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Dhampur Sugar Mills Ltd.

BSE: 500119 Sector: Agri and agri inputs
NSE: DHAMPURSUG ISIN Code: INE041A01016
BSE 00:00 | 27 Jul 341.95 1.05
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OPEN 341.00
PREVIOUS CLOSE 340.90
VOLUME 51596
52-Week high 395.00
52-Week low 125.00
P/E 9.85
Mkt Cap.(Rs cr) 2,270
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 341.00
CLOSE 340.90
VOLUME 51596
52-Week high 395.00
52-Week low 125.00
P/E 9.85
Mkt Cap.(Rs cr) 2,270
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Dhampur Sugar Mills Ltd. (DHAMPURSUG) - Auditors Report

Company auditors report

To the Members of Dhampur Sugar Mills Limited

Report on the Audit of the Standalone Financial Statements Opinion

We have audited the Standalone Financial Statements of Dhampur Sugar Mills Limited("the Company”) which comprise the Standalone Balance Sheet as at March 312020 and the Standalone Statement of Profit and Loss (including other comprehensiveincome) Standalone Statement of Changes in Equity and Standalone Statement of Cash Flowsfor the year then ended and notes to the Standalone Financial Statements including asummary of the significant accounting policies and other explanatory information(hereinafter referred to as "the Standalone Financial Statements”).

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Standalone Financial Statements give the information requiredby the Companies Act 2013 ("the Act”) in the manner so required and give a trueand fair view in conformity with the accounting principles generally accepted in India ofthe state of affairs of the Company as at March 31 2020 and profit (including othercomprehensive income) changes in equity and its cash flows for the year ended on thatdate.

Basis for Opinion

We conducted our audit of the Standalone Financial Statements in accordance with theStandards on Auditing (SAs) specified under section 143(10) of the Act. Our

responsibilities under those Standards are further described in the Auditor'sResponsibilities for the Audit of the Standalone Financial Statements section of ourreport. We are independent of the Company in accordance with the Code of Ethics issued bythe Institute of Chartered Accountants of India ('ICAI') read together with theindependence requirements that are relevant to our audit of the Standalone FinancialStatements under the provisions of the Act and the Rules made there under and we havefulfilled our other ethical responsibilities in accordance with these requirements and theICAI's Code of Ethics. We believe that the audit evidence we have obtained is sufficientand appropriate to provide a basis for our audit opinion on the Standalone FinancialStatements.

Key Audit Matters

Key audit matters ('KAM') are those matters that in our professional judgment were ofmost significance in our audit of the Standalone Financial Statements of the currentperiod. 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. We have determined the matters described below to bethe key audit matters to be communicated in our report.

