Rattanindia Power Ltd Directors Report.

To the members of RattanIndia Power Limited (formerly Indiabulls Power Limited.) Report on the Audit of the Standalone Financial Statements Qualified Opinion

1. We have audited the accompanying standalone financial statements of RattanIndia Power Limited (formerly Indiabulls Power Limited.) (‘the Company), which comprise the Balance Sheet as at 31 March 2019, the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of the significant accounting policies and other explanatory information.

2. In our opinion and to the best of our information and according to the explanations given to us, except for the possible effects of the matters 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 (‘Act) in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India including Indian Accounting Standards (‘Ind AS) specified under section 133 of the Act, of the state of affairs (financial position) of the Company as at 31 March 2019, and its loss (financial performance including other comprehensive income), its cash flows and the changes in equity for the year ended on that date.

Basis for Qualified Opinion

3. As explained in Note 55 to the accompanying standalone financial statements, the Company has a non-current investment of र 302,621.55 lakhs in, inter corporate deposits (classified as loans under current financial assets) of र 5,098.36 lakhs and trade receivable of र 532.65 lakhs recoverable from Sinnar Thermal Power Limited (formerly RattanIndia Nasik Power Limited) (STPL), a wholly-owned subsidiary of the Company, as at 31 March 2019. The subsidiary company has incurred losses since its inception and is yet to commence operations. The accumulated losses in the subsidiary company amount to र 377,824.45 lakhs as at 31 March 2019 and the management of the subsidiary company has determined that a material uncertainty exists, as at 31 March 2019, that may cast significant doubt about the subsidiary companys ability to continue as a going concern. The management of the Company, based on an internal estimate, has recorded an impairment against carrying value of investment in STPL amounting to र 151,310.77 lakhs and has also written off aforementioned balances of inter corporate deposits amounting to र 4,848.36 lakhs and trade receivables of र 532.65 lakhs. In the absence of evidence for such impairment assessment performed by the management, we are unable to obtain sufficient appropriate evidence to comment on any adjustment that may further be required to be made to the balance carrying value of the above mentioned non-current investment as at 31 March 2019, and the consequential impact thereof on the accompanying standalone financial statements.

4. We conducted our audit 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 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 financial statements under the provisions of the Act and the rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified opinion.

Material Uncertainty Related to Going Concern

5. We draw attention to Note 53 to the standalone financial statements which indicates that the Company has incurred a net loss of र 279,152.62 lakhs during the year ended 31 March 2019 and, as of that date, the Companys accumulated losses amounts to र 411,673.83 lakhs and the Companys current liabilities exceed its current assets by र 285,867.93 lakhs. The Company has also made defaults in repayment of borrowings from banks, including interest, by an amount aggregating र 237,051.14 crores till 31 March 2019. These conditions along with other matters as set forth in such note, indicate the existence of material uncertainty that may cast significant doubt about the Companys ability to continue as a going concern. However, in view of withdrawal of the petition before the National Company Law Tribunal (NCLT) under Insolvency and Bankruptcy Code, 2016 by the lender banks on 14 May 2019, the ongoing discussions relating to restructuring of its borrowings and other debts with the lenders which includes a binding One Time Settlement (OTS) offer made by the Company based on identification of new investors and infusion of funds by the promoters, better financial performance as a result of favourable business conditions expected in future and other mitigating factors mentioned in the aforesaid note, the management is of the view that going concern basis of accounting is appropriate for preparation of the accompanying standalone financial statements. Our opinion is not modified in respect of this matter.

The above assessment of the Companys ability to continue as going concern is by its nature considered as key audit matter in accordance with SA 701 In relation to the above key audit matter, our audit work included, but was not limited to, the following procedures: a) Obtained understanding of the managements process for identifying all events or conditions that could impact the Companys ability to continue as a going concern, and the process to assess the corresponding mitigating factors existing against each such event or condition. b) Evaluated the design and tested the operating effectiveness of key controls around aforesaid identification of events or conditions and mitigating factors, and controls around cash flow projections prepared by the management. c) Tested the appropriateness of the key assumptions in the cash flow projections for next 12 months by considering our understanding of the business, past performance of the Company, external data and market conditions apart from discussing these assumptions with the management and the Audit Committee. d) Evaluated the sensitivity analysis performed by the management in respect of the key assumptions discussed above to ensure that there was sufficient headroom with respect to the estimation uncertainty impact of such assumptions on the calculation. e) Tested the arithmetical accuracy of the calculations including those related to sensitivity analysis performed by the management. f) Evaluated the historical accuracy of the cash flow projections made by the management in prior periods. g) Reviewed the minutes of meetings of lenders, binding offer, correspondence with proposed investors, etc. with respect to the status of OTS offer. h) Evaluated the appropriateness of the disclosures made in the financial statements in respect of going concern basis of accounting in accordance with the applicable accounting standards.

