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Arshiya Ltd.

BSE: 506074 Sector: Others
NSE: ARSHIYA ISIN Code: INE968D01022
BSE 00:00 | 22 Sep 12.24 -0.49
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12.19

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12.73

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12.10

NSE 00:00 | 22 Sep 12.40 -0.05
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13.05

HIGH

13.05

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12.05

OPEN 12.19
PREVIOUS CLOSE 12.73
VOLUME 12383
52-Week high 26.30
52-Week low 6.74
P/E
Mkt Cap.(Rs cr) 316
Buy Price 12.10
Buy Qty 4096.00
Sell Price 12.73
Sell Qty 200.00
OPEN 12.19
CLOSE 12.73
VOLUME 12383
52-Week high 26.30
52-Week low 6.74
P/E
Mkt Cap.(Rs cr) 316
Buy Price 12.10
Buy Qty 4096.00
Sell Price 12.73
Sell Qty 200.00

Arshiya Ltd. (ARSHIYA) - Auditors Report

Company auditors report

To the Members of Arshiya Limited

Report on the Audit of Standalone Financial Statements Opinion

We have audited the accompanying Standalone Financial Statements of Arshiya Limited(‘the Company') which comprise the Balance Sheet as at 31st March 2019 theStatement of Profit and Loss (including Other Comprehensive Income) the Cash FlowStatement and the Statement of Changes in Equity for the year then ended and a summary ofthe significant accounting policies and other explanatory information. (hereinafterreferred to as "the Financial Statements")

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid financial statements give the information required by the Actin the manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India including Ind AS specified under Section 133 of theAct of the financial position of the Company as at 31st March 2019 and its financialperformance including other comprehensive income its cash flows and the changes in equityfor the year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Companies Act 2013 our responsibilities under thoseStandards are further described in the Auditor's Responsibilities for the Audit of theFinancial Statements section of our report. We are independent of the Company inaccordance 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 Rulesthereunder and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the Code of Ethics. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our opinion.

Emphasis of Matters

1. We draw attention to the note no. 47 of the financial statements regardinginvocation of corporate guarantee by the Company to lenders of Arshiya Northern FTWZLimited (ANFTWZ). The Company carried out the fair valuation of above guarantee through anindependent Chartered Accountants firm and as per their report the value of assets infavor of lenders of ANFTWZ is higher than the total liabilities to them. Accordingly noprovision against the claims under the invoked corporate guarantee is considerednecessary.

2. We draw attention to note no. 66 of the financial statements regarding the balanceconfirmations of borrowings trade receivables capital advances and trade payables.During the course of preparation of standalone financial statements e-mails/letters havebeen sent to various parties by the company with a request to confirm their balancesdirectly to us out of which only few parties have responded accordingly the possibleadjustment if any required in the financial statements is presently not determinable.

Our opinion is not modified in respect of the said matters.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the financial statements of the current period. These matterswere addressed in the context of our audit of the financial statements as a whole and informing our opinion thereon and we do not provide a separate opinion on these matters. Inaddition to the matter described in the Emphasis of matters we have determined thematters described below to be key audit matters to be communicated in our report.

