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Dwarikesh Sugar Industries Ltd.

BSE: 532610 Sector: Agri and agri inputs
NSE: DWARKESH ISIN Code: INE366A01041
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VOLUME 161491
52-Week high 148.45
52-Week low 63.50
P/E 11.80
Mkt Cap.(Rs cr) 1,980
Buy Price 0.00
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Sell Price 0.00
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OPEN 107.00
CLOSE 105.70
VOLUME 161491
52-Week high 148.45
52-Week low 63.50
P/E 11.80
Mkt Cap.(Rs cr) 1,980
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Dwarikesh Sugar Industries Ltd. (DWARKESH) - Auditors Report

Company auditors report

To

The Members of

Dwarikesh Sugar Industries Limited

Report on the Audit of the Financial Statements Opinion

We have audited the accompanying financial statements of Dwarikesh Sugar IndustriesLimited ("the Company") which comprise the Balance Sheet as at March 31 2022the Statement of Profit and Loss (including Other Comprehensive Income) the Statement ofChanges in Equity and the Statement of Cash Flows for the year ended on that date and asummary of significant accounting policies and other explanatory information includingnotes to the financial statements (hereinafter referred to as "the financialstatements").

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 theCompanies Act 2013 as amended ("the Act") in the manner so required and give atrue and fair view in conformity with the Indian Accounting Standards prescribed undersection 133 of the Act read with the Companies (Indian Accounting Standards) Rules 2015as amended thereof ("Ind AS") and other accounting principles generallyaccepted in India of the state of affairs of the Company as at March 31 2022 and itsprofit total comprehensive income changes in equity and its cash flows for the yearended on that date. section 143(10) of the Act (SAs). Our responsibilities under thoseStandards are further described in the Auditor’s Responsibilities for the Audit ofthe financial 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 (ICAI) together with the ethical requirements that are relevant to our audit of thefinancial statements under the provisions of the Act and the Rules made thereunder and wehave fulfilled our other ethical responsibilities in accordance with these requirementsand the ICAI’s Code of Ethics.

We believe that the audit evidence obtained by us is sufficient and appropriate toprovide a basis for our audit opinion on the financial statements.

Key Audit Ma ers

Key audit ma ers are those ma ers that in our professional judgment were of mostsignificance in our audit of the financial statements of the current period. These ma erswere 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 ma ers. Wehave determined the ma ers described below to be the key audit ma ers to be communicatedin our report.

Basis for Opinion

We conducted our audit of the financial statements in accordance with the Standards onAuditing specified under

