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Fermenta Biotech Ltd.

BSE: 506414 Sector: Health care
NSE: N.A. ISIN Code: INE225B01021
BSE 00:00 | 09 Apr 270.50 8.05
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NSE 05:30 | 01 Jan Fermenta Biotech Ltd
OPEN 265.00
PREVIOUS CLOSE 262.45
VOLUME 36469
52-Week high 442.00
52-Week low 218.00
P/E 16.08
Mkt Cap.(Rs cr) 796
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 265.00
CLOSE 262.45
VOLUME 36469
52-Week high 442.00
52-Week low 218.00
P/E 16.08
Mkt Cap.(Rs cr) 796
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Fermenta Biotech Ltd. (FERMENTABIOTEC) - Auditors Report

Company auditors report

To

The Members of

Fermenta Biotech Limited

(formerly known as DIL Limited)

Report on the Audit of the Standalone Financial Statements Qualified Opinion

We have audited the accompanying standalone financial statements of Fermenta BiotechLimited (formerly known as DIL Limited) ("the Company") which comprise theBalance Sheet as at 31 March 2020 and the Statement of Profit and Loss (including OtherComprehensive Income) the Cash Flow Statement and the Statement of Changes in Equity forthe year then ended and a summary of significant accounting policies and otherexplanatory information.

In our opinion and to the best of our information and according to the explanationsgiven to us except for the possible effects of the matter described in the Basis forQualified Opinion section below the aforesaid standalone financial statements give theinformation required by the Companies Act 2013 ("the Act") in the manner sorequired and give a true and fair view in conformity with the Indian Accounting Standardsprescribed under section 133 of the Act read with the Companies (Indian AccountingStandards) Rules 2015 as amended ("Ind AS") and other accounting principlesgenerally accepted in India of the state of affairs of the Company as at 31 March 2020and its profit total comprehensive income its cash flows and the changes in equity forthe year ended on that date.

Basis for Qualified Opinion

The Company has given (unsecured) Inter-corporate deposits aggregating Rs 2130.00Lakhs in various tranches to another entity over the last twenty months until the end ofthe reporting period. During the year the Company has also given trade advances of Rs102.00 Lakhs to the same entity. The amount outstanding as on March 31 2020 is Rs2430.88 Lakhs including interest of Rs 198.88 Lakhs. The deposits are repayable withinone year from the date of entering into the ICD agreement and are further renewable suchthat the total period of deposits does not exceed three years. No Interest has beenrecovered on these deposits since inception. As per that entity's latest available auditedfinancial statements for the year ended March 31 2019 the entity is dominantly dependenton borrowings including from banks and the net worth is marginal.

Further the directors of that entity in their report have stated that no provision forinterest has been made as per mutually agreed terms. The Management of the Company hasrepresented to us that they have not entered into any such terms that would result innon-receipt of interest. For the reasons stated in Note 62 to the standalone financialstatements the Management of the Company believes that no impairment on theseInter-corporate deposits including interest accrued on such deposits and trade advances isdeemed necessary. Having regard to the foregoing and in the absence of sufficientappropriate audit evidence we are unable to comment whether the aforesaid Inter-corporatedeposits including interest accrued on such deposits and trade advances would berecoverable including the consequential impact if any of such impairment that may berequired to be made in the standalone financial statements.

We conducted our audit of the standalone financial statements in accordance with theStandards on Auditing specified under section 143(10) of the Act (SAs). Ourresponsibilities under those Standards are further described in the Auditor'sResponsibility for the Audit of the Standalone Financial Statements section of our report.We are independent of the Company in accordance with the Code of Ethics issued by theInstitute of Chartered Accountants of India (ICAI) together with the ethical requirementsthat are relevant to our audit of the standalone financial statements under the provisionsof the Act and the Rules made thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the ICAI's Code of Ethics. Webelieve that the audit evidence obtained by us is sufficient and appropriate to provide abasis for our qualified opinion on the standalone 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 financial statements of the current period.These matters were addressed in the context of our audit of the standalone financialstatements as a whole and in forming our opinion thereon and we do not provide aseparate opinion on these matters. In addition to the matter described in the Basis forQualified Opinion section of our report we have determined the matters described below tobe the key audit matters to be communicated in our report.