Emphasis of Matter

6. We draw attention to Note 54 to the accompanying standalone financial statements with respect to capital work-in-progress (CWIP) aggregating to र 54,657.35 lakhs outstanding as at 31 March 2019, pertaining to construction of second 1350 MW power plant (Phase II) of the Company which is currently suspended. Based on expected revival of the project and other factors described in the aforesaid note, the management believes that no adjustment is required to the carrying value of the aforesaid balances. Our audit opinion is not modified in respect of this matter.

Key Audit Matter

7. Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements of the current year. 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.

8. In addition to the matter described in the Basis for Qualified Opinionand Material Uncertainty Related to Going Concern sections we have determined the matters described below to be the key audit matters to be communicated in our report.

Recoverability of amounts due from Maharashtra State Electricity Distribution Company Limited (MSEDCL) Our audit work in relation to assessment of recoverability of amounts due from MSEDCL included, but was not limited to, the following:
The Company has dues from MSEDCL amounting to Rs. 123,297.03 lakhs as at 31 March 2019. • Obtained an understanding of the nature of litigations and key developments during the year from the management.
As detailed in Note no 32(C) to the standalone financial statements, there are certain claims by the Company which are disputed by MSEDCL including claim on account of Compensatory Claim (CCEA) amounting to Rs. 28,658.80 lakhs and Late Payment Surcharge (LPS) thereon and Change- in-law (CIL) Claims. These are under litigation at various levels of regulatory authorities. • Tested the design, implementation and operating effectiveness of the controls that the Company has established in relation to recoverability of such dues.
The Company has obtained a legal opinion from an independent counsel with respect to recoverability of Rs. 28,658.80 lakhs on account of CCEA claims and LPS thereon. • Evaluated the reasonableness of the key assumptions used by the management in determination of recoverable amount based on our knowledge of the business and industry.
• Obtained legal opinion from the Companys external legal counsel and analysed the same in light of the current industry practice.
Further, in respect of claim related to CIL, the Maharashtra Electricity Regulatory Commission, vide order dated 3 April 2018, has decided a methodology for computing the quantum of claim which is disputed by the Company and the matter is pending for resolution under Appellate Tribunal for Electricity. • Obtained and reviewed the necessary evidence which includes correspondence with the internal legal counsels and where necessary, inspected minutes of case proceedings available in public domain, to support the decisions and rationale for creation of provisions and / or disclosure of receivables in respect of each such litigation selected for testing.
Considering the materiality of the balances to the Companys standalone financial statements and the judgements involved in the estimation of recoverability, this matter is considered to be a key audit matter for the current year audit. • Ensured appropriateness of disclosures made in the financial statements with respect to the receivables are in accordance with the applicable accounting standards.
Impairment of power plant at Amravati Our audit procedures included, but were not limited to, the following:
Refer Note 3 for the accounting policies for impairment of assets. The Company has a power generating plant and allied facilities valuing र 639,000.41 lakhs and र 64,591.69 lakhs respectively. • Obtained an understanding of the management process, and performed a walkthrough to evaluate design effectiveness and tested the operating effectiveness of key controls for identifying impairment indicators as well as determining the appropriate methodology to carry out impairment testing for plant, property and equipment.
In accordance with Ind AS 36, Impairment of assets, the management identified that impairment indicators existed for the power plant owing to the fact that there has been less than full capacity utilisation of the plant since the commencement of operations, and currently, the plant is operating at around 34% capacity. • Evaluated the appropriateness of applying relevant accounting standards in recognising the impairment loss.
The aforesaid assessment of the impairment involves exercising a significant judgement with regard to assumptions and estimates involved in forecasting future cash flows. These assumptions include plant operating level, discount rates, estimation of terminal value. • Challenged the management on the underlying assumptions used for the cash flow projections including the implied growth rates, discount rate, estimation of terminal value etc. considering the evidence available to support these assumptions and our understanding of the business and industry.
