Ujaas Energy Ltd Auditors Report.

To,

The Members of -

Ujaas Energy Limited

Report on the financial Statements

Opinion

We have audited the financial statements of Ujaas Energy Limited ("the Company"), which comprise the balance sheet as at 31st March 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 om* information and according to the explanations given to us, the aforesaid Standalone financial statements give the information required by the Act in the manner so required and give a true .and fair view in conformity with accounting principles generally, accepted in India, of the state of affairs of the company as at 31st March., 2019, and its profit, total comprehensive income, the changes in equity and its cash flows for fee year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Cornpaiii.es 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 fee 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 financial statements under the provisions of the Companies Act, 2013 and the Rules thereunder, and we have fiil.fi lied 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.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Key Audit Matters

1. Revenue recognition - Fixed price development contracts

The Group inter alia engages in Fixed-price development contracts, where, revenue is recognized using the . percentage of completion computed as per the input method based on managements estimate of contract costs.

We identified revenue recognition of fixed price . development contracts as aKAM considering-

• Application of revenue recognition accounting standard, is complex and involves a number of key judgments and estimates including estimating the future cost-to- completion of these contracts, which is used to determine the percentage of completion of the relevant performance obligation;

• There is an inherent risk around the accuracy of revenues and cost estimation given the customized and complex nature these contracts;

• These contracts may involve onerous obligations on the Company that require critical estimates to be made by management: and

Auditors Response -

Our audit procedures on revenue recognized from fixed price development contracts included

• Obtaining an understanding of the systems, processes and controls implemented by management for recording and calculatingrevenue and the associated cost

• Involving specialists to assess the design and operating effectiveness of controls:

• On selected samples of contracts, we tested that the revenue recognized is in accordance with the accounting standard by-

• Evaluating the identification of performance obligation;

• Testing managements calculation of the estimation of contract cost and onerous obligation, if any. We:

• Observed that the estimates of cost io complete were reviewed and approved by appropriate levels of management; .

• Performed a retrospective review of costs incurred with estimated costs to identify significant variations and verify whether those variations have been considered in estimating the remaining costs to complete the contract;

• Assessed the appropriateness of work in progress (contract assets) on balance sheet by evaluating the underlying documentation to identity possible delays in achieving milestones which, may require change in estimated costs to complete the remaining performance obligations: and

• Performed test of details including analytics to determine reasonableness of contract costs

2. Accuracy of recognition, measurement, presentation and disclosures of revenues and other related balances in view of adoption of lad AS 115 "Revenue from Contracts with Customers" (new revenue accounting standard)

The application of the new revenue accounting standard involves some key points which includes Identification of contract with customer, identification of distinct performance obligations, determination of transaction price of the identified performance obligations, the . appropriateness of the basis used to measure revenue recognized. Additionally, new revenue accounting standard contains disclosures which involves collation of information in respect of disaggregated revenue and periods over which the remaining performance obligations will be satisfied subsequent to the balance sheet date.

Auditors Response Principal Audit Procedures

We assessed the Companys process to identify the impact of adoption of the new revenue accounting standard. Our audit approach consisted testing of the design and operating effectiveness of the internal  controls and substantive testing as follows:

Evaluated the design of internal controls relating to implementation of the new revenue accounting standard.

Sample selected from continuing and new contracts, and. tested the operating effectiveness of the internal control,. relating to identification of the distinct performance obligations and determination of transaction price.

We have performed the following procedures: Read, analysed and identified the distinct performance obligations in these contracts. Compared these performance obligations with that identified and recorded by the Company. Considered the terms of the contracts to determine the transaction price including any variable consideration to verify the transaction price used to compute revenue and to test the basis of estimation of the variable consideration.

Sample of revenues disaggregated by type and service offerings was tested with the performance obligations specified, in the underlying contracts. Performed analytical procedures for reasonableness of revenues disclosedby type and service offerings. We reviewed the collation of information and the logic of the report generated from the budgeting system used to prepare the disclosure relating to the periods over which the remaining performance obligations will be satisfied subsequent to the balance sheet date.

3. Evaluation of uncertain tax positions

The Company operates in multiple jurisdictions and is subject to periodic challenges by local tax authorities on a range of tax matters during the normal course of business including direct and indirect tax matters. These involve significant management judgment to determine the possible outcome of the uncertain tax positions, consequently having an impact on related accounting anddisc-losures in the financial statements.

