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Alchemist Ltd.

BSE: 526707 Sector: Others
NSE: ALCHEM ISIN Code: INE964B01033
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OPEN 3.02
CLOSE 3.02
VOLUME 3185
52-Week high 11.69
52-Week low 3.02
P/E
Mkt Cap.(Rs cr) 4
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Alchemist Ltd. (ALCHEM) - Auditors Report

Company auditors report

To the Members of Alchemist Limited

Report on the Audit of Standalone Financial Statements

Qualified Opinion

We have audited the accompanying standalone financial statements ofAlchemist Limited ("the Company") which comprise the Balance Sheet as at 31stMarch 2020 the Statement of Profit and Loss (including Other Comprehensive Income) theStatement of Cash Flows and the Statement of Changes in Equity for the year then endedand a summary of the significant accounting policies and other explanatory information.

In our opinion and to the best of our information and according to theexplanations given to us except for the effects of the matter described in the Basis forQualified Opinion section of our report the aforesaid standalone financial statementsgive the information required by the Companies Act 2013 ('Act') in the manner so requiredand give a true and fair view in conformity with the accounting principles generallyaccepted in India including Indian Accounting Standards ('Ind AS') specified under section133 of the Act of the state of affairs (financial position) of the Company as at 31stMarch 2020 and its loss (financial performance including other comprehensive income) itscash flows and the changes in equity for the year ended on that date.

Basis for Qualified Opinion

a. Attention is invited to note no. 43 to the standalone financialstatements which states that "The Company extends credit from time to time as permarket practices. In respect of export receivables' amounting to ^ 46442.79 Lakhs creditwas extended for export sales in the normal course of the business however it apparentlygot stuck. Though the Company is regularly following up on the same has initiated legalrecourse and is hopeful of recovering such amount still considering the principal ofconservatism the Company has made a provision for expected credit loss allowance @ 10% ofthe outstanding export receivables amounting to ^ 4644.28 Lakhs and has not recognisedunrealised foreign exchange gain/loss on such export receivable and related trade payableduring the financial year 2019-20. Hence forth the Company shall not be accounting forthe unrealised foreign exchange loss on such export receivable and related trade payablesand the same will only be accounted for on actual realisation/payment"

Further the Company has stated that the total provision on suchdoubtful export receivables stands at 20% amounting to ^ 9288.56 Lakhs as at 31stMarch 2020.

Such export receivables are outstanding for more than three years as atthe yearend date; provision @ 20% is made against such doubtful trade receivables. Sincethe actual realisation of such doubtful export receivable cannot be ascertained we areunable to comment on the adequacy of the provision of excepted credit loss made by theCompany.

In the absence of the information on record the consequential impactif any on the standalone financial statements is not ascertainable.

Though the Company admits that the export receivable is doubtful ofrecovery and has made partial provision on such export receivable still such exportreceivable and related trade payable stand in the books hence require recognition ofunrealised foreign exchange gain/loss as per the provisions of Ind AS 21 The Effects ofChanges in Foreign Exchange Rates. Accordingly the loss is overstated by % 3178.87 Lakhsfor the year ended 31st March 2020 and accordingly the trade receivables andtrade payable are understated by %4329.75 Lakhs and % 1150.88 Lakhs respectively as atthe year ended 31st March 2020.

b. Attention is invited to note no. 60 to the standalone financialstatements which states that "The working capital limits of ^ 350.00 Lakhs availedfrom Bank of India for the working capital requirements of the pharmaceutical division hasbeen classified as nonperforming asset (herein referred to as 'NPA') on 30thNovember 2018. The outstanding as on the date of classification by the bank as NPA was ^363.88 Lakhs. The Company has not recognised interest liability on such loan from the dayit has become NPA in line with the practice followed by the respective bank".

The Company has not made provision of interest due on the borrowingsfrom Bank of India post the date the account was classified as non-performing assets bythe bank.

In the absence of the information on record the consequential impactif any on the standalone financial statements is not ascertainable.

c. Attention is invited to note no. 10 and note no. 49 to thestandalone financial statements which considers capital advances of ^ 769.70 lakhs as goodand recoverable and also states that out of the same the Company is pursuing legal actionin Honourable Kolkata High Court against Medisphere Marketing Limited for recovery of theamount of ^ 459.80 Lakhs outstanding in its books. Further The Company is hopeful ofrecovering the above amounts and hence no provision is considered necessary.

