Shah Alloys Ltd Auditors Report.

To the Members of SHAH ALLOYS LIMITED

Report on the Audit of the Standalone Financial Statements Qualified

Opinion

We have audited the accompanying standalone financial statements of M/s SHAH ALLOYS LIMITED (the Company"), which comprise the balance sheet as at March 31, 2019, 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.

In our opinion and to the best of our information and according to the explanations given to us, except for the effects of the matter 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 accounting principles generally accepted in India including Indian Accounting standards (Ind AS) specified under section 133 of the Act, of the state of affairs (financial Position )of the Company as at March 31, 2019, and its Profits (financial performance including other comprehensive income), its Cash flows and changes in equity for the year ended on that date.

Basis for Qualified Opinion

1. The Company has not provided for foreign exchange loss in the financial results on the Principal amount of 1,00,00,000 USD and on the Premium amount of 48,25,500 USD of the Foreign Currency Convertible Bonds (FCCB) which had become due for payment on September 22, 2011 and remain unpaid as at March 31, 2019, which constitutes a departure from the Indian Accounting Standard- 21. "The Effects of Changes in Foreign Exchange Rates which requires that each foreign currency monetary items should be reported using the closing rate as at the balance sheet date. Non provision of the foreign exchange loss on the aforesaid Foreign Currency Convertible Bonds (FCCB) and the Premium amount relates to the period from September 23, 2011 to March 31, 2019. Had the company followed the Accounting Standard and made the provision for foreign exchange loss on the above FCCB for the year ending on 31.03.2019, then the Profit of the company for the year ending on 31.03.2019 would have been lower by Rs. 652.17 lacs and to that extent the liability would have been higher. However, the company has not provided for foreign exchange fluctuation on the above FCCB since September 2011 and accordingly the total loss on foreign exchange works out to Rs.3057.40 lacs which has not been provided by the company. Thus, balance of Reserve and surplus and the current liabilities have been understated by Rs. 3057.40 as on 31.03.2019. (Refer Note no 32 of notes forming part of standalone financial statements)

2. For the year ending on 31st March,2019, the company has discontinued to make the provision of interest on loans from banks and financial institutions (excluding on the settlement entered with ARCs for specific loans which are assigned to them).Had the company continued the said practice of making provision of interest on loans from banks and financial institutions for the year ended on 31st March2019 the Profit of the year would have been lower by Rs 1305.64 lacs and current liabilities would have been higher to that extent. (Refer Note no 33 of notes forming part of standalone financial statements)

3. The Company has not assessed the impact of Effective Interest Method to the finance cost as per the requirement of lnd AS 109 Financial Instruments and hence, the effect of the same, if any, on the financial results is not identifiable therefore, we are unable to comment upon its impact on the Financial results for the year ended March 31, 2019(Refer Note no 43 of notes forming part of standalone financial statements)

4. The Company has not evaluated the provisioning requirement of a loss allowance on its financial assets so as to give impact of impairment if any as per the expected credit loss method as per the requirement of lnd AS 109 Financial Instruments and hence, the effect of the same if any on the Financial Results is not identifiable therefore. We are unable to comment upon its impact on the financial results for the year ended March 31, 2019(Refer Note no 44 of notes forming part of standalone financial statements)

We conducted our audit in accordance with the Standards on Auditing specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditors Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Act, and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Material Uncertainty Related to Going Concern

The Companys current liabilities exceeded its current assets as at the previous year balance sheet date. These conditions indicate the existence of a material uncertainty that may cast significant doubt about the Companys ability to continue as a going concern. However, in the view of the management, the Company is making sincere efforts for the revival of the Business S the management is confident to recover the losses through improved profitability in foreseeable future and therefore the financial results of the

Company have been prepared on a "going concern basis". (Refer Note no 42 of notes forming part of standalone financial statements)

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 financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Key Audit Matter:

Description of Key audit Matter Our response and results
Litigations and claims Our audit procedures, inter alia, included following:
(Refer note 38) to the standalone financial statements) The cases are pending with multiple tax authorities like - Discussed disputed litigation matters with the companys management.
Excise and Service tax and there are claims against the company which have not been acknowledged as debt by the company. In normal course of business, financial exposures may arise from pending proceedings and from claims of the customers not acknowledged as debt by the company. Whether a claim needs to be recognized as liability or disclosed as contingent liability in the financial statements is dependent on a number of significant assumptions and judgments. The amounts involved are potentially significant and determining the amount, if any, to be recognised or disclosed in the financial statements, is inherently subjective. - Evaluated the managements judgment of tax risks, estimates of tax exposures, other claims and contingencies. Past and current experience with the tax authorities and managements correspondence/response including on the claims lodged by customers, were used to assess the appropriateness of managements best estimate of the most likely outcome of each uncertain contingent liability.
We have considered Litigations and claims, a Key Audit Matter as it requires significant management judgement, including accounting estimates that involves high estimation uncertainty. - Critically assessed the entitys assumptions and estimates in respect of claims, included in the contingent liabilities disclosed in the financial statements. Also, assessed the probability of negative result of litigation and the reliability of estimates of related obligations. Conclusion: Based on the procedures described above, we did not find any material exceptions to the managements assertions and treatment, presentation S disclosure of the subject matter in the standalone financial statements.

Emphasis of Matter

1. The Companys current liabilities exceeded its current assets as at the previous year balance sheet date. These conditions indicate the existence of a material uncertainty that may cast significant doubt about the Companys ability to continue as a going concern. However, in the view of the management, the Company is making sincere efforts for the revival of the Business S the management is confident to recover the losses through improved profitability in foreseeable future and therefore the financial results of the Company have been prepared on a "going concern basis". (Refer Note no 42 of notes forming part of standalone financial statements)

2. The balance confirmation from the suppliers, customers as well as to various loans or advances given have been called for, but the same are awaited till the date of audit. Thus, the balances of receivables, trade payables as well as loans and advances have been taken as per the books of accounts submitted by the company and are subject to confirmation from the respective parties(Refer Note no 41 of notes forming part of standalone financial statements)

Our opinion is not modified on the above matters.

Information other than the Financial Statements and Auditors Report thereon

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

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

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

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

The Companys Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these standalone financial statements that give a true and fair view of the state of affairs (financial position),Profit or loss(financial performance including other comprehensive income), changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due. to fraud or error.

In preparing the financial statements, management is responsible for assessing the Companys ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those Board of Directors are also responsible for overseeing the Companys financial reporting process.

Auditors Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are .free from material misstatement, whether due to fraud or error. and to issue an auditors report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Standards on Auditing will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if; individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements

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

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

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for 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 financial statement or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors report. However, future events or conditions may cause the Company to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

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 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 197(16) of the Act, we report that the company has paid remuneration to its directors during the year in accordance with the provisions of and limits laid down under section 197 read with schedule V to the Act. The remuneration paid to any director is not in excess of the limit laid down under section 197 of the Act. The Ministry of Corporate Affairs has not prescribed other details under Section 197(16) which are required to be commented upon by us.

2. As required by the Companies (Auditors Report) Order, 2016 (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.

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

a. We have sought and except for the matters described in the Basis for Qualified opinion, 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 possible effects of the matter described in the Basis for Qualified opinion, paragraph above, 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, Statement of Changes in Equity and the Statement of Cash Flow Statement dealt with by this Report are in agreement with the. books of account.

d. The matter described under the Emphasis of Matters paragraph above, in our opinion, may have an adverse effect on the functioning of the Company

e. 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, 2014.

f. On the basis of written representations, received from the directors as on March 31,2019 taken on record by the Board of Directors, none of the Directors is disqualified as on March 31,2019 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".Our report express an unmodified opinion on the adequacy and operating effectiveness of the companys internal financial control over financial reporting.

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

i. The Company has disclosed the impact of pending litigations on its financial position in the standalone Financial Statements ( Refer Note No 38 to the Standalone 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.

ANNEXURE A -TO THE INDEPENDENT AUDIT REPORT OF EVEN DATE TO THE MEMBERS OF SHAH ALLOYS LIMITED ON THE STANDALONE FIANCIAL STATEMENTS FOR THE YEAR ENDED 31ST MARCH 2019

(i) In respect of its Property, Plant S Equipments:

(a) The Company has maintained proper records showing full particulars, including quantitative details and situation of Property, Plant S Equipments on the basis of available information.

