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Century Textiles & Industries Ltd.

BSE: 500040 Sector: Industrials
NSE: CENTURYTEX ISIN Code: INE055A01016
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OPEN 848.35
PREVIOUS CLOSE 848.15
VOLUME 10423
52-Week high 1025.00
52-Week low 686.50
P/E 40.23
Mkt Cap.(Rs cr) 9,433
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 848.35
CLOSE 848.15
VOLUME 10423
52-Week high 1025.00
52-Week low 686.50
P/E 40.23
Mkt Cap.(Rs cr) 9,433
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Century Textiles & Industries Ltd. (CENTURYTEX) - Auditors Report

Company auditors report

To the Members of Century Textiles and Industries Limited

REPORT ON THE AUDIT OF THE STANDALONE IND AS FINANCIAL STATEMENTS

Opinion

We have audited the accompanying standalone Ind AS financial statements of CenturyTextiles and Industries Limited ("the Company") which comprise the Balancesheet as at March 31 2022 the Statement of profit and loss including the statement ofOther Comprehensive Income the Cash Flow Statement and the Statement of Changes in Equityfor the year then ended and notes to the standalone Ind AS financial statementsincluding a summary of significant accounting policies and other explanatory information.

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone Ind AS financial statements give the informationrequired by the Companies Act 2013 as amended ("the Act") in the manner sorequired and give a true and fair view in conformity with the accounting principlesgenerally accepted in India of the state of affairs of the Company as at March 31 2022its profit 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 of the standalone Ind AS financial statements in accordance withthe Standards on Auditing (SAs) as specified under section 143(10) of the Act. Ourresponsibilities under those Standards are further described in the ‘Auditor'sResponsibilities for the Audit of the Standalone Ind AS Financial Statements' section ofour 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 ethicalrequirements that are relevant to our audit of the standalone Ind AS financial statementsunder the provisions of the Act and the Rules thereunder and we have fulfilled our otherethical responsibilities in accordance with these requirements and the Code of Ethics. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our audit opinion on the standalone Ind AS financial statements.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the standalone Ind AS financial statements for the financialyear ended March 31 2022. These matters were addressed in the context of our audit of thestandalone Ind AS financial statements as a whole and in forming our opinion thereon andwe do not provide a separate opinion on these matters. For each matter below ourdescription of how our audit addressed the matter is provided in that context.

We have determined the matter described below to be the key audit matter to becommunicated in our report. We have fulfilled the responsibilities described in theAuditor's responsibilities for the audit of the standalone Ind AS financial statementssection of our report including in relation to this matter. Accordingly our auditincluded the performance of procedures designed to respond to our assessment of the risksof material misstatement of the standalone Ind AS financial statements. The results of ouraudit procedures including the procedures performed to address the matter below providethe basis for our audit opinion on the accompanying standalone Ind AS financialstatements.

Key audit matters How our audit addressed the key audit matter
Recognition and Measurement of Deferred tax (as described in Note 16 of the standalone Ind AS financial statements)
The Company has recognized Minimum Alternate Tax (MAT) credit receivable of INR 416.54 Crores as at March 31 2022. The Company also has recognized deferred tax assets of INR 102.51 Crores on unabsorbed depreciation and indexation benefit on land. Our procedures included amongst others the following:
• Considered Company's accounting policies with respect to recognition and measurement of tax balances in accordance with Ind AS 12 "Income Taxes".
Further pursuant to the Taxation Laws (Amendment) Act 2019 (new tax regime) the Company has measured its deferred tax balances expected to reverse after the likely transition to new tax regime at the rate specified in the new tax regime. • Performed an understanding of the process and tested the internal controls over recognition and measurement of tax balances through inspection of evidence of performance of these controls.
• Performed the tests of details including the following key procedures:
The recognition and measurement of MAT credit receivable and deferred tax balances is a key audit matter as the recoverability of such credits within the allowed time frame in the manner prescribed under tax regulations and estimation of year of transition to the new tax regime involves significant estimate of the financial projections availability of sufficient taxable income in the future and admissibility of tax positions adopted by the Company. • Involved tax specialists who evaluated the Company's tax positions basis the tax law and also by comparing it with prior years and past precedents.
• Discussed the future business plans and financial projections as approved by the management.
• Assessed the management's long-term financial projections and the key assumptions used in the projections by comparing it with the past trends approved business plan projections used for estimation of likely year of transition to the new tax regime and projections used for impairment assessment where applicable.
• Assessed the deferred tax on temporary differences which are expected to reverse after the likely date of transition to the new tax regime and considered the impact thereof.
• Assessed the disclosures in accordance with the requirements of Ind AS 12 "Income Taxes".