Auditors Response

Our audit procedures include the following substantive procedures:

• Obtained understanding of key uncertain tax positions; and .

• We along with our internal tax experts -

• Read and analysed select key correspondences, external legal- opinions / consultations by management for key uncertain tax positions;

• - Discussed with appropriate senior management and evaluated managements underlying key assumptions in estimating the tax provisions: and

• Assessed managements estimate of the possible outcome of the disputed cases

4. Recoverability from Renewable Energy Certificates

The Company has material balance of renewable energy certificates included in "Other Financial Asset"- Note 11, which is subject to adjudication of pending litigation at Apex.Court

Auditors Response

Our audit procedures include the following substantive procedures:

• Obtained understanding of key uncertain positions; and ,

• Analysed earlier / preceeding judgements in the related matters

• Analysed select key correspondences, external legal opinions / consultations by management for key uncertain positions

• Discussed with appropriate senior management . and evaluated managements underlying key assumptions in estimating the provisions; and

• Assessed managements estimate of the possible outcome of the disputed cases .

Information Other than the Financial Statements and Auditors ReportThereon

The Companys Board of Directors is responsible for the preparation of the other information. The other information comprises the information included in the Management Discussion and. Analysis, Boards Report including Annexures to Boards Report, Business Responsibility Report, Corporate Governance and Shareholders Information, but does not include the standalone financial statements and our auditors report thereon.

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

In connection with, our audit of the standalone financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained during the course of our audit or otherwise appears to be materi ally misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other in formation, we are required to report that fact. We have nothing to report in this regard.

Managements Responsibility for the Financial Statements

The Companys Board of Directors is responsible for the matters .^i&ted-in section 134(5) of the Companies Act, 2013 ("the Act") with respect: to the preparation of these financial statements that give a true and fair view of the financial position, financial performance, changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the accounting Standards specified under section 133 of the Act This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities: selec tion 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 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.

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 SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

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

a. Identify and assess the risks of material mi sstatement 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 abasis 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 overide of internal control.

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

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

d. Conclude on the appropriateness of managements use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant 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.

e. Evaluate the overall presentation, structure and content of the 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

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 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.

As requiredbv Section 143(3) oftheAct,wereportthat:

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 o f our audit.

b. In our opinion, proper books of account as required by lawr 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 dealt with by this Report are in agreement with the books of account.

d. In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specifiedundef Section 133 of the Act, read with Rule 7 offae Companies (Accounts) Rules, 2014:

e. On the bas is of the written representations received from the directors as on 31 st March, 201.9 taken on, record by the Board of Directors, none of the directors is disqualified as on 31st March, 2019 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, controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure .B".

g. With respect to the other matters to be included in the Auditors Report in accordance with Rule 11 of the rCompanies (Audit andAuditors) Rules,12014, in our opinion and to the best of our information and according to theexplanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial, position in its financial statements - Refer Note 33 to the financial statements;

ii. The Company did not have any long term contract including derivative contract for which there were material foreseeable losses;

iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fun d by the Company.

ANNEXURE A TO INDEPENDENT AUDITORS REPORT

Referred to in paragraph (i) under the heading of‘‘Report on Other Legal and Regulatory Requirements" of our report of even date to the members of UjaasEnergy Limited on the Ind AS financial statements for the year ended 31st March, 2019.

i. In respect of its Fixed Assets:

a. The Company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets,

b. As explained to us, the fixed assets of the Company- have been physically verified by the management during the year, which in our opinion is reasonable, having regard to the size of the Company and the nature of its assets. No material discrepancies between the book records and the physical inventory have been.noticed.,In. our opinion, the frequency of verification is reasonable. . .