Sr. No. Key Audit Matter Auditor's Response
1 Scheme of Amalgamation of the Company with its subsidiary and their respective shareholders and its accounting implications (See Note 1.2 to the standalone financial statements) Our principal audit procedures performed included among others:
During the year the National Company Law Tribunal (NCLT) Mumbai Bench has approved the Scheme of Amalgamation between the Parent i.e. DIL Limited (DIL) and its subsidiary Fermenta Biotech Limited (FBL) and their respective shareholders. The Scheme became effective from September 26 2019. The appointed date of the Scheme is April 01 2018. The amalgamation has been accounted as a common control transaction in accordance with Appendix C of Ind AS 103 "Business Combinations". Accordingly the figures of the corresponding previous year have been restated. 1. Evaluated the design and tested the operating effectiveness of controls over the accounting for business combination.
2. Examined the regulatory approvals required for the Scheme of amalgamation to take effect and read the order dated September 19 2019 passed by the Mumbai Bench of NCLT.
3. Read the Scheme of amalgamation to understand the key clauses and accounting implications and confirmed our understanding of the transaction with the Management.
The name of the amalgamated company has been changed from DIL Limited to Fermenta Biotech Limited. 4. Tested supporting workings prepared by the management relating to the accounting of the amalgamation as per the terms of the scheme of amalgamation and as a common control transaction in accordance with Appendix C of
This amalgamation has a significant impact on the standalone financial statements of the Company and comparative numbers. The accounting for this business combination being a significant transaction during the year this has been considered as a key audit matter. Ind AS "Business Combinations". Also checked that the management has appropriately restated the figures of the corresponding previous year in the standalone financial statements.
5. Assessed the adequacy of disclosures made in the standalone financial statements of the Company.
2 Recoverability of MAT credit entitlement - (See Notes 2(g) and 46C to the standalone financial statements) Our principal audit procedures performed included among others:
Unused tax credits in the form of MAT credits is recognized to the extent it is reasonably certain that sufficient taxable profits will be available in the future against which such MAT credits can be utilized. 1. Evaluated the design and tested the operating e_ectiveness of controls related to the assessment of recoverability of MAT credit entitlement.
During the year the Company has reassessed the recoverability of MAT credit entitlement and recognized MAT credit of H 5072.14 Lakhs (presented within deferred tax asset). 2. Evaluated and discussed with the Management the appropriateness of assumptions and evidences for the underlying profitability forecasts. Assessed the assumptions used in the profitability forecasts along with the Company's tax position including the timing of future taxable profits. We also performed sensitivity analysis on the key assumptions in respect of recoverability of MAT credit entitlement.
The recoverability of such MAT credit entitlement is considered as a key audit matter as it involves significant management judgement including accounting estimates relating to profitability forecasts availability of sufficient taxable income in the future and recoverability within the specified period of time. 3. Assessed the adequacy of disclosures made in the standalone financial statements of the Company.

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 Annual report for examplemanagement discussion & analysis board's report etc. but does not include theconsolidated financial statements standalone financial statements and our auditor'sreport thereon.

• Our opinion on the standalone 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 financial statements ourresponsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the standalone financial statements orour knowledge obtained during the course of our audit or otherwise appears to bematerially 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 Responsibility for the Standalone Financial Statements

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 financial statementsthat give a true and fair view of the financial position financial performance includingother comprehensive income cash flows and changes in equity of the Company in accordancewith the Ind AS and other accounting principles generally accepted in India. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; anddesign implementation 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 financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

In preparing the standalone 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 Responsibility 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 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 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 standalone financial statements may be influenced. Weconsider quantitative materiality and qualitative factors in (i) planning the scope of ouraudit work and in evaluating the results of our work; and (ii) to evaluate the effect ofany identified misstatements in the standalone 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 de_ciencies 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 thematter or when in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.

Other Matters

(a) Due to COVID-19 related lockdown we were not able to physically observe thephysical verification of inventory that was carried out by the Management of the Companysubsequent to the year end. Consequently we have performed alternate procedures to auditthe existence and condition of inventory as per the guidance provided in the Standard onAuditing 501 "Audit Evidence – Specific Consideration for Selected Items"which includes inspection of supporting documents on test check basis relating topurchases production sales results of cyclical counts performed by the Management ofthe Company through the year and such other third party evidences as applicable and haveobtained sufficient appropriate audit evidence to issue an unmodified opinion on thestandalone financial statements.

