S R Industries Ltd Auditor Reports

Being Board is Suspended as company is under CIRP, the report is addressed

To the Members of S R Industries Limited

Report on the Audit of the Standalone Financial Statements

Disclaimer of Opinion

We have audited the financial statements of M/s S R Industries Limited ("the Company"), which comprise the balance sheet as at 31st March 2024, and the statement of Profit and Loss and for the year then ended, the statement of Changes in Equity and the statement of Cash Flows and notes to the financial statements, including a summary of significant accounting policies and other explanatory information. We do not express an opinion on the Ind AS financial statement of the company. Because of the significance of the matters described in Basis for disclaimer of Opinion section to this report and the uncertainties involved , we have not been able to obtain sufficient and appropriate audit evidence to provide a basis for an audit opinion on the Ind AS financial statements.

Basis for Disclaimer of Opinion

1. Note No. 1 to the financial statement explains that since Resolution Professional has taken charge of the company on 21.12.2021 and is unable to express any opinion with respect to these financial statements except for the limited consideration of the corporate insolvency resolution process cost incurred by the Interim/Resolution Professional in accordance with the provisions of the Insolvency & Bankruptcy Code, 2016 and has signed these accounts for the limited purpose of filing the same with the Registrar of Companies. These signatures shall not be construed to imply any opinion with respect to the accuracy or true and fair view or otherwise of these financial statements in any other way.

2. Resolution Professional has appointed independent valuers to conduct valuation of the assets of the company and assets/collaterals held as securities, we are unable to comment on the impact of the same, if any, on the financial statements.

3. Note No.1 to the financial statement that the Resolution Professional has filed an application with the Honble NCLT Chandigarh bench for reversal of certain PUFE/ Avoidance transactions carried out by the erstwhile management of the company during the previous years under the IBC and we are unable to comment upon the same.

4. Inventory records were not provided to us for checking. These were not physically verified by us.

5. We are unable to confirm or verify balances of accounts receivable and account payable included in the Balance Sheet of total amount of Rs 351.83 lakhs and Rs 652.07 Lakhs respectively as at 31.03.2024.

6. Most of the vouchers and other supporting documents were not made available to us for verification.

7. Note No 37 to financial statement GST Returns filed monthly by the Company are subject to reconciliation and the differences, if any, with the Books of Accounts, will be dealt with at the time of filing of Annual Return in Form GSTR9 and GSTR9C by the company. GSTR9 & 9C has not been filed by the company since F/Y 2020-21 to 2022-23.

8. Note No 39 Regarding verification and admission of claims by RP and due to pending finalization of resolution plan ,the impact of such claims have not been considered in the preparation of the financial statement.

Key Audit Matters

Key Audit Matters are those matters that, in our professional judgment, were of most significance Key audit matters in our audit of the standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone 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	Auditors Response
1.	Company under CIRP	Nil

Information other than the financial statements and auditorsf report thereon

The RP is responsible for the preparation of the other information. The Other information comprises the information included in the Board s Report including Annexures to Boards

Report but does not include the financial statements and our auditor s report thereon

Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

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

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

Emphasis of Matter

1. Note No. 36 The Banks (SBI and UCO Bank) have classified the accounts of the Company as Non-Performing Assets on 30.06.Z017 and issued notices under SARFAESI Act, 2002 on 02.05.2018 and 24,09.2018 respectively.

The Company submitted proposal to State Bank of India for settlement of its dues through One Time Settlement Scheme (OTS) on 10.07.2019. State Bank of India approved the same vide Sanction Letter Mo SAMB/CHD/T-1/1920 dated 11.02.2020. The total debt was settled for an amount of Rs. 850 Lakhs against the outstanding amount of Rs 1340.37 Lakhs. However, the company defaulted to make the payment as per the said OTS Scheme.

As per the scheme, the Company was required to deposit Rs. 50 Lakhs as upfront which was in addition to the amount required to be paid .The Company submitted another proposal to State Bank of India on 27.08.2020 for extension of time for payment of balance unpaid compromise amount of Rs. 722 lakhs upto 31.03.2021. State Bank of India approved the same vide Sanction Letter No. SAMB/CHD/T-1/956/A dated 29.10.2020.

As per the extended timeline, the Company was required to deposit Rs. 722 Lakhs. The Company paid only Rs. 138 Lakhs till 31.03.2021 inclusive of upfront payment and the Company and promoters could not fulfill its commitment to repay the balance in time.

State Bank of India has classified the accounts of the company as Recalled Assets Account on 29 09.2021 and balance due has been transferred to Recalled Assets account by the Bank.

