Sadbhav Infrastructure Projects Ltd Auditor Reports

Independent Auditors Report

To the Members of

Sadbhav Infrastructure Project Limited

Report on the Audit of the Standalone Financial Statements

Qualified Opinion

We have audited the accompanying Standalone Financial Statements of Sadbhav Infrastructure Project Limited ("the Company"), which comprises of the Standalone Balance sheet as at March 31, 2024, and the Standalone Statement of Profit and Loss (including other comprehensive income), and 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 material accounting policies and other explanatory information (hereinafter referred to as "the Standalone Financial Statements").

In our opinion and to the best of our information and according to the explanations given to us, except for 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, ("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, 2024, and its loss, total comprehensive income, its cash flows and the changes in equity for the year ended on that date.

1. Basis for Qualified Opinion

We draw attention to Note 43 and Note 44 to the accompanying Standalone Financial Statements with respect to investment in (including subordinate debt), and loan & advances to Rohtak Panipat Tollway Private Limited and Rohtak Hissar Tollway Private Limited, subsidiaries of the Company. Both the subsidiaries have issued notice of termination of Concession Agreement to National Highways Authority of India (NHAI) on account of Force Majeure Event as per Concession Agreement. As explained in the said note, the Company has carried out impairment assessment of investment in these subsidiaries considering the expected payment arising out of aforesaid termination and other claims filed with NHAI and based on the above assessment, management has concluded that no impairment/adjustment to the carrying value of the investments (including subordinate debt) and loan & advances, trade and other receivables aggregating to INR 8,040.58 million are necessary as at March 31, 2024.

However, We have not been able to corroborate the managements contention of realising the carrying value of investments (including subordinate debt), loans and advances, trade and other receivables related to both subsidiaries aggregating to INR 8,040.58 million as on March 31, 2024.

Accordingly, we are unable to comment on appropriateness of the carrying value of such investment and loans and advances and their consequential impact on the Standalone Financial Statements and financial position of the Company as at and for the year ended on March 31, 2024.

Our audit report dated May 28, 2023 on the Standalone Financial Statements for the year ended 31 March 2023 was also qualified in respect of this matter.

2. We draw attention to Note 45 of the accompanying Standalone Financial Statements with respect to Sadbhav Udaipur Highway Limited (Concessionaire or SUDHL), subsidiary of the Company, in which case, National Highways Authority of India in the month of December 2023, at the request of the Company has given in principal approval for harmonious substitution of the Concessionaire. The Company is in the process of compliance of the conditions prescribed by National Highways Authority of India for substitution. As explained in the said note, the management has carried out impairment assessment of Investment (including subordinate debt) and other receivables in this subsidiary duly considering the expected payment arising out of aforesaid substitution and based on the above assessment, the management has concluded that no impairment/adjustment to the carrying value of investment (including subordinate debt ), loans and advances, trade and other receivables of INR 1,774.09 million is considered necessary as at March 31, 2024.

However, we have not been able to corroborate the managements contention of realizing the carrying value of Investment (including subordinate debt), loans and advances and trade and other receivables balances aggregating to INR 1,774.09 million as at March 31, 2024.

Accordingly, we are unable to comment on appropriateness of the carrying value of Investment (including subordinate debt), loans and advances, trade and other receivables and their consequential impact on the Standalone Financial Statements and financial position of the Company as at and for the year ended on March 31, 2024.

3. We draw attention to Note 46 of the accompanying Standalone Financial Statements with respect to Sadbhav Rudrapur Highway Limited (SRHL), a subsidiary of the Company, in which case, NHAI in the month of January 2024, at the request of the Company has given in principal approval for harmonious substitution of the concessionaire. The Company is in the process of compliance of the conditions prescribed by NHAI for substitution. As explained in the said note, management has carried out impairment assessment of Investment (including subordinate debt) and other receivables in this subsidiary duly considering the expected payment arising out of aforesaid substitution and based on the above assessment, management has concluded that no impairment/adjustment to the carrying value of Investment (including subordinate debt) and other receivables aggregating to INR 1,196.96 million is considered necessary as at March 31, 2024.