(b) As stated in Note 1.2 to the standalone financial statements pursuant to theScheme of Amalgamation of erstwhile Fermenta Biotech Limited as stated in the said Noteinto the Company becoming effective during the year ended March 31 2020 thecorresponding financial information for the year ended March 31 2019 has been restated.Also refer the first matter under the Key Audit Matters paragraph above.

Our opinion on the standalone financial statements and our report on Other Legal andRegulatory Requirements below is not modified in respect of these matters.

Report on Other Legal and Regulatory Requirements

1. As required by Section 143(3) of the Act based on our audit we report that: a) Wehave sought and except for the matter described in the Basis for Qualified Opinion sectionabove obtained all the information and explanations which to the best of our knowledgeand belief were necessary for the purposes of our audit. b) Except for the possibleeffects of the matter described in the Basis for Qualified Opinion section above in ouropinion proper books of account as required by law have been kept by the Company so faras it appears from our examination of those books. c) The Balance Sheet the Statement ofProfit and Loss including 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) Except for the possible effects of the matter described in the Basis forQualified Opinion section above in our opinion the aforesaid standalone financialstatements comply with the Ind AS specified under Section 133 of the Act. e) The matterdescribed in the Basis for Qualified Opinion section above in our opinion may have anadverse effect on the functioning of the Company.

f ) On the basis of the written representations received from the directors as on 31March 2020 taken on record by the Board of Directors none of the directors isdisqualified as on 31 March 2020 from being appointed as a director in terms of Section164(2) of the Act. g) The qualification relating to the maintenance of accounts and othermatters connected therewith are as stated in the Basis for Qualified Opinion sectionabove. h) With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in "Annexure A". Our report expresses a qualified opinion on theadequacy and operating effectiveness of the Company's internal financial controls overfinancial reporting for the reasons stated therein. i) With respect to the other mattersto be included in the Auditor's Report in accordance with the requirements of section197(16) of the Act as amended in our opinion and to the best of our information andaccording to the explanations given to us the remuneration paid by the Company to itsdirectors during the year is in accordance with the provisions of section 197 of the Act.j) With respect to the other matters to be included in the Auditor's Report in accordancewith Rule 11 of the Companies (Audit and Auditors) Rules 2014 as amended in our opinionand to the best of our information and according to the explanations given to us: i. TheCompany has disclosed the impact of pending litigations on its financial position in itsstandalone financial statements - See Note 41(ii) to the standalone 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 intransferring amounts required to be transferred to the Investor Education and ProtectionFund by the Company.

2. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government in terms of Section 143(11) of the Act we give in"Annexure B" a statement on the matters specified in paragraphs 3 and 4 of theOrder.

For Deloitte Haskins & Sells LLP
Chartered Accountants
(Firm's Registration No. 117366W/W-100018)
Rajesh K. Hiranandani
Partner
Place: Mumbai (Membership No. 36920)
Date: August 28 2020 (UDIN: 20036920AAAACU7943)
109

ANNEXURE "A" TO THE INDEPENDENT AUDITOR'S REPORT

[Referred to in paragraph 1(h) under ‘Report on Other Legal and RegulatoryRequirements' section of our report of even date to the members of Fermenta BiotechLimited (formerly known as DIL Limited)]

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) ofSubsection 3 of Section 143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls over financial reporting of FermentaBiotech Limited (formerly known as DIL Limited) ("the Company") as of March 312020 in conjunction with our audit of the standalone financial statements of the Companyfor the year ended on that date.

Management's Responsibility for Internal Financial Controls

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

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 ouraudit in accordance with the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting (the "Guidance Note") issued by the Institute of CharteredAccountants of India and the Standards on Auditing prescribed under Section 143(10) of theCompanies Act 2013 to the extent applicable to an audit of internal financial controls.Those Standards and the Guidance Note require that we comply with ethical requirements andplan and perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls over financial reporting was established and maintained and if suchcontrols operated effectively in all material respects. Our audit involves performingprocedures to obtain audit evidence about the adequacy of the internal financial controlssystem over financial reporting and their operating effectiveness. Our audit of internalfinancial controls over financial reporting included obtaining an understanding ofinternal financial controls over financial reporting assessing the risk that a materialweakness exists and testing and evaluating the design and operating effectiveness ofinternal control based on the assessed risk. The procedures selected depend on theauditor's judgement including the assessment of the risks of material misstatement of thefinancial 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 qualified 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 process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal financial control over financialreporting includes those policies and procedures that (1) pertain to the maintenance ofrecords 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 financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the company are being made only in accordance with authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised acquisition use or disposition of thecompany's assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over 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.