Other Information

The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the Annual report but does not includethe standalone Ind AS financial statements and our auditor's report thereon.

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

In connection with our audit of the standalone Ind AS financial statements ourresponsibility is to read the other information and in doing so consider whether suchother information is materially inconsistent with the standalone Ind AS financialstatements or our knowledge obtained in the audit or otherwise appears to be materiallymisstated. If based on the work we have performed we conclude that there is a materialmisstatement of this other information we are required to report that fact. We havenothing to report in this regard.

Responsibilities of Management for the Standalone Ind AS Financial Statement

The Company's Board of Directors is responsible for the matters stated in section134(5) of the Act with respect to the preparation of these standalone Ind AS financialstatements that give a true and fair view of the financial position financial performanceincluding other comprehensive income cash flows and changes in equity of the Company inaccordance with the accounting principles generally accepted in India including theIndian Accounting Standards (Ind AS) specified under section 133 of the Act read with theCompanies (Indian Accounting Standards) Rules 2015 as amended. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and the designimplementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the standalone Ind AS financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

In preparing the standalone Ind AS financial statements management is responsible forassessing the Company's ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessmanagement either intends to liquidate the Company or to cease operations or has norealistic alternative but to do so.

Those Board of Directors are also responsible for overseeing the Company's financialreporting process.

Auditor's Responsibilities for the Audit of the Standalone Ind AS Financial Statements

Our objectives are to obtain reasonable assurance about whether the standalone Ind ASfinancial statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these standalone Ind AS 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 standalone Ind ASfinancial 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 the audit in order todesign audit procedures that are appropriate in the circumstances. Under section 143(3)(i)of the Act we are also responsible for expressing our opinion on whether the Company hasadequate internal financial controls with reference to standalone Ind AS financialstatements in place and the operating effectiveness 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 standalone Ind AS 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 the standalone IndAS financial statements including the disclosures and whether the standalone Ind ASfinancial statements represent the underlying transactions and events in a manner thatachieves 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 standalone Ind AS financialstatements for the financial year ended March 31 2022 and are therefore the key auditmatters. We describe these matters in our auditor's report unless law or regulationprecludes public disclosure about the matter or when in extremely rare circumstances wedetermine that a matter should not be communicated in our report because the adverseconsequences of doing so would reasonably be expected to outweigh the public interestbenefits of such communication.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order 2020 ("the Order")issued by the Central Government of India in terms of sub-section (11) of section 143 ofthe Act we give in the "Annexure 1" a statement on the matters specified inparagraphs 3 and 4 of the Order.

2. As required by Section 143(3) of the Act we report that: (a) We have sought andobtained all the information and explanations which to the best of our knowledge andbelief were necessary for the purposes of our audit; (b) In our opinion proper books ofaccount as required by law have been kept by the Company so far as it appears from ourexamination of those books; (c) The Balance Sheet the Statement of profit and lossincluding the Statement of Other Comprehensive Income the Cash Flow Statement andStatement of Changes in Equity dealt with by this Report are in agreement with the booksof account; (d) In our opinion the aforesaid standalone Ind AS financial statementscomply with the Accounting Standards specified under Section 133 of the Act read withCompanies (Indian Accounting Standards) Rules 2015 as amended;