Key Audit Matter How our audit addressed the Key Audit Matter
1. Determination of NRV of Sugar for comparison with Cost of Production (COP) for valuation of inventory:
As on March 31 2020 the Company has inventory of sugar with a carrying value of H1486.67 Crores. The inventory of sugar is valued at the lower of cost and net realizable value. We considered the value of the inventory of sugar as a key audit matter given the relative value of inventory in the financial statements and significant judgement involved in the consideration of factors such as minimum sale price monthly quota and fluctuation in domestic and international selling prices in valuation of NRV. We understood and tested the design and operating effectiveness of controls as established by the management in determination of cost of production and net realizable value of inventory of sugar. We considered various factors including the prevailing unit specific domestic selling price during and subsequent to the year end minimum selling price & monthly quota selling price for contracted sugar export and initiatives taken by the Government with respect to sugar industry as a whole.
Based on the above procedures performed the management's determination of the net realizable value of the inventory of sugar as at the year-end and comparison with cost for valuation of inventory is considered to be reasonable.
Key Audit Matter How our audit addressed the Key Audit Matter
2. Recognition of deferred tax asset relating to minimum alternate tax (MAT) credit entitlement and re-measurement of deferred tax assets and liabilities
The Government of India on December 12 2019 vide the Taxation Laws (Amendment) Ordinance 2019 inserted a new section 115BAA in the Income Tax Act 1961 which provides the company an option to choose lower tax rate of 22% subject to forego of MAT credit entitlement and certain exemptions and deductions or to continue with the existing income tax rate of 30% with utilization of MAT credit and such exemptions and deductions. We considered relevant notifications/circulars issued by Income tax department and provisions of Income Tax Act 1961 and relevant accounting standard and clarification given by Ind AS Technical Facilitation Group (ITFG). We also understood the various assumptions and judgements made by the management relating to forecast of future profitability projections and future taxable profits for making assessment of utilization of MAT credit entitlement and for migration to new tax regime.
The Company has assessed dual tax structures and decided to continue with the existing tax structure until the utilization of MAT credits and to measure deferred tax assets and liabilities at the tax rates that are expected to apply for its reversal in future. Accordingly deferred tax assets and liabilities that are expected to reverse when the company would migrate to new lower tax regime have been measured at lower tax rate.
We evaluated the reasonableness and tested the appropriateness of those underlying assumptions and judgements based on the existing parameters and business environment.
We considered the issue of recognition of deferred tax asset and liabilities based on the tax rates expected to be applied at the time of its reversal and assessed the appropriateness of Company's accounting policy for recognition of deferred tax assets and liabilities and compliance of the policy with the requirement of prevailing accounting standards.
As on March 31 2020 the company has recognised deferred tax asset relating to MAT credit entitlement amounting to H176.93 crores and also re-measured its deferred tax assets and liabilities using the dual Income tax rates enacted as at the close of the financial year resulting in reversal of deferred tax liability of H55.90 Crores.
Based on the above procedures performed the recognition of deferred tax assets relating to the MAT credit entitlement and measurement of deferred tax assets and liabilities using the tax rates applicable at the time of reversal are considered adequate and reasonable.
We considered the re-measurement of deferred tax assets and liabilities based on migration to lower tax regime and recognition of deferred tax assets relating to MAT credit entitlement as a key audit matter because significant judgement is required in forecasting future taxable profits for recognition of deferred tax asset relating to MAT credit entitlement as well as for migration to new lower tax regime.
Key Audit Matter How our audit addressed the Key Audit Matter
3. Contingent Liabilities
There are a number of litigations pending before various forums against the Company and management's judgement is required for estimating the amount to be disclosed as contingent liability. We have obtained an understanding of the Company's internal instructions and procedures in respect of estimation and disclosure of contingent liabilities and adopted the following audit procedures:
We identified this as a key audit matter because the estimates on which these amounts are based involve a significant degree of management judgement in interpreting the cases and it may be subject to management bias. - understood and tested the design and operating effectiveness of controls as established by the management for obtaining all relevant information for pending litigation cases;
- discussing with the management any material developments and latest status of legal matters;
- read various correspondences and related documents pertaining to litigation cases produced by the management and relevant external legal opinions obtained by the management and performed substantive procedures on calculations supporting the disclosure of contingent liabilities; examining management's judgements and assessments whether provisions are required; considering the management assessments of those matters that are not disclosed as the probability of material outflow is considered to be remote;
- reviewing the adequacy and completeness of disclosures;
Based on the above procedures performed the estimation and disclosures of contingent liabilities are considered to be adequate and reasonable.

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

The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the Company's annual report but doesnot include the Standalone Financial Statements and our auditors' report thereon. Theaforesaid report is expected to be made available to us after the date of this auditor'sreport.

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

In connection with our audit of the Standalone Financial Statements our responsibilityis to read the other information identified above when it becomes available and in doingso consider whether the other information is materially inconsistent with the StandaloneFinancial Statements or our knowledge obtained during the course of our audit or otherwiseappears to be materially misstated. When we read the company's annual report and if weconclude that

there is a material misstatement therein we are required to communicate the matter tothose charged with governance and shall take appropriate actions if required.

Responsibilities of Management and Those Charged with Governance for the StandaloneFinancial Statements

The Company's Board of Directors is responsible for the matters stated in Section134(5) of the Act with respect to the preparation and presentation of these StandaloneFinancial Statements that give a true and fair view of the financial position financialperformance changes in equity and cash flows of the Company in accordance with theaccounting principles generally accepted in India including the Indian AccountingStandards (Ind AS) specified under Section 133 of the Act.