Key Audit Matters How Our Audit Addressed The Key Audit matter
1. Impairment of Investments and receivables from Arshiya Industrial & Distribution Hub Limited (AIDHL) Arshiya Northern FTWZ Limited (ANFTWZ) and Arshiya Rail Infrastructure Limited (ARAIL)
Management regularly reviews whether there are any indicators of impairment on the investments made by the Company and advances by reference to the requirements under Ind AS 36 "Impairment of Assets". Accordingly management has identified impairment indicators (operating losses negative net-worth) in AIDHL ANFTWZ & ARAIL wholly owned subsidiaries of the Company with an investment and advances aggregating to Rs 156510.60 Lakh. Investment and receivables amounts to 57.01% of the total assets of the Company. As a result an impairment assessment was required to be performed by the Company by comparing the carrying value of these investments and advances to their recoverable amount to determine whether impairment was required to be recognised. (Refer Note 54.1) For the purpose of the above impairment testing value in use has been determined by forecasting and discounting future cash flows. Furthermore the value in use is highly sensitive to changes in some of the inputs used for forecasting the future cash flows e.g. expectation of cash flows assumption used in valuation. The determination of the recoverable amount of the investments and receivable involved judgment due to inherent uncertainty in the assumptions supporting the recoverable amount of these investments and receivables. Accordingly the evaluation of impairment of investments in AIDHL ANFTWZ and ARAIL was determined to be a key audit matter. (Refer note no. 54.1) Our audit procedures included the following:
• Obtained the impairment model from the management and tested the arithmetical accuracy of the same.
• Reviewed the valuation report obtained by the Company from registered valuers.
• Assessed the appropriateness of the Company's valuation methodology applied in determining the recoverable amount. In making this assessment we also evaluated the objectivity independence and competency of specialists involved in the process.
• Assessed the assumptions around the key drivers of the cash flow forecasts.
• Discussed/evaluated potential changes in key drivers with management in order to evaluate whether the inputs and assumptions used in the cash flow forecasts were suitable.
• Assessed the recoverable value headroom by performing sensitivity testing of key assumptions used.
• Verification that the accounting and /or disclosures as the case may be in the standalone financial statements is in accordance with the assessment management.
• Obtaining representation letter from the management on the assessment of those matters as per SA 580 (revised) - written representations.
2. Litigations matters and contingent liabilities
The Company and it's subsidiaries are subject to number of significant litigations. These subsidiaries are Arshiya Northern FTWZ Limited Arshiya Rail Infrastructure Limited and Arshiya Industrial & Distribution Hub Limited collectively known as Arshiya Group. In such litigation matters certain lenders and creditors have filed winding up petitions/cases/other legal proceedings against the Company and its Directors for recovery of the amounts due to them which are at different stages before the respective judicial forums/authorities. The financial implication of such claims will be disclosed and recognized as and when finality in the matter is reached. Further risks identified by the Company in that area relates to Income tax demand claims against the company not acknowledged as debts. The amounts of litigations may be significant and estimates of the amounts of provisions or contingent liabilities are subject to significant management judgment. [Refer note no.37.1 ( i to v) and 43]. Due to complexity involved in these litigation matters management's judgment regarding recognition and measurement of provisions for these legal proceedings is inherently uncertain and might change over time as the outcomes of the legal cases are determined and it has been considered as a key audit matter. Our audit procedures included the following
• Assessing the procedures implemented by the company to identify and gather the risks it is exposed to.
• Discussion with the management on the development in theses litigations during the year ended 31st March 2019.
• Obtaining an understanding ofthe risk analysis performed by the company with the relating supporting documentation.
• Verification that the accounting and /or disclosures as the case may be in the standalone financial statements is in accordance with the assessment of management.
• Obtaining representation letter from the management on the assessment of those matters as per SA 580 (revised) - written representations.
3. Classification of land from property plant and equipment to inventory
The Company is engaged in the business of development operations and maintenance of free trade and warehouse zone and domestic warehouse zone and value added services. It owns SEZ notified land parcels at Sai Village Panvel. Vacant land is available for future development. During the year the company has identified 45.52 Acres land for warehousing development in future where upon the company can develop / lease on the said land area which can be leased / sub-leased to its co-developer. The cost of said land amounting to '19089.31 Lakh is classified from property plant and equipment to land under inventory. After classification to inventory the Company have executed lease agreement with 100% subsidiary company and transferred this land for 30 years. Accordingly consideration for transfer of such land is disclosed under revenue from operations (Note no. 28) and it's cost (Note no. 30) has been disclosed in the profit of loss account and remaining cost of land is disclosed in Note No. 11 as inventory. Considering the nature of business and its classification of land from property plant and equipment to inventory and transfer of certain portion of land is significant considering the size of profit and loss account hence the during the year it is considered as Key Audit Matter. (Refer note no. 44) Our audit procedures included following:-
• Discussion with the management and obtaining an understanding of the same.
• Read the minutes of meeting of audit committee and Board of Directors wherein if s classification from property plant and equipment to inventory is approved.
• Verification that the accounting and /or disclosure as the case may be in the standalone financial statements is in accordance with the assessment of management.
• Obtaining representation letter from the management on the assessment of those matters as per SA 580 (revised) - written representations.

 

Information Other than the Financial Statements and Auditor's Report Thereon

The Company's Board of Directors is responsible for the other information. The otherinformation comprises in the Annual Report (but does not include the financial statementsand our auditor's report thereon) which is expected to be made available to us after thatdate.

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

In connection with our audit of the financial statements our responsibility is to readthe other information identified above and in doing so consider whether the otherinformation is materially inconsistent with the financial statements or our knowledgeobtained in the audit or otherwise appears to be materially misstated.