(e) On the basis of the written representations received from the directors as on March31 2022 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2022 from being appointed as a director in terms of Section 164 (2) of theAct; (f) With respect to the adequacy of the internal financial controls with reference tothese standalone Ind AS financial statements and the operating effectiveness of suchcontrols refer to our separate Report in "Annexure 2" to this report; (g) Inour opinion the managerial remuneration for the year ended March 31 2022 has been paid /provided by the Company to its directors in accordance with the provisions of section 197read with Schedule V to the Act; (h) With respect to the other matters to be included inthe Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors)Rules 2014 as amended in our opinion and to the best of our information and according tothe explanations given to us: i. The Company has disclosed the impact of pendinglitigations on its financial position in its standalone Ind AS financial statements –Refer Note 38 to the standalone Ind AS financial statements; ii. The Company has madeprovision as required under the applicable law or accounting standards for materialforeseeable losses if any on long-term contracts including derivative contracts –Refer Note 20 to the standalone Ind AS financial statements; iii. There has been no delayin transferring amounts required to be transferred to the Investor Education andProtection Fund by the Company iv. a) The management has represented that to the best ofits knowledge and belief no funds have been advanced or loaned or invested (either fromborrowed funds or share premium or any other sources or kind of funds) by the Company toor in any other persons or entities including foreign entities("Intermediaries") with the understanding whether recorded in writing orotherwise that the Intermediary shall whether directly or indirectly lend or invest inother persons or entities identified in any manner whatsoever by or on behalf of thecompany ("Ultimate Beneficiaries") or provide any guarantee security or thelike on behalf of the Ultimate Beneficiaries; b) The management has represented that tothe best of its knowledge and belief no funds have been received by the Company from anypersons or entities including foreign entities ("Funding Parties") with theunderstanding whether recorded in writing or otherwise that the Company shall whetherdirectly or indirectly lend or invest in other persons or entities identified in anymanner whatsoever by or on behalf of the Funding Party ("UltimateBeneficiaries") or provide any guarantee security or the like on behalf of theUltimate Beneficiaries; and c) Based on such audit procedures that were consideredreasonable and appropriate in the circumstances nothing has come to our notice that hascaused us to believe that the representations under sub-clause (a) and (b) contain anymaterial misstatement. v. The dividend declared or paid during the year / subsequent tothe year-end by the Company is in compliance with section 123 of the Act.

For S R B C & CO LLP
Chartered Accountants
ICAI Firm Registration Number: 324982E/E300003
per Abhishek Agarwal
Partner
Mumbai Membership Number: 112773
25 April 2022 UDIN: 22112773AHSKZP4705

Annexure 1 referred to in paragraph under the heading "Report on Other Legal andRegulatory Requirements" of our report of even date of Century Textiles andIndustries Limited

In terms of the information and explanations sought by us and given by the Company andthe books of account and records examined by us in the normal course of audit and to thebest of our knowledge and belief we state that: i. (a)(A) The Company has maintainedproper records showing full particulars including quantitative details and situation ofproperty plant and equipments.

(a)(B) The Company has maintained proper records showing full particulars ofintangibles assets.

(b) All fixed assets have not been physically verified by the management during theyear but there is a regular programme of verification which in our opinion is reasonablehaving regard to the size of the Company and the nature of its assets. No materialdiscrepancies were noticed on such verification. (c) The title deeds of all the immovableproperties (other than properties where the Company is the lessee and the lease agreementsare duly executed in favour of the lessee) are held in the name of the Company except theimmovable properties as indicated in the table below:

Description of the property Gross carrying value (INR Crores) Held in the name of Whether promoter director or their relative or employee Period held – indicate range where appropriate Reason for not being held in the name of Company*
Land 0.01 Municipal Corporation of Greater Mumbai (MCGM) No 50+ years Ongoing litigation with MCGM in Bombay High Court

(d) The Company has not revalued its property plant and equipments (including Right ofuse assets) or intangible assets during the year ended March 31 2022.

(e) There are no proceedings initiated or are pending against the Company for holdingany benami property under the Prohibition of Benami Property Transactions Act 1988 andrules made thereunder. ii. (a) The inventory has been physically verified by themanagement during the year except for inventories lying with third parties. In ouropinion the frequency of verification by the management is reasonable and the coverageand procedure for such verification is appropriate and no discrepancies of 10% or more inaggregate for each class of inventory were noticed. Inventories lying with third partieshave been confirmed by them as at March 31 2022 and discrepancies of 10% or more inaggregate for each class of inventory were not noticed in respect of such confirmations.