Basis for Qualified Opinion

According to the information and explanations given to us and based on our audit amaterial weakness has been identified in the Company's internal financial controls overfinancial reporting in respect of the assessment of impairment in the carrying value of(unsecured) inter-corporate deposits including interest accrued on such deposits and tradeadvances wherein the Company does not have relevant internal financial controls in placewhich could potentially result in recognising these financial assets and other currentassets at a value more than its recoverable amount and consequential overstatement ofprofits and overstatement of other equity as at March 31 2020.

A ‘material weakness' is a de_ciency or a combination of de_ciencies in internalfinancial control over financial reporting such that there is a reasonable possibilitythat a material misstatement of the company's annual or interim financial statements willnot be prevented or detected on a timely basis.

Qualified Opinion

In our opinion to the best of our information and according to the explanations givento us except for the possible effects of the material weakness described in the Basis forQualified Opinion paragraph above on the achievement of the objectives of the controlcriteria the Company has maintained in all material respects adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as of March 31 2020 based on theinternal financial control over financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls Over Financial Reporting issued by the Institute ofChartered Accountants of India.

We have considered the material weakness identified and reported above in determiningthe nature timing and extent of audit tests applied in our audit of the standalonefinancial statements of the Company for the year ended March 31 2020 and the materialweakness has affected our opinion on the said standalone financial statements of theCompany and we have issued a qualified opinion on the standalone financial statements.

For Deloitte Haskins & Sells LLP
Chartered Accountants
(Firm's Registration No. 117366W/W-100018)
Rajesh K. Hiranandani
Partner
Place: Mumbai (Membership No. 36920)
Date: August 28 2020 (UDIN: 20036920AAAACU7943)

ANNEXURE "B" TO THE INDEPENDENT AUDITOR'S REPORT

[Referred to in paragraph 2 under ‘Report on Other Legal and RegulatoryRequirements' section of our report of even date to the members of Fermenta BiotechLimited (formerly known as DIL Limited)]

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

(b) The Company has a programme of verification of fixed assets to cover all the itemsin a phased manner over a period of three years which in our opinion is reasonablehaving regard to the size of the Company and the nature of its assets. Pursuant to theprogramme certain fixed assets were physically verified by the management during theyear. According to the information and explanations given to us no material discrepancieswere noticed on such verification.

(c) According to the information and explanations given to us and the records examinedby us and based on the examination of the registered indenture of sale lease deeds andother documents provided to us by the Management of the Company and based on theconfirmation directly received by us from lender in case of the title deed and the leasedeed that have been pledged as security for loans taken by the Company we report thatthe title deeds and lease deeds comprising the immovable properties of land and buildingsdisclosed under ‘Property Plant and Equipment' ‘Right-of-use-asset' and‘Investment Property' in the standalone financial statements are held in the name ofthe Company as at the balance sheet date except as described below:

Particulars

As at March 31 2020

Remarks
Cost or deemed cost (in Lakhs) Carrying amount (in Lakhs)
Freehold land located at Village Takwe (Budruk) Tal – Maval District – Pune admeasuring 21.39 Acres 8.06 8.06 The land is held in Trust in the name of the Managing Director and one of the directors of the Company who is also a relative of the Managing Director on behalf of the Company and as confirmed by them.

(ii) As explained to us the inventories excluding inventories with third partieswere physically verified during the year by the Management at reasonable intervals(including the verifications conducted by the Management subsequent to the year end onaccount of COVID-19 related lockdown) and no material discrepancies were noticed onphysical verification. Inventories lying with third parties as at March 31 2020 have beenconfirmed by them to the Company.

(iii) According to the information and explanations given to us in respect of loansgranted by the Company secured or unsecured to companies firms Limited LiabilityPartnerships or other parties covered in the register maintained under section 189 of theCompanies Act 2013: (a) The Company has not granted any loan during the year ended March31 2020 and hence reporting under clause 3(iii)(a) of the Order is not applicable.

(b) The Company had in the previous year granted an unsecured loan repayable ondemand to a Company which is an associate. In the absence of repayment schedule ofprincipal and interest being stipulated we are unable to comment on the regularity of therepayments or receipts of principal amounts and interest.

