Railtel Corporation of India Ltd Directors Report.

To

The Members of

RailTel Corporation of India Ltd.

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the accompanying standalone financial statements of RailTel Corporation of India Limited ("the Company"), which comprise the Standalone Balance Sheet as at March 31, 2020, the Standalone Statement of Profit and Loss (including Other Comprehensive Income), the Standalone Statement of Changes in Equity and Standalone Statement of Cash Flows for the year then ended, and notes to the Standalone financial statements including a summary of the significant accounting policies and other explanatory information (hereinafter referred to as "standalone financial statements").

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013 ("the Act") in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, ("Ind AS") and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2020, its profit and other comprehensive income, changes in equity and its cash flows for the year ended on that date.

Basis for opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. Our responsibilities under those SAs 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 ethical 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 Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Emphasis of Matter

We draw attention to Item no. 19 and 23 of Note no. 42 to the Standalone financial statements regarding NE project with a total estimated expenditure of Rs.45125 lakhs and anticipated subsidy of Rs.38800 lakhs. The company has however, incurred total capital expenditure of Rs. 31107 Lakhs and has received a subsidy of Rs.3146 lakhs only. Further, the company has transferred material amounting to Rs. 1172 lakhs to other projects/regions. As the project is on hold, the company has recognized an impairment loss of Rs.4930 Lakhs based on an impairment study carried out by an independent consultant which has been disclosed under the head Exceptional Items in Statement of Profit & Loss.

However, our opinion is not modified in respect of matter stated above as Emphasis of Matter.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone Ind AS financial statements of the current period. These matters were addressed in the context of our audit of the standalone Ind AS 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 the key audit matters to be communicated in our report -

S. No. Key Audit Matter How our audit addressed the key audit matters
1. Expected Credit Loss for Trade Receivables We have obtained an understanding of the companys credit policy along with the applications controls associated with the accuracy of the information included in the debtors ageing report.
The company has applied simplified approach to measure ECL for trade receivables, which allows for lifetime expected credit losses to be recognised from initial recognition of the receivables. The company determines the expected credit losses on trade receivables by using a provision matrix that is based on historical credit loss experience, adjusted for forward looking factors to the debtors and the economic environment.
We evaluated the companys process of ECL calculation including the techniques suggested by the experts involved therein.
We assessed the reasonableness of the assumptions used in ECL calculation by comparing them with the historic data adjusted for current market condition and forward-looking information.
Due to significance of trade receivables and the complexity involved in the ECL calculation, this was considered as a key audit matter. We have also considered the disclosures made by the company under the head credit risk.
(Refer Item no. 27 of note no. 42 to the standalone financial statements) Based on the above procedure performed, the management estimations and judgement in ECL were found to be reasonable.
2. Contingent Liabilities We have adopted the following audit procedures-
There are a number of litigations pending before various forums against the Company and the managements judgement is required for estimating the amount to be disclosed as contingent liability. Understood and tested the design and operating effectiveness of controls as established by the management for obtaining all relevant information for pending litigation cases
We identified this as a key audit matter because the estimates on which these amounts are based involve Discussed with the management any material developments and latest status of legal matters
a significant degree of management judgement in interpreting the cases and it may be subject to management bias. Read various correspondences and related documents pertaining to litigation cases and performed substantive procedures on calculations supporting the disclosure of contingent liabilities
(Refer item no. 24.1(a) of note no. 42 to the standalone financial statements) Assessed the adequacy and completeness of disclosures
Based on the above procedure performed, the estimations and disclosure of contingent liabilities are considered to be adequate and reasonable.
Our audit procedures on adoption of Ind AS 116 include:
Assessed and tested new processes and controls in respect of the lease accounting standard (Ind AS 116)
3 Accuracy of recognition, measurement, presentation and disclosures of leases and other related adjustments in view of adoption of Ind AS 116 - Leases (New Ind AS)
We have assessed the companys evaluation on identification of leases based on the contractual agreements and method adopted and related adjustments made on transition dated i.e. 1st April 2019.
The Company has adopted Ind AS 116 Leases (Ind AS 116) in the current year. The application and transition to this accounting standard is complex and is an area of focus in our audit. We have considered the report of independent agency involved for assessment of key terms and conditions of each lease with the underlying lease contract, computation of lease liability and reconciling the companys operating lease commitments to data used in computing ROU assets as on transition date.
We have evaluated the reasonableness of the discount rate applied in determining the lease liability.
Ind AS 116 introduces a new lease accounting model, wherein lessees are required to recognise a right-of-use (ROU) asset and a lease liability arising from a lease on the balance sheet. The lease liabilities are initially measured by discounting future lease payments during the lease term as per the contract/ arrangement. Adoption of the standard involves significant judgements and estimates including, determination of the discount rates and the lease term. On a sample basis, we assessed the terms and conditions of lease with the underlying lease contracts and evaluated computation of lease liabilities. We assessed the presentation and disclosure relating to Ind AS 116.
Refer item no. 29 to Note 42 to the standalone financial statements read with the Accounting Policy no. 9) Based on the above procedure performed, the presentations and disclosure relating to Ind AS 116 was found to be adequate