(b) As disclosed in Note 14 to the standalone Ind AS financial statements the Companyhas been sanctioned working capital limits in excess of INR five Crores in aggregate frombanks during the year on the basis of security of current assets of the Company. Thequarterly returns / statements filed by the Company with such banks are in agreement withthe books of accounts of the Company. iii. (a) During the year the Company has providedloans advances in the nature of loans stood guarantee and provided security tocompanies firms limited liability partnerships or any other parties as follows:

(figures in INR Crores)

Particulars Guarantees Loans
Aggregate amount granted / provided during the year
- Subsidiaries - 146.25
Balance outstanding as at balance sheet date in respect of above cases
- Subsidiaries 200.00 342.12

(b) During the year the investments made guarantees provided security given and theterms and conditions of the grant of all loans and advances in the nature of loans andguarantees to companies firms limited liability partnerships or any other parties arenot prejudicial to the Company's interest.

(c) The Company has granted loans during the year to a company-where the schedule ofrepayment of principal and payment of interest has been stipulated and the repayment orreceipts are regular. (d) There are no amounts of loans and advances in the nature ofloans granted to companies firms limited liability partnerships or any other partieswhich are overdue for more than ninety days.

(e) There were no loans or advance in the nature of loan granted to companies firmslimited liability partnerships or any other parties which was fallen due during the yearthat have been renewed or extended or fresh loans granted to settle the overdues ofexisting loans given to the same parties.

(f) The Company has not granted any loans or advances in the nature of loans eitherrepayable on demand or without specifying any terms or period of repayment to companiesfirms limited liability partnerships or any other parties. Accordingly the requirementto report on clause 3(iii)(f) of the Order is not applicable to the Company. iv. Loansinvestments guarantees and security in respect of which provisions of sections 185 and186 of the Companies Act 2013 are applicable have been complied with by the Company. v.The Company has neither accepted any deposits from the public nor accepted any amountswhich are deemed to be deposits within the meaning of sections 73 to 76 of the CompaniesAct and the rules made thereunder to the extent applicable. Accordingly the requirementto report on clause 3(v) of the Order is not applicable to the Company. vi. We havebroadly reviewed the books of account maintained by the Company pursuant to the rules madeby the Central Government for the maintenance of cost records under section 148(1) of theCompanies Act 2013 related to the manufacture of the Company's products and are of theopinion that prima facie the specified accounts and records have been made andmaintained. We have not however made a detailed examination of the same. vii. (a) TheCompany is regular in depositing with appropriate authorities undisputed statutory duesincluding goods and services tax provident fund employees' state insurance income-taxsales-tax service tax duty of customs duty of excise value added tax cess and otherstatutory dues applicable to it. According to the information and explanations given to usand based on audit procedures performed by us no undisputed amounts payable in respect ofthese statutory dues were outstanding at the year end for a period of more than sixmonths from the date they became payable.

(b) The dues of goods and services tax provident fund employees' state insuranceincome-tax sales-tax service tax duty of custom duty of excise value added tax cessand other statutory dues have not been deposited on account of any dispute are asfollows:

Name of statue Nature of dues Amount* (INR Crores) Period to which the amount relates Forum where the dispute is pending
Customs Act 1962 Custom duty 0.22 2000-2001 High Court
4.42 2004-2017 CESTAT
1.03 1987-2017 Departmental Authorities
Finance Act 1994 Service tax 0.95 2005-2010 High Court
0.21 2006-2016 CESTAT
1.84 1994-2018 Departmental Authorities
The Central Excise Act 1944 Excise duty 25.97 1994-2018 High Court
0.22 1994-2018 CESTAT
8.24 1994-2018 Departmental Authorities
MVAT Act 2002 VAT 5.16 2017-2018 Appellate Authorities
CST Act 1995 CST 0.64 2017-2018 Appellate Authorities
Sales tax and Entry tax Sales tax and 2.76 1999-2018 High Court
Entry tax
5.15 1987-2017 Departmental Authorities
Zilla Parishad and Panchayat Water charges 117.37 1991 onwards Departmental Authorities
Samities Act 1961 cess
Bombay Provincial Municipal Corporation Act 1949 Octroi duty 38.53 1992-1993 High Court
1.03 1996 to 2007 Departmental Authorities
Maharashtra Land Revenue Code 1966 Others 3.02 2001-2020 Departmental Authorities
Bombay Provincial Municipal Corporation Act 1949 Property tax 9.18 1994 onwards Bombay High Court and Civil Court of Kalyan

* Net of deposits viii. The Company has not surrendered or disclosed any transactionpreviously unrecorded in the books of account in the tax assessments under the Income TaxAct 1961 as income during the year. Accordingly the requirement to report on clause3(viii) of the Order is not applicable to the Company. ix. (a) The Company has notdefaulted in repayment of loans or other borrowings or in the payment of interest thereonto any lender.

