sakthi sugars ltd Auditors report

To The Members of Sakthi Sugars Limited

Report on the Audit of the Financial Statements

Qualified Opinion

1. We have audited the accompanying financial statements of Sakthi Sugars Limited ("the Company"), which comprise the Balance Sheet as at March 31,2023, and the Statement of Profit and Loss (including Other Comprehensive Income), Statement of Changes in Equity and Statement of Cash Flows for the year then ended and notes to the financial statements, including a summary of 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 effect/possible effect of the matter described in the Basis for Qualified Opinion section of our report, the aforesaid 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 accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2023, the profit and total comprehensive income, changes in equity and its cash flows for the year ended on that date.

Basis for Qualified Opinion

3. No provision for the expected credit loss/ impairment on interest receivable from an erstwhile associate company of Rs. 25219.69 lakhs has been recognized as per the requirement of Ind AS 109 "Financial Instruments". In view of non-recoveries, non- confirmations/reconciliation from the debtor company, initiation of legal action against the interest claim of the company and in absence of clear forward looking information regarding outcome of pending legal actions initiated and time frame and quantum of realisability of the interest receivable, we are unable to determine the amount of expected credit loss/ impairment as per the requirements of Ind AS 109 "Financial Instruments" and its consequential impact on the profit for the year/accumulated loss. This matter has been qualified by the predecessor auditors in their audit report for the year ended March 31,2022.

4. We conducted our audit in accordance with the Standards on Auditing (SAs) 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 ICAIs Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified opinion.

Key Audit Matters

5. Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the current period. 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. We have determined the matter described below to be the key audit matter to be communicated in our report..

Key Audit Matter	How the matter was addressed in the audit
Assessment of litigations and related disclosure of contingent liabilities	Our audit procedures included the following:
[Refer to the accompanying note 1.3 and 42A forming integral part of the Financial Statements]	(a) We understood, assessed and tested the design and operating effectiveness of key controls surrounding assessment of litigations relating to the relevant laws and regulations;
As on March 31, 2023, the Company has exposures towards litigations relating to various matters.	(b) We discussed with management the recent developments and the status of the material litigations which were reviewed and noted by the audit committee;
Significant management judgement is required to assess such matters to determine the probability of occurrence of material outflow of economic resources and whether a provision should be recognised, or a disclosure should be made. The management judgement is also supported with legal advice in certain cases as considered appropriate.	(c) We performed our assessment on a test basis on the underlying calculations supporting the contingent liabilities/ other significant litigations made in the Financial Statements;
As the ultimate outcome of the matters are uncertain and the positions taken by the management are based on the application of their best judgement, related legal advice including those relating to interpretation of laws/ regulations, it is considered to be a Key Audit Matter.	(d) We evaluated managements assessments by understanding precedents set in similar cases and assessed the reliability of the managements past estimates/judgements; and
	(e) We assessed the adequacy of the Companys disclosures.
	Based on the above work performed, managements assessment in respect of litigations and related disclosures relating to contingent liabilities/other significant litigations in the Financial Statements are considered to be reasonable.

INDEPENDENT AUDITORS REPORT

4> Other Information

6. The Companys management and Board of Directors are responsible for the other information. The other information comprises the information included in the Companys Annual Report, but does not include the financial statements and our auditors report thereon.

7. The other information 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 do not express any form of assurance conclusion thereon.

8. 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.

9. 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 and take necessary actions, as applicable under the relevant laws and regulations.

Responsibilities of Management and Those Charged with Governance for the 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 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 accounting Standards 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 judgements 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, the Board of Directors 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 the Board of Directors 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 SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

14. As part of an audit in accordance with SAs, we exercise professional judgement and maintain professional skepticism throughout the audit. We also:

(a) 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.

(b) Obtain an understanding of internal financial controls relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such controls.

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

(d) 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

SAKTHI SUGARS LIMITED

INDEPENDENT AUDITORS REPORT

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.

(e) 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 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 A" a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

19. In our opinion and according to the information and explanations given to us, the Company has not paid/provided any managerial remuneration during the year. Hence the reporting requirement under Section 197(16) of the Act, does not arise.

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

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.

(c) The Balance Sheet, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

(d) In our opinion, except for the effect/possible effect of the matters described in the Basis for Qualified Opinion paragraph above, the aforesaid financial statements comply with the Ind AS specified under Section 133 of the Act.