Changes in the management forecasts or assumptions can impact the assessment of the discounted cash flows and consequently the valuation of such power plant. • Tested the discount rate and plant operating level used in the forecasts, including comparison to economic and industry forecasts where appropriate.
A significant amount of audit effort was required particularly as some of these assumptions are dependent on the economic factors and trading conditions in the markets in which the Company operates. Considering the significance of the amounts involved, degree of judgement and subjectivity involved in the estimates and key assumptions used in determining the cash flows used in the impairment evaluation, we have determined impairment of power generating plant as a key audit matter. • Evaluated the sensitivity analysis performed by the management in respect of the key assumptions discussed above to ensure that there was sufficient headroom with respect to the estimation uncertainty impact of such assumptions on the calculation.
• Ensured that disclosures for the aforesaid balances and transactions are adequately disclosed in accordance with the applicable accounting standards.
Litigation and contingent liabilities Our audit procedures included, but were not limited to, the following:
We refer to the Note 32 of the standalone financial statements of the Company for the year ended 31 March 2019. The Company operates in an industry which is heavily regulated which increases inherent risk of litigations. There are a number of legal and regulatory cases, of which the most significant ones are claims by the Company on MSEDCL as explained in the KAM on recoverability from MSEDCL, and claims by the vendors / suppliers on the Company. • Obtained an understanding of the management process for:
- identification of legal and tax matters initiated against the Company;
- assessment of accounting treatment for each such litigation identified under Ind AS 37 accounting principles; and
- for measurement of amounts involved.
The eventual outcome of these legal proceedings is dependent on the outcome of future events and unexpected adverse outcomes could significantly impact the Companys reported profits and balance sheet position. • Evaluated the design and tested the operating effectiveness of key controls around above process.
The amounts involved are material and the application of accounting principles as given under Ind AS 37, Provisions, Contingent Liabilities and Contingent Assets, in order to determine the amount to be recorded as a liability or to be disclosed as a contingent liability, in each case, is inherently subjective, and needs careful evaluation and judgement to be applied by the management. • Obtained an understanding of the nature of litigations pending against the Company and discussed the key developments during the year for key litigations with the management and respective legal counsels handling such cases on behalf of the Company.
• Obtained and reviewed the necessary evidence which includes correspondence with the external and internal legal counsels, wherever applicable and inspected minutes of case proceedings available in public domain, to support the decisions and rationale for creation of provisions and / or disclosure of contingent liabilities in respect of each such litigation selected for testing.
Key judgments are also made by the management in estimating the amount of liabilities, provisions and/or contingent liabilities related to aforementioned litigations. We focused on the developments in the existing litigations and new litigations, which could have materially impacted the amounts recorded as provisions or disclosed as contingent liability in the standalone financial statements.
Considering the degree of judgment, significance of the amounts involved, inherent high estimation uncertainty and reliance on external legal and tax experts, this matter has been identified as a key audit matter for the current year audit.
• Assessed managements conclusions through discussions held with the in-house legal counsel and understanding precedents set in similar cases.
• Obtained and read the correspondence with the regulatory authorities, including past judgements on the subject matter of specific significant litigations.
• Assessed the appropriateness of methods used, and the reliability of underlying data for the underlying calculations made for quantifying the amounts involved. Tested the arithmetical accuracy of such calculations.
• Evaluated the adequacy of disclosures made by the Company in the financial statements in view of the requirements as specified in the Indian Accounting Standards.

