Shristi Infrastructure Development Corporation Ltd Auditor Reports

To,

The Members of

Shristi Infrastructure Development Corporation Limited Report on the Audit of Standalone Financial Statements

Qualified Opinion

We have audited the accompanying Standalone Financial Statements of SHRISTI INFRASTRUCTURE DEVELOPMENT CORPORATION LIMITED (hereinafter referred to as the ‘Company) which comprise the Balance Sheet as at 31st March, 2024, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the Statement of Cash Flows for the year then ended and notes to standalone financial statements, including a summary of the material accounting policies and other explanatory information (hereinafter referred to as "standalone financial statements").

In our opinion and to the best of our information and according to the explanations given to us, except for the possible effect of the matters described in the ‘Basis for Qualified Opinion paragraph 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, of the state of affairs of the Company as at 31st March, 2024, its loss and other comprehensive income, changes in equity and its cash flows for the year ended on that date.

Basis for Qualified Opinion

a) We draw your attention to Note 31(18) to the accompanying standalone financial statements regarding non - provision of interest expense of Rs. 2579.28 lakhs on the borrowings from Srei Equipment Finance Limited for the year ended 31st March, 2024 (Cumulative non- provisioning of interest w.e.f 1st April, 2023 to 31st March, 2024 for Rs. 2579.28 lakhs) which is not in accordance with the requirements of Ind AS 23: Borrowing Costs read with Ind AS 109: Financial Instruments.

This has resulted in understatement of finance cost to the extent with consequential impact on other reported financials along with non- provision of Income Tax Deducted at Sources (TDS) liability in this regard of Rs. 143.15 lakhs as on 31st March, 2024.

Had the aforesaid interest expense been recognized, the finance cost for the year ended 31st March, 2024 would have been Rs. 5387.78 lakhs instead of Rs. 2808.50 lakhs. The total expenses for the year ended 31st March, 2024 would have been Rs. 18667.70 lakhs instead of Rs. 16088.42 lakhs. The Net Profit /(loss) after tax for the year ended 31st March 2024 would have been Rs. (4418.81 lakhs) instead of Rs. (1839.53 lakhs). The comprehensive Profit /(Loss) for the year ended 31st March 2024 would have been Rs. (4405.79 lakhs) instead of reported amount of Rs. (1826.51 lakhs). Other Equity as on 31st March, 2024 would have been Rs. (9466.27) lakhs instead of reported amount of Rs. (6886.99) lakhs and Other current financial liability as on 31st March 2024 would have been Rs. 9149.35 lakhs instead of reported amount of Rs. 6713.22 Lakhs. Other Current Liability as on 31st March, 2024 would have been Rs. 21371.39 lakhs instead of Rs. 21228.24 lakhs.

b) In the matter of Sarga Udaipur Hotels & Resorts Private Limited, a subsidiary of the company, as stated in Note 31(17) to the standalone financial statements, the Honble National Company Law Tribunal ("NCLT"), Kolkata Bench, admitted the Corporate Insolvency Resolution Process ("CIRP") under the Insolvency and Bankruptcy Code, 2016 (IBC) against Sarga Udaipur Hotels & Resorts Private Limited and CIRP is initiated vide order dated 29th April, 2022.

In view of the admission of the above subsidiary under CIRP process by the Honble NCLT, we are unable to comment on the extent of realisability of its value of investment of Rs. 195.00 lakhs and interest free loan of Rs. 1,865.79 lakhs receivable from above subsidiary.

Similarly, we are also unable to comment on the extent of realisability of investment of Rs. 300.00 lakhs and loan of Rs. 731.35 lakhs (including interest) receivable from Shristi Urban Infrastructure Development Limited, being subsidiary of the company (which is the holding company of Sarga Udaipur Hotels & Resorts Private Limited, a company undergoing CIRP process as mentioned above), The consequential effect of the above, on the standalone financial statements for the year ended 31st March, 2024 is not ascertainable.

c) Asian Healthcare Services Limited (erstwhile associate) has not commenced any business operation since its incorporation in the year 2004 and has reported accumulated losses. There is an apparent indication of impairment in value of outstanding balance of loan (given) of Rs. 140.65 lakhs as on 31st March 2024. Provision for impairment of aforesaid outstanding amount of loan of Rs. 140.65 lakhs has not been made. This might have consequential impact on the reported financials.

