tamilnadu jai bharath mills ltd share price Auditors report

To the Members of M/s. Tamilnadu Jai Bharath Mills Limited

Report on the Ind AS Financial Statements

Qualified Opinion

We have audited the accompanying Ind AS financial statements of M/s. Tamilnadu Jai Bharath Mills Limited ("the Company") which comprises the Balance Sheet as at March 31,2022, 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 (hereinafter referred to as "the financial statements").

In our opinion and to the best of our information and according to the explanations given to us, except for the possible effects of the matter described in the ‘Basis for Qualified Opinion paragraph below and based on our audit and in view of non-compliance to various accounting standards, absence of confirmation and reconciliation of balances in parties accounts as discussed in the below paras, combined with non-availability of data to assess their impact on the financial statements and undetected misstatement, if any, contained therein, the aforesaid Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the Ind AS and accounting principles generally accepted in India, of the state of affairs of the Company as at March 31,2022, its Loss, including other comprehensive income, the changes in equity and its cash flows for the year ended on that date.

Basis for Qualified Opinion

a) Going Concern Concept:

i) The Company has discontinued the production since 15^th December 2021. Also the Electricity connection to the Factory also disconnected since 28^th December 2021.

ii) The accumulated losses of the company as at the close of 31^st March 2022 amounted to Rs.8431.89 lakhs against which the paid up capital of the company is Rs.3978.47 lakhs and the losses has totally eroded the net worth of the company.

iii) The company has been incurring losses continuously for the past many years.

iv) The total liabilities of the company as at the close of 31^st March 2022 is Rs. 79.87 Crores (Previous year Rs. 84.64 crores) against which the Fixed and current assets book values are only Rs. 19.55 crores (Previous year Rs.27.79 crores)

v) The contingent liabilities disclosed in the financial statements are Rs. 201.50 lakhs (Previous year Rs.201.50/-lakhs) and there are other liabilities, which have not been quantified. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

vi) Consequent to stoppage of Production, the company has sold all the Fixed Assets, except the Factory Building.

b) The Company has not complied the disclosure for the following as per IND AS:-

i) IND AS 16: - The Company has not made adequate disclosure on depreciable asset, with respect to reconciliation of carrying amount in the beginning and end of the period.

ii) IND AS 36:- The Company has not identified, measured, quantified and disclosed the impairment of assets and its impact on the current financial statements.

iii) IND AS 12: The Company has not made any provision with respect to Deferred Tax

c) The company has not made provision for liability towards the interest payable under microsmall and medium enterprises development act 2006, if any, in the accounts. The impact of non provision for such interest on the financial results of the company is not ascertainable. In the absence of confirmation from vendors and non availability of adequate information with the units, provision made towards interest and the principal amount disclosedas dues as on balance sheet date, we are unable to comment on the adequacy of provision and the impact on the financial statements.

d) The company did not follow the established internal controls such as performing account reconciliations, obtaining periodical conformation of balances and periodical verification of fixed assets.

e) The Trade Receivables to the tune of Rs.3,48,55,813 is disputed, doubtful and outstanding for more than 3 years. No Provision in the books of accounts has been made.

Further, any provision required which is resulting from above transactions is also not accounted and not ascertained

We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Companies Act, 2013. 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 together with the ethical requirements that are relevant to our audit of the Ind AS financial statements under the provisions of the Companies Act, 2013 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 qualified audit opinion on the financial statements.

Emphasis of Matter:

a. We draw attention to Note No.2.11 to the financial statements, which describe non provision of Gratuity, in compliance with IndAs19 issued by the ICAI.

b. We draw attention to Note No.8, to the financial statements, which describe pending confirmation of balance of Trade Debtors, Creditors and Advances.

c. We draw attention to Note No.5, to the financial statements, which describes, non disclosure of details of creditors as per the provisions of MSME Act.

d. We draw attention to Note No.2.14, to the financial statements, which describes non compliance of the provisions of IndAs12 with respect to Income tax.

Our opinion is not modified in respect of these matters.

Material uncertainty related to Going Concern:

All the manufacturing facilities have been leased out on conversion basis. Further to the circumstances described in note 10 to the financial statement, regarding huge accumulated losses, complete erosion of Net Worth , incurring of huge cash losses in the current and previous years, sale of substantial portion of Plant & Machinery during the year to meet out the working capital requirements etc., indicate the existence of a material uncertainty that may cast significant doubt about the companys ability to continue as a going concern. However, the financial statements of the company have been prepared on a going concern basis for the reasons stated in the said note. Our opinion is not modified in respect of these matters.