If based on the work we have performed on the other information that we obtained priorto the date of this auditor's report we conclude that there is a material misstatement ofthis other information we are required to report that fact. We have nothing to report inthis regard.

When we read the Annual Report if we conclude that there is a material misstatementtherein we are required to communicate the matter to those charged with governance.

Responsibilities of Management and those charged with Governance for the FinancialStatements

The Company's Board of Directors is responsible for the matters stated in Section134(5) of the Companies Act 2013 ('the Act') with respect to the preparation of thesefinancial statements that give a true and fair view of the financial position financialperformance including other comprehensive income cash flows and changes in equity of theCompany in accordance with the accounting principles generally accepted in Indiaincluding the Indian Accounting Standards ('Ind AS') prescribed under Section 133 of theAct read with relevant rules issued there under. This responsibility also includesmaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding the assets of the Company and for preventing and detecting frauds andother irregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the financial statements that give a true and fair viewand are free from material misstatement whether due to fraud or error.

In preparing the financial statements management is responsible for assessing theCompany's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless managementeither intends to liquidate the Company or to cease operations or has no realisticalternative but to do so.

That Board of Directors is also responsible for overseeing the Company's financialreporting process.

Auditor's Responsibility for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financialstatements as a whole are free from material misstatement whether due to fraud or errorand to issue an auditor's report that includes our opinion. Reasonable assurance is a highlevel of assurance but is not a guarantee that an audit conducted in accordance with SAswill always detect a material misstatement when it exists. Misstatements can arise fromfraud or error and are considered material if individually or in the aggregate theycould reasonably be expected to influence the economic decisions of users taken on thebasis of these financial statements.

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

• Identify and assess the risks of material misstatement of the financialstatements whether due to fraud or error design and perform audit procedures responsiveto 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 fromfraud is higher than for one resulting from error as fraud may involve collusionforgery intentional omissions misrepresentations or the override of internal control.

• Obtain an understanding of internal control relevant to the audit in order todesign 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 whetherthe company has adequate internal financial controls system in place and the operatingeffectiveness of such controls.

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

• Conclude on the appropriateness of management's use of the going concern basisof accounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe 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 auditor'sreport. However future events or conditions may cause the Company to cease to continue asa going concern.

• Evaluate the overall presentation structure and content of the financialstatements including the disclosures and whether the financial statements represent theunderlying transactions and events in a manner that achieves fair presentation.

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

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

From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the financial statements of thecurrent period and are therefore the key audit matters. We describe these matters in ourauditor's report unless law or regulation precludes public disclosure about the matter orwhen in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.

Report on other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order 2016 issued by the CentralGovernment of India in terms of sub-section (11) of section 143 of the Act ("theOrder") and on the basis of such checks of the books and records of the Company aswe considered appropriate and according to the information and explanations given to uswe give in the "Annexure A" a statement on the matters specified inparagraphs 3 and 4 of the Order.

2. Further to our comment in the Annexure A as required by Section 143 (3) of the Actwe report that:

a. We have sought and obtained all the information and explanations which to the bestof 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 theCompany so far as it appears from our examination of those books;

c. The Balance Sheet the Statement of Profit and Loss (including other comprehensiveincome) the Cash Flow Statement and the Statement of Changes in Equity dealt with by thisreport are in agreement with the books of account;

d. In our opinion the aforesaid standalone financial statements comply with Ind ASprescribed under Section 133 of the Act read with relevant rules there under;

e. On the basis of the written representations received from the directors of theCompany as on 31st March 2019 and taken on record by the Board of Directors we reportthat none of the directors is disqualified as on 31st March 2019 from being appointed asa director in terms of Section 164(2) of the Act;

f. With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in "Annexure B";

g. With respect to the other matters to be included in the Auditor's Report inaccordance with the requirements of section 197 (16) of the Act;

In our opinion and to the best of our information and according to the explanationsgiven to us no remuneration is paid by the Company to its directors during the year hencethe provisions of section 197 of the Act is not applicable.

h. With respect to the other matters to be included in the Auditor's report inaccordance with Rule 11 of the Companies (Audit and Auditor's) Rules 2014 in our opinionand to the best of our information and according to the explanations given to us:

i. The Company as detailed in Note no. 37.1 (i to v) and 43 to the standalonefinancial statements have disclosed the impact of pending litigations on its financialposition.

ii. The Company does not have any long term contracts including derivative contractsand hence there are no material foreseeable losses.

iii. There has been no delay in transferring amount which was required to betransferred to the Investor Education and Protection Fund by the Company.