However, we have not been able to corroborate the managements contention of realizing the carrying value of Investment (including subordinate debt) and other receivables balances aggregating to INR 1,196.96 million as at March 31, 2024.

Accordingly, we are unable to comment on appropriateness of the carrying value of Investment (including subordinate debt) and other receivables and their consequential impact on the Standalone Financial Statements and financial position of the Company as at reporting date and for the year ended on March 31, 2024.

We conducted our audit of the Standalone Financial Statements in accordance with the Standards on Auditing (SAs) specified under Section 143(10) of the Companies Act, 2013 (the Act). Our responsibilities under those Standards 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 the ICAIs Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified audit opinion on Standalone Financial Statements.

Emphasis of Matter

We draw attention to Note No 49 to the accompanying Standalone Financial Statements, wherein it is stated that balances in the accounts of parties pertaining to trade payables and trade receivables, along with other incidental balances, are currently under evaluation by the management. Subsequent adjustments, if any, may be necessary upon completion of this evaluation and reconciliation.

Our opinion is not modified in respect of this matter.

Material uncertainty related to going concern

We draw attention to Note no. 48 to the accompanying Standalone Financial Statements, which indicates that, the Companys financial position and financial performance for the year ended March 31, 2024 on account of significant reduction in revenue and substantial losses over period. These events or conditions along with other matters as set forth in the said note indicate that a material uncertainty exists that may cast significant doubt on the Companys ability to continue as a going concern. Managements evaluation of the events and conditions and managements plans regarding these matters are also described in the said note.

Our opinion is not modified in respect of this 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 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.

In addition to the matters described in the Basis for Qualified Opinion section and Material Uncertainty Related to Going Concern section of our report, we have determined the matters described below to be key audit matters to be communicated in our report. We have fulfilled the responsibilities described in the Auditors responsibilities for the audit of the Standalone Financial Statements section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the Standalone Financial Statements. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying Standalone Financial Statements.

Assessing impairment of investments in assets operated under concession arrangements for the subsidiary companies namely Ahmedabad Ring Road Infrastructure Limited, Sadbhav Rudrapur Highway Limited and Sadbhav Udaipur Highway Limited (refer note no 3.10 of the Standalone Financial Statements)
As at March 31, 2024, the Company had investments (including sub-ordinate debt) in BOT/Check post asset and Hybrid Annuity (HAM) assets amounting to Rs 1,036.80 million and Rs 2,541.65 million respectively which are operated under concession agreement.	Our audit procedures included but were not limited to Obtained an understanding of the Companys valuation Methodology applied in determining the recoverable amount of its investment in Assets.
	- Obtained the financial model and understood the key assumptions around the cash flow forecasts like growth rate, change in traffic and toll rate/collection/user fees and future
For the purpose of impairment testing, recoverable amount has been determined based on discounted future cash flows such as annuity model, discount rate and future operating and finance cost based on managements view of future business prospects.	- Operating and finance costs considering the current and estimated future economic conditions.
Further, the recoverable amount is highly sensitive to changes in key assumptions used for forecasting the future cash flows including growth rate, discount rate, change in traffic and tolls and future operating and finance cost. Thus, the determination of the recoverable amount of such investment in projects involves significant management judgement.	- Obtained the financial model and understood the key assumptions around the cash flow forecasts like annuity model, discount rate and future operating and finance costs.
Accordingly, the impairment assessment of investment in asset operated under concession arrangement was determined to be a key audit matter in our audit of the Standalone Financial Statements	- Assessed the inputs and assumptions around the key drivers of the cash flow forecasts against historical performance, economic and industry indicators.
	Tested the arithmetical accuracy of the model.
	- Reviewed the adequacy of the disclosures made in the standalone Financial Statements.