Sr. No. Key Audit Ma ers Auditor’s Response
1 Calculation of deferred tax liability on the basis of dual rates. Principal Audit Procedures
From the financial year commencing April 1 2019 the Government of India Promulgated the Taxation Laws (Amendment) Ordinance 2019 (enacted into Taxation Laws) (Amendment) Act 2019) has introduced Section 115BAA of the Income Tax Act 1961 in which companies can opt for lower tax rate based on certain conditions such as foregoing exemptions/deductions including deduction under chapter VI A and foregoing the benefits of MAT credit entitlement. Our audit procedures in relation to the recognition of deferred tax assets/liabilities included but were not limited to the following:
As per Para 47 of IND AS 12 and clarifications given in bulletin no 23 of ITFG where a company expects to avail of the lower tax rate only from a later financial year it should apply the lower tax rate in measurement of deferred taxes only to the extent that the deferred tax assets are expected to be realised or deferred tax liabilities are expected to be se led in the periods during which the Company expects to be subject to lower tax rate. To the extent deferred tax assets are expected to be realised or deferred tax liabilities are expected to be se led in earlier periods the normal tax rate should be applied. Evaluated the design and tested the operating efiectiveness of key controls implemented by the Company over recognition of deferred tax assets based on the assessment of Company’s ability to generate sufficient taxable profits in foreseeable future allowing the use of deferred tax assets.
Based on the assessment made by the Company deferred tax liability/Assets as on March 31 2022 has been calculated on the basis of dual rates as may be applicable in future. Considered the relevant accounting standards and clarifications given by ITFG for recognition of deferred tax assets and liabilities based on the tax rates expected to be applied at the time of reversal and assessed the appropriateness of the recognition of Deferred Tax Assets/Liabilities.
Measurement of deferred tax assets & liabilities has resulted in reversal of deferred tax liability of H1628.69 Lakhs. Evaluated the management’s assessment for complying with the prescribed conditions as mentioned in the relevant notification issues by income Tax department.
For details: - Refer Note No 58 to the Financial Statements Understood and verified the assumptions taken for preparation of future profit projections utilisation of MAT Credit and for migration to new tax regime as prepared by the management.
Tested the arithmetical accuracy of the calculations performed by the management.
Evaluated management’s assessment of time period available for adjustment of such deferred tax assets as per provisions of the Income-tax Act 1961 and appropriateness of the accounting treatment with respect to the recognition of deferred tax assets as per requirements of Ind AS 12 Income Taxes.
Evaluated the appropriateness of the disclosures made in the financial statements in respect of deferred tax assets.
Based on the above procedures performed we are reasonably certain on recognition and disclosure of Deferred Tax Assets/Liabilities.
2. Determination of net realizable value of inventory of sugar as at the year ended March 31 2022 Principal Audit Procedures
As on March 31 2022 the Company has inventory of sugar with the carrying value H 63318.05 lakhs. The inventory of sugar is valued at the lower of cost and net realizable value. We understood and tested the design and operating efiectiveness of controls as established by the management in determination of net realizable value of inventory of sugar.
We considered the value of the inventory of sugar as a key audit ma er given the relative size of the balance in the financial statements and significant judgement involved in the consideration of factors such as minimum sale price monthly quota fluctuation in selling prices and the related notifications of the Government in determination of net realizable value. We considered various factors including the actual selling price prevailing around and subsequent to the year-end minimum selling price & monthly quota and other notifications of the Government of India initiatives taken by the Government with respect to sugar industry as a whole.
For details: - Refer Note No 10 & 45 (c) to the Financial Statements. 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.

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

The Company’s Board of Directors is responsible for the other information. Theother information comprises the information included in the Management Discussion andAnalysis Board’s Report and business responsibility report including Annexures toBoard’s Report and Corporate Governance and Shareholder’s information but doesnot include the financial statements and our auditor’s report thereon.

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

In connection with our audit of the financial statements our responsibility is to readthe other information and in doing so consider whether the other information ismaterially inconsistent with the financial statements or our knowledge obtained during thecourse of our audit or otherwise appears to be materially misstated.

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.

Management’s Responsibilities for the Financial Statements

The Company’s Board of Directors is responsible for the ma ers stated in section134(5) of the Act with respect to the preparation of these financial statements that givea true and fair view of the financial position financial performance including othercomprehensive income changes in equity and cash flows of the Company in accordance withaccounting principles generally accepted in India including the Indian AccountingStandards (Ind AS) specified under Section 133 of the Act read with the Companies (IndianAccounting Standards) Rules 2015 as amended thereof.

This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; design implementation and maintenance of adequate internal financial controlsthat were operating effectively for ensuring the accuracy and completeness of theaccounting records relevant to the preparation and presentation of the financialstatements that give a true and fair view and are free from material misstatement whetherdue 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 ma ersrelated 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.

The Board of Directors is responsible for overseeing the Company’s financialreporting process.

Auditor’s Responsibilities 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 ahigh level of assurance but is not a guarantee that an audit conducted in accordance withSAs will always detect a material misstatement when it exists. Misstatements can arisefrom fraud 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 scepticism throughout the audit. We also:

• Identifi 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 financial control relevant to the audit inorder to design audit procedures that are appropriate in the circumstances. Under section143(3)(i) of the Act we are also responsible for expressing our opinion on whether theCompany 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 the management.

• Conclude on the appropriateness of management’s use of the going concernbasis of accounting and based on the audit evidence obtained whether a materialuncertainty exists related to events or conditions that may cast significant doubt on theCompany’s ability to continue as a going concern. If we conclude that a materialuncertainty exists we are required to draw a ention in our auditor’s report to therelated disclosures in the financial statements or if such disclosures are inadequate tomodifi 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 theCompany to cease to continue as a 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.