We conducted our audit of the Standalone Financial Statements 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 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 opinion on the Standalone Financial Statements.

Material Uncertainty Related to Going Concern

We draw your attention to Note 31(24) of the standalone financial statements regarding preparation of the financial statements on going concern basis, for the reason mentioned therein. The Company has incurred losses for more than three consecutive financial years and net worth as on 31st March, 2024 has been fully eroded. This indicates the existence of a material uncertainty that may cast significant doubt on the Companys ability to continue as going concern. The appropriateness of assumption of going concern is critically dependent upon the management view and projected future cash flows of the Company.

Our opinion is not modified in respect of this matter.

Emphasis of Matter

a) With reference to Note 31(16) to the standalone financial statements, in the matter of Sarga Hotel Private Limited, a material subsidiary of the company, Corporate Insolvency Resolution Process (‘CIRP) was initiated w.e.f. 11th February 2022 and Resolution Plan was approved vide order dated 04th January, 2024 pronounced by Honble National Company Law Tribunal (NCLT), Kolkata Bench. An appeal was filed by the Company before National Company Law Appellate Tribunal (NCLAT), New Delhi against the aforesaid order which was disposed -off vide order dated 4th of April 2024. The Company has further filed a Civil Appeal before the Honble Supreme Court of India, which is presently in admission stage. Accordingly, financial adjustment of balances appearing in books w.r.t. Sarga Hotel Pvt Ltd, has not been made in the standalone financial statements for the year ended 31st March, 2024 which might have consequential impact on reported financials.

b) Refer Note 31(15) to the standalone financial statements regarding an arbitration w.r.t dispute between Rishima SA Investments LLC, Mauritius ("Claimant") and the Company in respect of which the Arbitration Tribunal has issued a Final award in favour of the Claimant for payment of an amount of Rs.76,100 lakhs with interest calculated till 30.04.2019 amounting to Rs.1,390 lakhs and in case the same cannot be enforced in any Court or Tribunal a sum of Rs. 16,020 lakhs with interest calculated till 30th April, 2019 amounting to Rs. 2,621 lakhs towards the value of their investment in Sarga Hotel Pvt. Ltd, a erstwhile subsidiary of the Company together with aggregate costs, damages, etc. of Rs. 1,808 lakhs. Pending outcome of the enforcement proceedings before Honble High Court of Delhi and based on the legal opinion obtained by the Company, the management does not consider necessary for any provision in this respect.

c) With reference to Note 31(18) to the standalone financial statements, the Company has defaulted in payment of interest on Term Loan amounting to Rs. 4707.94 Lakhs to Financial Institution till 31st March, 2024. Further non - provisioning of interest of Rs. 2579.28 lakhs (subject to TDS) for the period from 1st April, 2023 to 31st March, 2024 is also in default.

d) With reference to Note 31(19) to the standalone financial statements, certain balances of Trade Receivables, Trade payables etc. are subject to confirmation/reconciliation. The reported standalone financials might have consequential impact which remains unascertained.

e) Pursuant to One-Time settlement (OTS) as mentioned in Note no. 31(23) to the standalone financial statements in respect of borrowings from DBS Bank India Limited, an amount of Rs. 3710.13 lakhs have been considered as income and shown under "Exceptional Items" in the Statement of Profit and Loss for the year ended 31st March, 2024.

f) As stated in Note 31(20) to the standalone financial statements regarding Corporate guarantee of Rs. 72,522.05 lakhs was given by the Company for loan granted by the lenders to its erstwhile Subsidiary Company, Sarga Hotel Private Limited and Rs. 25,355.63 lakhs for its erstwhile associate, Suasth Health Care Foundation. The lenders have filed an application under Sec 7 of IBC for the corporate guarantee extended by the Company for the debt of Sarga Hotel Private Ltd. Subsequent to such application the Resolution Plan in respect of Sarga Hotel Private Limited has already been approved by Honble NCLT, Kolkata. The Honble NCLT, Kolkata has further approved Resolution Plan in respect of Suasth Health Care Foundation vide Order dated 18.12.2023.