Key Audit Matters:

Key Audit Matters are those matters that, in our professional judgment, were of most significance in our audit of the Ind AS financial statements of the current period. These matters were addressed in the context of our audit of the Ind AS financial statements as a whole, and informing 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.

Sl.No. Key Audit Matter	Auditors Response
1 Assessment of Going Concern Basis - (as described in Note No.2.2 of financial statements)
Consequent to the decision of closing down the Company, the operations of the company was stopped in December 2021.	We have analysed the managements report to gain an understanding of the current situation and the status of closure process of the company. For notes on the going concern assumption and financing requirements, see the going concern on page 1 of Audit Report.
	Principal Audit Procedures
2 Realization of Trade Receivables (as described in Note No.3.6 )	Our audit procedures included the following:
Trade Receivables of the Company comprise mainly receivables in relation to the companys receivables from its customers towards sale of yarn.	Tested the accuracy of aging of Trade receivables at year end on a sample basis;
	Obtained a list of outstanding receivables along with confirmation of balances on a sample basis as per the auditing standards and identified any debtors with financial difficulty through discussion with Management.
The operating environment in the Textile industry has the inherent risk of default on receivables from the companys customers. In particular in the event of financial stress at the customers end the company is exposed to potential risk of financial loss when the customers fail to meet their payment obligations in accordance with the agreed credit terms.
	Assessed the recoverability of the unsettled receivables on a sample basis through our evaluation of managements assessment with reference to the credit profile of the customer historical payment pattern of customers publicly available information, if any, and latest correspondence with customers and to consider if any, additional provision should be made; and
	Tested subsequent settlement of trade receivables after the balance sheet date on a sample basis, if any.
The recoverable amount was estimated by management based on their specific recoverability assessment on individual debtor
with reference to the ageing profile, historical payment pattern and the past record of default of the customer. Management would make specific provision against individual balances with reference to the recoverable amount. For the purpose of determination of provision requirement, significant judgments and assumptions including the credit risks of customers, the timing and amount of realization of these receivables are required for the identification of impairment events and the determination of the provision to be made towards the receivables.
Claims and exposure relating to taxation and litigation (as described in Note 2.12 and 2.13 of the Ind AS financial statements).
3. The Company is subject to a few legal and tax related claims which have been disclosed / provided for in the financial statements based on the facts and circumstances of each case.	Our audit procedures included the following:-
	• Gained an understanding of the process of identification of claims, litigations and contingent liabilities and identified key controls in the process.
Taxation and litigation exposures have been identified as a key audit matter due to complexities involved in these matters, timescales involved for resolution and the potential financial impact of these on the financial statements. Further, significant management judgment is involved in assessing the exposure of each case and thus a risk that such cases may not be adequately provided for or disclosed.	For selected controls, we have performed tests of controls.
	• Obtained the summary of Companys legal and tax cases and critically assessed managements position through discussions with the Head of Tax and operational management, on both the probability of success in significant cases, and the magnitude of any potential loss.
	• Inspected external legal opinions, wherever considered necessary, and other evidence to corroborate managements assessment of the risk profile in respect of legal claims.
	• Assessed the relevant disclosures made within the financial statements to address whether they appropriately reflect the facts and circumstances of the respective tax and legal exposures and the requirements of relevant accounting standards.

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 Management Discussion and Analysis, Boards Report including Annexures to Boards Report, Business Responsibility Report, Corporate Governance and Shareholders Information, 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 Ind AS Financial Statements

The Companys Board of Directors is responsible for the matters stated in section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these Ind AS financial statements that give a true and fair view of the financial position, financial performance, including other comprehensive income, changes in equity and cash flows of the Company in accordance with accounting principles generally accepted in India, including Indian Accounting Standards (Ind AS) prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate implementation and maintenance of accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Ind AS financial statement that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the Ind AS 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.

The Board of Directors is also responsible for overseeing the companys financial reporting process.

Auditors Responsibilities for the Audit of Ind AS Financial Statement

Our objectives are to obtain reasonable assurance about whether the Ind AS 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 Ind AS financial statements.

A further description of the auditors responsibilities for the audit of the Ind AS financial statements is included in Annexure A. This description forms part of our auditors report.