Materiality is the magnitude of misstatements in the financial statements thatindividually 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 audit work and in evaluating the results of our work; and

(ii) to evaluate the effect of any identified misstatements in the financialstatements.

We communicate with those charged with governance regarding among other ma ers theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identifi 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 ma ers that may reasonably be thought to bear on ourindependence and where applicable related safeguards.

From the ma ers communicated with those charged with governance we determine those maers that were of most significance in the audit of the financial statements of the currentperiod and are therefore the key audit ma ers. We describe these ma ers in ourauditor’s report unless law or regulation precludes public disclosure about the ma eror when in extremely rare circumstances we determine that a ma er 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 2020 ("theOrder") issued by the Central Government of India in terms of Section 143(11) of theAct we give in "Annexure A" a statement on the ma ers specified in paragraphs 3and 4 of the Order.

2. As required by Section 143(3) of the Act based on our audit 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 of the aforesaidfinancial statements;

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 statement of cash flow and the statement of changes in equity dealt with by thisReport are in agreement with the relevant books of account;

d) In our opinion the aforesaid financial statements comply with the Ind AS specifiedunder Section 133 of the Act read with Companies (Indian Accounting Standards) relevantRules 2015 as amended thereof;

e) On the basis of the wri en representations received from the directors as on March31 2022 and taken on record by the Board of Directors none of the directors isdisqualified as on March 31 2022 from being appointed as a director in terms of Section164 (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". Our report expresses an unmodified opinion onthe adequacy and operating effectiveness of the Company’s internal financial controlsover financial reporting.

g) With respect to the other ma ers to be included in the Auditor’s Report inaccordance with the requirements of section 197(16) of the Act as amended: In our opinionand to the best of our information and according to the explanations given to us theremuneration paid by the Company to its directors during the year is in accordance withthe provisions of section 197 of the Act; and

h) With respect to the other ma ers to be included in the Auditor’s Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 as amended inour opinion and to the best of our information and according to the explanations given tous:

i. The Company has disclosed the impact of pending litigations as at March 31 2022 onits financial position in its financial statements – Refer Note 39 40 41 and 42 tothe financial statements;

ii. The Company has made provisions as required under the applicable law or accountingstandards for material foreseeable losses if any on long term contracts includingderivatives contracts; and

iii. There has been no delay in transferring amounts required to be transferred to theInvestor Education and Protection Fund by the Company during the year ended March 312022.

iv. (a) The Management has represented to us that to the best of its knowledge andbelief other than as disclosed in the notes to the accounts no funds have been advancedor loaned or invested (either from borrowed funds or share premium or any other sources orkind of funds) by the Company to or in any other persons or entities including foreignentities ("Intermediaries") with the understanding whether recorded in writingor otherwise that the Intermediary shall whether directly or indirectly lend or investin other 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 to us that to the best of its knowledge and beliefother than as disclosed in the notes to the accounts no funds (which are material eitherindividually or in aggregate) have been received by the Company from any person(s) orentities 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;

(c) Based on our audit procedure conducted that are considered reasonable andappropriate in the circumstances nothing has come to our a ention that cause us tobelieve that the representation under sub- clause (i) and (ii) of Rule 11 (e) as providedunder paragraph (2) (h) (iv) (a) & (b) above contain any material misstatement. v. Asstated in Notes 18 to the financial statements:

(a) The final dividend proposed in the previous year declared and paid by the Companyduring the year is in accordance with Section 123 of the Act as applicable.

(b) The interim dividend declared and paid by the Company during the year and until thedate of this report is in compliance with Section 123 of the Act.

For NSBP & Co.
Chartered Accountants
Firm’s Registration No. 001075N
Deepak K. Aggarwal
Partner
Place: New Delhi Membership No: 095541
Date: May 02 2022 UDIN: 22095541AIGPQV7129

Annexure A to the Independent Auditor’s Report to the members of Dwarikesh SugarIndustries Limited on its financial statements dated May 02 2022.

Report on the ma ers specified in paragraph 3 of the Companies (Auditor’s Report)Order 2020 ("the Order’) issued by the Central Government of India in terms ofsection 143(11) of the Companies Act 2013 ("the Act") as referred to inparagraph 1 of ‘Report on Other Legal and Regulatory Requirements’ section.