Information other than the Financial Statements and Auditors Report thereon

9. The Companys Board of Directors is responsible for the other information. The other information comprises the information included in the Annual Report, but does not include the financial statements and our auditors report thereon. The Annual Report is expected to be made available to us after the date of this auditors report.

Our opinion on the financial statements does not cover the other information and we will 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 identified above when it becomes available 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.

When we read the Annual Report, if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance.

Responsibilities of Management and Those Charged with Governance for the Standalone Financial Statements

10. 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 state of affairs (financial position), loss (financial performance including other comprehensive income), changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Ind AS specified under section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

11. In preparing the 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. 12. Those Board of Directors are also responsible for overseeing the Companys financial reporting process.

Auditors Responsibilities for the Audit of the Financial Statements

13. Our objectives are to obtain reasonable assurance about whether the 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 Standards on Auditing 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 statements.

14. As part of an audit in accordance with Standards on Auditing, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for explaining 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 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 financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

15. 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.

16. 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.

17. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

18. As required by section 197(16) of the Act, we report that the Company has paid 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.

19. 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 A, a statement on the matters specified in paragraphs 3 and 4 of the Order.

20. Further to our comments in Annexure A, as required by section 143(3) of the Act, we report that: a) we have sought and except for the possible effect of the matter described in the Basis for Qualified Opinion paragraph, obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit; b) except for the possible effects of the matter described in the Basis for Qualified Opinion paragraph, 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 dealt with by this report are in agreement with the books of account; d) except for the possible effects of the matter described in the Basis for Qualified Opinion paragraph, in our opinion, the aforesaid standalone financial statements comply with Ind AS specified under section 133 of the Act; e) the matters described in paragraph 3 under the Basis for Qualified Opinion paragraph and paragraph 5 under Material Uncertainty Related to Going Concern and paragraph 6 under the Emphasis of Matters paragraph, in our opinion, may have an adverse effect on the functioning of the Company; f) 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 31 March 2019 from being appointed as a director in terms of section 164(2) of the Act; g) the qualification relating to the maintenance of accounts and other matters connected therewith are as stated in the Basis for Qualified Opinion paragraph; h) we have also audited the internal financial controls over financial reporting (IFCoFR) of the Company as on 31 March 2019 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date and our report dated 20 May 2019 as per Annexure B expressed modified opinion; and i) 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, as detailed in Note 32(A) and 32(B) to the standalone financial statements, has disclosed the impact of pending litigations on its financial position as at 31 March 2019; ii. the Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses as at 31 March 2019; iii. there were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company during the year ended 31 March 2019; and iv. the disclosure requirements relating to holdings as well as dealings in specified bank notes were applicable for the period from 8 November 2016 to 30 December 2016, which are not relevant to these standalone financial statements. Hence, reporting under this clause is not applicable.

For Walker Chandiok & Co LLP
Chartered Accountants
Firms Registration No.: 001076N/N500013
Rohit Arora
Place : New Delhi Partner
Date : 20 May 2019 Membership No.: 504774

Annexure A to the Independent Auditors Report of even date to the members of RattanIndia Power Limited (formerly Indiabulls Power Limited.) on the standalone financial statements for the year ended 31 March 2019 Annexure A

Based on the audit procedures performed for the purpose of reporting a true and fair view on the financial statements of the Company and taking into consideration the information and explanations given to us and the books of account and other records examined by us in the normal course of audit, and to the best of our knowledge and belief, we report that: (i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of property, plant and equipment.

(b) The Company has a regular program of physical verification of its property, plant and equipment under which fixed assets are verified in a phased manner over a period of three years, which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. In accordance with this program, certain fixed assets were verified during the year and no material discrepancies were noticed on such verification. (c) The title deeds of all the immovable properties (which are included under the head ‘Property, plant and equipment) are held in the name of the Company except for the following properties:

(Amount in र Lakhs)
Nature of property Total number of cases Whether leasehold/ freehold Gross block as on 31 March 2019 Net block on 31 March 2019
Land 1 Freehold 337.35 337.35

(ii) In our opinion, the management has conducted a physical verification of inventory at reasonable intervals during the year, except for goods-in-transit and stocks lying with third parties. For stock lying with the third parties at the year-end, written confirmations have been obtained by the management. No material discrepancies were noticed on the aforesaid verification.

(iii) The Company has not granted any loan, secured or unsecured to companies, firms, Limited Liability Partnerships (LLPs) or other parties covered in the register maintained under Section 189 of the Act. Accordingly, the provisions of clauses 3(iii)(a), 3(iii)(b) and 3(iii)(c) of the Order are not applicable.

(iv) In our opinion, the Company has complied with the provisions of Sections 185 and 186 of the Act in respect of loans, investments, guarantees and security.

(v) In our opinion, the Company has not accepted any 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 the Order are not applicable.

(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 sub-section (1) of Section 148 of the Act in respect of Companys products 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 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 provident fund, employees state insurance, income-tax, sales-tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues, as applicable, to the appropriate authorities. Further, no undisputed amounts payable in respect thereof were outstanding at the year-end for a period of more than six months from the date they become payable.

(b) There are no dues in respect of income-tax, sales-tax, service tax, duty of customs, duty of excise and value added tax that have not been deposited with the appropriate authorities on account of any dispute.