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 B 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, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

d) In our opinion, the aforesaid Ind AS financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act, except compliance of IndAs19 with respect to Employee Benefits.

e) On the basis of the written representations received from the directors as on 31st March, 2022 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2022 from being appointed as a director in terms of Section 164 (2) of the Act.

f) With respect to the adequacy of the Internal Financial Control with reference to Financial Statements of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure C"

g) In our opinion and to the best of our information and according to the explanations given to us, the company has not paid any remuneration to its directors during the year and hence the provisions of section 197(16) of the Act are not applicable.

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 Ind AS financial statements - Refer Note 2.12 and 2.13 to the Ind AS financial statements;

 

ii) The Company does not have any long term contract including derivative contract, requiring provision for material foreseeable losses;

iii) The Company does not have any amount required to be transferred to the Investor Education and Protection Fund.

iv) a. Management has represented that, to the best of its knowledge and belief, other than as disclosed in the notes to the accounts (refer Note 42 (xii), no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the company to or in any other person(s) or entity(is), 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. Management has represented that, to the best of its knowledge and belief, other than as disclosed in the notes to the accounts (refer Note 42 (xiii)) no funds have been received by the Company from any person(s) or entity(ies), including foreign entities ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries, and

c. Based on the audit procedures adopted by us, nothing has come to our notice that has caused us to believe that the representations made by the management under sub clause (i) and (ii) above, contain any material misstatement.

v) No interim dividend has been declared and paid by the Company during the year and hence the provisions of Section 123 of the Companies Act, 2013 are not applicable to the Company.

3. With respect to the matter to be included in the Auditors Report under Section 197(16) of the Act.

In our opinion and according to the information and explanations given to us, the remuneration paid by the Company to its directors during the current year is in accordance with the provisions of Section 197 of 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.

	For SRITHAR & ASSOCIATES
	Chartered Accountants
	Firms Registration No. 015896S
Date: 25.07.2022	(S.SRITHAR)
Place: Rajapalayam	MembershipNo.209047
	UDIN: 22209047ATOLER7115

Annexure A

Responsibilities for Audit of Ind AS Financial Statement

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 material misstatement of the standalone Ind AS 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 internal financial controls with reference to Financial Statements 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 Ind AS 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 Ind AS financial statements, including the disclosures, and whether the Ind AS 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 Ind AS 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.

	For SRITHAR & ASSOCIATES
	Chartered Accountants
	Firms Registration No. 015896S
Date: 25.07.2022	(S.SRITHAR)
Place: Rajapalayam	MembershipNo.209047
	UDIN: 22209047ATOLER7115

ANNEXURE B TO INDEPENDENT AUDITORS REPORT

Annexure referred to in paragraph 1 of our Report of even date to the members of Tamilnadu Jai Bharath Mills Limited on the accounts of the Company for the year ended 31^stMarch 2022

In terms of Companies (Auditors Report) Order 2020, issued by Central Government of India, in terms of Section 143(11) of The Companies Act, 2013, we further report, on the matters specified in paragraph 3 and 4 of the said Order, that: -

(i) a) A) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company has maintained proper records showing full particulars, including quantitative details and situation of Property, Plant and Equipment.

B) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is not having any Intangible assets.

b) The Company has a regular program of physically verifying all the Property, Plant and Equipment at its plants / offices in a phased manner, which in our opinion is reasonable having regard to the size of the company and the nature of its assets. No material discrepancies as compared to book records were noticed on such verification.

c) According to the information and explanations given to us and the records of the Company examined by us, the title deeds of the immovable properties (other than properties where the Company is the lessee and the lease agreements are duly executed in favour of the lessee) are held in the name of the Company.

d) The Company has not revalued its Property, Plant and Equipment (including Right of use assets) or intangible assets during the year ended March 31,2022.

e) According to the information and explanation given to us and the records of the Company examined by us, there are no proceedings 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) As informed to us, the management has conducted physical verification of inventory [including inventory lying with third parties] at reasonable intervals during the year. In our opinion the coverage and the procedure of such verification by the management is appropriate. Discrepancies noticed on such physical verification, were less than 10% in aggregate for each class of inventory and have been properly dealt with in the books of account.

b) According to the information and explanations given to us and the records of the Company examined by us, the Company has not been sanctioned working capital limits in excess of Rupees five crores in aggregate from banks during the year on the basis of security of current assets of the Company. Therefore, the clause (ii) of para 3 of the order is not applicable to the Company.

