VRL Logistics Ltd Auditor Reports

To

THE MEMBERS OF VRL LOGISTICS LIMITED

Report on the Audit of the Ind-AS Financial Statements Opinion

We have audited the accompanying Ind-AS Financial Statements of VRL LOGISTICS LIMITED ("the Company"), which comprise the Balance Sheet as at March 31, 2025, the Statement of Profit and Loss (including Other

Comprehensive Income), the Statement of Changes in Equity, the Statement of Cash Flows for the year then ended and the Notes to the Ind-AS Financial Statements, including a summary of material accounting policies and other explanatory information (hereinafter referred to as "Ind-AS Financial Statements").

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Ind-AS 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 Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standard) Rules, 2015, as amended, ("Ind-AS") and with other accounting principles generally accepted in India, of the state of affairs of the Company as at

March 31, 2025, the profit, total comprehensive income, changes in equity and its cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit of the Ind-AS 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 Ind-AS 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 Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

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 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.

Sr. no. Key audit matter description	How the scope of our audit addressed the key audit matter
1. Revenue recognition and measurement	Our procedures included:
	Accounting policies: Assessing the Companys revenue recognition accounting policy, by comparing the same with Ind AS 115 - Revenue from Contracts with Customers
Refer to Note 1(l) (Accounting policies) and Note 24 of the Ind-AS Financial Statements for aggregate revenue from sale of products and services recognised as required by the applicable Ind-AS. For the year ended March 31, 2025, the Company recognised revenues aggregating to 3,16,094.80 lakhs.
	Tests of controls: Understanding and evaluating the design and implementation of the key controls around the revenue recognition process including controls around evidence of service delivery, price approvals, cash collection, system interface and timing of transactions including cut off.
	Tested operating effectiveness of above identified key controls over the recognition and measurement of revenue during the year and as at year end.
The Company has high volume of transactions each day recorded across various branches and agencies using complex information technology - systems which are linked to the financial reporting process. A high number of sale transactions in the goods transport business are settled in cash. Further, Standards on Auditing mandate a presumed significant risk of fraud in revenue recognition.
	Tests of details:
	Perused the internal audit reports for any observations reported based on such internal audits conducted at branchesduringtheyeartoevaluateifanysuchobservations materially impact the Ind-AS Financial Statements or impact our assessment of relevant key internal financial controls tested as above or otherwise materially impacts recognition and measurement of revenue.
	- Performedtestofdetailsonasampleofrevenuetransactions recorded during the year including specific periods before and after year end. For the samples selected, inspected supporting documents such as invoices, contracts, goods consignment notes, evidence of delivery of service, cash receipt, etc.
Risk identified:
Due to the Companys Revenue cycle being material to the Ind-AS Financial Statements, complexities involved including high inherent risk associated with cash transactions and information technology systems relied on, this matter has been identified as a key audit matter for the current years audit.
	- On a sample basis, we compared the daily cash collection with the bank deposit reconciliation prepared by each branch and agency and submitted to Head office periodically by tracing the same to relevant bank statements.
	- Tested the appropriateness and rationale for specificmanual journal entries impacting recognition and measurement of revenue, as well as other adjustments made in the preparation of the Ind-AS Financial Statements, selected through a combination of risk-based and high-value transactions selection criteria.
	- Reviewed the recoverability of trade receivables, our procedures included an assessment of whether provision against or write-off of the trade receivables impacted our view as to the initial recognition of the related revenue.
	- We have relied on the reports generated from the entitys information systems, as the underlying systems and controls were validated by our IT specialist during the audit, who have confirmed the accuracy and completeness of these reports.
	Performing substantive analytical procedures:
	Performedsubstantiveanalyticalproceduresliketonnagegrowth, price yield growth, etc. We also evaluated the appropriateness and adequacy of the related disclosures made in the Ind-AS Financial Statements for revenue recorded during the year. We also assessed as to whether the disclosures in respect of revenue were adequate.

