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Gillanders Arbuthnot & Company Ltd.

BSE: 532716 Sector: Others
NSE: GILLANDERS ISIN Code: INE047B01011
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OPEN 43.95
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VOLUME 1
52-Week high 51.15
52-Week low 17.85
P/E
Mkt Cap.(Rs cr) 94
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Gillanders Arbuthnot & Company Ltd. (GILLANDERS) - Auditors Report

Company auditors report

TO THE MEMBERS OF GILLANDERS ARBUTHNOT AND COMPANY LIMITED

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the accompanying standalone financial statements ofGillanders Arbuthnot and Company Limited ("the Company") which comprise theBalance Sheet as at March 31 2020 the Statement of Profit and Loss (including OtherComprehensive Income) the Statement of Changes in Equity and the Cash Flows Statement forthe year ended on that date and a summary of the significant accounting policies andother explanatory information in which are included the financial statements for the yearended on that date audited by the branch auditors of the one unit of the Company'sEngineering (MICCO) Division (hereinafter referred to as "the standalone financialstatements").

In our opinion and to the best of our information and according to theexplanations given to us 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 March 31 2020the loss and total comprehensive income changes in equity and its cash flows for the yearended on that date.

Basis for Opinion

We conducted our audit of the standalone financial statements inaccordance with the Standards on Auditing specified under section 143(10) of the Act(SAs). Our responsibilities under those Standards are further described in the"Auditor's Responsibilities for the Audit of the Standalone FinancialStatements" section of our report. We are independent of the Company in accordancewith the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI)together with the independence requirements that are relevant to our audit of thestandalone financial statements under the provisions of the Act and the Rules madethereunder and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the ICAI's Code of Ethics. We believe that the audit evidence wehave obtained is sufficient and appropriate to provide a basis for our audit opinion onthe standalone financial statements.

Emphasis of Matter

We draw attention to Note 54 of the standalone financial statementswhich describes the extent to which the COVID-19 Pandemic will impact the Company'sresults which depend on future developments that are highly uncertain.

Our opinion is not modified in respect of this matter.

Key Audit Matters

Key audit matters are those matters that in our professional judgmentwere of most significance in our audit of the standalone financial statements of thecurrent period. 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. Revenue Recognition (See note 27 to the Standalone Financial Statements)
Revenue recognition is significant audit risk within the Company. Our audit consisted testing of the design and operating effectiveness of the internal controls and substantive testing as follows:
The revenue standard establishes a comprehensive framework for determining whether how much and when revenue is recognized. This involves certain key judgments relating to identification of distinct performance obligations determination of transaction price of identified performance obligation the appropriateness of the basis used to measure revenue recognized over a period. Additionally the standard mandates robust disclosures in respect of revenue and periods over which the remaining performance obligations will be satisfied subsequent to the balance sheet date. • Evaluated the design and tested the operative effectiveness of the internal controls relating to revenue recognition discounts and rebates.
• Tested sample of sale transactions to their respective customer contracts underlying invoices and related documents.
• Obtained confirmations from customers on sample basis to support existence assertion of trade receivables and assessed the relevant disclosures made in the financial statements; to ensure revenue from contracts with customers are in accordance with the requirements of relevant accounting standards.
• In case of construction contracts reviewed the Company's estimation process (including the approval of project budget monitoring of project costs and activities and management's review and customer's approval of project's stage of completion and milestones achieved) used in determining the amounts of revenue and costs recognised in Company's financial statements.
Risk exists that revenue is recognized without substantial transfer of control and is not in accordance with Ind AS-115 "Revenue from Contracts with Customers"
2. Impairment of Assets (See note 4 to the Standalone Financial Statements)
Significant judgement is involved in assessing property plant and equipment for impairment. At the end of every reporting period the Company assesses whether there is any indication that an asset or cash generating unit (CGU) may be impaired. If any such indication exists the Company estimates the recoverable amount of the asset or CGU. Our audit procedures included considering the Company's accounting policies with respect to impairment in accordance with Ind AS 36 "Impairment of Assets".
We performed test of controls over impairment process through inspection of evidence of performance of these controls. We performed the following tests of details:
• We obtained the management's impairment assessment.
• We evaluated the key assumptions including projected cash flows. In determining future cash flows management is required to make assumptions relating to future profitability including revenue growth and operating margins and the determination of an appropriate discount rate all of which are subject to management override as the outcome of the impairment assessments could vary significantly if different judgements are applied.
The determination of recoverable amount being the higher of fair value less costs to sell and value-in-use involves significant estimates assumptions and judgements of the long-term financial projections.
Impairment of assets is a key audit matter considering the significance of the carrying value long term estimation and the significant judgements involved in the impairment assessment.
• We have tested the workings of management for ascertaining fair value and costs of disposal of CGU for ascertaining recoverable amount.
Key Audit Matter How our audit addressed the key audit matter
3. Expected Credit Loss (See note 51A to the Standalone Financial Statements)
The Company assesses at each date of balance sheet whether a financial asset or a group of financial assets is impaired. Ind AS - 109 requires expected credit losses to be measured through a loss allowance. The company recognizes impairment loss for trade receivables that do not constitute a financing transaction using expected credit loss model which involves use of a provision matrix constructed on the basis of historical credit loss experience. For all other financial assets expected credit losses are measured at an amount equal to the 12 month expected credit losses or at an amount equal to the life time expected credit losses if the credit risk on the financial asset has increased significantly since initial recognition. Our Audit procedure on evaluation of Expected credit loss model include:
• Obtained an understanding of the Company's process for estimating the ECL of various eligible assets included in the Standalone Financial Statements.
• Evaluated the detailed analysis performed by management on revenue by selecting samples for the existing contracts with customers.
• Evaluated the calculation of historical loss rate on the basis of historical trends industry practices business environment in which company operates & forward looking information.