This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding of the assets of the Companyand for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies;

106

making judgements and estimates that are reasonable and prudent; and designimplementation and maintenance of adequate internal financial controls that were operatingeffectively for ensuring the accuracy and completeness of the accounting records relevantto the preparation and presentation of the Standalone Financial Statements that give atrue and fair view and are free from material misstatement whether due to fraud or error.

In preparing the Standalone Financial Statements Board of Directors 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 responsible for overseeing the Company's financialreporting process.

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

Our objectives are to obtain reasonable assurance about whether the StandaloneFinancial 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 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 StandaloneFinancial 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 theCompany has adequate internal financial controls system with reference to Standalone

Financial statement 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 Financial Statements or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor's report. However future events or conditions may cause the Company to cease tocontinue as a going concern.

• Evaluate the overall presentation structure and content of the StandaloneFinancial Statements including the disclosures and whether the Standalone FinancialStatements represent the underlying transactions and events in a manner that achieves fairpresentation.

Materiality is the magnitude of misstatements in the Standalone Financial Statementsthat individually or in aggregate makes it probable that the economic decisions of areasonably knowledgeable user of the financial statements may be influenced. We considerquantitative materiality and qualitative factors in (i) planning the scope of our auditwork and in evaluating the results of our work; and (ii) to evaluate the effect of anyidentified misstatements in the financial statements.

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 Financial Statementsof the current period and are therefore the key audit matters. We describe these mattersin our auditor's report unless law or regulation precludes public disclosure

about 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 the Companies (Auditors' Report) Order 2016 ("the Order”)issued by the Central Government of India in terms of Section 143(11) of the Act we givein the "Annexure A” a statement on the matters specified in paragraphs 3 and 4of the Order to the extent applicable.

2. As required by Section 143(3) of the Act based on our report we 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 Standalone Balance Sheet the Standalone Statement of Profit and Loss(including other comprehensive income) the Standalone Statement of Changes in Equity andthe Standalone Statement of Cash Flow dealt with by this report are in agreement with thebooks of account.

(d) In our opinion the aforesaid Standalone Financial Statements comply with the IndAS specified under Section 133 of the Act read with Rule 7 of the Companies (Accounts)Rules 2014.

(e) On the basis of the written representations received from the directors as on March31 2020 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2020 from being appointed as a director in terms of Section 164 (2) of theAct.

For Atul Garg & Associates

Chartered Accountants Firm Registration No.001544C

Fiza Gupta

Partner

Membership No. 429196 UDIN: 20429196AAAAAH3569

Place of signature: Kanpur Date: June 2 2020

(f) With respect to the adequacy of the internal financial controls over financialreporting with reference to Standalone Financial Statements of the Company and theoperating effectiveness of such controls refer to our separate Report in "AnnexureB”.

(g) With respect to the matter to be included in the Auditor's Report in accordancewith the requirements of section 197(16) of the Act as amended:

In our opinion and according to the information and explanation given to us theremuneration paid during the current year by the Company to its directors is in accordancewith the provisions of Section 197 of the Act. The remuneration paid to any director isnot in excess of the limit laid down under Section 197 of the Act. The Ministry ofCorporate Affairs has not prescribed other details under Section 197(16) of the Act whichare required to be commented upon by us.

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

i. The Company has disclosed the impact of pending litigations as at March 31 2020 onits financial position in its Standalone Financial Statements. Refer Note - 39 to theStandalone Financial Statements;

ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.

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

For T R Chadha & Co LLP

Chartered Accountants Firm Registration No.006711N/N500028

Neena Goel

Partner

Membership No. 057986 UDIN: 20057986AAAAEE9860

Place of signature: New Delhi Date: June 2 2020

Annexure A to the Independent Auditor's Report

Referred to in our report of even date to the members of Dhampur Sugar Mills Limited onthe Standalone Financial Statements for the year ended March 31 2020 we report that:

(i) (a) In our opinion and according to the information

and explanation given to us during the course of audit the company has maintainedproper records showing full particulars including quantitative details and situation ofproperty plant and equipment.