To the best of our information and according to the explanations provided to us by theCompany and the books of account and records examined by us in the normal course of auditwe state that:

i. (a) (A) The Company has maintained proper records showing full particulars includingquantitative details and situation of property plant and equipment and relevant detailsof right-of use assets.

(B) The Company has maintained proper records showing full particulars of intangibleassets.

(b) The property plant and equipment and right-of use assets have been physicallyverified by the management according to the programme of periodical verification in phasedmanner which in our opinion is reasonable having regard to the size of the Company andthe nature of its property plant and equipment. The discrepancies if any noticed onsuch physical verification have been properly dealt with in the books of accounts.

(c) According to the information and explanation given to us and on the basis of ourexamination of the records of the Company the title deed of immovable properties are heldin the name of the Company.

(d) The Company has not revalued its property plant and equipment (including right-ofuse assets) and intangible assets during the year.

(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) In our opinion and according to the information and explanations given to usthe procedures of physical verification of inventories followed by the management arereasonable and adequate in relation to the size of the Company and the nature of itsbusiness. The discrepancies noticed on verification between the physical stocks and thebook records in each class of inventory is less than 10% and have been properly dealt within the books of accounts.

(b) As disclosed in note 44 to the financial statements the Company has beensanctioned working capital limits in excess of Rupees five crores in aggregate from banksduring the year on the basis of security of current assets of the Company. The quarterlyreturns/statements filed by the Company with such banks are not in agreement with thebooks of accounts of the Company and the details are as follows:

( H In lakhs)

Quarter ending Value as per books of account Value as per quarterly return/ statement filed with lenders Difierence Reason for differences
June 30 2021 90523.93 80131.76 10392.17 As explained by the management the differences are because the statements filed with the lenders are based on financial statements which are prepared on provisional basis and also on account of exclusion of certain current assets in the statements filed with the lenders.
September 30 2021 50504.37 42206.85 8297.52
December 31 2021 49187.56 39708.63 9478.93
March 31 2022 84686.73 71710.42 12976.31

iii The Company has not made any investment provided any security or guarantee orgranted any loans or advances in the nature of loans secured or unsecured to companiesfirms and limited liability partnership or any other parties covered except an investmentmade during the year in a company the terms and condition of the same are not prejudicialto the interest of the Company. Accordingly reporting under clause 3 (iii) (a) (c) to(f) of the Order are not applicable to the Company.

iv In our opinion and according to the information and explanations given to us theCompany has complied with provisions of Sections 185 and 186 of the Act with respect toinvestment made.

v According to the information and explanations given to us the Company has notaccepted any deposits or amounts which are deemed to be deposits within the meaning ofprovisions of sections 73 to 76 or any other relevant provisions of the Act and the Rulesframed there under. Accordingly reporting under clause 3 (v) of the Order is notapplicable to the Company.

vi. We have broadly reviewed the books of account relating to materials labour andother items of cost maintained by the Company as specified by the Central Government ofIndia under section 148(1) of the Act and are of the opinion that prima facie theprescribed accounts and records have been made and maintained. We have not however madea detailed examination of the records with a view to determine whether they are accurateand complete.

vii. (a) According to the records of the Company examined by us and the information andexplanations given to us in our opinion the Company is generally regular in depositingits undisputed statutory dues including provident fund income-tax sales-tax servicetax goods and service tax duty of customs duty of excise value added tax cess and anyother material statutory dues as applicable with the appropriate authorities.Employees’ state insurance is not applicable on the Company. Further there were noundisputed amounts outstanding at the year-end for a period of more than six months fromthe date they became payable.