 

2. Lease Accounting Ind AS 116	Our procedures included:
Refer to Note 1(e) (Accounting poli- cies) and Note 42 of the accompanying Ind-AS Financial Statements.	Accounting policies:
	Assessing the Companys lease accounting policy, by compar- ing the same with Ind AS 116 - Leases
The Company has a high volume of lease contracts owing to the nature of its operations which are spread across India. The application of Ind-AS 116 involves use of significant judgementsdesign and and estimates including determination of leases, lease term including termina- tion and renewal option, use of practi- cal expedients, and discount rates for each lease etc.	Tests of controls:
	Obtained an understanding of the Managements process for identification of leasing arrangements which are considered to be within the scope of Ind-AS 116, Leases, and tested the effectiveness of Managements controls relating to identification and accounting of lease contracts and disclosures.
	Tests of details:
	- Reviewed the overall impact analysis prepared by the Management including completeness of lease contracts, lease term and application of practical expedients.
Risk identified: -	Tested the reasonableness of key assumptions used including discount rate, lease terms and measurement principles.
Owing to the inherent subjectivity re- lated to principal assumptions such as discount rates, we have identified the application of Ind-AS 116 as a key audit matter for the current year audit.
	- Tested the inputs and calculations of the right-of-use assets and lease liability, prepared by the Management for each material lease contract.
	- Verified the integrity and arithmetical accuracy of Ind- 116 calculations for each sample, through recalculation of the Ind-AS 116 adjustments.
	We also evaluated the appropriateness and adequacy of disclo- sures made in the Ind-AS Financial Statements with respect to lease liability and right of use assets recorded during the year, in accordance with Ind-AS 116.

Information Other than the Ind-AS Financial Statements and Auditors Report Thereon

The Companys Board of Directors is responsible for the other information. The other information comprises the Directors Report and Report on Corporate Governance but does not include the Ind-AS Financial Statements and our auditors report thereon. Our opinion on the Ind-AS 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 Ind-AS Financial Statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the Ind-AS 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, changes in equity and the cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making 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 Statements 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, Board of Directors is responsible for assessing the Companys ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

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

Auditors Responsibilities for the Audit of the Ind-AS Financial Statements

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.

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

Identify and assess the risks of material misstatement of the 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 adequate 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 Ind-AS Financial Statements that, individually or in aggregate, makes it probable that the economic decisions of the users of the Ind-AS 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 Ind-AS

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 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.

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

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 Ind-AS Financial Statements comply with the Accounting Standards specified under Section 133 of the Act, read with relevant rules issued thereunder. e) On the basis of the written representations received from the Directors of the Company as on March 31,

2025, taken on record by the Board of Directors, none of the Directors of the Company are disqualified as on March 31, 2025, 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 with reference to Ind-AS Financial Statements 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 Companies (Audit and Auditors) Rules, 2014, ("the Rules") in our opinion and to the best of our information and according to the explanations given to us: i) The Company has disclosed the impactofpendinglitigations financialposition in its Ind-AS its Financial Statements – Refer Note 36 to the Ind-AS Financial Statements. ii) The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses as at March 31, 2025. iii) There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended March 31, 2025 iv) The Management has represented that a) to the best of their knowledge and belief, 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(ies), including foreign entity(ies) ("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") security or the like on behalf of the Ultimate Beneficiaries; b) to the best of their knowledge and belief, 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, 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;

Based on such audit procedures performed by us that have been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (i) and (ii) of Rule 11 (e) of the Rules as provided under (a) and (b) above contain any material misstatement. v) As per information and explanation represented by Management and based on the records of the Company, the dividend proposed in the previous year, declared and paid by the Company during the year is in accordance with Section 123 of the Act, as applicable.

The Board of Directors of the Company have proposed final dividend for the year which is subject to the approval of the shareholders at the ensuing Annual General Meeting. The amount of dividend proposed is in accordance with section 123 of the Act. 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.

Additionally, the audit trail has been preserved by the Company as per the statutory requirements for record retention.

3) In our opinion and according to information and explanations given to us and based on our examination of the records of the Company, the Company has paid / provided managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 of the Act.

Annexure A to the Independent Auditors Report

The Annexure referred to in paragraph 1 ‘Report on Other Legal and Regulatory Requirements in our Independent Auditors Report to the members of the Company on the Ind-AS Financial Statements for the year ended March 31, 2025:

Statement on Matters specified in paragraphs 3 and 4 of the Companies (Auditors Report) , 2020: i) In respect of Companys Property Plant and Equipment, Right-of-use assets and Intangible assets a) (A) The Company has maintained proper records showing full particulars, including quantitative details and situation of property, plant and equipment.