The entire capital advances of % 769.70 Lakhs are outstanding for morethan three years as at the yearend date and seems doubtful of recovery or adjustmenthowever no provision is made against such doubtful capital advances.

In the absence of the information on record the consequential impactif any on the standalone financial statements is not ascertainable.

d. Attention is invited to note no. 8 13 and 25 to the financialstatements state that FDR's current accounts and cash credit limit with a cumulativedebit balance of ^ 106.39 Lakhs and cumulative credit balance of ^ 375.07 Lakhs do nothave statements or even confirmation.

In the absence of the information on record the consequential impactif any on the standalone financial statements is not ascertainable.

e. The financial impact arising out of the COVID -19 outbreak are notaccounted or reported or disclosed as per the prescribed Accounting Standards in thefinancial statements.

In the absence of the information on record the consequential impactif any on the standalone financial statements is not ascertainable.

We conducted our audit in accordance with the Standards on Auditing(SAs) specified under section 143(10) of the Companies Act 2013. Our responsibilitiesunder those Standards are further described in the Auditor's Responsibilities for theAudit of the Financial Statements section of our report. We are independent of the Companyin accordance with the Code of Ethics issued by the Institute of Chartered Accountants ofIndia together with the ethical requirements that are relevant to our audit of thefinancial statements under the provisions of the Companies Act 2013 and the Rules thereunder and we have fulfilled our other ethical responsibilities in accordance with theserequirements and the Code of Ethics. We believe that the audit evidence we have obtainedis sufficient and appropriate to provide a basis for our qualified opinion.

Emphasis of Matters

a. Attention is invited to note no. 61 to the standalone financialstatements which states that "The income tax department has through its order dated 7thFebruary 2019 has demanded an amount of ^ 29129.34 Lakhs in lieu of the assessmentcarried out by the income tax departments for the assessments years 2009-10 to 2015-16.The Company has not provided for such liability in its books as it has appealed againstsuch demand raised by the income tax department. The liability however has been reflectedas a contingent liability".

b. Attention is invited to note no. 50 to the standalone financialstatements which states that "The pharma division of the Company has adjusted tradepayables amounting to ^ 380.32 Lakhs (Previous Year ^ 1021.40 Lakhs) by way of a bookentry on account of direct payment to them by some trade receivables or by making directpayment to the suppliers of the supplier from whom the Company is getting the productsmanufactured as per the Company's specification. Such adjustments is only in the case ofthe franchise arrangement and in case of a third party manufacturer".

c. Attention is invited to note no. 57 to the standalone financialstatements which states that "Cash in hand includes cash amounting to ^ 180.54 Lakhswhich was seized by the Income tax authorities during the search and seizure operation u/s132 of the Income Tax Act 1961 during the month of June 2014".

d. Attention is invited to note no. 53 to the standalone financialstatements which states that "The balances of majority of the Trade ReceivablesTrade Payables and Loan made and received are subject to confirmation and as such theirbalances are reflected in the Balance Sheet as appearing in the books pendingreconciliation the net effect is unascertainable".

e. Attention is invited to note no. 62 to the standalone financialstatements which states that "The subsidiary company Alchemist Hospitality GroupLimited is in the process of voluntary strike off. The forms required to be filed with theRegistrar of Companies have been filed and approval is awaited".

Our opinion is not qualified in respect of the matters as stated in theEmphasis of Matters paragraph.

Key Audit Matter

Key audit matters are those matters that in our professional judgmentwere of most significance in our audit of the standalone financial statements of thecurrent period. These matters were addressed in the context of our audit of the standalonefinancial statements as a whole and in forming our opinion thereon and we do not providea separate opinion on these matters. In addition to the matters described in the Basis forQualified Opinion section we have determined the matter described below to be the keyaudit matter to be communicated in our report.