Information Other than the Standalone Financial Statements and Auditors Report Thereon

The Companys management is responsible for the preparation of the other information. The other information comprises the information included in the Management Discussion and Analysis, Boards Report including Annexures to Boards Report, Business Responsibility Report, Corporate Governance and Shareholders Information, but does not include the Standalone Financial Statements and our auditors report thereon. The other information report is expected to be made available to us after the date of this auditors report.

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 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 the other information 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

The accompanying Standalone Financial Statements have been approved by the Companys Board of Directors. The Companys management 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, changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under Section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended.

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 implementation and maintenance of 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 these standalone financial statement 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, the management and the Board of Directors are 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.

Those 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 these 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 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 control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls 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.

Report on Other Legal and Regulatory Requirements

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

a) We have sought and for except for 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 purposes of our audit.

b) Except for the matter described in the Basis for Qualified Opinion paragraph and paragraph (vi) below on reporting under Rule 11 (g), 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 Balance Sheet, the Standalone Statement of Profit and Loss including the Other Comprehensive income, the Standalone Statement of Cash Flow and Standalone Statement of Changes Equity dealt with by this Report are in agreement with the books of account;

d) Except for the effects of the matter described in the Basis for Qualified Opinion paragraph above, in our opinion, the aforesaid Standalone Financial Statements comply with the Indian Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2015, as amended;

e) In our opinion, the matters described in the Basis for Qualified Opinion paragraph above and the going concern matter described in Material Uncertainty Related to Going Concern paragraph above, 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 as on March 31, 2024, taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2024 from being appointed as a director in terms of Section 164 (2) of the Act;

g) The qualifications relating to the maintenance of accounts and other matters connected therewith are as stated in Basis of Qualified Opinion paragraph above, paragraph (b) above on reporting under Section 143(3)(b) and paragraph (vi) below on reporting under Rule 11(g).

h) With respect to the adequacy and the operative effectiveness of the internal financial controls with reference to the Standalone Financial Statements of the Company and the operating effectiveness of such controls, refer to our separate report in "Annexure A". Our report expresses a qualified opinion on the operating effectiveness of the Companys internal financial controls with reference to Standalone Financial Statements.

i) In our opinion, the managerial remuneration for the year ended March 31, 2024 paid/provided by the Company to their directors is in accordance with the provisions of section 197 read with Schedule V to the Act;

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

i. the Company has disclosed the impact, wherever necessary, of pending litigations on its financial position in its Standalone Financial Statements; Refer Note 38 to the Standalone Financial Statements;

ii. the Company did not have any long-term contracts including derivative contracts for which there were material foreseeable losses;

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 on March 31, 2024.

iv. (a) The management has represented that, to the best of its knowledge and belief, no funds (which are material either individually or in the aggregate) 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 or entity, including foreign entity ("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend 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 Management has represented, that, to the best of its knowledge and belief, no funds (which are material either individually or in the aggregate) have been received by the Company from any person or entity, including foreign entity ("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;

(c) Based on such audit procedures as 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 misstatement;

v. The Company has not declared or paid any dividend in the year and hence the eporting requirement for compliance with Section 123 of the Act is not applicable.

vi. Based on our examination which included test checks, the Company has used accounting software for maintaining its books of account which has a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software. However, the audit trail feature is not available for certain direct changes to data when using certain access rights and at the database level for the accounting software, as described in Note 51 to the Standalone Financial Statements.

Further, during the course of our audit we did not come across any instance of audit trail feature being tampered with in respect of the accounting software.

As proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 is applicable from April 1, 2023, reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 on preservation of audit trail as per the statutory requirements for record retention is not applicable for the financial year ended March 31, 2024.

2. As required by 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 Act, we give in the Annexure B, a statement on the matters specified in the paragraphs 3 and 4 of the Order, to the extent applicable.