Information Other than the Standalone Financial Statements andAuditor's Report Thereon

The Company's Board of Directors is responsible for the presentation ofthe other information. The other information comprises the information included in theAnnual Report but does not include the standalone financial statements and our auditor'sreport thereon.

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

In connection with our audit of the standalone financial statementsour responsibility is to read the other information and in doing so consider whethersuch other information is materially inconsistent with the standalone financial statementsor our 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 amaterial misstatement of this other information; we are required to report that fact. Wehave nothing to report in this regard.

Management's Responsibility for the Standalone Financial Statements

The Company's Board of Directors is responsible for the matters statedin section 134(5) of the Act with respect to the preparation of these standalone financialstatements that give a true and fair view of the financial position financial performanceincluding other comprehensive income changes in equity and cash flows of the Company inaccordance with the accounting principles generally accepted in India including theaccounting standards specified under section 133 of the Act. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and designimplementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the standalone 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 the Board ofDirectors is responsible for assessing the Company's ability to continue as a goingconcern disclosing as applicable matters related to going concern and using the goingconcern basis of accounting unless the Board of Directors either intends to liquidate theCompany or to cease operations or has no realistic alternative but to do so.

Those Board of Directors are also responsible for overseeing theCompany's financial reporting process.

Auditor's Responsibility for the Audit of the Standalone FinancialStatements

Our objectives are to obtain reasonable assurance about whether thestandalone financial statements as a whole are free from material misstatement whetherdue to fraud or error and to issue an auditor's report that includes our opinion.

Reasonable assurance is a high level of assurance but is not aguarantee that an audit conducted in accordance with SAs will always detect a materialmisstatement when it exists. Misstatements can arise from fraud or error and areconsidered material if individually or in the aggregate they could reasonably beexpected to influence the economic decisions of users taken on the basis of thesestandalone financial statements.

As part of an audit in accordance with SAs we exercise professionaljudgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of thestandalone financial statements whether due to fraud or error design and perform auditprocedures responsive to those risks and obtain audit evidence that is sufficient andappropriate to provide a basis for our opinion. The risk of not detecting a materialmisstatement resulting from fraud is higher than for one resulting from error as fraudmay involve collusion forgery intentional omissions misrepresentations or the overrideof internal control.