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 companys Annual Report 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 when it becomes available to us and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated.

When we read such other information as and when made available to us and if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance. We have nothing to report in this regard.

Responsibilities of Managements and those charged with Governance 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 a true and fair view of the financial position, financial performance, total comprehensive income, changes 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 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 are also responsible for overseeing the Companys financial reporting process.

Auditors Responsibilities 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 judgment and maintain professional skepticism 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 system in place and the operating effectiveness of such controls.

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

• Conclude on the appropriateness of managements use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Companys ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors report. However, future events or conditions may cause the Company to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the 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.

Other Matters

We did not audit the separate financial statements of Eastern Region, Western region and Southern Region included in these standalone financial statements; whose financial statements reflect total assets of Rs. 107543 Lakhs, total liabilities of Rs. 35173 Lakhs as at 31st March 2020 and total revenues of Rs. 77409 Lakhs for the year ended on that date, as considered in these standalone financial statements. The company had prepared separate set of statutory financial statements of these regional offices for the year ended 31st March 2020 in accordance with accounting principles generally accepted in India and which have been audited by other auditors appointed by the CAG under generally accepted auditing standards applicable in India. Our opinion in so far as it relates to the amounts and disclosures in respect of these regional offices is solely based on reports of other auditors. Our opinion is not qualified in respect of this matter. Further, Audit of the financial statements of Northern Region and Corporate Office have been audited by us.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditors report) Order, 2016 ("the Order") issued by the Central Government of India in terms of section 143 (11) of the Act, and on the basis of such checks of the books and records of the company as we considered appropriate and according to information and explanation given to us, we give in the "Annexure-A", a statement on the matters specified in paragraphs 3 and 4 of the Order.

2. The Comptroller and Auditor General of India has issued directions indicating the areas to be examined in terms of subsection (5) of Section 143 of the Companies Act 2013. On the basis of written representation received from the management, we give our report on the matters specified in the Annexure - B

3. 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 account as required by law have been kept by the Company so far as it appears from our examination of those books;

c. The standalone financial statements i.e. Balance Sheet, Statement of Profit and Loss including the Statement of Other Comprehensive Income, the statement of Cash Flow and Statement of Changes in Equity 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 Indian Accounting Standards specified under section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015, as amended;

e. Pursuant to the notification no. G.S.R. No. 463(E) dated 05th June 2015 issued by Ministry of Corporate Affairs, Government of India, the provisions of section 164(2) of the Companies Act 2013 regarding disqualification of directors, are not applicable to the company, being a government company.

f. We are enclosing herewith a report in "Annexure-C" for our opinion on adequacy of internal financial controls system in place in the Company and the operating effectiveness of such controls

g. Pursuant to the Notification No. GSR 463(E) dated 5th June 2015 issued by the Ministry of Corporate Affairs, Government of India, provisions of Section 197 of the Companies Act, 2013, are not applicable to the Company, being a Government Company; and

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 Financial Statements - Refer Item No. 24.1(a) to Note no. 42 to the Standalone Financial Statements;

II. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts.

III. The provision of transferring the amount to the Investor Education and Protection Fund is not applicable to the Company.

For Suresh Chandra & Associates Chartered Accountants FRN 001359N

UDIN: 20500369AAAABP3790 Sd/-

(Ved Prakash Bansal)

Partner M. No: 500369

Place: New Delhi

Date: 28/08/2020

Annexure-A" to the Independent Auditors Report on the Standalone Financial Statements of RailTel Corporation of India Ltd.

The Annexure referred to in paragraph 1 under the heading ‘Report on Other Legal and Regulatory Requirements section of our report of even date on the Standalone financial statement of the Company for the year ended 31 March 2020, we report that:

(i) (a) The Company has maintained proper records showing full particulars with respect to most of its fixed assets, and is in the process of updating the quantitative, identification marks and situation details with respect to certain fixed assets in the records maintained by the Company.