(iii) a) According to the information and explanations given to us and the records of the Company examined by us, during the year, the Company:

i. Has not made investments in Companies.

ii. Has not made investments in firms, Limited Liability Partnerships or any other parties.

iii. Has not provided loans, advances in the nature of loans and security to companies, firms, Limited Liability Partnerships or any other parties.

iv. Has not provided guarantee to any company.

b) Therefore, the requirement to report under clauses (iii) (b) to (f) of para 3 of the Order are not applicable to the Company.

(iv) In our opinion and according to the information and explanations given to us, the Company has not made any investment or given guarantee, coming under the provisions of sections 185 and 186 of the Companies Act, 2013. Therefore, the clause (iv) of para 3 of the order is not applicable to the Company.

(v) According to the information and explanation given to us and the records of the Company examined by us, the Company has neither accepted any deposits from the public nor accepted any amounts which are deemed to be deposits within the meaning of sections 73 to 76 of the Companies Act and the rules made thereunder, to the extent applicable. Therefore, the clause (v) of para 3 of the order is not applicable to the Company.

(vi) According to the information and explanation given to us, the Central Government has not prescribed the maintenance of cost records under Section 148(1) of the Act in respect of products manufactured by the Company. Therefore, the clause (vi) of para 3 of the order is not applicable to the Company.

(vii) a) According to the information and explanations given to us and based on the records of the Company examined by us, in our opinion, the Company is generally regular in depositing undisputed statutory dues payable including Provident Fund, Employees State Insurance, Income Tax, Goods and Services Tax, Customs duty and Cess and other material statutory dues as applicable to the Company with the appropriate authorities. According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Employees State Insurance, Income Tax, Goods and Services Tax, Customs duty and Cess were in arrears as at 31st March 2022 for a period of more than six months from the date they became payable.

b) According to the information and explanations given to us and based on the records of the Company examined by us, the dues of Income-Tax, Customs Duty, Sales Tax, Service Tax, Goods and Services Tax, Value Added Tax, Excise Duty and Cess which have not been deposited on account of any dispute are as follows:

Nature of Dues	Forum where the dispute is pending	Period	Amount (Rs. in Lakhs)
Sales Tax	Additional Commissioner , Chennai	2003-2004	12.86
Central Sales Tax	Commissioner - Virudhunagar	2007-2008	20.57
Central Sales Tax	Commissioner - Virudhunagar	2008-2009	12.30
Central Sales Tax	Commissioner - Virudhunagar	2011-2012	10.89
Provident Fund	High Court, Madurai	Apr, 09 to Dec,09	56.48 *
Provident Fund	Appellate Tribunal, Delhi	Jan10- Jun 11	99.07*
E.S.I.	High Court, Madurai	Nov 06- Mar07	5.03
		Total	217.20

• Out of the total sum of Rs.155.55 lakhs, Rs.56.48 lakhs has been already deposited with PF Authority under protest.

(viii) According to the information and explanations given to us and based on the records, the Company has not surrendered or disclosed any transaction, previously unrecorded in the books of account, in the tax assessments under the Income Tax Act, 1961 as income during the year. Accordingly, the requirement to report on Clause 3(viii) of the Order is not applicable to the Company.

(ix) On the basis of verification of records, on an overall examination of the financial statements of the Company and according to the information and explanations given to us,

a) The Company has not defaulted in repayment of loans or other borrowings or in the payment of interest thereon to any lender.

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

c) The term loans were applied for the purpose for which the loans were obtained.

d) According to the information and explanations given to us, and the procedures performed by us, and on an overall examination of the financial statements of the Company, the Company has not utilized funds raised on short-term basis for long-term purposes.

e) According to the information and explanation given to us and on overall examination of the financial statements of the Company, the Company has not taken funds from any entities and persons on account of or to meet the obligations of its subsidiaries or associates.

f) According to the information and explanations given to us and based on the records of the Company examined by us, the Company has not raised loans during the year on the pledge of securities held in its subsidiaries or associate companies.

Hence, the requirement to report on clause (ix)(f) of the Order is not applicable to the Company.

(x) a) According to the information and explanations given to us and based on the records, the Company has not raised any money during the year by way of initial public offer or further public offer (including debt instruments) hence, the requirement to report on clause 3(x)(a) of the Order is not applicable to the Company.

b) According to the information and explanations given to us and based on the records, the Company has not made any preferential allotment or private placement of shares or fully or partially or optionally convertible debentures during the year under audit and hence, the requirement to report on clause 3(x)(b) of the Order is not applicable to the Company.