Key audit matter How our audit addressed the key audit matter
Going concern assessment
Attention is invited to note no. 58 to the standalone financial statements which states that "The accumulated losses of the Company had exceeded its net worth. The company's operations were adversely affected in earlier financial years due to sluggish market demand working capital getting stuck in trade receivables and loss making manufacturing activity of the pharmaceutical unit. The Company has initiated legal recourse against the defaulting customers and is regularly following up on the same and the Company has recently even closed down its loss making pharmaceutical manufacturing. The units of the company now continue to operate at satisfactory capacity utilization levels and are generating positive Earnings before Interest Depreciation Tax and Amortization (EBIDTA). With strong management focus on strategic initiatives for cost rationalization optimum product mix and efficient plant operations the management believes that accumulated losses would reasonably be paired in due course. The Company can even liquidate its non-core strong fixed assets cover to support the operations in times of any need. Further the Company has the backing of the strong group because of which the Company has been able to pay off its borrowings from Punjab National Bank and support the operations of the Company even though the Company has incurred losses in the recent past. The financial statements as such have been prepared on a going concern basis". Our audit procedures were focused on obtaining sufficient appropriate audit evidence that the going concern assessment made by the Company is not materially misstated. These procedures included but were not limited to the following:
We analysed management's report to gain an understanding of the inputs and process underpinning the cash flow model prepared for the purpose of the going concern assessment.
We reviewed the operating performances of the various units of the Company to evaluate whether or not they are actually generating positive EBIDTA.
We assessed the possible mitigating actions identified by management in the event that actual cash flows are below forecast.
The availability of sufficient funding and the testing of whether the company will be able to continue meeting its obligations under the financing covenants are important for the going concern assumption and as such are significant aspects of our audit. This test or assessment is largely based on the expectations of and the estimates made by management. The expectations and estimates can be influenced by subjective elements such as estimated future cash flows forecasted results and margins from operations. Estimates are based on assumptions including expectations regarding future developments in the economy and the market.

Information other than the Financial Statements and Auditor's Reportthereon

The Company's Board of Directors is responsible for the otherinformation. The other information comprises the information included in the AnnualReport but does not include the standalone financial statements and our auditor's reportthereon.

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

In connection with our audit of the standalone financial statementsour responsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the standalone financial statements orour 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 amaterial misstatement of this other information we are required to report that fact. Wehave nothing to report in this regard.

Management's Responsibility for the Standalone Financial Statements

The Company's Board of Directors are responsible for the matters statedin Section 134(5) of the Companies Act 2013 ("the Act") with respect to thepreparation of these standalone financial statements that give a true and fair view of thefinancial position financial performance including other comprehensive income changes inequity and cash flows of the Company in accordance with the accounting principlesgenerally accepted in India including the Indian Accounting Standards (Ind AS) prescribedunder section 133 of the Act.

This responsibility also includes maintenance of adequate accountingrecords in accordance with the provisions of the Act for safeguarding the assets of theCompany and for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of

adequate internal financial controls that were operating effectivelyfor ensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the standalone financial statements that give a true andfair view and are free from material misstatement whether due to fraud or error.

In preparing the standalone financial statements management isresponsible for assessing the Company's ability to continue as a going concerndisclosing as applicable matters related to going concern and using the going concernbasis of accounting unless management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so.

Those Board of Directors are also responsible for overseeing theCompany's financial reporting process.

Auditor's Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether thestandalone financial statements as a whole are free from material misstatement whetherdue to fraud or error and to issue an auditor's report that includes our opinion.Reasonable assurance is a high level of assurance but is not a guarantee that an auditconducted in accordance with Standards on Auditing will always detect a materialmisstatement when it exists. Misstatements can arise from fraud or error and areconsidered material if individually or in the aggregate they could reasonably beexpected to influence the economic decisions of users taken on the basis of thesestandalone financial statements.

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

• Identify and assess the risks of material misstatement of thefinancial statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.

• Obtain an understanding of internal control relevant to theaudit in order to design audit procedures that are appropriate in the circumstances. Undersection 143(3)(i) of the Act we are also responsible for expressing our opinion onwhether the company has adequate internal financial controls system in place and theoperating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and thereasonableness of accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management's use of the goingconcern basis of accounting and based on the audit evidence obtained whether a materialuncertainty exists related to events or conditions that may cast significant doubt on theCompany's ability to continue as a going concern. If we conclude that a materialuncertainty exists we are required to draw attention in our auditor's report to therelated disclosures in the financial statements or if such disclosures are inadequate tomodify our opinion. Our conclusions are based on the audit evidence obtained up to thedate of our auditor's report. However future events or conditions may cause the Companyto cease to continue as a going concern.