• Obtain an understanding of internal controls relevant to theaudit in order to design audit procedures that are appropriate in the circumstances. Undersection 143(3)(i) of the Act we are also responsible for expressing our opinion onwhether the Company has adequate internal financial controls system in place and theoperating effectiveness of such controls.

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

• Conclude on the appropriateness of management's use of the goingconcern basis 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 attention in our auditor's report to therelated disclosures in the standalone financial statements or if such disclosures areinadequate to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditor's report. However future events or conditions maycause the Company to cease to continue as a going concern.

• Evaluate the overall presentation structure and content of thestandalone financial statements including the disclosures and whether the standalonefinancial statements represent the underlying transactions and events in a manner thatachieves fair presentation.

Materiality is the magnitude of misstatements in the standalonefinancial statements that individually or in aggregate makes it probable that theeconomic decisions of a reasonably knowledgeable user of the financial statements may beinfluenced. We consider quantitative materiality and qualitative factors in (i) planningthe scope of our audit work and in evaluating the results of our work; and (ii) toevaluate the effect of any identified misstatements in the standalone financialstatements.

We communicate with those charged with governance regarding amongother matters the planned scope and timing of the audit and significant audit findingsincluding any significant deficiencies in internal control that we identify during ouraudit.

We also provide those charged with governance with a statement that wehave complied with relevant ethical requirements regarding independence and tocommunicate with them all relationships and other matters that may reasonably be thoughtto bear on our independence and where applicable related safeguards.

From the matters communicated with those charged with governance wedetermine those matters that were of most significance in the audit of the standalonefinancial statements of the current period and are therefore the key audit matters. Wedescribe these matters in our auditor's report unless law or regulation precludes publicdisclosure about the matter or when in extremely rare circumstances we determine that amatter should not be communicated in our report because the adverse consequences of doingso would reasonably be expected to outweigh the public interest benefits of suchcommunication.

Other Matters

We did not audit the financial statements and other financialinformation of the Company's Engineering (MICCO) Division whose financial statementsreflect total assets of Rs. 16627.91 lakhs as at 31st March 2020 and total revenue of '8142.67 lakhs for the year ended on that date. This financial statements/ financialinformation has been audited by other auditor and whose report have been furnished to usby the management. Our opinion on the Statement in so far as it relates to the affairs ofsuch division is based solely on the reports of the other auditors.

Our opinion is not modified in respect of this matter.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order 2016("the Order") issued by the Central Government of India in terms of Section 143(11) of the Act we give in the Annexure "A" a statement on the mattersspecified in paragraphs 3 and 4 of the Order.

2. As required by Section 143 (3) of the Act based on our audit wereport that:

a) We have sought and obtained all the information and explanationswhich to the best of our knowledge and belief were necessary for the purposes of ouraudit.

b) In our opinion proper books of account as required by law have beenkept by the Company so far as it appears from our examination of those books.

c) The report on the financial statements of Engineering (MICCO)Division of the Company audited under section 143 (8) of the Act by branch auditors hasbeen sent to us and has been properly dealt with us in preparing this report.

d) The Balance Sheet the Statement of Profit and Loss including OtherComprehensive Income Statement of Changes in Equity and the Cash Flow Statement dealtwith by this Report are in agreement with the books of account.

e) In our opinion the aforesaid standalone financial statements complywith the Indian Accounting Standards specified under Section 133 of the Act read with therelevant Rules thereon.

f) On the basis of the written representations received from thedirectors as on March 31 2020 taken on record by the Board of Directors none of thedirectors is disqualified as on March 31 2020 from being appointed as a director in termsof Section 164 (2) of the Act.

g) With respect to the adequacy of the internal financial controls overfinancial reporting with reference to financial statements of the Company with referenceto these standalone financial statements and the operating effectiveness of such controlsrefer to our separate Report in Annexure "B" to this report. Our reportexpresses an unmodified opinion on the adequacy and operating effectiveness of theCompany's internal financial controls over financial reporting with reference to financialstatements with reference to these standalone financial statements.

h) With respect to the other matters to be included in the Auditor'sReport in accordance with the requirements of section 197(16) of the Act as amended:

In our opinion and to the best of our information and according to theexplanations given to us the remuneration paid by the Company to its directors during theyear is in accordance with the provisions of section 197 of the Act.

i) With respect to the other matters to be included in the Auditor'sReport in accordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 asamended in our opinion and to the best of our information and according to theexplanations given to us:

i. The Company has disclosed the impact of pending litigations as atMarch 31 2020 on its financial position in its Standalone financial statements - ReferNote No. 39 to the Standalone financial statements;

ii. The Company did not have any long-term contracts includingderivative contracts for which there were any material foreseeable losses;

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

For Singhi & Co.