(b) The Company has not been declared wilful defaulter by any bank or financialinstitution or government or any government authority. (c) Term loans were applied for thepurpose for which the loans were obtained.

(d) On an overall examination of the standalone Ind AS financial statements of theCompany no funds raised on short-term basis have been used for long-term purposes by theCompany. (e) On an overall examination of the standalone Ind AS financial statements ofthe Company the Company has not taken any funds from any entity or person on account ofor to meet the obligations of its subsidiaries associates or joint ventures.

(f) The Company has not raised loans during the year on the pledge of securities heldin its subsidiaries joint ventures or associate companies. Hence the requirement toreport on clause (ix)(f) of the Order is not applicable to the Company. x. (a) The Companyhas not raised any money during the year by way of initial public offer / further publicoffer (including debt instruments) hence the requirement to report on clause 3(x)(a) ofthe Order is not applicable to the Company.

(b) The Company has not made any allotment or private placement of shares / fully orpartially or optionally convertible debentures during the year under audit and hence therequirement to report on clause 3(x)(b) of the Order is not applicable to the Company. xi.(a) No fraud / material fraud by the Company or no fraud / material fraud on the Companyhas been noticed or reported during the year.

(b) During the year no report under sub-section (12) of section 143 of the CompaniesAct 2013 has been filed by the cost auditor or secretarial auditor or by us in Form ADT– 4 as prescribed under Rule 13 of Companies (Audit and Auditors) Rules 2014 withthe Central Government.

(c) As represented to us by the management there are no whistle blower complaintsreceived by the Company during the year. xii. The Company is not a nidhi Company as perthe provisions of the Companies Act 2013. Therefore the requirement to report on clause3(xii) of the Order is not applicable to the Company. xiii. Transactions with the relatedparties are in compliance with sections 177 and 188 of Companies Act 2013 whereapplicable and the details have been disclosed in the notes to the standalone Ind ASfinancial statements as required by the applicable accounting standards. xiv. (a) TheCompany has an internal audit system commensurate with the size and nature of itsbusiness.

(b) The internal audit reports of the issued till the date of the audit report for theperiod under audit have been considered by us. xv. The Company has not entered into anynon-transactions with its directors or persons connected with its directors and hencerequirement to report on clause 3(xv) of the Order is not applicable to the Company. xvi.(a) The provisions of section 45-IA of the Reserve Bank of India Act 1934 (2 of 1934) arenot applicable to the Company. Accordingly the requirement to report on clause (xvi)(a)of the Order is not applicable to the Company.

(b) The Company has not conducted any Non-Banking Financial or Housing Financeactivities without obtained a valid Certificate of Registration (CoR) from the ReserveBank of India as per the Reserve Bank of India Act 1934.

(c) The Company is not a Core Investment Company as defined in the regulations made byReserve Bank of India. Accordingly the requirement to report on clause 3(xvi)(c) of theOrder is not applicable to the Company. (d) The Group has one Core Investment Company aspart of the Group. xvii. The Company has not incurred cash losses in the current as wellas the immediately preceding financial year.

xviii.There has been no resignation of the statutory auditors during the year andaccordingly requirement to report on Clause 3(xviii) of the Order is not applicable to theCompany. xix. On the basis of the financial ratios disclosed in Note 46 to the standaloneInd AS financial statements ageing and expected dates of realization of financial assetsand payment of financial liabilities other information accompanying the standalone Ind ASfinancial statements our knowledge of the Board of Directors and management plans andbased on our examination of the evidence supporting the assumptions nothing has come toour attention which causes us to believe that any material uncertainty exists as on thedate of the audit report that Company is not capable of meeting its liabilities existingat the date of balance sheet as and when they fall due within a period of one year fromthe balance sheet date. We however state that this is not an assurance as to the futureviability of the Company. We further state that our reporting is based on the facts up tothe date of the audit report and we neither give any guarantee nor any assurance that allliabilities falling due within a period of one year from the balance sheet date will getdischarged by the Company as and when they fall due. xx. (a) In respect of other thanongoing projects there are no unspent amounts that are required to be transferred to afund specified in Schedule VII of the Companies Act (the Act) in compliance with secondproviso to sub section 5 of section 135 of the Act. This matter has been disclosed in note29 to the standalone Ind AS financial statements.