• Evaluate the overall presentation structure and content of thefinancial statements including the disclosures and whether the financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.

We communicate with those charged with governance regarding amongother matters the planned scope and timing of the audit and significant audit findingsincluding any significant deficiencies in internal control that we identify during ouraudit.

We also provide those charged with governance with a statement that wehave complied with relevant ethical requirements regarding independence and tocommunicate with them all relationships and other matters that may reasonably be thoughtto bear on our independence and where applicable related safeguards.

From the matters communicated with those charged with governance wedetermine those matters that were of most significance in the audit of the financialstatements of the current period and are therefore the key audit matters. We describethese matters in our auditor's report unless law or regulation precludes public disclosureabout the matter or when in extremely rare circumstances we determine that a mattershould not be communicated in our report because the adverse consequences of doing sowould reasonably be expected to outweigh the public interest benefits of suchcommunication.

Report on Other Legal and Regulatory Requirements

1. As required by section 197(16) of the Act we report that theCompany has paid remuneration to its directors during the year in accordance with theprovisions of and limits laid down under section 197 read with Schedule V to the Act.

2. As required by the Companies (Auditor's Report) Order 2016("the Order") issued by the Central Government of India in terms of sub-section(11) of section 143 of the Act we give in the Annexure A a statement on the mattersspecified in paragraphs 3 and 4 of the Order to the extent applicable.

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

(a) We have sought and except for the matters described in the Basisfor Qualified Opinion section and Emphasis of Matters section above have obtained all theinformation and explanations which to the best of our knowledge and belief were necessaryfor the purposes of our audit.

(b) Except for the matter described in the Basis for Qualified Opinionparagraph in our opinion proper books of account as required by law have been kept bythe Company so far as it appears from our examination of those books.

(c) The Balance Sheet the Statement of Profit and Loss including OtherComprehensive Income the Cash Flow Statement and Statement of Changes in Equity dealtwith by this Report are in agreement with the books of account.

(d) Except for the matter described in the Basis for Qualified Opinionsection in our opinion the aforesaid standalone financial statements comply with theIndian Accounting Standards specified under Section 133 of the Act read with theCompanies (Indian Accounting Standards) Rules 2015 as amended.

(e) The matters described in the Basis for Qualified Opinion sectionand Emphasis of Matters section above in our opinion may have an adverse effect on thefunctioning of the Company.

(f) On the basis of the written representations received from thedirectors as on 31st March 2020 taken on record by the Board of Directorsnone of the directors is disqualified as on 31st March 2020 from beingappointed as a director in terms of Section 164 (2) of the Act.

(g) The qualification relating to the maintenance of accounts and othermatters connected therewith are as stated in the Basis for Qualified Opinion sectionabove.

(h) With respect to the adequacy of the internal financial controlsover financial reporting of the Company and the operating effectiveness of such controlsrefer to our separate report in "Annexure B".

(i) With respect to the other matters to be included in the Auditor'sReport in accordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 inour opinion and to the best of our information and according to the explanations given tous:

i. The Company has disclosed the impact of pending litigations on itsfinancial position in its standalone financial statements - Refer note no. 45 to thestandalone financial statements.

ii. The Company did not have any long-term contracts includingderivative contracts for which there were any material foreseeable losses.

iii. Amount of % 12.61 Lakhs was required to be transferred during theprevious year to the Investor Education and Protection Fund by the Company but the samehas not been transferred till date.

for Anu and Associates
Chartered Accountants
Firm's Registration Number: 019624N
Sd/-
CA. Parveen Kumar
Partner
Membership Number: 531655
Place of Signature: New Delhi
Date: 30th July 2020
UDIN: 20531655AAAADL4334

Annexure - A to the Independent Auditors' Report

Referred to in paragraph 2 under 'Report on other Legal and RegulatoryRequirements' section of our report of even date. We report that:

(i) (a) In our opinion and according to the information andexplanations given to us the Company has maintained fixed asset register

however the same does not specify the quantity and exact location ofthe fixed assets.