(B) The Company has maintained proper records showing full particulars of intangible assets. b) The Company has a program of physical verification of Property, Plant and Equipment and Right- of-use assets at periodic intervals to cover all Property, Plant and Equipment and Right-of-use assets are verified during the year. In our opinion, this the size of the Company and the nature of its assets. The Company has physically verified

Plant and Equipment and Right-of-use assets of the Company in accordance with the above policy. According to information and explanations given to us and on the basis of the records of the Company examined by us, no material discrepancies were noticed during such verification. c) According to the information and explanations given to us and on the basis of the records of the Company examined by us, the title deeds of immovable properties (other than properties where the Company is the lessee and the lease agreement are duly executed in favour of the lessee), are held in the name of the Company except in the case of 14 leases (having a Net Carrying Value of 523.71 lakh as at March 31, 2025) where Right-of-Use (ROU) asset has been recognised, for which the lease agreements have expired. The Management in the process of renewing the lease agreements. Refer Note 2(a) of the Ind-AS Financial Statement. d) The Company has not revalued any of its Property, Plant and Equipment (including right-of-use assets) and intangible assets during the year. e) According to the information and explanations given to us, representation obtained from Management and on the basis of our examination of the records of the Company, no proceedings have been initiated during the year or are pending against the Company as at March 31, 2025, for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) (as amended in 2016) and rules made thereunder. ii) Inventory: a) The Management has conducted physical verification of inventories at reasonable intervals. In our opinion, the coverage and procedure of such physical varification by the management is commensurate with the size of the Company and the nature of its operations. The discrepancies noticed on such physical verifications between physical stock and book records are less than 10% in the aggregate for each class of inventories and the discrepancies have been properly dealt with in the books of account. b) According to the information and explanations given to us by the Management and books and records maintained, the Company has been sanctioned working capital limits in excess of 5 crore, in aggregate, at various points of time during the year, from banks on the basis of security of current assets of the Company. The quarterly returns filed by the Company with such banks are in agreement with the unaudited books of account of the Company of the respective quarters.

The Company has not availed working capital limits in excess of 5 crores in aggregate from any Financial Instituations at any point during the year. iii) a) The Company has made investments in a Co-operative Bank. The Company has not provided any guarantee or security or granted any loans or advances in the nature of loans, secured or unsecured, Therefore, the provisions of sub-clause (a), (c), (d), (e) and (f) of paragraph 3 (iii) of the Order are not applicable. b) In our opinion, the investments made during the year are, prima facie, not prejudicial to the Companys interest.

iv) According to the information and explanations given to us, the Company has not granted any loans or given guarantee or provided any security to parties covered under Section 185 of the Act. In our opinion and according to the information and explanations given to us and records examined by us, the provisions of Section 186 of the Act, in respect of investments made have been complied with by the Company. v) According to the information and explanations given to us and representations obtained from Management, the Company has not accepted any deposits from the public to which the directives issued by the Reserve Bank of India and the provisions of section 73 to 76 of the Act and the Rules framed thereunder apply. Accordingly, paragraph 3 (v) of the Order is not applicable to the Company. vi) According to the information and explanations given to us, the Central Government has not prescribed maintenance of cost records under sub-section (1) of section 148 of the Act, in respect of any of its activities carried out by the Company. Accordingly, paragraph 3 (vi) of the Order is not applicable to the Company. vii) Statutory Dues: a) According to the information and explanations given to us and on the basis of the records examined by us, the Company is regular in depositing undisputed statutory dues, including Goods and Service tax, Provident Fund, Employees State Insurance, Income-tax, Service Tax, Duty of Custom, Profession Tax, cess and other material applicable statutory dues during the year. We have been informed that there are no undisputed dues which have remained outstanding as at the last day of the financial year, for a period of more than six months from the date they became payable. b) According to the information and explanations given to us, details of statutory dues referred to in sub- clause (a) above which have not been deposited as on March 31, 2025, on account of disputes are given below:

Name of the statute	Nature of dues	Amount (in Lakhs)	Period to which the amount relates	Forum where dispute is pending
The Income	Demand of tax on set-off of Depreciation loss of windmill segment with other segment	2,635.86	F. Y. - 2007-08	High Court of Karnataka
Tax Act, 1961	Disallowance on Tax on Sale of Certified Emission Reduction and on account of personal flights undertaken by the management.	185.59	F.Y. - 2013-14	High Court of Karnataka
	Disallowance of certain expenses treating them as personal expenses	14.23	F.Y.- 2015-16	Commissioner of Income Tax (Appeals)
	Disallowance of employers contribution to gratuity fund, leave salary and bonus, deduction in respect of new employees and certain expenses treating them as personal expenses. Addition on account of fall in net profit ratio. (Net of Amount paid under Protest – 245.20 lakhs).	980.82	F.Y.- 2016-17	Commissioner of Income Tax (Appeals)
	Disallowance of employers contribution to gratuity fund and deduction in respect of new employees. (Net of Amount paid under Protest – 29.23 lakhs).	116.92	F.Y.- 2017-18	Commissioner of Income Tax (Appeals)
	Demand of tax treating the slump sale of Bus division as short-term capital gain (Refer Note below)	811.83	F.Y.- 2022-23	Commissioner of Income Tax (Appeals)

 

Name of the statute	Nature of dues	Amount ( in Lakhs)	Period to which the amount relates	Forum where dispute is pending
The Custom Act, 1962	Custom Duty on import of aircraft and related interest / penalties / fines.	1,569.02	FY 2007-08	High Court of Gujarat
The	Non-refund of service tax paid	242.88	2000-01 to	Customs,
Finance Act, 1994			2001- 02	Excise and Service Tax Appellate Tribunal (Bengaluru)
	Service tax arising due to reclassification of services.	328.45	April 2014 to February 2017	Customs, Excise and Service Tax Appellate Tribunal (Bengaluru)
	Service Tax on National Permit Fees.	68.07	April 2016 to June 2017	Commissioner of GST, Belgaum.
	Goods & Service Tax on National Permit Fees. (Net of GST paid under protest 31.76 lakh)	285.79	July 2017 to Septemb er 2021	Commissioner of GST, Belgaum.
	GST on Supplies attracting reverse charge (net of GST paid under protest 4.28 lakh)	85.69	July 2017 to March 2018	Additional commissioner (Appeals), Delhi.

Note: Stay order has been granted against demand of 811.83 lakh. viii) According to the information and explanations given to us and on the basis of the records examined by us, there were no transactions relating to previously unrecorded income that have been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (43 of 1961). ix) Borrowings: a) In our opinion and according to the information and explanations given to us, and representation obtained from Management, the Company has not defaulted in repayment of loans or other borrowings or payment of interest thereon to any bank during the year. The Company has not taken any loan and borrowings from financial institutions and the Government. b) In our opinion and according to the information and explanations given to us and representation obtained from Management, the Company has not been declared wilful defaulter by any bank or financial institution or other lender. c) In our opinion and according to the information and explanations given to us and representation obtained from Management, the Company has applied the term loans obtained from the banks during the year for the purpose for which it was obtained. d) In our opinion and according to the information and explanations given to us and representation obtained from Management, on an overall examination of the Ind-AS Financial Statements of the Company, funds raised on short-term basis have not been used during the year for long-term purposes by the Company.

e) According to the information and explanations given to us, representation obtained from Management, and on an overall examination of the Ind-AS Financial Statements of the Company, the Company does not have any subsidiaries, associates or joint ventures and hence reporting on clause 3(ix)(e) and (f) of the Order are also not applicable. x) Allotment of Shares a) According to the information and explanations given to us, representation obtained from Management, the Company has not raised moneys by way of initial public offer or further public offer (including debt instruments) during the year and hence reporting under clause 3(x)(a) of the Order is not applicable. b) 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 convertible debentures (fully or partly or optionally convertible) and hence reporting under paragraph (iii) (x)(b) of the Order is not applicable to the Company. xi) Frauds (a) According to the information and explanations given to us, on the basis of the records examined by us and representation from Management, no frauds by the Company or material frauds on the Company have been noticed or reported during the year. b) No report under sub-section (12) of Section 143 of the Companies Act has been filed in Form ADT-4 as prescribed under Rule 13 of Companies (Audit and Auditors) Rules, 2014 with the Central Government, during the year and up to the date of this report. c) According to the information and explanations given to us and representation from Management, no whistle-blower complaints have been received by the Company during the year. xii) In our opinion and according to the information and explanations given to us, the Company is not a Nidhi Company, Company hence reporting under paragraph (iii) (xii) (a), (b) and (c) of the Order are not applicable to the Company. xiii) According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with Sections 177 and 188 of the Act with respect to applicable transactions with the related parties and details of such transactions have been disclosed in the Ind-AS Financial Statements as required by the applicable accounting standards. xiv) Internal Audit System a) In our opinion the Company has an adequate internal audit system commensurate with the size and the nature of its business. b) We have considered, the internal audit reports for the year under audit, issued to the Company during the year and till date, in determining the nature, timing and extent of our audit procedures. xv) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into any non-cash transactions with Directors or persons connected with them, and hence provisions of section 192 of the Companies Act, 2013 are not applicable to the Company. xvi) a) In our opinion, according to the information and explanations given to us, the Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934 and has also not conducted anyNon-BankingFinancialorHousingFinanceactivities.Hence,reportingunderparagraph3(xvi)(a)and (b) of the Order are not applicable. b) Neither the Company nor any company in the Group is a part of the Core Investment Company (CIC) as defined in the regulations made by the Reserve Bank of India. Hence, reporting under paragraph 3(xvi) (c) and (d) of the Order are not applicable. xvii) According to the information and explanations given to us and based on our examination of the Ind-AS Financial Statements of the Company, the Company has not incurred cash losses during the current financial year and the immediately preceding financial year. xviii) There has been no resignation of the statutory auditor of the Company during the year.