(b) In our opinion and according to the information and explanation given to us duringthe course of audit property plant and equipment have been physically verified by themanagement at reasonable intervals having regard to the size of the company and the natureof its assets and no material discrepancy was noticed on such verification as compared tobook records.

(c) According to the information and explanations given to us and on the basis ofrecords examined by us the title deeds of the immovable properties are held in the nameof the company.

(ii) In our opinion and according to the information and explanations given to usinventories have been physically verified by the management at reasonable intervals havingregard to the size of the company and no material discrepancy was noticed on suchverification as compared to book records.

(iii) In our opinion and according to the information and explanation given to usduring the course of audit the Company has not granted any loans secured or unsecured tocompanies firms Limited Liability Partnerships or other parties covered in the registermaintained under section 189 of the Companies Act 2013. Therefore sub clauses (a) (b)& (c) of paragraph 3(iii) the Order are not applicable to the Company.

(iv) In our opinion and according to the information and explanation given to us duringthe course of audit the Company has complied with the provisions of Section 185 and 186of the Act with respect to the loans given investments made guarantees and securitiesgiven.

(v) According to the information and explanations given to us in our opinion theCompany has complied with the directives issued by the Reserve Bank of India and theprovisions of sections 73 to 76 or any other relevant provisions of the Act and rulesframed thereunder in respect of deposits accepted during the year. As informed to us noorder has been passed by the Company Law Board or National Company Law Tribunal or Reserve

Bank of India or any court or any other Tribunal in this connection.

(vi) We have broadly reviewed the cost records maintained by the Company pursuant tothe Companies (Cost records and Audit) Rules 2014 under section 148 of the Companies Actand are of the opinion that prima facie the prescribed cost records have been made andmaintained. We have however not made a detailed examination of the cost records with aview to determine whether they are accurate or complete.

(vii) (a) According to the information and explanations

given to us and the books and records examined by us we state that the company isgenerally regular in depositing undisputed statutory dues including provident fundemployees' state insurance income- tax sales tax service tax goods and service taxduty of customs duty of excise value added tax cess and any other statutory dues asapplicable with the appropriate authorities except for demand raised by Income TaxAuthorities at the time of processing of TDS return. There are no undisputed statutorydues as referred to above as at March 31 2020 outstanding for a period of more than sixmonths from the date they become payable except for demand raised by Income TaxAuthorities at the time of processing of TDS return aggregating to H0.01Crores. We havebeen informed by the Company that they are in process of getting these returns rectifiedand are hopeful that these demands will be substantially reduced after rectification.

(b) In terms of the information and explanations sought by us and given by the companyand the books and records examined by us in the normal course of audit and to the best ofour knowledge and belief we state that there are no dues of income tax or sale tax orservice tax or goods and service tax or duty of customs or duty of excise or value addedtax or cess which have not been deposited on account of any dispute except mentioned inAnnexure-A1.

(viii) According to the information and explanations given to us and the books andrecords examined by us in our opinion the Company has not defaulted in repayment ofloans and borrowings to any financial institution bank and government during the period.The Company has not borrowed any money by way of issue of debentures.

(ix) According to the information and explanations given to us and based on ourexaminations of the records in our opinion the money raised by the Company by way ofterm loans have been applied for the purposes for which they were obtained. The companydid not raise any money by way of initial public offer or further public offer during thecurrent year.

(x) To the best of our knowledge and according to the information and explanation givento us no fraud by the company or on the company by its officers or employees has beennoticed or reported during the year.

(xi) In our opinion and according to the information and explanation given to us duringthe course of audit the company has paid managerial remuneration in accordance with therequisite approvals as mandated by the provisions of Section 197 of the Act read withSchedule V of the Act.

(xii) In our opinion and according to the information and explanation given to usduring the course of audit the company is not a Nidhi company. Therefore clause 3(xii)of the Order is not applicable.

(xiii) In our opinion and according to the information and explanations given to usthe Company is in compliance

For Atul Garg & Associates

Chartered Accountants

Firm Registration No.001544C

Fiza Gupta

Partner

Membership No. 429196

UDIN: 20429196AAAAAH3569

Place of signature: Kanpur

Date: June 2 2020

with Section 177 and 188 of the Companies Act 2013 where applicable for alltransactions with the related parties and the details of related party transactions havebeen disclosed in the Standalone Financial Statements as required by the applicableaccounting standards.