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

ii. In res ppct of its inventories:

The inventories has been physically verified by tbe Management during the year. In our opinion, the frequency-.of verification is.reasonable.and no material di screpanci es were noticed.

iii. According to the information and explanations given to us, the Company, has granted unsecured loans to one company covered in. the register maintained under section 189 of the Companies Act, 2013, ITe company has not granted any loans secured, or unsecured to firms, LLPs or other parties covered in the register maintained under secti on 189 o f the Companies Act, 2013. In respect of the aforesaid loans granted:

a. The- terms and conditions of the grant of such loans are, in our opinion, prima facie, not prejudicial to the Companys interest;

b. The loan has been repaid and there is no amount outstanding at the end of the year.

iv. In our opinion and according to the information and . explanations given to us, the Company has complied with tbe provisions of section 185 and 186 of the Act, with respect to the loans and investments made. The company has not given any guarantee or provided any security in terms of section 185 and 186 of the Act.

v. In our opinion and according to the information and explanations given to us, the- Company has not accepted deposits from the public within the meaning of Section 73 to 76 or any other relevant provisions of the : Companies Act, 2013 and the Rules, framed there under. As informed to us no Order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Batik of India or any court or any other Tribunal.

vi. We have broadly reviewed the cost records maintained by the Company pursuant to the rules made by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013 and are of the opinion that prima facie the prescribed records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determine wh.etl.ier they are accurate or complete.

vii. In respect of Statutory dues:

a) According to the information and explanationsgiven to us and the records of the Company examined by us, in our opinion the Company is generally regular in depositing undisputed statutory dues including provident .fund, employees state insurance, income tax, sales tax, goods and sendee tax, sendee tax, duty . of customs, duty of excise, value added tax, cess and any other statutory dues with the appropriate authori ties. There were no undisputed statutory dues in arrears, as at 31 st March, 2019 for a period of more than six months from the date they became payable.

b) According to the information and explanations given to us, there are no dues of sales tax, value added tax, income tax, service tax, goods and service -tax, duties of customs, duties of excise which have not been deposited with appropriate authorities on acco unt: of any dispute except as follows;

Name of the Statute Nature of Liability (Amount in Lacs) Related Period Forum where dispute is pending
Income Tax Act, 1961 Income tax Act, 1961 2.57 FY 2005-06 CIT (Appeals)

viii. According to the records of the company examined by us and as per the information and explanations given to us. the Company has not defaulted in repayment of loans and borrowings to a financial institution, bank or government as on the balance sheet date. The Company has not issued any debenture.

ix. In our opinion and according to the information and explanations given to us, the company has not raised money by way of initial public offer or further public offer (including debt instruments) and In our opinion and according to the information and explanations given to us, the company has not raised any term loan during the year.

x. During the course of our examination of the books of account and records of the Company, carried out in accordance with the generally accepted auditing practices in. India and according to the information and explanations given to us, we have neither come across any instance of material fraud by the Company or on the company by the officers or employees, noticed or reported during the year, nor have we been informed of such case by the management

xi. According to the information and explanations given 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 to the Act.

xii. In our opinion and according to information and explanation given to us, the company is not a Nidhi Company therefore, the provision of para 3 (xii) of the Order is not applicable! the company.

xiii. According to the information and explanations given to us and based on our examination of die 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 appli cable 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, therefore the provisi on of para 3 (xiv) of the Order is not applicable to the company.

xv. In our opinion and according to the information and explanations given to us, the company has not entered into any non-cash transactions with, directors or persons connected .with him during the year, hence the provision of para 3 (xv) of the Order is not applicable to the company.

xvi. The company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934 therefore, the provision of para 3 (xvi) of the Order is not. applicable to the company for the year under audit.

ANNEXURE B TO THE INDEPENDENT AUDITORS REPORT OF EVEN DATE ON -THE FINANCIAL STATEMENTS OFUJAAS ENERGY LIMITED

Report on the Internal Financial Controls 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 Ujaas Energy Limited ("the Company") as of March 3.1.2019 in conjunction with our audit of the financial statements of the Company for the year ended on that date.

Managements Responsibility for Internal Financial Controls

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. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating1 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 CompaniesAct, 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 OverFinancial Reporting (the "Guidance Note") and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 201.3, to the extent applicable to an audit of internal financial controls. Thos e Standards and the Guidance Nole require that we comply with ethical requirements and plan and perform tire 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 accotrnting principles, and that receiptsiaiid 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 Interna! Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, ineluding 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 March 31, 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 on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

For SMAK & Co.
Chartered Accountants
(FRN. O2O120C)
CA ShridharMandhanya
Place: Indore (Partner)
Date: 29/05/2019 M.No.421425