(e) The matters described in the Basis for Qualified Opinion paragraph above, in our opinion, may not 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, 2023 taken on record by the Board of Directors, none of the Directors is disqualified as on March 31,2023 from being appointed as a Director in terms of Section 164(2) of the Act.

(g) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure B".

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

(i) The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note 42A to the financial statements;

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

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

(iv) (a) The Management has represented to us that, to the best of its 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 persons or entities, including foreign entities ("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 to us that, to the best of its knowledge and belief, other than as disclosed in the notes to the accounts no funds (which are material either individually or in aggregate) have been received by the Company from any person(s) or entities, 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.

(c) Based on our audit procedure conducted that are considered reasonable and appropriate in the circumstances, nothing has come to our attention that cause us to believe that the representation under subclause (i) and (ii) of Rule 11(e) as provided under paragraph (2)(h)(iv)(a) & (b) above, contain any material misstatement.

(v) The company has not declared or paid any dividend during the year. Hence, the question of compliance under Section 123 of the Act does not arise.

(vi) Proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 for maintaining books of account using accounting software which has a feature of recording audit trail (edit log) facility is applicable to the Company with effect from April 01, 2023, and accordingly, reporting under Rule 11 (g) of Companies (Audit and Auditors) Rules, 2014 is not applicable for the year ended March 31,2023.

For P N RAGHAvENDRA RAO & CO., Chartered Accountants Firm Registration Number: 003328S

P R vittel

Coimbatore Partner

May 29, 2023 Membership Number: 018111

UDIN : 23018111BGZEXT7296

Annexure - A to the Independent Auditors Report

Referred to in paragraph 18 of the Independent Auditors Report of even date to the members of Sakthi Sugars Limited on the

financial statements for the year ended March 31, 2023

i. In respect of the Companys Property, Plant and Equipment and Intangible Assets:

(a) (A) The Company has maintained proper records showing full particulars, including quantitative details and situation of

Property, Plant and Equipment and relevant details of right-of-use assets.

(B) The Company does not hold any intangible assets and hence reporting under this clause is not applicable.

(b) The Company has physically verified Property, Plant and Equipment in regular intervals 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 Property, Plant and Equipment. In respect of immovable properties taken on lease and disclosed as right-of-use assets in the financial statements, the lease agreements are in the name of the company.

(c) According to the information and explanation given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company, except for the following:

Description of Property	Gross carrying value (Rs. in lakhs)	Held in the name of	Whether promoter, director or their relative or employee	Period held - indicate range, where appropriate	Reason for not being held in name of company
Land	2388.70	Sakthi Soyas Limited	No	Since 01.04.1993	Property acquired pursuant to scheme of amalgamation. The company has taken steps for name change.
Building	984.24	Sakthi Soyas Limited	No	Since 01.04.1993

(d) The Company has not revalued its Property, Plant and Equipment (including Right of Use assets) during the year.

(e) Based on the information and explanations given to us, no proceedings have been initiated or are pending against the Company for holding any benami property under the Prohibition of Benami Property Transactions Act, 1988 and rules made thereunder.

ii. (a) The physical verification of inventory has been conducted at reasonable intervals by the management during the year. In

our opinion, the coverage and procedure of such verification by management is appropriate. No discrepancies of 10% or more in the aggregate for each class of inventory were noticed as compared to book records.

(b) Based on the information and explanations furnished to us, the Company has not been sanctioned working capital limits in excess of Rs. 5 crore, in aggregate, at any points of time during the year, from banks or financial institutions on the basis of security of current assets and hence reporting under clause 3(ii)(b) of the Order is not applicable.

iii. The company has not made investments in, provided any security or granted any loans or advances in the nature of loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or any other parties during the year.

(a) The company has given loan to employees and provided guarantee to one entity during the year. The Company has given unsecured loan to two entities during earlier years and in respect of one entity the principal has been fully repaid and there is an outstanding balance of Rs. 25219.69 lakhs towards interest as on the balance sheet date. The other entity has become a related party during the year. The details of loans and guarantees given and their balances outstanding are as below.

(Rs.in Lakhs)

Particulars	Loans	Guarantee
Aggregate amount granted/ provided during the year to:
-- Other Entities / Employees	114.49	5000.00
Balance outstanding as at balance sheet date:
-- Other Entities / Employees	25474.51	4356.84

(b) In respect of the investments, loans and guarantees, the terms and conditions under which such investments were made, loans granted and guarantees provided are not prejudicial to the Companys interest.