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 for the year ended 31st March, 2024. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matters described below to be the key audit matters to be communicated in our report.

Key Audit Matter	How our audit addressed the key audit matter
Revenue Recognition	Our audit procedures included the following:
Revenues from real estate development and contracts represent the largest portion of the total revenues of the Company. Revenue is recognized upon transfer of control of units to customers for an amount, which reflects the consideration the Company expects to receive in exchange for those units. The point of revenue recognition is normally on possession/handover of the unit to the customer on completion of the project. The Company records revenue at a point in time upon transfer of control of residential units to the customers.Considering the volume of the Companys projects and the competitive business environment, there is a risk of revenue being overstated or understated. Since revenue recognition has direct impact on the Companys profitability this is considered as a key audit matter.	? Evaluation of the Companys accounting policies for revenue recognition are in line with the applicable Indian Accounting Standards and their application to customer contracts including consistent application;
	? Evaluation of the design and implementation and testing the operating effectiveness of key controls around contracts with customers, milestone billing, handover/possession, and controls over collection from customers;
	? Verified the documents – sale agreement, handover/possession letter, collections etc. on selective basis;
Refer Notes 2.9 on Material Accounting Policy and 31(7) regarding disclosures w.r.t. Ind AS 115.	Cut-off procedures for recording of revenue in the relevant reporting period; and Considered the adequacy of the disclosures in notes to the standalone financial statements in respect of recognition of revenue.
Evaluation of Uncertain outcome of pending litigation	Our audit procedures included the following:
Refer Note 31(1) in respect of contingent liabilities.	? Obtained understanding of key issues involved in pending tax and other litigations;
The Company is having various ongoing litigations and other legal proceedings before government, other regularity authorities and courts. These litigations involve significant management judgment to determine the possible outcome of the uncertain tax positions and legal cases, consequently having an impact on related accounting and disclosures in the Ind-AS standalone financial statements.	? We have asked the management for new legal cases arose during current financial year and latest development;
	We have discussed with appropriate senior management and evaluated underlying key assumptions.

Information other than the Standalone Financial Statements and Auditors Report Thereon

The Companys Board of Directors is responsible for other information. The other information comprises the information included in the Boards Report including Annexures to Boards Report, Business Responsibility Report but does not include the Standalone Financial Statements and our Auditors report thereon.

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 Financial Statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information; we are required to report that fact. We have nothing to report in this regard.

Responsibility of the Management for the Standalone Financial Statements

The Companys Board of Directors is responsible for the matters stated in section 134(5) of the Companies Act, 2013 with respect to the preparation of these financial statements that give a true and fair view of the financial position and financial performance and cash flow of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards 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 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 standalone financial statements 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 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 the Board of Directors either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

The 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 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 Standalone financial statements.

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

? Identify and assess the risks of the 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 Companies Act,2013, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such controls.

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

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

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

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

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 the Companies (Auditors Report) Order, 2020 ("the Order"), issued by the Central Government of India in terms of sub-section (11) of Section 143 of the Companies Act, 2013, we give in the Annexure A, a Statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

2. 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 Cash Flow Statement and the Statement of Changes in Equity dealt with by this Report agree with the books of accounts.

d) Except for the possible effect of the matters described in the "Basis of Qualified opinion "paragraph of our report, 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.

e) The matter described in the Basis for Qualified Opinion and Emphasis of Matter paragraph to this report, 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 31st March, 2024 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2024 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 expresses a

qualified opinion on the adequacy and operating effectiveness of the Companys internal financial controls over financial reporting.

h) In our opinion, the managerial remuneration for the year ended 31st March, 2024 has been paid / provided by the Company to its directors is in accordance with the provisions of Section 197 read with Schedule V to the Act.