(b) The Company has not transferred the amount remaining unspent in respect of ongoingprojects to a special account till the date of the report. However the period for suchtransfer i.e. thirty days from the end of the financial year as permitted under subsection (6) of section 135 of the Companies Act has not elapsed till the date of ourreport.

For S R B C & CO LLP
Chartered Accountants
ICAI Firm Registration Number: 324982E/E300003
per Abhishek Agarwal
Partner
Mumbai Membership Number: 112773
25 April 2022 UDIN: 22112773AHSKZP4705

Annexure 2 to the Independent Auditor's Report of even date on the Standalone Ind ASFinancial Statements of Century Textiles and Industries Limited

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 with reference to standalone Ind ASfinancial statements of Century Textiles and Industries Limited ("the Company")as of March 31 2022 in conjunction with our audit of the standalone Ind AS financialstatements 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 Reporting (the"Guidance Note") issued by the Institute of Chartered Accountants of India (the"ICAI"). These responsibilities include the design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the orderly and efficient conduct of its business including adherence to theCompany's policies the safeguarding of its assets the prevention and detection of fraudsand errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Companies Act 2013.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols with reference to these standalone Ind AS financial statements based on ouraudit. We conducted our audit in accordance with the Guidance Note and the Standards onAuditing as specified under section 143(10) of the Act to the extent applicable to anaudit of internal financial controls 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 controlswith reference to these standalone Ind AS financial statements was established andmaintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls with reference to these standalone Ind AS financialstatements and their operating effectiveness. Our audit of internal financial controlswith reference to standalone Ind AS financial statements included obtaining anunderstanding of internal financial controls with reference to these standalone Ind ASfinancial statements assessing the risk that a material weakness exists and testing andevaluating the design and operating effectiveness of internal control based on theassessed risk. The procedures selected depend on the auditor's judgement including theassessment of the risks of material misstatement of the standalone Ind AS financialstatements whether due to fraud or error. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our audit opinion on theCompany's internal financial controls with reference to these standalone Ind AS financialstatements.

Meaning of Internal Financial Controls With Reference to these Standalone Ind ASFinancial Statements

A company's internal financial controls with reference to standalone Ind AS financialstatements is a process designed to provide reasonable assurance regarding the reliabilityof financial reporting and the preparation of standalone Ind AS financial statements forexternal purposes in accordance with generally accepted accounting principles. A company'sinternal financial controls with reference to standalone Ind AS financialstatementsincludesthosepoliciesandproceduresthat(1) pertain to the maintenance of recordsthat in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of the standalone Ind ASfinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the Company are being made only in accordance withauthorisations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorised acquisition use ordisposition of the Company's assets that could have a material effect on the standaloneInd AS financial statements.

Inherent Limitations of Internal Financial Controls With Reference to Standalone Ind ASFinancial Statements

Because of the inherent limitations of internal financial controls with reference tostandalone Ind AS financial statements including the possibility of collusion or impropermanagement override of controls material misstatements due to error or fraud may occurand not be detected. Also projections of any evaluation of the internal financialcontrols with reference to standalone Ind AS financial statements to future periods aresubject to the risk that the internal financial control with reference to standalone IndAS financial statements may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion the Company has in all material respects adequate internal financialcontrols with reference to standalone Ind AS financial statements and such internalfinancial controls with reference to standalone Ind AS financial statements were operatingeffectively as at March 31 2022 based on the internal control over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note issued by the ICAI.

For S R B C & CO LLP
Chartered Accountants
ICAI Firm Registration Number: 324982E/E300003
per Abhishek Agarwal
Partner
Mumbai Membership Number: 112773
25 April 2022 UDIN: 22112773AHSKZP4705

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