(xi) a) During the course of our examination of the books and records of the Company, carried out based upon the generally accepted audit procedures performed for the purpose of reporting the true and fair view of the Standalone financial statements, to the best of our knowledge and belief and as per the information and explanations given to us by the Management, and the representations obtained from the Management, no material fraud on the Company has been noticed or reported during the year.

b) During the year, no report under sub-section (12) of Section 143 of the Companies Act, 2013 has been filed by us in Form ADT - 4 as prescribed under Rule 13 of Companies (Audit and Auditors) Rules, 2014 with the Central Government. According to the information and explanations given to us and based on the information provided to us and records verified by us, the Secretarial Auditor and the Cost Auditor have not filed report in Form ADT - 4 as prescribed under Rule 13 of Companies (Audit and Auditors) Rules, 2014 with the Central Government.

c) According to the information and explanations given to us and as represented to us by the management, there are no whistle blower complaints received by the Company during the year.

(xii) The Company is not a Nidhi Company and hence reporting under Clause (xii) of the Order is not applicable.

(xiii) In our opinion and according to the information and explanations given to us, based on verification of the records and approvals of the Audit Committee, the Company is in compliance with Section 177 and Section 188 of the Act, where applicable, for all transactions with the related parties and the details of related party transactions have been disclosed in the financial statements as required by the applicable accounting standards.

(xiv) a) In our opinion and based on our examination, the Company has an internal audit system commensurate with the size and nature of its business.

b) The internal audit reports of the Company issued till the date of this audit report, for the period under audit have not been furnished to us.

(xv) In our opinion and according to the information and explanations given to us, during the year the Company has not entered into any non-cash transactions with its directors or persons connected with him and hence provisions of section 192 of the Act are not applicable.

(xvi) a) According to the information and explanations given to us and based on the information provided to us and records verified by us, the Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, requirement to report on Clause 3(xvi) of the Order is not applicable to the Company.

b) The Company has not conducted any Non-Banking Financial or Housing Finance activities.

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

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

(xvii) The Company has incurred cash losses of Rs. 742.96 lakhs in the current year and Rs. 844.48 lakhs in the immediately preceding financial year respectively.

(xviii) There has been no resignation of the statutory auditor during the year and accordingly requirement to report on Clause 3(xviii) of the Order is not applicable to the Company.

(xix) According to the information and explanations given to us and on the basis of the financial ratios disclosed in notes to the financial statements, ageing and expected dates of realization of financial assets and payment of financial liabilities, other information accompanying the Standalone financial statements, our knowledge of the Board of Directors and management plans and based on our examination of the evidence supporting the assumptions, it has come to our attention and believe that material uncertainty exists as on the date of the audit report 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.

xx) According to the information and explanations given to us, the provisions of section 135 of the Companies Act, with respect to Corporate Social Responsibility is not applicable to the company. Therefore, requirement to report on Clause 3(xx) of the order is not applicable to the Company.

(xxi) According to the information and explanations given to us, the provisions with respect to preparation of consolidated financial statements are not applicable to the company. Therefore requirement to report on Clause 3(xxi) of the order is not applicable to the Company.

	For SRITHAR & ASSOCIATES
	Chartered Accountants
	Firms Registration No. 015896S
Date: 25.07.2022	(S.SRITHAR)
Place: Rajapalayam	MembershipNo.209047
	UDIN: 22209047ATOLER7115

ANNEXURE - C TO THE INDEPENDENT AUDITORS REPORT

[Referred to in paragraph 2(g) under Report on Other Legal and Regulatory Requirements in our Independent Auditors Report of even date, to the members of the company on the IND AS financial statements for the year ended 31st March, 2022]

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 the company as of 31^st March, 2022, in conjunction with our audit of the IND AS 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 essential components such as the control environment, the entitys risk assessment process, control activities, Information system and communication and the monitoring of such controls. 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 and the Standards on Auditing specified under Section 143(10) of the Act, to the extent applicable to an audit of internal financial controls, 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 were 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

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

ii) 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

iii) 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 controls 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 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, 2022, 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 control over Financial Reporting issued by the ICAI.

	For SRITHAR & ASSOCIATES
	Chartered Accountants
	Firms Registration No. 015896S
Date: 25.07.2022	(S.SRITHAR)
Place: Rajapalayam	MembershipNo.209047
	UDIN: 22209047ATOLER7115