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

i) The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements. Refer Note 31 (1) 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 has been no delay in transferring amounts required to be transferred to the Investor Education and Protection Fund by the Company.

iv) (a) The Management has represented that, to the best of its knowledge and belief, as disclosed in the notes to the accounts, 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(s) or entity(ies), 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, 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 any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities ("Intermediaries"), with the understanding, whether recorded in writing or 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

(c) Based on such audit procedures performed as considered reasonable and appropriate in the circumstances, nothing has come to our attention that causes us to believe that the management representations under sub-clauses (a) and (b) above contain any material misstatement.

v) The Company has neither declared nor paid dividend during the year, hence compliance of section 123 of the Companies Act, 2013 does not arise.

vi) Based on our examination which included test checks, the company has used an 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. Further, during the course of our audit we did not come across any instance of audit trail feature being tampered with.

As provision 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

"Annexure A" to the Independent Auditors Report

The Annexure A referred to in paragraph I under the heading ‘Report on Other Legal & Regulatory Requirements of our report of even date to the standalone financial statements of the Company for the year ended 31st March, 2024.

According to the information and explanations given to us and on the basis of our examination of the records of the Company we report that:

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

(B) The Company does not hold any intangible assets. Therefore, reporting under clause (i) (a) (B) of paragraph 3 of the said order is not applicable.

(b) The Property, plant and equipment of the Company have been physically verified by the management at reasonable intervals and no material discrepancies were noticed on such verification.

(c) The title deeds of all immovable properties (other than properties where the Company is the lessee and the lease agreements are duly executed in favour of the lessee), disclosed in the standalone financial statements under Property, Plant and Equipment are held in the name of the Company.

(d) The Company has not revalued any of its Property, Plant and Equipment during the year. Hence, reporting other information under this clause is not required.

(e) There are no proceedings have been initiated or pending against the Company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 and Rules made thereunder. Hence, disclosures of details in this regard under clause 3 (i) (e) of the said Order is not applicable.

(ii) (a) The inventory has been physically verified by the management during the year. In our opinion, the frequency of such verification is reasonable and procedures and coverage as followed by management were appropriate. Discrepancies of 10% or more in the aggregate were not noticed on physical verification.

(b) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has been sanctioned working capital limits in excess of five crore rupees, in aggregate, from banks on the basis of security of current assets. However, as per terms of revised sanction of repayment plan issued by the members of consortium credit facilities taken, there is no requirement to file any returns or statement of current assets with such banks.

(iii) The Company has made investments in, granted loans, secured or unsecured, to companies, firms, Limited Liability Partnerships, or any other parties during the year.

a) The Company has provided loans, or stood guarantee to its subsidiaries and to parties other than subsidiaries, joint ventures and associates as follows:

Particulars	Loans (Rs. in lakhs)
Aggregate amount granted/provided during the year
- to Subsidiaries	11.66
- to Others	-
Balance outstanding as at Balance Sheet date in respect of above cases
- Subsidiaries	2,597.15
- Others	140.65

"Annexure A" to the Independent Auditors Report (Contd.)

b) We are of the opinion that the terms and conditions of grant of loans are, prima facie, not prejudicial to the interest of the Company.

c) The loans granted to the companies and the interest thereon do not have any stipulated schedule of repayment as they are repayable on demand, hence we are unable to express comment on the extent of realisability of aforesaid loan.

d) As there is no stipulation for repayment of loans given, there is no overdue amount for more than ninety days in respect of loans outstanding as on balance sheet date.

e) There is no loan given falling due during the year, which has been renewed or extended or fresh loans given to settle the overdues of existing loans given to the same party.

f) The Company has granted the following loans that are repayable on demand as detailed below:

Particulars	All Parties	Related Parties
Aggregate amount of loans repayable on demand (Rs. in lakhs)	2,737.80	2,597.15
Percentage of loans to the total loans	100	95

(iv) The Company has complied with the provisions of Sections 185 and 186 of the Act, with respect to loans provided, investments made and guarantees given.