(c) With respect to loan to an entity, the principal amount of the loan has already been fully repaid and interest has been charged after the repayment of principal. As per the representation of the management of the company, the interest has become due and payable on demand. The Company has demanded payment of interest as on date and the receipt of the same is not regular on account of dispute. In respect of the loans given to employees and one other entity, no schedule of repayment of principal and payment of interest has been stipulated and are repayable on demand.

(d) In respect of the aforesaid loan given to the entity, the entire amount of interest is overdue for more than 90 days and the Company has initiated legal actions for recovery of the outstanding interest. In respect of the loans given to the employees and one other entity, that has become a related party during the year, there are no amounts which are overdue for a period of more than 90 days.

(e) No loan granted by the Company which has fallen due during the year, has been renewed or extended or fresh loans granted to settle the overdue of existing loans given to the same parties.

(f) The aforesaid loans are repayable on demand and the company has not granted any loans without specifying any terms or period of repayment. The aggregate amount of loans granted as repayable on demand to related parties are Rs. 25329.69 lakhs and percentage thereof is 99.43% to the total loans granted.

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, in respect of loans granted, investments made, and guarantees and securities provided, wherever applicable.

v. According to the information and explanations given to us, the Company has not accepted any deposits or amounts which are deemed to be deposits within the meaning of provisions of sections 73 to 76 or any other relevant provisions of the Act and the Rules framed there under.

vi. We have broadly reviewed the cost records maintained by the company specified under sub-section (1) of Section 148 of the Act, and are of the opinion that, the prescribed accounts and records have been made and maintained.

vii. (a) According to the information and explanations given to us and on the basis of our examination of the records of the

Company, the company is generally regular in depositing undisputed statutory dues including goods and service tax,

ANNUAL REPORT 2022-23

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 except undisputed statutory dues relating to provident fund, income-tax and goods and services tax that have not generally been regularly deposited during the year by the Company with the appropriate authorities.

According to the information and explanations given to us, arrears of undisputed statutory dues as at March 31, 2023 outstanding for a period of more than six months from the date they became payable are mentioned below:

Name of the Statute	Nature of dues	Amount	Period to which
		(Rs.in lakhs)	the amount relates
Tamil Nadu Tax on Consumption	Electricity Generation Tax	250.61	June 2016 to September 2022
or Sale of Electricity Act, 2003	Interest on Electricity Generation Tax	38.98	June 2016 to September 2022

(b) According to the information and explanations given to us and the records of the Company examined by us, details of statutory dues referred to in sub-clause (a) above which have not been deposited as on March 31, 2023 on account of disputes are given below:

S. No.	Name of the Statute	Nature of dues	Amount (Rs.in lakhs)	Period to which the amount relates	Forum where the dispute is pending
1.	The Central Excise Act, 1944	Excise Duty	759.06	2010-12 & 2015-17	CESTAT, Chennai
2.	The Central Goods and Services Tax Act, 2017	CGST	469.24 4.24	August 2017 and December 2017 2017	Commissioner of GST and Central Excise (Appeals), Coimbatore Commissioner of GST and Central Excise (Appeals), Coimbatore
3.	Tamil Nadu General Sales Tax Act, 1959	Sales Tax	28.24	2000-01	Additional Commissioner (CT)/(RP), Chennai
4.	The Bihar & Orissa Excise Act, 1915	Excise Duty	12.63	2002-03	High Court of Orissa, Cuttack

viii. According to the information and explanations given to us and the records of the Company examined by us, there were no transactions relating to previously unrecorded income that have been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961.

ix. (a) According to the records of the Company examined by us and the information and explanations given to us, the Company

has defaulted in repayment of loans or other borrowings or in the payment of interest to lenders during the year. The defaults by the Company as at the balance sheet date are as under:

Nature of Borrowings	Name of Lender	Amount not paid on due date (Rs. in lakhs)	Whether principal or interest	No. of days delay or unpaid	Remarks, if any
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (Canara Bank)	243.90	Principal	186	Paid on 04.04.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (Canara Bank)	406.50	Principal	188	Paid on 06.04.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (Canara Bank)	89.47	Principal	222	Paid on 10.05.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (Canara Bank)	4607	Principal	246	Paid on 03.06.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (Canara Bank)	17495.59	Interest	246	Interest remission on 03.06.2022