(b) In our opinion and according to the information and explanationsgiven to us the Company has not physically verified the fixed assets during the year. Inour opinion the periodicity of the physical verification is not reasonable having regardto the size of the Company and nature of its assets.

(c) In our opinion and according to the information and explanationgiven to us the Company holds valid title for all the immovable properties in the booksof the Company except for one land valuing % 55.59 Lakhs the title deed of which has notbeen produced before us for our verification of the same.

(ii) In our opinion and according to the information and explanationsgiven to us inventories have been physically verified during the year by the managementat reasonable intervals. The material discrepancies if any noticed have been properlydealt with in the books of accounts.

(iii) According to the information & explanations given to us theCompany has granted loans secured or unsecured outstanding at year end at ^ 62.43 Lakhsto 7 parties covered in the register maintained under section 189 of the Act.

(a) It has been informed to us that the terms of repayment have notbeen defined however they are repayable on the mutual agreement of both the partiesinvolved. Moreover the loans granted are unsecured and interest free thus the terms ofsuch loans are prejudicial to the interests of the Company.

(b) All the loans made are interest free and schedule of repayment arenot defined hence the timeliness of repayment cannot be commented upon.

(c) As mentioned in the above paragraphs since terms of repayment ofloans are not defined we are unable to comment on the overdue amount.

(iv) The Company has given loans/amount recoverable to/from two partieswhose yearend outstanding balance is % 19.07 Lakhs in contravention of provisions ofSection 185 of the Companies Act 2013.

Further the Company has given interest free loans/amount recoverableto/from 11 parties whose yearend outstanding balance is % 876.64 Lakhs which is incontravention of sub section 7 of section 186 of the Companies Act 2013 which requiresthat "No loan shall be shall be given under this section at a rate of interest lowerthan the prevailing yield of one year three year five year or ten year GovernmentSecurity closest to the tenor of the loan".

(v) The Company has not accepted deposits. Hence the provisions ofSection 73 to 76 or any other relevant provisions of the Act and the rules framed thereunder are not applicable to the Company.

(vi) The central government has not prescribed maintenance of costrecords under sub-section (1) of Section 148 of the Companies Act 2013 in respect of theactivities of the company.

(vii) (a) Based on our audit procedures and on the information andexplanations given by the management we report that there

has been delays in deposit of undisputed statutory dues includingProvident Fund Employees' State Insurance Income-tax Goods and Service Tax Sales TaxService Tax Custom Duty Excise Duty Value Added Tax Cess and any other statutory duesto the extent applicable during the financial year. According to the information andexplanations given to us statutory dues amounting to % 153.04 Lakhs were outstanding ason 31st March 2020 for a period of more than six months from the date itbecame payable.

(b) Details of statutory dues which have not been deposited as on 31stMarch 2020 by the Company on account of dispute is given below:

Nature of Tax Name of the Statute Period to which amount relates Amount demanded (In Lakhs) Amount deposited (In Lakhs) Pending deposit Forum
Income Tax Income TaxAct 1961 2007-08 5.11 0.00 5.11 Assessing Officer
Income Tax Income Tax Act 1961 2008-09 to 2014-15 29129.34 0.00 29129.34 CIT(Appeals) New Delhi
Excise Duty Central Excise Act 1944 December 2007 to September 2012 173.55 63.13 110.42 Supreme Court
Total 29308.00 63.13 29244.81

ALCHEMIST LIMITED

(viii) Based on our audit procedures and on the information andexplanations given by the management we are of the opinion that during the year therehave been delays in repayment of dues by the Company to financial institutions banks ordebenture holders. The details of the continuing default as on 31st March 2020in repayment of principle and interest is as follows:

Details of continuing default as on 31 march 2020

Name and Bank-Type of loan Sanction Amount Default Amount as on 31st March 2020
Punjab National Bank-Term Loan 2100.00 52.74
Bank Of India-Working Capital Loan 350.00 363.88
Total 2450.00 416.62

(ix) The Company did not raise any money by way of initial public offeror further public offer (including debt instruments) and term loans during the yeartherefore the provisions of para 3(ix) of the Order is not applicable to the Company.

(x) Based on the audit procedures performed and the information andexplanations given to us we report that no fraud on or by the Company has been noticed orreported during the year nor have we been informed of such case by the management.