(b) As explained to us, major portion of Property, Plant S Equipments are physically verified by the management during the year in accordance with a phased program of verification adopted by company. in our opinion, the frequency of verification is reasonable having regard to the size of the Company and nature of its assets. As informed to us, no material discrepancies were noticed on such physical verification.

(c) According to the information and explanation given to us and on the basis of our examination of records of the company, title deeds of the immovable properties held are in the name of the company.

(ii) As explained to us, inventories(excluding goods in transit and goods lying at port) were physically verified by management at reasonable intervals during the year. In our opinion, the frequency of the verification is reasonable. The discrepancies noticed on verification between the physical stocks and the book records were not material.

(iii) In respect of loans, Secured or unsecured granted by the company to the companies, firms, limited liability partnership or other parties covered in the register maintained u/s 189 of the companies Act, 2013:

According to the information and explanations given to us and on the basis of records produced before us,the company has not granted any loan, secured or unsecured to the companies,limited liability partnership or firms or other parties covered in the register maintained u/s 189 of the companies Act,2013 and hence sub-clause (a)S(b) S (c) of paragraph 3 of companies auditors report order 2016 are not applicable to the company.

(iv) According to the information and explanations given to us, the company has not made any investment or given any loans during the year under review Accordingly, paragraph 3(iv) of the Order is not applicable.

(v) The Company has not accepted any deposits from the public.

(vi) We have broadly reviewed the books of accounts maintained by the company pursuant to the rules made by the Central Government of India for the maintenance of Cost records specified under section 148 of Companies Act 2013 and are of the opinion that prima facie, the prescribed accounts S records have been made and maintained. We have however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

(vii) In respect of Statutory dues

(a) According to the information and explanation given to us and on the basis of examination of the records of the Company, amounts deducted/ accured in the books of accounts in respect of undisputed statutory dues including provident fund, ESIC, income-tax, sales tax, Goods S Service Tax, service tax, , duty of customs, duty of excise, value added tax, cess and other statutory dues have been generally regularly deposited during the year with the appropriate authorities.

According to the information and explanation given to us no undisputed amounts payable in respect of provident fund, ESIC, income-tax, Goods S ServIce Tax, service tax, duty of customs, duty of excise, cess and other statutory dues were resaid dues were outstanding as at 31st March,2019 for a period of more than six months from the date of becoming payable

b) On the basis of records produced before us for our verification and according to the information and explanations given to us, the details of disputed dues that have not been deposited as on 31st March, 2019 on account of matters pending before the appropriate authorities are as under:

Sr. no Name of the statue Nature of Dues Financial year to which it relates From where the dispute is pending Amount under dispute not yet deposited (Net of Payments) (in Rs lakhs.)
1 Custom , Service tax and Excise Service tax January 2005 to July 2011 The Commissioner of Central Excise , Ahmedabad III 51.58
2 Custom , Service tax and Excise Service tax April 2012 to October 2012 Custom Excise and Service Tax , Appellate Tribunal, Ahmedabad 23.43
Sr. no Name of the statue Nature of Dues Financial year to which it relates From where the dispute is pending Amount under dispute not yet deposited (Net of Payments) (in Rs lakhs.)
3 Custom , Service tax and Excise Service tax to March 2013 November 2012 The Addl. Commissioner of Central Excise , Ahmedabad III 1.71
4 Custom , Service tax and Excise Service tax 2013-14 The Joint Commissioner of Central Excise , Ahmedabad III 1.48
5 Custom , Service tax and Excise Service tax November 1997 to June 1998 Gujarat High Court 25.43
6 Custom , Service tax and Excise Excise duty September 2010 to Dec. 2013 Custom Excise and Service Tax , Appellate Tribunal, Ahmedabad 1909.76
7 Custom , Service tax and Excise Service tax Dec. 2014 to May 2015 The Dy, Commissioner of Central Excise Division Kalol, Ahmedabad III 0.87
8 Custom , Service tax and Excise Service tax June 2015 to Dec. 2015 The Asst. Commissioner of Central Excise S CGST, Div.Kalol 5.75
9 Custom , Service tax and Excise Service tax January 2016 to July 2016 The Asst. Commissioner of Central Excise S CGST, Division Kalol 1.22
10 Custom , Service tax and Excise Service tax August 2016 to June 2017 The Asst. Commissioner of Central Excise S CGST, Division Kalol 1.83