For S G D G & Associates LLP
Chartered Accountants
Firm Registration No.: W100188
Mittali Dakwala
Partner
Membership No.: 143236	Place: Ahmedabad
UDIN: 24143236BKJMWC2375	Date: May 21, 2024

ANNEXURE - A TO THE INDEPENDENT AUDITORS REPORT of Even Date on the Standalone Financial Statements of Sadbhav Infrastructure Project Limited (Referred to in paragraph 1(g) under "Report on Other legal and Regulatory Requirements" section of our report the member of Sadbhav Infrastructure Project Limited of even date)

Report on the Internal Financial Controls with reference to Standalone Financial Statements under clause (i) of sub-section 3 of Section 143 of the Companies Act, 2013 (the "Act")

We have audited the internal financial controls with reference to Standalone Financial Statements of Sadbhav Infrastructure Project Limited ("the Company") as of March 31, 2024 in conjunction with our audit of the Standalone Financial Statements of the Company for the year ended on that date.

Responsibility of Management and Those Charged with Governance for Internal Financial Controls

The Companys management and Board of Directors is responsible for establishing and maintaining internal financial controls based on the internal controls 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 (the "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 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 Act.

Auditors Responsibility for the Audit of Internal Financial Controls with reference to Standalone Financial Statements

Our responsibility is to express an opinion on the Companys internal financial controls with reference to Standalone Financial Statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by ICAI prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls with reference to the Standalone Financial Statements and the Guidance Note issued by ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls with reference to Standalone Financial Statements 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 with reference to Standalone Financial Statements and their operating effectiveness. Our audit of internal financial controls with reference to Standalone Financial Statements included obtaining an understanding of internal financial controls with reference to Standalone Financial Statements, 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 Standalone 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 qualified audit opinion on the Companys internal financial controls system with reference to these Standalone Financial Statements.

Meaning of Internal Financial Controls with reference to the Standalone Financial Statements

A Companys internal financial control with reference to the Standalone Financial Statements is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the Standalone Financial Statements for external purposes in accordance with generally accepted accounting principles. A Companys internal financial control with reference to Standalone Financial Statements 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 the Standalone 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 Standalone Financial Statements.

Inherent Limitations of Internal Financial Controls with reference to the Standalone Financial Statements

Because of the inherent limitations of internal financial controls with reference to Standalone Financial Statements, 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 with reference to Standalone Financial Statements to future periods are subject to the risk that the internal financial control with reference to Standalone Financial Statements may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Qualified Opinion

According to the information and explanations given to us and based on our audit, the following material weaknesses has been identified in the operating effectiveness of the Companys internal financial controls with reference to Standalone Financial Statements as at March 31, 2024:

• The Companys internal financial controls with reference to Standalone Financial Statements as at March 31, 2024 as regards evaluation of uncertainty for realizing the carrying value of investments (including sub ordinate debt), loan and other receivables as explained in Note 43, Note 44, Note 45 and Note 46 to the Standalone Financial Statements were not operating effectively which could potentially lead to not providing adjustments, if any, that may be required to the carrying values of investments (including sub-debt), loan and other receivables from such subsidiaries and its consequential impact on the earnings, other equity and related disclosures in the Standalone Financial Statements.

• The Companys internal process with regards to the confirmation and reconciliation of trade payables, trade receivables, other incidental balances pertaining to the said trade payables and trade receivables are not operating effectively which could have consequential effect on balances.

• In our opinion, the Companys system of processing journal entries in accounting software does not have a maker checker system which could result in a possible effect to the processing of transaction and its consequential effect on balances.

A material weakness is a deficiency, or a combination of deficiencies, in internal financial control with reference to the Standalone Financial Statements, such that there is a reasonable possibility that a material misstatement of the Companys annual or interim Standalone Financial Statements will not be prevented or detected on a timely basis.