(v) The Company has not accepted any deposits or amounts which are deemed to be deposits from the public as per the provisions of sections 73 to 76 or any other relevant provisions of the Companies Act and the rules made thereunder. Accordingly, clause 3(v) of the Order is not applicable.

(vi) The Central Government has prescribed maintenance of cost records under sub-section (1) of Section 148 of the Companies Act 2013, in respect of the activities carried on by the Company. We have broadly reviewed the books of account maintained by the company in respect of products where maintenance of cost records has been prescribed and are of the opinion that, prima facie, the prescribed accounts and records have been maintained. We have however not made a detailed examination of such records with a view to determine whether they are accurate and complete.

(vii) a) The Company has delayed in depositing undisputed statutory dues of Goods & Service Tax and TDS with appropriate authorities and there are no undisputed amounts payable in respect of the Goods and Services Taxes, TDS, Provident fund, ESI, Professional Taxes and other statutory liabilities were in arrears as at 31st March, 2024 for a period of more than six months from the date on when they become payable except the following:

? TDS Liability remain unpaid exceeding six months Rs. 108.70 lakhs

? Goods and Service Taxes remain unpaid six months Rs. 50.81 lakhs

b) There are no dues of Income Tax, Goods & Services Tax, Sales Tax, Value Added Tax, Service Tax, Customs Duty, Excise Duty and Cess which have not been deposited with the appropriate authorities on account of any dispute except the following cases:

"Annexure A" to the Independent Auditors Report (Contd.)

Sl. No.	Name of the Statute	Nature of dues	Period to which the amount relates**	Amount (Rs. in lakhs)	Forum where the dispute is pending
1	West Bengal Sales Tax Act	Work Contract Tax	F.Y. 2009-10 & 2014-15	181.56	West Bengal Appellate & Revisional Board
2	West Bengal Sales Tax Act	Work Contract Tax	F.Y. 2013-14, 2015-16 & 2016-17	1,252.06	Joint Commissioner of Commercial Taxes
3	Finance Act, 1994	Service Tax	F.Y. 2011-12 to 2014-15	712.77	Commissioner, Central Tax, CGST & CX Kolkata North Commissionerate
4	Employees State Insurance Act, 1948	Employee State Insurance	F.Y. 2005-06 -2009-10	123.55	Recovery Officer

(viii) There were no transactions unrecorded in the books of account and which were surrendered or disclosed as income in the tax assessments under the Income Tax Act, 1961 during the year. Hence, reporting of other information under clause 3 (viii) of the said Order is not required.

(ix) a) Based on the audit procedures carried on by us and as per the information and explanations given to us, the Company has defaulted in payment of interest on term loan taken from Srei Equipment Finance Limited amounting to Rs. 4707.94 lakhs as on 31.03.2024. Further interest for the financial year 2023-24 amounting to Rs. 2579.28 lakhs have not been provided for which are also in default (refer note 31.18) to the standalone financial statements.

b) The Company has not been declared wilful defaulter by any bank or financial institution or other lenders.

c) The term loans taken by the company were applied for the purpose for which these loans were obtained.

d) The funds raised by the Company on short term basis have not been utilised for long term purposes.

e) The Company has not taken any funds from any entity or person on account of or to meet the obligations of its subsidiaries, associates, or joint ventures.

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

(x) a) The Company has not raised any money by way of initial public offer or further public offer (including debt instruments) during the year. Accordingly, 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 fully or partly convertible debentures during the year. Accordingly, clause 3(x)(b) of the Order is not applicable.

(xi) a) 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, 2013 has been filed by the auditors in Form ADT-4 as prescribed under Rule 13 of Companies (Audit and Auditors) Rules, 2014 with the Central Government.

c) The Company has not received any whistle-blower complaint during the year.

(xii) The Company is not a Nidhi Company. Therefore, clause (xii) of paragraph 3 of the Order is not applicable to the Company.