(xiv) In terms of the information and explanations sought by us and given by thecompany and the books and records examined by us in the normal course of audit and to thebest of our knowledge and belief we state that the company has not made any preferentialallotment or private placements of shares or fully or partly convertible debentures duringthe year.

(xv) In terms of the information and explanations sought by us and given by the companyand the books and records examined by us in the normal course of audit and to the best ofour knowledge and belief we state that the Company has not entered into non-cashtransaction with directors or persons connected with him. Therefore paragraph 3(xv) Orderis not applicable.

(xvi) I n our opinion and according to the information and explanation given to usduring the course of audit the Company is not required to be registered under section45-IA of the Reserve Bank of India Act 1934.

For T R Chadha & Co LLP

Chartered Accountants Firm Registration No.006711N/N500028

Neena Goel Partner

Membership No. 057986 UDIN: 20057986AAAAEE9860

Place of signature: New Delhi Date: June 2 2020

Annexure A1 to the Independent Auditors' Report

(Referred to in paragraph vii (b) under 'Annexure A to the Independent Auditors Reportsection of our report of even date)

Sr# Name of the Statute Nature of Dues Amount in H crores Period to which the amount relates Forum where the dispute is pending
1 Central Excise Act 1944 Excise Duty 0.01 2003-04 Hon'ble Supreme Court
2 Central Excise Act 1944 Excise Duty 0.02 2005-06 Hon'ble Supreme Court
3 Central Excise Act 1944 Excise Duty # 2012-13 Hon'ble Supreme Court
4 Central Excise Act 1944 Excise Duty 0.01 2012-13 Hon'ble Supreme Court
sub-total 0.04
1 Central Excise Act 1944 Excise Duty # 1998-99 Allahabad High Court
2 Central Excise Act 1944 Excise Duty 0.01 2001-02 Allahabad High Court
3 Central Excise Act 1944 Excise Duty # 2004-05 Allahabad High Court
4 Central Excise Act 1944 Excise Duty # 2004-05 Allahabad High Court
5 Central Excise Act 1944 Excise Duty 0.01 2004-05 Allahabad High Court
6 Central Excise Act 1944 Excise Duty 0.02 2005-06 Allahabad High Court
7 Central Excise Act 1944 Excise Duty 0.04 2010-11 Allahabad High Court
sub-total 0.08
1 Central Excise Act 1944 Excise Duty 0.04 1995-96 CESTAT Bench Allahabad
2 Central Excise Act 1944 Excise Duty # 1996-97 CESTAT Bench Allahabad
3 Central Excise Act 1944 Excise Duty 0.62 2001-02 CESTAT Bench Allahabad
4 Central Excise Act 1944 Excise Duty 0.01 2003-04 CESTAT Bench Allahabad
5 Central Excise Act 1944 Excise Duty 0.03 2004-05 CESTAT Bench Allahabad
6 Central Excise Act 1944 Excise Duty 0.03 2004-05 CESTAT Bench Allahabad
7 Central Excise Act 1944 Excise Duty 0.07 2005-06 CESTAT Bench Allahabad
8 Central Excise Act 1944 Excise Duty 0.26 2005-06 CESTAT Bench Allahabad
9 Central Excise Act 1944 Excise Duty 0.02 2006-07 CESTAT Bench Allahabad
10 Central Excise Act 1944 Excise Duty 0.04 2009-10 CESTAT Bench Allahabad
11 Central Excise Act 1944 Excise Duty # 2009-10 CESTAT Bench Allahabad
12 Central Excise Act 1944 Excise Duty 2.89 2010-11 CESTAT Bench Allahabad
13 Central Excise Act 1944 Excise Duty 4.76 2010-11 CESTAT Bench Allahabad
14 Central Excise Act 1944 Excise Duty 3.09 2010-11 CESTAT Bench Allahabad
15 Central Excise Act 1944 Excise Duty 2.08 2014-15 CESTAT Bench Allahabad
16 Central Excise Act 1944 Excise Duty 0.02 2016-17 CESTAT Bench Allahabad
17 Central Excise Act 1944 Excise Duty 0.01 2015-16 CESTAT Bench Allahabad
18 Central Excise Act 1944 Excise Duty 0.31 2017-18 CESTAT Bench Allahabad