(b) According to the information and explanations given to us and the records of theCompany examined by us the dues of duty of excise service tax and income tax have notbeen deposited on account of dispute along with the forum where the dispute is pending asfollows:

Name of the statute Nature of the dues Gross Amount in dispute (H in lakhs) Amount deposited (H in lakhs) Net amount outstanding (H in lakhs) Period to which the amount relates Forum where dispute is pending
Central Excise Act 1944 Service Tax 41.81 0.00 41.81 2010-11 to 2011-12 AC/DC
Central Excise Act 1944 Excise duty and Penalty 13.89 9.79 4.10 Apl-07 to Dec-07 AC/DC
Central Excise Act 1944 Excise duty and Penalty 1.97 0.00 1.97 Jul-97 Aug-97 to Oct-97 Comm. (A) Meerut Commissioner Noida Superintendent
Finance Act 1994 Service Tax 265.52 10.38 255.14 Apr-16 to Jun-17
Finance Act 1994 Service Tax 11.56 0.23 11.33 Nov-05 to Mar-09 Apr-09 to Sep-09 Oct-09 to Mar-10 Apr-10 to Sep-10 Oct-10 to Mar-11 Apr-15 to Mar-17 Apr-17 to Jun-17 Apr-07 to May-09 ‘Sep-09 Jul-15 to May-16 Jun-16 to Jun-17 Apr- 16 to Jun-17
Central Excise Act 1944 Excise duty and Penalty 1.66 0.77 0.89 Apr-09 to Sep-09 Apr-10 to Sep-10 Apr-11 to Sep-11 Sep- 15 to Mar-17 Apr-17 to Jun-17 March 09 Oct-09 to Mar-10 Feb-16 to Jun-17 Superintendent
Central Excise Act 1944 Excise duty 3.11 0.00 3.11 April 07 to April 09 Superintendent
Income Tax Act 1962 Income Tax 5.46 - 5.46 For various years TDS- CPC
Income Tax Act 1962 Income Tax 270.16 Adjusted against the MAT credit available to the Company 0.00 Assessment Year 2017-2018 ITAT Mumbai

viii. According to the information and explanations given to us Company has notsurrendered or disclosed any transaction previously unrecorded in the books of accountsin the tax assessments under the Income Tax Act 1961 as income during the year.Accordingly the requirement to report on clause 3(viii) of the Order is not applicable tothe Company.

ix (a) According to the information and explanations given to us and as per the booksand records examined by us in our opinion the Company has not defaulted in repayment ofloans or other borrowings or in the payment of interest thereon to any lender includingthe loans and interest which are repayable on demand.

(b) According to the information and explanations given to us and the records of theCompany examined by us including representation received from the management the Companyhas not been declared wilful defaulter by any bank financial institution or other lendersor government or any government authority.

(c) Term loans were applied for the purpose for which the loans were obtained.

(d) On an overall examination of the financial statements of the Company prima facieno funds raised on short-term basis have been used for long-term purposes by the Company.

(e) The Company does not have any subsidiary associate or joint venture. Accordinglythe requirement to report on clause 3(ix) (e) of the Order is not applicable to theCompany.

(f) The Company does not have any subsidiary associate or joint venture. Accordinglythe requirement to report on Clause 3(ix) (f) of the Order is not applicable to theCompany.

x (a) According to the information and explanations given to us and as per the booksand records examined by us the Company has not raised money by way of initial publicoffer or further public offer (including debt instruments). Accordingly reporting underclause 3 (x) (a) of the Order is not applicable to the Company.

(b) According to the information and explanations given to us and as per the books andrecords examined by us the Company has not made any preferential allotment or privateplacement of shares or convertible debentures during the year. Accordingly reportingunder clause 3 (x) (b) of the Order is not applicable to the Company.

xi (a) To the best of our knowledge and according to the information and explanationsgiven to us no fraud by the Company or any fraud on the Company has been noticed orreported during the year. Accordingly reporting under clause 3 (xi) (a) and (b) of theOrder is not applicable to the Company.

(b) According to the information & explanations and representation made by themanagement no whistle- blower complaints have been received during the year (and up tothe date of the report) by the Company.

xii In our opinion the Company is not a Nidhi Company. Accordingly reporting underclause 3 (xii) (a) to (c) of the Order is not applicable to the Company.

xiii According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the financial statements as required by applicableaccounting standards.

xiv (a) The Company has an internal audit system commensurate with the size and natureof its business.