For Chaturvedi & Shah LLP

Chartered Accountants

Registration No. 101720W/ W100355

Vijay Napawaliya

Partner

Membership No. 109859

Place: Mumbai

Date: 27/05/2019

"Annexure A" to the Independent Auditors' Report

(Referred to in paragraph 1 under the heading "Report on Other Legal andRegulatory Requirements" of our report of even date to the members of the ArshiyaLimited on the standalone financial statements for the year ended 31st March 2019)

(i) In respect of fixed assets:-

(a) The Company has maintained proper records showing full particulars includingquantitative details and situation of the fixed assets.

(b) As explained to us the Company has physically verified fixed assets in accordancewith a phased program of verification which in our opinion is reasonable having regardto the size of the Company and the nature of its assets. No material discrepancies werenoticed on such physical verification as compared with the available records.

(c) In our opinion and according to information and explanation given to us and on thebasis of our examination of available records of the Company the title deeds of immovableproperties are held in the name of the Company.

(ii) The Company is engaged in the business and development of Free Trade andWarehousing Zone (FTWZ) and Domestic Warehousing and during the current year the companyhas accounted for inventory represented by freehold land for the business purpose. In ouropinion management has conducted physical verification of inventory at reasonableintervals and no material discrepancies were noticed on the aforesaid verification.

(iii) In respect of unsecured loans granted by the Company to companies firms Limitedliability partnerships or other parties covered in the register maintained under section189 of the Act. According to the information and explanations given to us:

(a) In our opinion and according to the information and explanations provided to usthe terms and conditions of the grant of such loans are prima facie not prejudicial to theCompany's interest.

(b) The schedule of repayment of principal and payment of interest has been stipulatedfor the loans granted and the repayment/ receipts are regular as applicable.

(c) There are no overdue amounts as at the year-end in respect of both principal andinterest as applicable.

(iv) In our opinion and according to the information and explanations provided to usprovisions of section 185 and 186 of the Companies Act 2013 in respect of loansinvestments guarantees and security as applicable have been complied with.

(v) The Company has not accepted any deposits from the public within the meaning ofSections 73 74 75 and 76 of the Act and the Rules framed there under to the extentnotified. During the year no order has been passed by the Company Law Board or NationalCompany Law Tribunal or Reserve Bank of India or any court or any other Tribunal.

(vi) Pursuant to the rules made by the Central Government of India the Company isrequired to maintain cost records as specified under Section 148(1) of the Act in respectof services rendered. We have broadly reviewed the same and are of the opinion that primafacie the prescribed accounts and records have been made and maintained. We have nothowever made a detailed examination of the records with a view to determine whether theyare accurate or complete.

(vii) (a) According to the records of the company and information and explanationsgiven to us the Company has generally been regular except slight delays in few cases indepositing undisputed statutory dues including provident fund employees' stateinsurance income tax duty of customs goods and service tax cess and any otherstatutory dues to the appropriate authorities as applicable during the year. According tothe information and explanations given to us no undisputed amounts payable in respect ofsuch statutory dues were outstanding as at 31st March 2019 for a period ofmore than six months from the date they became payable except Tax deducted at Sourceamounting to Rs. 494.30 Lakh and interest on tax deducted at source amounting to Rs.605.25 Lakh.

(b) According to the information and explanations given to us and the records of theCompany examined by us there are no dues of income-tax sales-tax service-tax duty ofcustoms duty of excise value added tax and goods and service tax which have not beendeposited on account of any dispute except as mentioned below:-

(Rs. In Lakh)
Name of the Statute Nature of Dues Amount Disputed (Net of TDS and Advance tax Paid) Period to which Dispute Relates Forum where Dispute is Pending
Income Tax Act 1961 Income Tax 14293.30 Assessment year 20092010 to 2016-2017 commissioner of income tax
Service Tax Act 1994 Service Tax 62.68 Financial Year 20132014 Customs Central Excise and Service Tax Appellate Tribunal
Total 14355.98

(viii) According to the records of the Company examined by us and the information andexplanation given to us the Company has not defaulted in repayment of loans or borrowingsto any financial institution or bank as at balance sheet date except as mentioned below.There are no dues to debenture holders and government as at the balance sheet date.