"Annexure A" to the Independent Auditors Report (Contd.)

(xiii) The transactions with related parties are in compliance with Sections 177 and 188 of the Companies Act, 2013, where applicable, and the details of the related party transactions have been disclosed in the standalone financial statements.

(xiv) a) The company has an internal audit system commensurate with the size and nature of its business.

b) We have considered the internal audit reports of the Company issued till date for the period under audit.

(xv) The Company has not entered into any non-cash transactions with its directors or persons connected with him. Accordingly, the reporting in respect of compliance of Section 192 of the Act are not required.

(xvi) (a) The provisions of section 45-IA of the Reserve Bank of India Act, 1934 (2 of 1934) are not applicable to the Company. Accordingly, the requirement to report on clause (xvi)(a) of the Order is not applicable.

(b) The Company is not engaged in any Non-Banking Financial or Housing Finance activities. Accordingly, the requirement to report on clause 3 (xvi)(b) of the Order is not applicable.

(c) The Company is not a Core Investment Company as defined in the regulations made by Reserve Bank of India. Accordingly, the requirement to report on clause 3(xvi)(c) of the Order is not applicable.

(d) There is no Core Investment Company as a part of the Group, hence, the requirement to report on clause 3(xvi)(d) of the Order is not applicable.

(xvii) According to the information and explanation given to us and as per records examined by us, the Company has incurred cash losses of Rs. 2523.11 lakhs during the financial year and Rs. 7703.90 lakhs in the immediately preceding financial year.

(xviii) There has been no resignation of the statutory auditors during the year and accordingly, this clause is not applicable.

(xix) On the basis of financial ratios, ageing and expected dates of realizations of financial assets and payment of the financial liabilities, other information accompanying the financial statements, management plans and based on our examination of the evidence supporting the assumptions, which causes us to belief that any material uncertainty exists 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 the future viability / inability 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/ not discharged by the Company as and when they fall due.

(xx) The Company is not required to spend towards Corporate Social Responsibility (CSR). Therefore, the second proviso to sub-section (5) and provision of sub section (6) of 135 of the said Act are not applicable.

"Annexure B" to the Independent Auditors Report

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

We have audited the internal financial controls over financial reporting of Shristi Infrastructure Development Corporation Limited ("the Company") as of 31st March, 2024 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.

Managements Responsibility for Internal Financial Controls

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 Companies Act, 2013.

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 Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the "Guidance Note") issued by the Institute of Chartered Accountants of India and the Standards on Auditing issued by ICAI and prescribed under section 143(10) of the Companies Act, 2013, 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 Institute of Chartered Accountants of India. 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 with reference to these standalone financial statements.

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 the Indian Accounting Standards specified under Section 133 of the Companies Act, 2013. 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;

"Annexure B" to the Independent Auditors Report (Contd.)

(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 standalone 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 occur and not be detected. Also, projections of any evaluation of the internal financial controls collusion or improper management override of controls, material misstatements due to error or fraud may 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.

Qualified Opinion

According to the information and explanations given to us and based on our audit, the following material weaknesses have been identified in the operating effectiveness of Companys internal financial controls over financial reporting as at 31st March, 2024:

a) The Company has not made any assessment of impairment of Investment in certain subsidiary and an associate as at the balance sheet date.

b) There are delays in payment of statutory dues. The Company needs to strengthen internal control system in this regard.

A ‘material weakness is a deficiency, or a combination of deficiencies, in internal financial control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Companys annual or interim financial statements will not be prevented or detected on a timely basis. In our opinion, except for the possible effects of the material weaknesses described above under Qualified Opinion paragraph on the achievement of the objectives of the control criteria, 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, 2024, 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 ICAI.

We have considered material weakness identified and reported above in determining the nature, timing, and extent of audit tests applied in our audit of the financial statements of the Company for the year ended 31st March, 2024 and these material weaknesses affect our opinion on financial statements of the Company for the year ended 31st March, 2024 [our audit report dated 28th May, 2024 which expressed a qualified opinion on those financial statements of the Company].