(xi) Based on the audit procedures performed and the information andexplanations given to us we report that the managerial remuneration has been paid orprovided in accordance with requisite approvals mandated by the provisions of section 197read with Schedule V to the Companies Act 2013.

(xii) In our opinion and according to the information and explanationsgiven to us the Company is not a nidhi company therefore the provisions of para 3(xii)of the Order is not applicable to the Company.

(xiii) According to the information and explanations given to us andbased on our examination of the records of the Company transactions with the relatedparties are in compliance with sections 177 and 188 of the Act where applicable anddetails of such transactions have been disclosed in the financial statements as requiredby the applicable accounting standards.

(xiv) According to the information and explanations given to us andbased on our examination of the records of the Company the Company has not made anypreferential allotment or private placement of shares or fully or partly convertibledebentures during the year.

(xv) According to the information and explanations given to us andbased on our examination of the records of the Company the Company has not entered intonon-cash transactions with directors or persons connected with him therefore theprovisions 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-IAof the Reserve Bank of India Act 1934.

for Anu and Associates

Chartered Accountants Firm's Registration Number: 019624N

Sd/-

CA. Parveen Kumar

Partner

Membership Number: 531655

Place of Signature: New Delhi Date: 30th July 2020 UDIN:20531655AAAADL4334

Annexure - B to the Independent Auditors' Report

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

We have audited the internal financial controls over financialreporting of Alchemist Limited ("the Company") as of 31st March 2020in conjunction with our audit of the standalone financial statements of the Company forthe year ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing andmaintaining internal financial controls based on the internal control over financialreporting criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note on Audit of Internal Financial Controls overFinancial Reporting issued by the Institute of Chartered Accountants of India ('ICAI').These responsibilities include the design implementation and maintenance of adequateinternal financial controls that were operating effectively for ensuring the orderly andefficient conduct of its business including adherence to company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Companies Act 2013.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internalfinancial controls over financial reporting based on our audit. We conducted our audit inaccordance with the Guidance Note on Audit of Internal Financial Controls over FinancialReporting (the "Guidance Note") and the Standards on Auditing issued by ICAIand deemed to be prescribed under section 143(10) of the Companies Act 2013 to theextent applicable to an audit of internal financial controls both applicable to an auditof Internal Financial Controls and both issued by the ICAI. Those Standards and theGuidance Note require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether adequate internal financial controlsover financial reporting was established and maintained and if such controls operatedeffectively in all material respects.

Our audit involves performing procedures to obtain audit evidence aboutthe adequacy of the internal financial controls system over financial reporting and theiroperating effectiveness. Our audit of internal financial controls over financial reportingincluded obtaining an understanding of internal financial controls over financialreporting assessing the risk that a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal control based on the assessed risk. Theprocedures selected depend on the auditor's judgment including the assessment of therisks of material misstatement of the financial statements whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the Company's internal financialcontrols system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A company's internal financial control over financial reporting is aprocess designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles. A company's internal financial control overfinancial reporting includes those policies and procedures that (1) pertain to themaintenance of records that in reasonable detail accurately and fairly reflect thetransactions and dispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of financialstatements in accordance with generally accepted accounting principles and that receiptsand expenditures of the company are being made only in accordance with authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised acquisition use or disposition of thecompany's assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over FinancialReporting

Because of the inherent limitations of internal financial controls overfinancial reporting including the possibility of collusion or improper managementoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projections of any evaluation of the internal financial controls overfinancial reporting to future periods are subject to the risk that the internal financialcontrol over financial reporting may become inadequate because of changes in conditionsor that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion the Company has in all material respects an adequateinternal financial controls system over financial reporting and such internal financialcontrols over financial reporting were operating effectively as at 31st March2020 based on the internal control over financial reporting criteria established by theCompany considering the essential components of internal control stated in the GuidanceNote on Audit of Internal Financial Controls over Financial Reporting issued by the ICAI.

for Anu and Associates

Chartered Accountants Firm's Registration Number: 019624N

Sd/-

CA. Parveen Kumar

Partner

Membership Number: 531655

Place of Signature: New Delhi Date: 30th July 2020

UDIN: 20531655AAAADL4334

.