In our opinion, the Company has, in all material respects, an adequate internal financial controls system with reference to Standalone Financial Statements as at March 31, 2024, based on the internal control with reference to the Standalone Financial Statements considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over financial reporting issued by the ICAI and except for the effects/possible effects of the material weakness described above on the achievement of the objectives of the control criteria, the Companys internal financial controls with reference to Standalone Financial Statements were operating effectively as at March 31, 2024.

For S G D G & Associates LLP
Chartered Accountants
Firm Registration No.: W100188
Mittali Dakwala
Partner
Membership No.: 143236	Place: Ahmedabad
UDIN: 24143236BKJMWC2375	Date: May 21, 2024

Annexure - B to the Independent Auditors Report

(Referred to in paragraph 2 under "Report on Other Legal and Regulatory Requirements" section of our report the members of

Sadbhav Infrastructure Project Limited of even date)

Report on the Companies (Auditor Report) Order, 2020, issued in terms of section 143 (11) of the Companies Act, 2013(the Act) of Sadbhav Infrastructure Project Limited (the Company)

To the best of our information and according to the explanations provided to us by the Company and the books of account and records examined by us in the normal course of audit, we state that:

(i)(a)(i) The Company has maintained proper records showing full particulars, including quantitative details and situation of Property, Plant and Equipment.

(ii) The Company did not have intangible Assets.

(b) The Company has a program of physical verification of its Property, Plant and Equipment. In accordance with this program, Property, Plant and Equipment were verified during the year and no material discrepancies were noticed on such verification. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets.

(c) The Title deeds of immovable property disclosed in the Standalone financial statements included in investment property are held in the name of the Company as at the balance sheet date.

(d) The Company has not revalued any of its Property, Plant and Equipment during the year.

(e) No proceedings have been initiated during the year or are pending against the Company as at March 31, 2023 for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder.

(ii)(a) The Company had no inventory during and at the year end. Therefore, the reporting requirements of paragraph 3(ii) of the Order are not applicable.

(b) During any point of time of the year, the Company has not been sanctioned working capital limits in excess of Rs. 5 crores, in aggregate, from banks or financial institutions on the basis of security of current assets. Hence the reporting requirements of paragraph 3(ii)(b) of the Order is not applicable.

(iii) (a) The Company has provided loans or advances in the nature of loans, stood guarantee, or provided security during the year and details of which are given below:

				(Rs in Million)
Particulars	Loans	Advances in nature of loans	Guarantees	Security
A. Aggregate amount granted/provided during the year:
- Subsidiaries	127.30	-	-	-
- Others	1.65	-	-	-
B. Balance outstanding as at balance sheet date in respect of above cases (including opening Balances)		-	-	-
- Subsidiaries	127.30
- Others	1.46	-	-	-

(b) In our opinion and according to the information and explanations given to us, the terms and conditions of the grant of loans are prejudicial to the Companys interest on account of the fact that the loans that have been granted are interest- free. However, attention is invited to "Basis for Qualified Opinion" in our main audit report.

(c) In respect of loans granted, the terms of arrangements do not stipulate any repayment schedule of principal and interest except for the loan given to subsidiary named Maharashtra Border Check Post Network Limited which is repayable on 31.03.2034 i.e. after the repayment of the amount of facilities from the banks as per the financing agreement and loan granted to employees wherein the schedule of repayment of principal is stipulated and repayments thereof have been regular as per stipulation.

(d) Since the cited loans are repayable on demand except for the loan as mentioned in the above sub clause which needs to be repaid after the repayment of the amount of facilities from the banks as per the financing agreement, reporting under this clause in respect of overdue balance is not applicable.

(e) In our opinion and according to the information and explanations given to us, neither loans or advances in nature of loans have been renewed or extended nor any fresh loans have been granted to settle the overdue of existing loans.

(f) The Company has granted Loans or advances in the nature of loans which are repayable on demand or without specifying any terms or period of repayment details of which are given below.