2. Resolution Professional has filed an application with the Honble NCLT Chandigarh bench for reversal of certain PUFE/ Avoidance transactions carried out by the erstwhile management of the company during the previou4 years under the IBC and we are unable to comment upon the same.

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

The Companys RP is responsible for the matters stated in section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the accounting Standards specified under section 133 of the Act. This responsib4ity 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.

In preparing the financial statements, RP 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 RP is also responsible for overseeing the Companys financial reporting process.

Auditors Responsibilities for the Audit of the Financial Statements

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 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 bases of these 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 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 Companies Act, 2013, 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.

Due to insufficient staff and availability of relevant record in our opinion , the company does not has an adequate internal financial internal control system over financial reporting, and such internal financial controls over financial reporting were not operating effectively as at March 31st 2024 . We have not been provided with 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.

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

Conclude on the appropriateness of management s 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 Company s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor s 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

Materiality is the magnitude of misstatements in the standalone financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the standalone financial statements may be inf1uenced We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our wort; and (ii) to evaluate the effect of any identified misstatements in the standalone financial statements.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

Report on Other Legal and Regulatory Requirements

1. This report does not include a statement on the matters specified in paragraph 3 and

4 of the Companies ( Auditors Report ) Order 2020 ( "the Order ) issued by the Central Government of India in terms of sub-section (11) of section 143 of the Companies Act,2013, since in our opinion and according to the information & explanation given to us, the said order is not applicable to the company.

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

a) is described in the Basis of Disclaimer of Opinion paragraph, we sought but were unable to obtain all information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit.

b) Due to possible effects of the matter described in the Basis of Disclaimer paragraph, we are unable to state whether proper books of accounts as required by law have been kept by the company so far as appears from our examination of those books.

c) Due to possible effects of the matter described in the Basis of Disclaimer paragraph, we are unable to state whether the Balance Sheet and the Statement of Profit and Loss dealt with by this Report are in agreement with the books of account.

d) Due to possible effects of the matter described in the Basis of Disclaimer paragraph , we are unable to state whether the aforesaid financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

e) The matter described in the Basis of Disclaimer paragraph above, in our opinion , may have an adverse effect on the functioning of the company.

f) As per management, neither written representations has been received from the Directors As On March 31, 2024 and nor taken on record by the Board DI Directors regarding disqualifications of Directors as on March 31, 2024 from being appointed as a Director in terms of Section 164 (2) of the Act . So we are unable to comment upon this.

g) This report does not include report relating to internal financial controls as required u/s 143(3)(i) pursuant to Notification No. GSR 583(E) dated 13.06 2017 issued by MCA. h) With respect to the Other matters to be included in the Auditor s Report in accordance with Rute 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. Due to possible effects of the matter described in the Basis of Disclaimer of opinion paragraph , we are unable to state whether the company has disclosed the impact of pending litigations on its financial position in its financial statements.

ii. Due to possible effects of the matter described in the Basis of Disclaimer of opinion paragraph we are unable to state whether the company has made provision as required under the applicable law or accounting standards , for material foreseeable losses ,if any, on long term contract including derivate contracts.

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

iv. (a) The RP has represented that, to the best of it s knowledge and belief, other than as disclosed in the notes to the accounts, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the company to or in any other person(s) or entity(ies), including foreign entities ("Intermediaries"), with the understanding, whether recorded in writing or other wise, that the Intermediary shall, whether, directly or indirectly tend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company ("Ultimate Beneficiaries") or provide any guarantee, security or the like. on behalf of the

Ultimate Beneficiaries;

(b) The RP has represented, that, to the best of its knowledge and belief, other than as disclosed in the notes to the accounts, no funds have been received by the company from any person(s) or entity(ies), including foreign entities

("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and

(c) Based on such audit procedures that have been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (i) and (ii) of Rule 11(e), as provided under (a) and (b) above, contain any material mis-statement.

v. No dividend have been declared or paid during the year by the company.

vi. Since the Company S R Industries Limited is undergoing CIRP , as initiated by Honble NCLT dated 21 12.2021 , during the financial year ended

31.03.2024 no board meeting was held as the powers of the Board remain suspended as per the provisions of Insolvency and Bankruptcy Code 2016.

For Krishan Rakesh & Co. Chartered Accountants

Firm Regn. No. 009088N

Sd/- Place : Delhi K.K.

Gupta Date : 06-12-2024 (Partner)

UDIN : 24087891 M.No. 087891