INDEPENDENT AUDITORS REPORT

Nature of Borrowings	Name of Lender	Amount not paid on due date (Rs. in lakhs)	Whether principal or interest	No. of days delay or unpaid	Remarks, if any
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (HDFC Bank Limited)	86.40	Principal	186	Paid on 04.04.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (HDFC Bank Limited)	144.00	Principal	188	Paid on 06.04.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (HDFC Bank Limited)	31.69	Principal	222	Paid on 10.05.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (HDFC Bank Limited)	1632.00	Principal	260	Taken over by Pheonix ARC Pvt. Ltd on 17.06.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (HDFC Bank Limited)	79.02	Interest	256	Paid on 13.06.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (HDFC Bank Limited)	6784.80	Interest	260	Interest remission on 17.06.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (State Bank of India)	207.99	Principal	186	Paid on 04.04.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (State Bank of India)	346.65	Principal	188	Paid on 06.04.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (State Bank of India)	76.30	Principal	222	Paid on 10.05.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (State Bank of India)	3929.00	Principal	260	Transferred to Pheonix ARC Pvt. Ltd on 17.06.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (State Bank of India)	190.20	Interest	256	Paid on 13.06.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (State Bank of India)	14839.34	Interest	260	Interest remission on 17.06.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (IDBI Bank)	137.88	Principal	186	Paid on 04.04.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (IDBI Bank)	229.80	Principal	188	Paid on 06.04.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (IDBI Bank)	50.58	Principal	222	Paid on 10.05.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (IDBI Bank)	2604.00	Principal	260	Transferred to Pheonix ARC Pvt. Ltd.on 17.06.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (IDBI Bank)	126.06	Interest	256	Paid on 13.06.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (Indian Overseas Bank)	176.58	Principal	186	Paid on 04.04.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (Indian Overseas Bank)	294.30	Principal	188	Paid on 06.04.2022

 

Nature of Borrowings	Name of Lender	Amount not paid on due date (Rs. in lakhs)	Whether principal or interest	No. of days delay or unpaid	Remarks, if any
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (Indian Overseas Bank)	64.78	Principal	222	Paid on 10.05.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (Indian Overseas Bank)	3335.00	Principal	260	Transferred to Pheonix ARC Pvt. Ltd. on 17.06.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (Indian Overseas Bank)	161.52	Interest	256	Paid on 13.06.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (Allahabad Bank)	47.25	Principal	186	Paid on 04.04.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (Allahabad Bank)	78.75	Principal	188	Paid on 06.04.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (Allahabad Bank)	17.33	Principal	222	Paid on 10.05.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (Allahabad Bank)	893.00	Principal	260	Transferred to Pheonix ARC Pvt. Ltd. on 17.06.2022
Term Loan from Financial Institution	Asset Reconstruction Company (India) Limited (Allahabad Bank)	43.20	Interest	256	Paid on 13.06.2022
Term Loan from Financial Institution	Edelweiss Asset Reconstruction Limited (IDFC Limited)	1984.09	Principal	291	Paid on 18.08.2022
Term Loan from Financial Institution	Edelweiss Asset Reconstruction Limited (IDFC Limited)	212.55	Interest	291	Paid on 18.08.2022
Term Loan from Financial Institution	Edelweiss Asset Reconstruction Limited (IDFC Limited)	1432.41	Interest	291	Interest remission on 18.08.2022
Term Loan from Financial Institution	Edelweiss Asset Reconstruction Limited (Oriental Bank of Commerce)	2360.41	Principal	291	Paid on 18.08.2022
Term Loan from Financial Institution	Edelweiss Asset Reconstruction Limited (Oriental Bank of Commerce)	253.85	Interest	291	Paid on 18.08.2022
Term Loan from Financial Institution	Edelweiss Asset Reconstruction Limited (Oriental Bank of Commerce)	1505.92	Interest	291	Interest remission on 18.08.2022
Term Loan from Financial Institution	Phoenix ARC Limited (HDFC Bank)	1632.00	Principal	29	Paid on 29.11.2022
Term Loan from Government	Sugar Development Fund	3614.56	Principal	3608	--
Term Loan from Government	Sugar Development Fund	5108.37	Interest	3973	--
Term Loan from Government	Sugar Development Fund	801.86	Principal	3325	--
Term Loan from Government	Sugar Development Fund	1111.32	Interest	4056	--

(b) According to the information and explanations given to us, the Company has not been declared willful defaulter by any bank or financial institution or any other lender.