19 Central Excise Act 1944 Excise Duty 0.36 2018-19 CESTAT Bench Allahabad
sub-total 14.64
1 Central Excise Act 1944 Excise Duty # 2001-02 Commissioner Appeal
2 Central Excise Act 1944 Excise Duty # 2004-05 Commissioner Appeal
3 Central Excise Act 1944 Excise Duty # 2004-05 Commissioner Appeal
4 Central Excise Act 1944 Excise Duty 0.05 2009-10 Commissioner Appeal
5 Central Excise Act 1944 Excise Duty 0.30 2011-12 Commissioner Appeal
6 Central Excise Act 1944 Excise Duty 0.14 2015-16 Commissioner Appeal
7 Central Excise Act 1944 Excise Duty 0.38 2016-17 Commissioner Appeal
sub-total 0.87
Total Excise duty demands 15.63
1 Service Tax Law Service Tax 0.56 2009-10 CESTAT Bench Allahabad
2 Service Tax Law Service Tax 0.35 2014-15 CESTAT Bench Allahabad
3 Service Tax Law Service Tax 0.10 2015-16 CESTAT Bench Allahabad
4 Service Tax Law Service Tax 0.36 2015-16 CESTAT Bench Allahabad
Total Service tax demands 1.37
Total Excise duty & Service tax demands 17.00
1 U.P. Trade Tax Act 1948 Trade Tax 0.05 1996-97 Allahabad High Court
2 U.P. Trade Tax Act 1948 Trade Tax 0.09 1997-98 Allahabad High Court
3 U.P. Trade Tax Act 1948 Trade Tax 0.22 1998-99 Allahabad High Court
4 U.P. Trade Tax Act 1948 Trade Tax 0.11 1999-00 Allahabad High Court
5 U.P. Trade Tax Act 1948 Trade Tax 0.02 2000-01 Allahabad High Court
6 U.P. Trade Tax Act 1948 Trade Tax 0.38 2001-02 Allahabad High Court
7 U.P. Trade Tax Act 1948 Trade Tax 0.16 2001-02 Allahabad High Court
8 U.P. Trade Tax Act 1948 Trade Tax 0.37 2002-03 Allahabad High Court
9 U.P. Trade Tax Act 1948 Trade Tax 0.13 2002-03 Allahabad High Court
10 U.P. Trade Tax Act 1948 Trade Tax 0.40 2003-04 Allahabad High Court
11 U.P. Trade Tax Act 1948 Trade Tax 0.07 2003-04 Allahabad High Court
12 U.P. Trade Tax Act 1948 Trade Tax 0.51 2004-05 Allahabad High Court
13 U.P. Trade Tax Act 1948 Trade Tax 0.55 2009-10 Allahabad High Court
Sub-total 3.06
1 U.P. Trade Tax Act 1948 Trade Tax 0.65 2014-15 Additional Commissioner (Appeals)
2 U.P. Trade Tax Act 1948 Trade Tax 0.37 2006-07 Additional Commissioner (Appeals)
3 U.P. Trade Tax Act 1948 Trade Tax # 2007-08 Additional Commissioner (Appeals)
4 U.P. Trade Tax Act 1948 Trade Tax 0.52 2007-08 Additional Commissioner (Appeals)
Sub-total 1.54
Total Trade tax demands 4.60
1 U.P. Tax on Entry of Goods into Local Area Act 2007 Entry Tax 1.06 1994-95 Allahabad High Court
2 U.P. Tax on Entry of Goods into Local Area Act 2007 Entry Tax 0.82 1994-95 Allahabad High Court
3 U.P. Tax on Entry of Goods into Local Area Act 2007 Entry Tax 0.37 1995-96 Allahabad High Court
Sr# Name of the Statute Nature of Dues Amount in H crores Period to which the amount relates Forum where the dispute is pending
4 U.P. Tax on Entry of Goods into Local Area Act 2007 Entry Tax 1.25 1995-96 Allahabad High Court
5 U.P. Tax on Entry of Goods into Local Area Act 2007 Entry Tax 0.89 2001-02 Allahabad High Court
Sub-total 4.39
1 U.P. Tax on Entry of Goods into Local Area Act 2007 Entry Tax 0.02 2000-01 Commercial Tax Tribunal
Sub-total 0.02
1 U.P. Tax on Entry of Goods into Local Area Act 2007 Entry Tax 0.01 2010-11 Additional Commissioner (Appeals)
2 U.P. Tax on Entry of Goods into Local Area Act 2007 Entry Tax 0.05 2014-15 Additional Commissioner (Appeals)
3 U.P. Tax on Entry of Goods into Local Area Act 2007 Entry Tax 0.07 2015-16 Additional Commissioner (Appeals)
4 U.P. Tax on Entry of Goods into Local Area Act 2007 Entry Tax 0.03 2017-18 Additional Commissioner (Appeals)
Sub-total 0.16
Total Entry tax demands 4.57
Total Trade tax and Entry tax demands 917