(b) The Company has a program of verification of fixed assets to cover all the items in a phased manner which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the program, during the year, as part of the internal audit, the internal auditors have carried out the physical verification of fixed assets of the Company. As per their report, no material discrepancies have been identified during the course of physical verification.

(c) According to the information and explanation 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 except the following -

Particulars Building
Total Number of cases i
Whether Leasehold / Freehold Leasehold
Gross Block as at 31.03.2020 Rs.9809 Lakhs
Net Block as at 31.03.2020 Rs.9271 Lakhs
Remarks Regd. Office Building at Kidwai Nagar, Delhi where possession was handed over in 2018-19 but lease deed is yet to be executed between the company and NBCC

(ii) (a) In our opinion, the management has conducted physical verification of inventory at reasonable intervals during the year.

(b) The procedures for physical verification followed by the management are reasonable and adequate in relation to the size of the Company and nature of its business.

(c) The Company has maintained proper quantitative records of its inventory and no material discrepancies were noticed on physical verification.

(iii) According to the information and explanation given to us, the Company has not granted any loans secured or unsecured to companies, firms, Limited Liability Partnerships or other parties covered in register maintained under section 189 of Companies Act, 2013. In view of this, sub clauses (a), (b), and (c) of clause 3(iii) of the Order are not applicable.

(iv) According to the information and explanations given to us the Company has not made any loans, investments, guarantee, and security in terms of Section 185 and 186 of Companies Act 2013. Accordingly, clause 3(iv) of the Order is not applicable.

(v) In our opinion and according to the information and explanations given to us the Company has not accepted any deposits from the public within the meaning of section 73 to 76 or any other relevant provisions of the Companies Act, 2013, and the rules framed there under, consequently the directives issued by the Reserve Bank of India and provisions of the Companies Act, 2013 and rules framed there under are not applicable.

(vi) We have reviewed the books of accounts 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 Companies Act 2013, and are of the opinion that the prescribed accounts and records have been made and maintained. As explained by the management, Cost records are maintained by the management and cost audit is conducted every year by the cost auditor.

(vii) (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/accrued in the books of account in respect of undisputed statutory dues including provident fund, income-tax, sales tax, value added tax, duty of customs, service tax, Goods and Service tax, cess and other material statutory dues have been regularly deposited during the year by the Company with the appropriate authorities. As explained to us, there are no outstanding statutory dues as at the last day of the financial year i.e. 31 March 2020 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there are no material dues of provident fund, income-tax, sales tax, value added tax, duty of customs, service tax, Goods and Service tax, cess which have not been deposited with the appropriate authorities on account of any dispute except as under-

S. No Name of the Statute Nature of Dues Forums where dispute is pending Amount Due (Rs. in Lakhs) Period to which the amount relates
1 Service Tax Levy of service tax on consideration received for maintaining electricity and power at major railway stations, Non-payment of service tax on service rendered to Associated enterprises, Nonreversal of cenvat credit on common input services received for providing taxable as well as exempted services, Difference in reconciliation for the period 2011-14. Order no. 70 & 71/2015-16. Tribunal Hyderabad 505.09 2011-14
2 Telangana VAT Form-VAT 203 dated 17-10-2016. Demand for penalty for not disclosing transaction (Rly. Deposit works) in time for which Railtel has already paid VAT with interest in 2013 and 2014 for works in 2008-2013. Appellate Deputy Commissioner, Hyderabad 34.63 2008-2013
3 Service Tax Classification of Railway deposit works under works contract tax. Department contention is service tax payable on 13% service charge for the period 2008-2011. Stay order provided by CeSTAT. Tribunal, Hyderabad 320.07 2008-2011
4 Income Tax Act 1961 TDS demand due to short deduction of TDS. TDS (Commissioner) 0.27 2010-11 to 2012-13
5 RVAT Act Levy of entry Tax and demand raised under the act. RVAT Department 5.41 2015-16
6 RVAT Act Levy of entry Tax and demand raised under the act. RVAT Department 12.46 2016-17
7 Income Tax Act 1961 Appeal filed against re-assessment order of AO for addition of Rs. 8.13 Crore in book profits on a/c of Railway Revenue Share from 5% to 7% (As per AO order Dt.29- 11-2018) (Tax Rate Applicable - 18.5% + 7.5% + 3%) ITAT, New Delhi 9.48 AY 2011-12
8 Income Tax Act 1961 Appeal filed against AO order for AY 2014-15 for making additions on account of disallowance for earlier year depreciation and disallowance on account of revaluation of fixed assets. ITAT, New Delhi 11.19 AY 2014-15
9 Income Tax Act 1961 TDS demand due to short deduction of TDS. 0.09 2010-11,11-12,19-20
10 UP VAT Act Demand raised on assessment. UPVAT Department 56.23 FY 2014-15
11 HVAT Act Demand raised on assessment. HVAT Department 7.74 FY 2015-16
Total 962.66

(viii) According to the information and explanations provided to us and based on our examination of the records of the Company, the Company has not availed any loan or borrowing from any financial institution, banks, government or from others. Accordingly, paragraph 3(viii) of the Order is not applicable.