Chartered Accountants

Firm's Registration No. 302049E
Aditya Singhi

Partner

Place: Kolkata Membership No. 305161
Date : 30th June 2020 UDIN: 20305161AAAAAP2702

Annexure 'A' to the Independent Auditors' Report

(Referred to in paragraph 1 under 'Report on Other Legal and RegulatoryRequirements' section of our report of even date)

i. a. The Company has maintained proper records showing fullparticulars including quantitative details and situation

of property plant and equipment.

b. As per the information and explanations given to us physicalverification of property plant and equipment have been carried out in terms of the phasedprogram of its verification adopted by the Company and no material discrepancies werenoticed on such verification. In our opinion the frequency of verification is reasonablehaving regard to size of the Company and nature of its business.

c. According to the information and explanations given to us and on thebasis of our examination of the records of the Company the title deeds of immovableproperties are held in the name of the Company.

ii. As per the information and explanations given to us theinventories have been physically verified at reasonable intervals during the year by themanagement or by a firm of Chartered Accountants on behalf of the Management and nomaterial discrepancies between book stock and physical stock have been found.

iii. a. The Company has granted loan to a wholly owned subsidiarycovered in the register maintained under section 189

of the Companies Act 2013. In our opinion and according to theinformation and explanations given to us the terms and conditions of the grant of suchloans are not prejudicial to the company's interest.

b. The schedule of repayment of principal and payment of interest hasbeen stipulated and repayments or receipts of principal amounts and interest have beenregular as per stipulations. The repayment of such loan along with interest has been madeduring the year.

c. There being no overdue amount and the loan being repaid during theyear the provision of paragraph 3 (iii) (c) of the said Order is not applicable.

iv. In our opinion and according to the information and explanationsgiven to us the Company has complied with the provisions of section 185 and 186 of theAct in respect of grant of loans making investments and providing guarantees andsecurities as applicable.

v. According to information and explanations given to us the companyhas complied with the directives issued by Reserve Bank Of India and the provisions ofSection 73 to 76 or any other relevant provisions of the Act and the rules framed thereunder with respect to deposits (from public). According to the information andexplanation's given to us no order has been passed by the Company Law Board or NationalCompany Law Tribunal or Reserve Bank of India or any Court or any other Tribunal on theCompany in respect of the aforesaid deposits.

vi. We have broadly reviewed the cost records maintained by the Companyin respect of its products (Tea and Textile) pursuant to the rules prescribed by theCentral Government of India under section 148 (1) of the Act and are of the opinion thatprima facie the prescribed records have been so made and maintained. We have howevernot made a detailed examined of the cost records with a view to determine whether they areaccurate or complete.

vii. a. According to the information and explanations given to us andon the basis of our examination of the records of the Company the Company is generallyregular in depositing undisputed statutory dues including provident fund employees' stateinsurance income tax duty of customs Goods & Service Tax cess and other materialstatutory dues during the year by the Company with the appropriate authorities. Accordingto the information and explanations given to us no undisputed amounts payable in respectof provident fund employees' state insurance income tax duty of customs Goods &Service Tax cess and other material statutory dues were in arrears as at March 31 2020for a period of more than six months from the date they became payable.

b. According to the information and explanations given to us the duesoutstanding in respect of income tax or sales tax or wealth tax or duty of customs or dutyof excise or value added tax or goods and service tax on account of disputes are asfollows:

Annexure 'A' to the Independent Auditors' Report (Contd.)