# represents where value is less than H 50000/-

Annexure B to the Independent Auditor's Report on the Standalone Financial Statementsof the Dhampur Sugar Mills Limited for the year ended March 31 2020

Report on the Internals Financial Controls with reference to aforesaid StandaloneFinancial Statements under Clause (i) of Sub-section 3 of Section 143 of the CompaniesAct 2013 (“the Act”)

(Referred to in paragraph 2 (f) under 'Report on Other Legal and RegulatoryRequirements' section of our report of even date)

Opinion

We have audited the internal financial controls over financial reporting of DhampurSugar Mills Limited ("the Company”) as of March 31 2020 in conjunction with ouraudit of the Standalone Financial Statements of the Company for the year ended on thatdate.

In our opinion the Company has in all material respects adequate internal financialcontrols over financial reporting and such internal financial controls were operatingeffectively as at March 31 2020 based on the internal financial controls 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 (the"Guidance Note”).

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal financial controls over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note. These responsibilities include the designimplementation and maintenance of adequate internal financial controls that were operatingeffectively for ensuring the orderly and efficient conduct of its business includingadherence to the Company's policies the safeguarding of its assets the prevention anddetection of frauds and errors the accuracy and completeness of the accounting recordsand the timely preparation of reliable financial information as required under theCompanies Act 2013 (hereinafter referred to as "the Act”).

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 and the Standards on Auditing prescribed under Section 143(10) of theAct to the extent applicable to an audit of internal financial controls with reference toStandalone Financial Statements. Those Standards and the Guidance Note require that wecomply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether adequate internal financial controls over financial reporting wasestablished and maintained and whether such controls operated effectively in all materialrespects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exits and testing and evaluating the designand operating effectiveness of the internal controls based on the assessed risk. Theprocedures selected depend on the auditor's judgement including the assessment of therisk of misstatement of the Standalone Financial Statements whether due to fraud orerror.

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 overfinancial reporting.

Meaning of Internal Financial Controls with reference to Standalone FinancialStatements

A company's internal financial controls 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 controls overfinancial reporting include those policies and procedures that (1) pertain to themaintenance of records

that 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 Standalone FinancialStatements in accordance with generally accepted accounting principles and that receiptsand expenditures of the company are being made only in accordance with authorizations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorized acquisition use or disposition of thecompany's assets that could have a material effect on the Standalone Financial Statements.

For Atul Garg & Associates

Chartered Accountants Firm Registration No.001544C

Fiza Gupta

Partner

Membership No. 429196 UDIN: 20429196AAAAAH3569

Place of signature: Kanpur Date: June 2 2020

Inherent Limitations of Internal Financial Controls with reference to StandaloneFinancial Statements

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 controlsover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.

For T R Chadha & Co LLP

Chartered Accountants Firm Registration No.006711N/N500028

Neena Goel

Partner

Membership No. 057986 UDIN: 20057986AAAAEE9860

Place of signature: New Delhi

Date: June 2 2020

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