xix) On the basis of the financial ratios, ageing and expected dates of realisation of financial assets and payment of financial liabilities, other information accompanying the IND-AS Financial Statements and our knowledge of the Board of Directors and Management plans and based on our examination of the evidence supporting the assumptions, nothing has come to our attention, which causes us to believe that any material uncertainty exists as on the date of the audit report indicating that Company is not capable of meeting its liabilities existing at the date of balance sheet as and when they fall due within a period of one year from the balance sheet date. We, however, state that this is not an assurance as to the future viability of the Company. We further state that our reporting is based on the facts up to the date of the audit report and representation from Management. Our report does not give any assurance that all liabilities falling due within a period of one year from the balance sheet date, will get discharged by the Company as and when they fall due. xx) Corporate Social Responsibility There are no unspent amounts towards Corporate Social Responsibility (CSR) as at March 31, 2025. Accordingly, reporting under paragraph 3(xx)(a) and 3(xx)(b) of the Order are not applicable for the year.

Annexure "B" to the Independent Auditors Report

(Referred to in Para 2 (f) Report on Other Legal and Regulatory Requirements in our Independent Auditors Report to the Members of the Company on the Financial Statements for the year ended March 31, 2025) Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Act

We have audited the internal financial controls with reference to Financial Statements of VRL LOGISTICS LIMITED ("the Company") as of March 31, 2025, 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 with reference to Financial Statements 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 (the "Guidance Note") 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 (the "Act" or the "Companies Act").

Auditors Responsibility

Our responsibility is to express an opinion on the Companys internal financialcontrols with reference to Financial

Statements based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the "Guidance Note") and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, 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 with reference to Financial Statements was established and main -tained 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 with reference to Financial Statements and their operating effectiveness. Our audit of internal financial controls with reference to Financial Statements included obtaining an understanding of internal financial controls with reference to Financial Statements, 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 sufficientand appropriate to provide a basis for our audit opinion on the Companys internal financial controls system with reference to Financial Statements.

Meaning of Internal Financial Controls with reference to Financial Statements

A Companys internal financial control with reference to Financial Statements 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 finan -cial control with reference to Financial Statements includes those policies and procedures that:

1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transac tions and dispositions of the assets of the company; 2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of Financial Statements in accordance with generally accepted accounting principles and that receipts and expenditures of the Company are being made only in accordance with authorisations of Management and Directors of the Company; and 3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the companys assets that could have a material effect on the Financial Statements.

Inherent Limitations of Internal Financial Controls with reference to Financial Statements

Because of the inherent limitations of internal financial controls with reference to Financial Statements, 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 with reference to Financial Statements to future periods are subject to the risk that the internal financial control with reference to Financial Statements 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, to the best of our knowledge and according to the explanations given to us, the Company has, in all material respects, an adequate internal financial controls system with reference to Financial Statements and such internal financial controls with reference to Financial Statements were operating effectively as at March 31,

2025, based on the internal controls with reference to Financial Statements criteria established by the Company considering the essential components of internal control stated in the Guidance Note issued by the Institute of Chartered Accountants of India.

For KALYANIWALLA & MISTRY LLP

CHARTERED ACCOUNTANTS

Firm Reg. No.: 104607W / W100166

 

Cyrus A. Nariman

Partner

Membership No.: 102643

 

UDIN: 25l02643DMKWYW5791

Hubballi: May 21, 2025