(b) The internal audit reports of the Company issued till the date of the audit reportfor the period under audit have been considered by us.

xv In our opinion and according to the information and explanations given to us theCompany has not entered into any non-cash transactions with directors or persons connectedwith him and hence requirement to report on clause 3 (xv) of the Order is not applicableto the Company.

xvi (a) The provisions of section 45-IA of the Reserve Bank of India Act 1934 (2 of1934) are not applicable to the Company. Accordingly the requirement to report on clause3 (xvi) (a) to (c) of the Order is not applicable to the Company.

(b) In our opinion there is no core investment company within the Group (as defined inthe Core Investment Companies (Reserve Bank) Directions 2016) and accordingly reportingunder Clause 3 (xvi) (d) of the Order is not applicable.

xvii In our opinion and according to the information and explanations provided to usThe Company has not incurred cash losses in the current financial year and in theimmediate preceding financial year.

xviii There has been no resignation of the statutory auditors during the year.Accordingly provisions of clause (xviii) of the Order are not applicable to the Company.

xix According to the information and explanations given to us and on the basis of thefinancial ratios ageing and expected dates of realization of financial assets and paymentof financial liabilities other information accompanying the financial statements ourknowledge of the Board of Directors and management plans and based on our examination ofthe evidence supporting the assumptions nothing has come to our a ention which causes usto believe that any material uncertainty exists as on the date of the audit report thatcompany is not capable of meeting its liabilities existing at the date of balance sheet asand when they fall due within a period of one year from the balance sheet date. Wehowever state that this is not an assurance as to the future viability of the Company. Wefurther state that our reporting is based on the facts up to the date of the audit reportand we neither give any guarantee nor any assurance that all liabilities falling duewithin a period of one year from the balance sheet date will get discharged by theCompany as and when they fall due.

xx (a) In respect of other than ongoing projects there are no unspent amounts that arerequired to be transferred to a fund specified in Schedule VII of the Act in compliancewith second proviso to sub section 5 of section 135 of the Act. This ma er has beendisclosed in note 52 to the financial statements.

(b) There are no unspent amounts and ongoing projects in the Company that are requiredto be transferred to a special account in compliance of provision of sub section (6) ofsection 135 of Companies Act.

For NSBP & Co.
Chartered Accountants
Firm’s Registration No. 001075N
Deepak K. Aggarwal
Partner
Place: New Delhi Membership No: 095541
Date: May 02 2022 UDIN: 22095541AIGPQV7129

"Annexure B" to the Independent Auditor’s Report to the members ofDwarikesh Sugar Industries Limited (‘the Company’) on its financial statementsdated May 02 2022.

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("the Act") as referredto in paragraph 1(f) of ‘Report on Other Legal and Regulatory Requirements’section

We have audited the internal financial controls over financial reporting of DwarikeshSugar Industries Limited ("the Company") as of March 31 2022 in conjunctionwith our audit of the Ind AS financial statements of the Company for the year ended onthat date.

Management’s Responsibility for Internal Financial Controls

The Management and Board of Directors of the Company is responsible for establishingand maintaining internal financial controls based on the internal control over financialreporting criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting issued by the Institute of Chartered Accountants of India". Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to the Company’s policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Act.

Auditor’s Responsibility

Our responsibility is to express an opinion on the Company’s internal financialcontrols over financial reporting of the Company based on our audit.

We conducted our audit in accordance with the Guidance Note on Audit of InternalFinancial Controls Over Financial Reporting (the "Guidance Note") and theStandards on Auditing prescribed under section 143(10) of the Act 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 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 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 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 controlssystem over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A Company’s internal financial control over financial reporting is a processdesigned to provide reasonable assurance regarding the reliability of financial reportingand the preparation of 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:

a) pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the Company;

b) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the Company are being made only inaccordance with authorizations of management and directors of the Company; and

c) provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the Company’s assets that could havea material effect on the financial 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

In our opinion to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal controls systemover financial reporting and such internal controls over financial reporting wereoperating effectively as at March 31 2022 based on the criteria for internal financialcontrol over financial reporting established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting issued by the Institute of Chartered Accountants ofIndia.

For NSBP & Co.
Chartered Accountants
Firm’s Registration No. 001075N
Deepak K. Aggarwal
Partner
Place: New Delhi Membership No: 095541
Date: May 02 2022 UDIN: 22095541AIGPQV7129

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