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

(x) According to the information and explanations given to us by the management, no fraud by the Company or on the Company by its officers or employees has been referred by the Companys Vigilance department during the year.

(xi) In view of the exemption given in terms of Notification No. G.S.R. No. 463E dated 5th June 2015 issued by the Ministry of Corporate Affairs, the provisions of section 197 read with schedule V to the Companies Act, 2013 regarding managerial remuneration are not applicable to the Company.

(xii) According to the information and explanations provided to us and based on our examination of the records of the Company, the Company is not a Nidhi Company. Accordingly, paragraph 3(xii) of the Order is not applicable.

(xiii) According to the information and explanations provided to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with Section 177 and 188 of Companies Act, 2013, wherever applicable.

(xiv) According to the information and explanation provided to us and based on our examination of the records of the Company, the Company has not made any preferential allotment/ private placement of shares or fully or partly convertible debentures during the year. Therefore, the provisions of clause 3(xiv) of the Order are not applicable to the Company.

(xv) According to the information and explanation provided to us and based on our examination of the records of the Company, the Company has not entered into any non-cash transactions with directors or persons connected with him. Therefore, provisions of 3(xv) of the Order are not applicable.

(xvi) The Company is not required to be registered under section 45 IA of the Reserve Bank of India Act, 1934. Therefore, the provisions of clause 3(xvi) of the Order are not applicable to the Company.

For Suresh Chandra & Associates

Chartered Accountants FRN 001359N

UDIN: 20500369AAAABP3790 Sd/-

(Ved Prakash Bansal)

Partner M. No: 500369

Place: New Delhi

Date: 28/08/2020

‘ANNEXURE-B to the Independent Auditors Report on the Standalone Financial Statements of RailTel Corporation of India Ltd.

Report on matters referred to in Section 143 (5) of Companies Act 2013.

S. No. Directions Reply
1 Whether the company has system in place to process all the accounting transactions through IT system? If yes, the implication of processing of accounting transactions outside IT system on the integrity of the accounts along with the financial implication, if any may be stated. Yes, the company has implemented Oracle- ERP system which is processing all the accounting transactions. Currently, the company is not prone to any such risk and hence, there is no financial implication of it.
2 Whether there are any restructuring of an existing loans or cases of waiver/ write off of debts/ loans/ interest etc. made by a lender to the company due to companys inability to repay the loan? If yes, the financial impact may be stated. The company has not availed any loan from any bank or financial institution.
The company is in receipt of subsidy in respect of the following projects-
3 Whether funds received / receivable for specific schemes from Central / State agencies were properly accounted for / utilised as per its term and conditions? List the cases of deviation.
a) NE-1 & NE-2 project - the company has received subsidy of Rs. 3146 lakhs till 31.03.2020 against the execution of the project.
b) Rural Wi-Fi Project - the company is in receipt of subsidy to the tune of Rs. 1031 lakhs till 31.03.2020. The said subsidy has been utilised for the project for which it has been received and balance unutilised amount of subsidy has been shown under the head Other Non-Current Liabilities.

The above information has been verified based on the information and explanations furnished to us at Corporate Office.

For Suresh Chandra & Associates

Chartered Accountants FRN 001359N

UDIN: 20500369AAAABP3790

Sd/-

(Ved Prakash Bansal)

Partner M. No: 500369

Place: New Delhi

Date: 28/08/2020

Annexure- C to the Independent Auditors Report on the Standalone Financial Statements of RailTel Corporation of India Ltd.

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 Railtel Corporation of India Ltd. ("the Company") as of March 31, 2020 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.

Opinion

In our opinion, the Company has, maintained in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2020, 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.

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.

For Suresh Chandra & Associates

Chartered Accountants

FRN 001359N

UDIN: 20500369AAAABP3790

Sd/-

(Ved Prakash Bansal)

Partner M. No: 500369

Place: New Delhi

Date: 28/08/2020