Act 1961	Income Tax	2011-12	Commissioner of Income Tax (A)	109.25
4	Income Tax Act 1961	Income Tax	2012-13	Commissioner of Income Tax (A)	37.34
5	Income Tax Act 1961	Income Tax	2014-15	Commissioner of Income Tax (A)	18.61
6	Central Sales Tax, 1956	CST	2009-10	Sales Tax Tribunal	26.83
7	Value Added Tax, 2002	VAT	2011-12	Sales Tax Tribunal	222.48
8	Value Added Tax, 2002 and Central Sales Tax Act 1956	VAT & CST	2013-14	Sales Tax Tribunal	CST Liability: 84.4 VAT Liability: 96.15

8. In our opinion and according to the information and explanations given to us, details of defaults in repayment of dues to Banks is as under:

Sr. No.	Name of Bank	Nature of Facility	Nature of overdue	Overdue Amount ( Rs. in lakhs)	Default in number of days
1	Bank of Baroda	Term Loan	Principal and Interest	3,791	384 to 1154
2	Bank of Baroda	Cash Credit	Principal and Interest	10,760	396 to 1170
3	NKGSB	Cash Credit	Principal and Interest	3,282	1 to 851
4	Axis Bank	Cash Credit	Principal and Interest	1,037	376 to 1170

Note - Overdue Amount does not includes unapplied interest if any due to classification loan as NPA by the lender.

In our opinion and according to the information and explanations given to us, the Company does not have any loans or borrowings from government and has not issued any debentures.

9. The Company did not raise any money by way of initial public offer or further public offer (including debt instruments) and term loans during the year. Accordingly, paragraph 3 (ix) of the Order is not applicable.

10. 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

11. According to the information and explanations give to us and based on our examination of the records of the company, the company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Act.

12. In our opinion and according to the information and explanations given to us, the company is not a nidhi company. Accordingly, paragraph 3(xii) of the order is not applicable.

13. 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. The details of such related party transactions have been disclosed in the financial statements as required under Indian Accounting standard (IND AS) 24, Related Party Disclosure specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules 2014.

14. According to the information and explanations give to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.

15. According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into non-cash transactions with directors or persons connected with him. Accordingly, paragraph 3(xv) of the Order is not applicable xvi. The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act 1934. Accordingly, paragraph 3(xvi) of the Order is not applicable.

	For P S V Jain & Associates
	Chartered Accountants
	Firms Registration no. 131505W
	Sd/-
Mumbai	CA Dularesh Kumar Jain
Date: June 30, 2021	Partner
	Membership no. 137264

ANNEXURE B TO INDEPENDENT AUDITORS REPORT

Referred to in paragraph 10(f) of the Independent Auditors Report of even date to the members OMKAR SPECIALITY CHEMICALS LIMITED on the financial statements for the year ended March 31, 2021

Report on the internal financial controls under clause(i) of sub-section 3 of section 143 of the Act

We have audited the internal financial controls over financial reporting OMKAR SPECIALITY CHEMICALS LIMITED (‘the Company) as of March 31, 2021, in conjunction with our audit of the financial statements of the Company for the year ended on that date.

Managements responsibility for internal financial controls

The Companys Management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (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 accur acy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.

Auditors responsibility

Our responsibility is to express an opinion on the Companys internal financial controls over financial r eporting 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 deemed to be prescribed under section 143(10) of the Act 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 ICAI. 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 design ed 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.

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.

Qualified Opinion

In our opinion, except for the material weakness described below in the Basis for Qualified Opinion paragraph, the Company has an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2021, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note issued by the ICAI. We have considered the material weakness identified and reported above in determining the nature, timing and extent of audit tests applied in our audit of the financial statements of the Company for the year ended March 31, 2021, and the material weakness has affected our opinion on the standalone financial statements of the Company, and we have issued a qualified opinion on the standalone financial statements.

Basis of qualified opinion

In our opinion, according to the information and explanations given to us and based on our audit procedures performed, the following material weakness has been identified in the operating effectiveness of the Companys internal financial controls over financial reporting as at March 31, 2021:

The Company does not have in place adequate standard operating procedures in place for its day-to-day operations and thus we are unable to comment on the design and operating effectiveness of the internal controls in the Company pertaining to its operations. This in turn has an impact on the internal financial controls over financial reporting. The Internal Financial Controls Over Financial Reporting (IFCR) in the Company requires to be strengthened significantly. Adequate IFCR policies, procedures should be laid down and overall internal controls and its operating effectiveness needs to be incorporated.

In our opinion, the above-mentioned qualifications, could result in a potential material misstatement to the carrying value of Inventory, trade receivables and trade payables, and consequently, could also impact the loss (financial performance including comprehensive income) after tax.

A ‘material weakness is a deficiency, or a combination of deficiencies, in internal financial control over financial reporting, such that there is a reasonable possibility that a material misstatement of the companys annual financial statements or interim financial statements will not be prevented or detected on a timely basis.

	For P S V Jain & Associates
	Chartered AccountantsFirms
	Registration no. 131505W
	Sd/-
Mumbai	CA Dularesh Kumar Jain
Date: June 30, 2021	Partner
	Membership no. 137264