(viii) There are no loans or borrowings payable to government and no dues payable to debenture-holders. The Company has defaulted in repayment of loans/borrowings to the following banks and financial institutions:

Statement of defaults in repayment of borrowings from banks and financial institutions that are not paid as at Balance Sheet date:

(Amount in र Lakhs)

Name of bank/financial 0-3 months 3-6 months 6-12 months More than
institution 12 months
Banks
Axis Bank 470.76 - - -
Bank of India 901.00 901.22 1,702.30 1,966.11
Canara Bank 538.36 538.36 1,076.72 1,794.53
Central Bank of India 518.00 239.00 - -
IDBI Bank - 3,750.00 4,605.97 5,000.00
ICICI Bank - - - 1,795.82
Punjab National Bank 901.00 901.22 1,802.43 3,003.89
State Bank of Bikaner & Jaipur 189.61 189.61 379.22 632.03
State Bank of India 1,949.00 1,948.50 3,897.00 6,495.00
State Bank of Travancore 269.19 269.19 538.38 897.30
Syndicate Bank 362.84 362.84 168.12 -
UCO Bank 608.00 275.48 - -
United Bank of India 422.42 422.42 844.83 803.34
Financial institutions
Life Insurance Corporation 598.18 598.18 682.35 -
Power Finance Corporation 5,355.98 5,355.98 4,162.95 -
Rural Electrification Corporation 1,778.94 1,571.98 - -

(ix) The Company did not raise moneys by way of initial public offer or further public offer (including debt instruments). In our opinion, the term loans were applied for the purposes for which the loans were obtained, though idle funds which were not required for immediate utilisation have been invested in liquid investments, payable on demand.

(x) No fraud by the Company or on the Company by its officers or employees has been noticed or reported during the period covered by our audit.

(xi) Managerial remuneration has been paid and provided by the Company in accordance with the requisite approvals mandated by the provisions of Section 197 of the Act read with Schedule V to the Act.

(xii) In our opinion, the Company is not a Nidhi Company. Accordingly, provisions of clause 3(xii) of the Order are not applicable. (xiii) In our opinion all transactions with the related parties are in compliance with Sections 177 and 188 of Act, where applicable, and the requisite details have been disclosed in the financial statements etc., as required by the applicable Ind AS. (xiv) During the year, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures.

(xv) In our opinion, the Company has not entered into any non-cash transactions with the directors or persons connected with them covered under Section 192 of the Act.

(xvi) The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934.

For Walker Chandiok & Co LLP
Chartered Accountants
Firms Registration No.: 001076N/N500013
Rohit Arora
Place : New Delhi Partner
Date : 20 May 2019 Membership No.: 504774

Annexure B to the Independent Auditors Report of even date to the members of RattanIndia Power Limited (formerly Indiabulls Power Limited.) on the standalone financial statements for the year ended 31 March 2019 Annexure B

Independent Auditors report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (‘the Act)

1. In conjunction with our audit of the standalone financial statements of RattanIndia Power Limited (formerly Indiabulls Power Limited.) (‘the Company) as of and for the year ended 31 March 2019, we have audited the internal financial controls over financial reporting (IFCoFR) of the company of as of that date.

Managements Responsibility for Internal Financial Controls

2. The Companys Board of Directors 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 (‘Guidance Note) 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 the companys 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.

Auditors Responsibility

3. Our responsibility is to express an opinion on the Companys IFCoFR based on our audit. We conducted our audit in accordance with the Standards on Auditing, issued by the ICAI and deemed to be prescribed under section 143(10) of the Act, to the extent applicable to an audit of IFCoFR, and the Guidance Note 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 IFCoFR were established and maintained and if such controls operated effectively in all material respects.

4. Our audit involves performing procedures to obtain audit evidence about the adequacy of the IFCoFR and their operating effectiveness. Our audit of IFCoFR included obtaining an understanding of IFCoFR, 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.

5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Companys IFCoFR.

Meaning of Internal Financial Controls over Financial Reporting

6. A companys IFCoFR 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 IFCoFR 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.

Inherent Limitations of Internal Financial Controls over Financial Reporting

7. Because of the inherent limitations of IFCoFR, 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 IFCoFR to future periods are subject to the risk that IFCoFR may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Qualified Opinion

8. We have not been provided sufficient and appropriate audit evidence with respect to assessment of the carrying value of

investment in a wholly owned subsidiary. In the absence of sufficient audit evidence, we are unable to comment on adequacy and operating effectiveness of controls over the impairment assessment process and its the potential impact on carrying value of investment and the consequential impact on the accompanying standalone financial statements.

9. In our opinion, the Company has, in all material respects, adequate internal financial controls over financial reporting as at 31 March 2019, 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 ICAI except for the possible effect of the material weakness described above on the achievement of the objectives of the control criteria, the Companys internal financial controls over financial reporting were operating effectively as at 31 March 2019.

10. 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 standalone financial statements of the Company as at and for the year ended 31 March 2019, 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.

For Walker Chandiok & Co LLP
Chartered Accountants
Firms Registration No.: 001076N/N500013
Rohit Arora
Place : New Delhi Partner
Date : 20 May 2019 Membership No.: 504774