			(Rs in Million)
Particulars	Others (Rs.)	Promoters (Rs.)	Related Parties (Rs.)
Aggregate amount of loans/ advances in nature of loans
Repayable on demand (A)	0.00	0.00	127.30
Agreement does not specify any terms or period of repayment (B)	0.00	0.00	0.00
Total (A+B)	0.00	0.00	127.30
Percentage of loans/ advances in nature of loans to the total loans	0.00%	0.00%	98.87%

(iv) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of sections 185 and 186 of the Act, with respect to the loans granted, investments made and guarantees and securities provided, as applicable.

(v) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits (including deemed deposits) from the public within the meaning of provisions of sections 73 to 76 of the Act and the rules framed there under and hence reporting under clause (v) of paragraph 3 of the Order is not applicable. According to the information and explanations given to us, no order has been passed by the Company Law Board or the National Company Law Tribunal or the Reserve Bank of India or any Court or any other Tribunal against the Company in this regard.

(vi) The Central Government has prescribed maintenance of cost records under section 148(1) of the Act. We have broadly reviewed the accounts and records of the Company in this connection and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have not, however, carried out a detailed examination of the same.

(vii) (a) 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 any other statutory dues, as applicable, have not been regularly deposited with the appropriate authorities during the year.

According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, employees state insurance, income tax, sales tax, service tax, duty of customs, duty of excise, value added tax, cess and any other statutory dues, as applicable were in arrears as at March 31, 2024 for a period of more than six months from the, date they became.

(b) Details of statutory dues referred to in sub-clause (a) above which have not been deposited as on March 31, 2024 on account of disputes are given below:

Name of the Statue	Nature of the Dues	Period to which the amount relates	Forum where Dispute is pending	Amount (Rs. in million)
The Income Tax Act, 1961	Income Tax	A.Y. 2016-2017	Income Tax Appellate Tribunal, Ahmedabad	61.12
Goods and Service Tax Act, 2017	Goods & Service Tax	P.Y. 2018-2019	Deputy Commissioners of Maharashtra State Tax.	6.79
Goods and Service Tax Act, 2017	Goods & Service Tax	P.Y. 2018-2019	Deputy Commissioners of Maharashtra State Tax.	8.15
Goods and Service Tax Act, 2017	Goods & Service Tax	P.Y. 2017-2018	Deputy Commissioners of Maharashtra State Tax.	21.68
Goods and Service Tax Act, 2017	Goods & Service Tax	P.Y. 2017-2018	Deputy Commissioners of Rajasthan State Tax.	59.95
Goods and Service Tax Act, 2017	Goods & Service Tax	P.Y. 2017-2018	Deputy Commissioners of Telangana State Tax.	0.40
Goods and Service Tax Act, 2017	Goods & Service Tax	P.Y. 2018-2019	Deputy Commissioners of Uttarakhand State Tax.	2.60
Goods and Service Tax Act, 2017	Goods & Service Tax	P.Y. 2021-2022	Joint Commissioner of Rajasthan State Tax.	0.50

(viii) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not surrendered or disclosed previously undisclosed transactions as income during the year in the tax assessments under the Income Tax Act, 1961 (43 of 1961). Accordingly, clause 3(viii) of the Order is not applicable to the Company.

(ix)(a) We are of the opinion that the Company has not defaulted in repayment of loans or other borrowings or in the payment of interest thereon to any lender.

(b) The Company has not been declared willful defaulter by any bank or financial institution or other lender.

(c) The Company has not taken any term loans during the year. Hence the reporting requirement of paragraph 3(ix)(c) of the Order are not applicable.

(d) On an overall examination of the Standalone Financial Statements of the Company, funds raised on short-term basis amounting to INR 1,107.70 Million have been used during the year for long-term purposes by the Company.

(e) According to the information and explanations given to us and on an overall examination of the financial statements of the Company, we report that the Company has not taken any funds from any entity or person on account of or to meet the obligations of its subsidiaries as defined under the Act. The Company does not hold any investment in associate and any joint venture (as defined under the Act) during the year ended March 31, 2024.