(viii) Consequent upon the sanction of the restructuring package given under CDR mechanism by banks and financial institutions, the company was requiredto start repaying the loans sanctioned by banks/institutions and debentures holders from June 2011 onwards, however the company has made default in repaying the dues as per the terms stipulated in CDR Rework Proposal. The amount and the period of default in respect of term loan, Non convertible Debentures, Funded interest term Loans, Interest Payable, on the said facilities are as under :

NAME OF THE BANK/FINANCIAL INSTITUTIONS NATURE OF FACILITY AMOUNT OF DEFAULT AS AT 31-03-2019 (Rs in lacs) PERIOD OF DEFAULT (No. of days )
HDFC BANK Term Loan 1171.54 1-2831
Funded Interest Term loan 449.41 1-1916
Interest Payable 877.89 1-2892
INDIAN OVERSEAS BANK Non convertible Debenture 979.17 1-2831
Funded Interest Term loan 684.15 1-1916
Interest payable 311.33 1-3165
LIC OF INDIA TERM LOAN 629.39 1-2831
Funded Interest Term loan 370.01 1-1916
Non convertible Debenture 7833.33 1-2831
Interest Payable 51.58 1-3196

Moreover, the company, in September 2006 has raised us $10 million through unsecured zero coupon foreign currency convertible bonds (FCCB), due on 22 September 2011.on full conversion of FCCB, the FCCB will be converted into 26,41,143 equity shares of Rs10 each at a premium of Rs 165 per share, at the option of bondholders at any time before the maturity of bonds. On conversion capital will increase by Rs264.11 Lakhs and share premium by Rs 4357.58 Lakhs. If bonds are not converted, the company will have to repay the bonds at premium and in us$. The bonds were convertible into equity shares at the option of bond holders at any time on or after 20thsept 2006 and upto and including 8th September 2011. And hence as on 31st march 2019, this conversion option with bond holders is not being in effect. The company has provided the premium till 22nd Sept 2011 which has been adjusted against security premium in accordance with section 52 of Companies Act, 2013.

However, the company has defaulted in repayment of foreign currency convertible bond (FCCB) dues on its maturity. The default is subsisting since2746 days.

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

(x) According to the information and explanations given to us, no fraud by the Company or on the Company by its officers or employees has been noticed or reported during the course of our audit.

(xi) According to the information and explanations give to us and based on our examination of the records of the Company, the Company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Act.

(xii) In our opinion and according to the information and explanations given to us, the Company is not a nidhi company. Accordingly, paragraph 3(xii) of the Order is not applicable.

(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 where applicable and details of such transactions have been disclosed in the financial statements as required by the applicable accounting standards.

(xiv) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.

(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, paragraph 3(xv) of the Order is not applicable.

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

Annexure B to the Independent Auditors Report of Even Date to the Members of SHAH ALLOYS LIMITED on the Standalone Financial Statements of the year ended on 31st March 2019 Independent Auditors Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act")

In conjunction with our audit of the standalone financial statements of M/s SHAH ALLOYS LIMITED ("the Company") as at and for the year ended 31st March 2019, We have audited the internal financial controls over financial reporting of the company as of that date. Managements Responsibility for Internal Financial Controls

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

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 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 over financial reporting 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 over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditors judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Companys internal financial controls system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A companys internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A companys internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the companys assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

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

Opinion

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 31st March 2019, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note issued by the ICAI.

For Parikh & Majmudar
Chartered Accountants
FR No. 107525W
Sd/-
[C.A (Dr) Hiten M. Parikh]
Place:Ahmedabad PARTNER
Date: 30/05/2019 Membership No. 40230