Sangam Health Care Products Ltd Auditors Report.

To the Members of SANGAM HEALTH CARE PRODUCTS LIMITED.

Report on the Financial Statements

We have audited the accompanying financial statements of SANGAM HEALTH CARE PRODUCTS LIMITED, which comprise the Statement of Financial Position as at March 31, 2019 and the Statement of Profit and Loss and Other Comprehensive for the year ended 31st March 2019, and a summary of significant accounting policies and other explanatory information.

Managements Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position and financial performance of the Company in accordance with the Indian Accounting Standards referred to in Section 133 of the Companies Act, 2013 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control 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.

Auditors Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. 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. In making those risk assessments, the auditor considers internal control relevant to the Companys preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a) In the case of the Statement of Financial Position( Balance Sheet), of the state of affairs of the Company as at March 31, 2019;

b) In the case of the Statement of Profit and Loss and Other Comprehensive Income, Operating and Non Operating profit for the year ended on that date March 31, 2019;

c) In the case of cash flow, the movement of cash in the company for the period

d) In case of Changes in Equity, the movement of net flows in other Equity for the period.

Emphasis of Matter Paragraph

As referred to Note no: 26, relating to balances due from and due by the company towards Long Term / Short Term borrowings, debtors, advances, other current assets and current liabilities in respect of which confirmations have not been received. Pending receipt of confirmation of balances and consequent adjustments arising on account of such reconciliations if any, including differences arising on account of netted off balances of certain debtors, advance from customers and creditors, if any and the resultant impact on the financial statements including the operating results is not ascertainable at this stage.

Our Opinion is not qualified in respect of these matters. Report on Other Legal and Regulatory Requirements

1. This report include a statement on the matters specified in paragraphs 3 and 4 of the Companies (Auditors Report) Order 2016, issued by the Department of Companies Affairs, in terms of sub section (11) of section 143 of the Companies Act 2013, since in our opinion and according to the information and explanations given to us, the said order is applicable to the company.

2. As required by section 143(3) of the Companies Act, 2013, we report that:

a) We have 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 account as required by law have been kept by the Company so far as appears from our examination of those books

c) The Statement of Financial Position and Statement of Profit and Loss, dealt with by this Report are in agreement with the books of account.

d) In our opinion, the Statement of Financial Position and Statement of Profit and Loss comply with the Accounting Standards referred to in Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014.

e) On the basis of written representations received from the directors as on March 31, 2019, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2019, from being appointed as a director in terms of sub section 2 of section 164 of the Companies Act, 2013.

f) With respect to the other matters to be included in the Auditors Report in accordance with Rule.11 Of the Companies (Audit and Auditors) Rules,2014, in our Opinion and to the best of our information and according to the explanation given to us

i. The Company doesnt have any pending litigations which would impact its financial position.

ii. The Company didnt have any long term contracts including derivative contracts for which there were any material foreseeable losses.

iii. There were no amounts which were required to be transferred to the Investor Education and Protection fund by the company.

Annexure to the Auditors Report

The annexure as referred in ‘Report on other Legal and Regulatory requirements of our independent auditors report to the members of SANGAM HEALTH CARE PRODUCTS LIMITED on the financial statements for the year ended March 31, 2019, we report that

i. a) The company has maintained proper records showing full particulars including quantitative details and situation of its principal fixed assets.

b) Other than the location of furniture and fixture and office equipments, which are under compilation, accordingly the fixed assets are physically verified by the management according to the programme of periodical verification in a phased manner, designed to cover all items over a period of one year which, in our opinion, is reasonable having regards to the size of the company and the nature of its assets. Pursuant to the management during the year and no material discrepancies have been noticed on such verification.

c) The Title Deed of the Immovable property as disclosed in Schedule III of Financial statements are held in the Name of Company as at the Balance Sheet date.

Particulars Land Factory Building
Gross Block as on 31st March,2019 7,90,50,000 6,51,30,130
Net Block as on 31st March,2019 7,90,50,000 3,87,80,053

ii. The inventory other than in transit has been physically verified at reasonable intervals during the year by the management. In our opinion, the frequency of such verification is adequate.

iii. The Company has not granted any loans, secured or unsecured, to companies, firms or other parties covered in the register maintained under section 189 of the Companies Act, 2013.

iv. According to the information and explanations given to us, the Company has not given any guarantees for loans taken by Directors from banks and financial institutions, and no investments, Guarantees, Securities given by the company.

v. The Company has not accepted any deposits during the year from the public within the meaning of the provisions of Section 73 to 76 or any other relevant provisions of the Companies Act, 2013 and rules made there under. Hence, the Clause (v) of the order is not applicable.

vi. The Central Government has not prescribed maintenance of the cost records under Section 148(1) of the Companies Act, 2013 in respect to the Companys product. Hence, the Clause (VI) of the order is not applicable.

vii. a) According to the information and explanations given to us and the records examined by us, the Company is not regularly in depositing with appropriate authorities in respect of provident fund, employees state insurance, wealth tax, income-tax, goods and services tax and other statutory dues wherever applicable, undisputed arrears of statutory dues were outstanding as at 31st March 2019.

b) According to the information and explanations given to us, there are dues of Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Sales Tax, Wealth Tax, Goods and Services Tax, Excise Duty and Cess which have not been deposited on account of any dispute.

c) On the basis of our examination the following are the undisputed statutory dues which were arrears as at 31st march, 2018.

Name of the statute Nature of dues Amount (Rs. In lakhs) Period to which the amount relates Remarks
The Employees Provident Funds And Miscellaneous Provisions Act,1952 Provident Fund 3.98 March 2019 Not Deposited
Employees State Insurance Act,1948 ESI 9.53 Sep 2016 & Apr 2017 Not Deposited

viii. Based on our audit procedures and the information and explanations given by the management, we are of the opinion that the company has not defaulted in repayment of dues to banks.

ix. The nature of Company is Public limited, the Company has not raised any money by way of Initial Public offer, further public offer including debt instruments during the year. Accordingly the provisions of Clause 3(ix) of the Order not applicable to the Company.

x. On the basis of our examination and according to the information and explanations given to us, no fraud, on or by the Company, has been noticed or reported during the year.

xi. According to the information and explanations given to us and based on our examination of the records, 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 of the act.

xii. On the basis of our examination the company is not a Nidhi company hence the paragraph 3(xiii) of the order is not applicable.

xiii. In our opinion and according to the information and explanations given to us, the company entered into related party transactions (the details of such transactions were enclosed in the financial statements).

xiv. On the basis of our examination the company has not issued or allotted any preferential shares/debentures hence the paragraph 3(xiv) of the order is not applicable.

xv. In our opinion and according to the information and explanations given to us, the company didnt entered into non-cash transactions with directors or persons concerned and such transactions were disallowed while calculating the income tax as per Income Tax Act.

xvi. The nature of Business is such that, the Clause (xvi) of Order- Register under RBI Act 1934 is not applicable.

Annexure - B to the Auditors Report

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act")

We have audited the internal financial controls over financial reporting of SANGAM HEALTH CARE PRODUCTS LIMITED as of 31 March 2019 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 accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditors Responsibility

Our responsibility is to express an opinion on the Companys internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the "Guidance Note") and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditors judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

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

Meaning of Internal Financial Controls over Financial Reporting

A companys internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A companys internal financial control over financial reporting includes those policies and procedures that:

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

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

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

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31 March 2018, 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 K.R.Shekher & Co.,
Firm Registration Number: 010828S
Chartered Accountants
Sd/-
Hyderabad, May 30, 2019. Rajashekhar Kaparti
Partner M.No.214810