Name of the Statute Nature of Dues Amount Involved (' in Lakhs) Period to which the amount relates Forum where Dispute is Pending
The Central Sales Tax Act1956

Sales Tax

1.62 2011-12 West Bengal Commercial Taxes Appellate and Revisional Board Kolkata
194.45 2004-05 Joint Commissioner Commercial Taxes Kolkata
104.61(pre-deposit amount ' 6.41) 2014-15 Joint Commissioner (Appeal) Kolkata
254.13 (pre-deposit amount ' 29.99) 2015-16 Sales tax Commissioner (Appeal) Kolkata
The West Bengal Value Added Tax Act 2005

Sales Tax

28.68 (Net of amount paid under protest '3.28) 2013-14 WBCT Appellate and Revisional Board Kolkata
83.33 (Pre-deposit amount ' 8.18) 2014-15 Joint Commissioner (Appeal) Kolkata
79.20 (Pre-deposit amount ' 12.58) 2015-16 Sales tax Commissioner (Appeal) Kolkata
80.12 2004-05 Joint Commissioner Commercial Taxes Kolkata
171.42 (Pre-deposit amount of ' 17.77) 2016-17 Sales tax Commissioner (Appeal) Kolkata
9.92 2017-18 Sales tax Commissioner (Appeal) Kolkata
Orissa Sales Tax Act 1947 Sales Tax

11.91

1998-99 Additional Commissioner of Sales Tax Cuttack
Central Sales Tax (Orissa) Rules 1957 Sales Tax 1998- 99 &

1999- 2000

Additional Commissioner of Sales Tax Cuttack
Assam Sales Tax Sales Tax 5.08 (Pre-deposit amount ' 1.68) 2011-12 to 2014-15 Deputy Commissioner of Commercial Taxes Assam
Chennai Sales Tax Jharkhand VAT Act 2005

Sales Tax VAT

5.13 2006-07 Sales Tax Tribunal Chennai
1.16 2015-16 Sales Tax Tribunal Ranchi
51.38 2009-10 Sales Tax Tribunal Ranchi
Finance Act 1994

Service

Tax

147.11 (Net of amount paid under Protest ' 14.00) 2003-04 to 2011-12 CESTAT Kolkata
2.04 (Net of amount paid under Protest ' 0.26) 2012-13 to 2015-16 Assistant Commissioner of CGST and Central Excise Kolkata
Income Tax Act 1961

Income

Tax

8.36 2007-08 to 2017-18 Asst. commissioner of I.T -CPC (TDS) Kolkata
5.86 1987-88 Hon'ble High Court at Calcutta
1.31 2007-08 - 2017-18 Income Tax Department Siliguri

viii. According to the records of the Company examined by us and theinformation and explanation given to us the company has not defaulted in repayment ofloans or borrowing to any financial institution or banks or Government. The companyneither had any outstanding debentures at the beginning of the year nor has it issued anydebenture during the year.

ix. The Company has not raised any money by way of initial public offeror further public offer including debt instruments during the year. According to theinformation and explanations given to us by the management term loans were applied forthe purpose for which the loans were obtained.

x. According to the information and explanations given to us no fraudby the Company or on the Company by its officers or employees has been noticed or reportedduring the course of our audit.

xi. According to the information and explanations given to us and basedon our examination of the records of the company the Company has paid/ provided formanagerial remuneration in accordance with the requisite approvals mandated by theprovisions of section 197 read with Schedule V to the Act.

xii. The Company is not a Nidhi Company. Accordingly paragraph 3 (xii)of the Order is not applicable.

xiii. According to the information and explanations given to us andbased on our examination of the records of the Company transactions with the relatedparties are in compliance with sections 177 and 188 of the Act where applicable anddetails of such transactions have been disclosed in the standalone financial statements asrequired by the applicable accounting standards.

xiv. According to the information and explanations give to us and basedon our examination of the records of the Company the Company has not made anypreferential allotment or private placement of shares or fully or partly convertibledebentures during the year. Accordingly paragraph 3(xiv) of the Order is not applicable tothe Company.

xv. According to the information and explanations given to us and basedon our examination of the records of the Company the Company has not entered intonon-cash transactions with directors or persons connected with him. Accordingly paragraph3(xv) of the Order is not applicable.

xvi. The Company is not required to be registered under section 45-IAof the Reserve Bank of India Act 1934. Accordingly paragraph 3(xvi) of the Order is notapplicable to the Company.