Defaults in respect of bank and financial institutions are as under:-

(Rs. In Lakh)
Particulars

Amount of continuing default as on 31st March 2019

Period of Default
Principal Interest
Edelweiss Asset Reconstruction Company Limited - various trust 5671.09 1065.91 Financial year 2017-2018
3774.68 Financial year 2018-2019
Edelweiss Asset Reconstruction Company Limited-SC 162 670.00 - Financial year 2018-2019
Edelweiss Asset Reconstruction Company Limited(Short term priority loan) 8474.04 1753.65 Financial year 2018-2019
Axis Bank 1472.84 178.98 Financial year 2017-2018 and 2018-2019
SREI Equipment finance Ltd. - 0.30 Financial year 2018-2019
IDFC FIRST Bank Ltd. - 92.93 Financial year 2018-2019
Tata Capital Financial Services Limited 2000.00 - Financial year 2018-2019
Total 18287.97 6866.45

(ix) According to the information and explanations given to us the Company did notraise any moneys by way of initial public offer further public offer (including debtinstruments). In respect of term loan taken during the year moneys were applied for thepurpose for which It was raised.

(x) During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing practices in India andaccording to the information and explanations given to us we have neither come across anyinstance of material fraud by the Company or on the Company by its officers or employeesnoticed or reported during the year nor have we been informed of any such case by theManagement.

(xi) In our opinion and according to the information and explanations given to us theCompany has not paid or provided managerial remuneration during the year.

(xii) As the Company is not a Nidhi Company and the Nidhi Rules 2014 are notapplicable to it the provisions of Clause 3(xii) of the Order are not applicable to theCompany.

(xiii) The Company has entered into transactions with related parties in compliancewith the provisions of Sections 177 and 188 of the Act. The details of such related partytransactions have been disclosed in the financial statements as required under IndianAccounting Standard (Ind AS) 24 Related Party Disclosures specified in the Companies(Indian Accounting Standards) Rules 2015 (as amended) under Section 133 of the Act.

(xiv) The Company has made preferential allotment of equity shares during the yearunder review and the requirement of Section 42 of the Companies Act 2013 have beencomplied with. The Company has not made private placement of shares or fully or partlyconvertible debentures during the year under review.

(xv) According to the information and explanations given to us the Company has notentered into any non-cash transactions with directors or persons connected with him.Therefore the provisions of Clause 3(xv) of the Order are not applicable to the Company.

(xvi) The Company is not required to be registered under section 45-1A of the ReserveBank of India Act 1934.

For Chaturvedi & Shah LLP

Chartered Accountants

Registration No. 101720W/ W100355

Vijay Napawaliya

Partner

Membership No. 109859

Place: Mumbai

Date: 27/05 /2019

"Annexure B" to the Independent Auditor's Report

Referred to in paragraph 2(f) under the heading "Report on Other Legal andRegulatory Requirements" of our report of even date to the members of the ArshiyaLimited on the standalone financial statements for the year ended 31st March 2019.

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls over financial reporting of ArshiyaLimited ("the Company") as of 31st March 2019 in conjunction with our audit ofthe standalone financial statements of the Company for the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls over Financial Reportingissued by the Institute of Chartered Accountants of India. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to Company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe Companies Act 2013.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting(the "Guidance Note") and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material respects. Our auditinvolves performing procedures to obtain audit evidence about the adequacy of the internalfinancial controls system over financial reporting and their operating effectiveness. Ouraudit of internal financial controls over financial reporting included obtaining anunderstanding of internal financial controls over financial reporting assessing the riskthat a material weakness exists and testing and evaluating the design and operatingeffectiveness of internal control based on the assessed risk. The procedures selecteddepend on the auditor's judgement including the assessment of the risks of materialmisstatement of the standalone financial statements whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company's internal financial controls systemover financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A Company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of standalone financial statements for external purposes in accordance withgenerally 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 standalonefinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the Company are being made only in accordance withauthorizations of management directors of the Company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorized acquisition use ordisposition of the Company's assets that could have a material effect on the standalonefinancial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.

Opinion

According to the information and explanations given to us and based on the audit oftest of controls 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 March2019 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 theInstitute of Chartered Accountants of India.

For Chaturvedi & Shah LLP

Chartered Accountants

Registration No. 101720W/ W100355

Vijay Napawaliya

Partner

Membership No. 109859

Place: Mumbai

Date: 27/05/2019

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