(f) The Company has not raised loans during the year on the pledge of securities held in its subsidiaries, joint ventures or associate companies.

(x) (a) The Company has not raised any money by way of initial public offer or further public offer during the year. Hence the reporting requirements of paragraph 3(x)(a) of the Order are not applicable.

(b) The Company has not made any preferential allotment or private placement of shares or convertible debentures (fully, partially or optionally convertible) during the year. Hence the reporting requirements of paragraph 3(x)(b) of the order are not applicable.

(xi) (a) Based on examination of the books and records of the Company and according to the information and explanations given to us, we report that no fraud by the Company or on the Company has been noticed or reported during the year.

(b) No report under sub-section (12) of section 143 of the Companies Act has been filed in Form ADT-4 as prescribed under Rule 13 of Companies (Audit and Auditors) Rules, 2014 with the Central Government, during the year and up to the date of this report.

(c) As represented by the management, there are no whistle blower complaints received by the Company during the year.

(xii) In our opinion the Company is not a Nidhi Company. Therefore, the reporting requirement of Clause 3(xii) of the Order is not applicable to the Company.

(xiii) According to the information and explanation given to us and on the basis of our examination of the records of the Company, all the transactions with related parties are in compliance with Sections 177 and 188 of the Act where applicable and also the details which have been disclosed in the Financial Statements are in accordance with the applicable Indian Accounting Standards.

(xiv) (a) In our opinion the Company has an internal audit system which is commensurate with the size and nature of its business.

(b) We have considered the internal audit reports for the year under audit, issued to the Company during the year, in determining the nature, timing and extent of our audit procedure.

(xv) The Company has not entered into non-cash transactions with directors or persons connected with its directors and hence the provisions of section 192 of the Companies Act, 2013 are not applicable to the Company.

(xvi)(a) According to the information and explanations given to us, the Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934. Hence, reporting under clause 3(xvi)(a), (b) and (c) of the Order is not applicable. (b) In our opinion, there is no core investment Company within the Group (as defined in the Core Investment Companies (Reserve Bank) Directions, 2016) and accordingly reporting under clause 3(xvi)(d) of the Order is not applicable.

(xvii) The Company has incurred cash losses amounting to INR 509.49 Million during the Financial Year and INR 612.03 Million in the immediately preceding financial year.

(xviii) There has been no resignation of the statutory auditors during the year. Accordingly, clause (xviii) of the Order is not applicable to the Company.

(xix) On the basis of the financial ratios, ageing and expected dates of realization of financial assets and payment of financial liabilities, other information accompanying the Standalone Financial Statements and our knowledge of the Board of Directors and management plans (refer note no 48 to the Standalone Financial Statements) and based on our examination of the evidence supporting the assumptions, there exist material uncertainty as on the date of the audit report indicating that the Company is not capable of meeting its liabilities existing at the date of balance sheet as and when they fall due within a period of one year from the balance sheet date.

We, however, state that this is not an assurance as to further viability of the Company and our reporting is based on the facts up to the date of the audit report and we neither give any guarantee nor any assurance that all liabilities falling due within a period of one year from the balance sheet date, will get discharged by the Company as and when they fall due. (Attention is invited to Note No. 48 to the standalone financial statement and material uncertainty related to going concern paragraph in the main Audit Report)

(xx) The Company has met the criteria as specified under sub-section (1) of section 135 of the Act read with the Companies (Corporate Social Responsibility Policy) Rules, 2014, however, in the absence of average net profits in the immediately three preceding years, there is no requirement for the Company to spend any amount under sub-section (5) of section 135 of the Act; hence reporting under clause 3(xx)(a) & (b) of the Order is not required.

For S G D G & Associates LLP

Chartered Accountants

Firm Registration No.: W100188

Mittali Dakwala

Partner

Membership No.: 143236

Place: Ahmedabad

UDIN: 24143236BKJMWC2375

Date: May 21, 2024