(c) In our opinion and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were obtained.

(d) On an overall examination of the financial statements of the Company, funds raised on short-term basis have, prima facie, not been used during the year for long-term purposes by the Company.

(e) According to the information and explanations given to us, the Company does not have any subsidiary, associate, or joint venture. Accordingly, the requirement to report on clause 3(ix)(e) of the Order is not applicable to the Company.

(f) According to the information and explanations given to us, the Company does not have any subsidiary, associate, or joint venture. Accordingly, the requirement to report on clause 3(ix)(f) of the Order is not applicable to the Company.

x. (a) The Company has not raised moneys by way of initial public offer or further public offer (including debt instruments) during

the year and hence reporting under clause 3(x)(a) of the Order is not applicable.

(b) The Company has not made any preferential allotment or private placement of shares or convertible debentures (fully or partly or optionally) during the year and hence reporting under clause 3(x)(b) of the Order is not applicable.

xi. (a) To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company or

any fraud on the Company has been noticed or reported during the year. Accordingly, reporting under clause 3(xi)(a) and (b) of the Order is not applicable to the Company.

(b) According to the information and explanations given to us, 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. Accordingly, the reporting under clause 3(xi)(b) of the Order is not applicable to the Company.

(c) According to the information and explanations given to us, and as represented by the management, no whistle-blower complaints have been received during the year by the Company. Accordingly, the reporting under clause 3(xi)(c) of the Order is not applicable to the Company.

xii. In our opinion, the Company is not a Nidhi Company. Accordingly, the reporting under clause 3 (xii)(a) to (c) of the Order is not applicable to the Company.

xiii. According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with sections 177 and 188 of the Act. The details of such transactions have been disclosed in the financial statements as required by the applicable accounting standards.

xiv. (a) In our opinion and according to the information and explanations given to us, the Company has an internal audit system

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 and till date, in determining the nature, timing and extent of our audit procedures.

xv. According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into non-cash transactions with directors or persons connected with him. Accordingly, the reporting under clause 3(xv) of the Order is not applicable to the Company.

xvi. (a) In our opinion, 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 to the Company.

(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 the reporting under clause 3(xvi)(d) of the Order is not applicable to the Company.

xvii. The Company has not incurred cash loss during the financial year covered by our audit. However, the company has incurred a cash loss of Rs.16635.04 lakhs in the immediately preceding financial year.

xviii There has been no resignation of the statutory auditors during the year. Accordingly, the reporting under 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 financial statements and our knowledge of the Board of Directors and Management plans and based on our examination of the evidence supporting the assumptions, nothing has come to our attention, which causes

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us to believe that any material uncertainty exists as on the date of the audit report indicating that 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 the future viability of the Company. We further state that 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.

xx. In our opinion and according to the information and explanations given to us, the Company is not required to spend on CSR activity based on the criteria prescribed under Section 135 of the Companies Act, 2013 and hence, reporting under clause 3(xx)(a) and 3(xx)(b) of the Order is not applicable to the Company.

For PN. RAGHAvENDRA RAO & CO., Chartered Accountants Firm Registration Number: 003328S P R vittel

Coimbatore Partner

May 29, 2023 Membership Number: 018111

UDIN: 23018111BGZEXT7296

Annexure - B to the Independent Auditors Report

Referred to in paragraph 20(g) of the Independent Auditors Report of even date to the members of Sakthi Sugars Limited on the

financial statements for the year ended March 31, 2023

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

("the Act)

1. We have audited the internal financial controls over financial reporting of Sakthi Sugars Limited ("the Company") as of March 31, 2023 in conjunction with our audit of the financial Statements of the Company for the year ended on that date.

Managements Responsibility for Internal Financial Controls

2. The Companys management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (‘ICAI). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.

Auditors Responsibility

3. Our responsibility is to express an opinion on the Companys internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the "Guidance Note") and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Act, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the 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 over financial reporting was 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 internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditors 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 internal financial controls system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

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

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

(b) 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

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

Opinion

8. In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2023, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

For PN. RAGHAvENDRA RAO & CO., Chartered Accountants Firm Registration Number: 003328S

P R vittel

Coimbatore Partner

May 29, 2023 Membership Number: 018111

UDIN: 23018111BGZEXT7296