(c) As stated above the schedule of repayment of principal and payment of interest isnot stipulated. The Company during the previous year made an allowance of Rs 37 Lakhs tofully impair the loan. Interest was not being accrued on this loan. As explained to usthe Company's management is not taking any steps for recovery of the principal andinterest.

According to the information and explanations given to us apart from the above theCompany has not granted loans secured or unsecured to firms Limited LiabilityPartnerships or other parties covered in the register maintained under section 189 of theCompanies Act 2013.

(iv) In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of section 186 of the Companies Act 2013 inrespect of grant of loans making investments and providing guarantees and securities asapplicable. During the year the Company has not granted any loan covered under section185 of the Companies Act 2013.

(v) In our opinion and according to the information and explanations given to us theCompany has not accepted any deposit to which the provisions of sections 73 to 76 or anyother relevant provisions of the Companies Act 2013 and the Companies (Acceptance ofDeposits) Rules 2014 as amended are applicable and hence reporting under clause 3(v) ofthe Order is not applicable.

(vi) The maintenance of cost records has been specified by the Central Government undersection 148(1) of the Companies Act 2013. We have broadly reviewed the cost recordsmaintained by the Company pursuant to the Companies (Cost Records and Audit) Rules 2014as amended prescribed by the Central Government under section 148(1) of the CompaniesAct 2013 and are of the opinion that prime facie the prescribed cost records have beenmade and maintained. We have however not made a detailed examination of the cost recordswith a view to determine whether they are accurate or complete.

(vii) According to the information and explanations given to us in respect ofstatutory dues: (a) The Company has been regular in depositing undisputed statutory duesincluding Provident Fund Employees' State Insurance Income-tax Customs duty Goods andServices

(b) There were no undisputed amounts payable in respect of Provident Fund Employees'State Insurance Income-tax Customs duty Goods and Services Tax and other materialstatutory dues in arrears as at March 31 2020 for a period of more than six months fromthe date they became payable.

(c) According to the records of the Company the dues of Sales Tax and Service Tax onaccount of disputes as on March 31 2020 are given below:

Statute Nature of Dues Forum where dispute is pending Period to which the amount relates Amount involved Rs ( In Lakhs)* Amount paid under protest (Rs In Lakhs)
(1) (2) (3) (4) (5) (6)
The Gujarat Sales Tax Act Sales tax and penalty Sales Tax Appellate Tribunal 1992-1994 4.63 -
Central Excise Act 1944 Service tax and penalty High Court Bombay 2000-2001 18.75 3.75

*Net of amount paid under protest disclosed in column (6)

(viii) In our opinion and according to the information and explanations given to usthe Company has not defaulted in the repayment of loans or borrowings to financialinstitutions and banks. The Company has not taken any loans or borrowings from governmentand has not issued any debentures.

(ix) In our opinion and according to the information and explanations given to usmoney raised by way of the term loans have been applied by the Company during the year forthe purposes for which they were raised. The Company has not raised money by way ofinitial public offer or further public offer (including debt instruments).

(x) To the best of our knowledge and according to the information and explanationsgiven to us no fraud by the Company and no material fraud on the Company by its officersor employees has been noticed or reported during the year.

(xi) In our opinion and according to the information and explanations given to us theCompany has paid / provided managerial remuneration in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the CompaniesAct 2013.

(xii) The Company is not a Nidhi Company and hence reporting under clause 3(xii) of theOrder is not applicable.

(xiii) In our opinion and according to the information and explanations given to usthe Company is in compliance with sections 177 and 188 of the Companies Act 2013 whereapplicable for all transactions with the related parties identified by the Management ofthe Company and the details of related party transactions have been disclosed in thestandalone financial statements as required by the applicable Indian Accounting Standards.

(xiv) During the year the Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures and hence reporting underclause 3(xiv) of the Order is not applicable.

(xv) In our opinion and according to the information and explanations given to usduring the year the Company has not entered into any non-cash transactions with itsdirectors or directors of its holding subsidiary or associate companies or personsconnected with them and hence provisions of section 192 of the Companies Act 2013 are notapplicable.

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

For Deloitte Haskins & Sells LLP
Chartered Accountants
(Firm's Registration No. 117366W/W-100018)
Rajesh K. Hiranandani
Partner
Place: Mumbai (Membership No. 36920)
Date: August 28 2020 (UDIN: 20036920AAAACU7943)

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