For Singhi & Co.

Chartered Accountants

Firm's Registration No. 302049E
Aditya Singhi

Partner

Place: Kolkata Membership No. 305161
Date : 30th June 2020 UDIN: 20305161AAAAAP2702

Annexure 'B' to the Independent Auditors' Report

(Referred to in paragraph 2(g) under 'Report on Other Legal andRegulatory Requirements' section of our report of even date)

Report on the Internal Financial Controls over financial reporting withreference to financial statements under Clause (i) of Sub-section 3 of Section 143 of theCompanies Act 2013 ("the Act")

We have audited the internal financial controls with reference tofinancial statements of Gillanders Arbuthnot and Company Limited ("the Company")as of March 31 2020 in conjunction with our audit of the standalone financial statementsof the Company for the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing andmaintaining internal financial controls based on the internal control with reference tofinancial statements criteria 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. These responsibilities include the design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theorderly and efficient conduct of its business including adherence to company's policiesthe safeguarding 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 Companies Act 2013.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company's internalfinancial controls over financial reporting with reference to financial statements basedon our audit. We conducted our audit in accordance with the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting (the "Guidance Note")issued by the Institute of Chartered Accountants of India and the Standards on Auditingprescribed under Section 143 (10) of the Companies Act 2013 to the extent applicable toan audit of internal financial controls. Those Standards and the Guidance Note requirethat we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls with reference tofinancial statements was established and maintained and if such controls operatedeffectively in all material respects.

Our audit involves performing procedures to obtain audit evidence aboutthe adequacy of the internal financial controls system with reference to financialstatements and their operating effectiveness. Our audit of internal financial controlsover financial reporting with reference to financial statements included obtaining anunderstanding of internal financial controls with reference to financial statementsassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor's judgement including the assessment of the risks ofmaterial misstatement of the standalone financial statements whether due to fraud orerror.

We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the Company's internal financialcontrols system with reference to financial statements.

Meaning of Internal Financial Controls over financial reporting withreference to financial statements

A company's internal financial control over financial reporting withreference to financial statements is a process designed to provide reasonable assuranceregarding the reliability of financial reporting and the preparation of standalonefinancial statements for external purposes in accordance with generally acceptedaccounting principles. A company's internal financial control over financial reportingwith reference to financial statements includes those policies and procedures that (1)pertain to the maintenance of records that in reasonable detail accurately and fairlyreflect the transactions and

dispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of standalonefinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorisations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorized acquisition use ordisposition of the company's assets that could have a material effect on the standalonefinancial statements.

Inherent Limitations of Internal Financial Controls over financialreporting with reference to financial statements

Because of the inherent limitations of internal financial controls overfinancial reporting with reference to financial statements including the possibility ofcollusion or improper management override of controls material misstatements due to erroror fraud may occur and not be detected. Also projections of any evaluation of theinternal financial controls with reference to financial statements to future periods aresubject to the risk that the internal financial control with reference to financialstatements may become inadequate because of changes in conditions or that the degree ofcompliance with the policies or procedures may deteriorate.

Opinion

In our opinion to the best of our information and according to theexplanations given to us the Company has in all material respects an adequate internalfinancial controls system with reference to financial statements and such internalfinancial controls with reference to financial statements were operating effectively as atMarch 31 2020 based on the internal control with reference to financial statementscriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting issued by the Institute of Chartered Accountants of India.

Other Matters

Our aforesaid reports u/s 143 (3) (i) of the Act on the adequacy andoperating effectiveness of the internal financial controls over financial reporting withreference to financial statements in so far as it relates to one unit of the Company'sEngineering (MICCO) Division is based on the corresponding report of the branch auditor ofsuch unit. Our opinion is not modified in respect of this matter.

For Singhi & Co.

Chartered Accountants

Firm's Registration No. 302049E
Aditya Singhi

Partner

Place: Kolkata Membership No. 305161
Date : 30th June 2020 UDIN: 20305161AAAAAP2702

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