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Ion Exchange (India) Ltd.

BSE: 500214 Sector: Engineering
NSE: IONEXCHANG ISIN Code: INE570A01014
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OPEN 3015.00
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VOLUME 6727
52-Week high 3055.00
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P/E 26.20
Mkt Cap.(Rs cr) 4,241
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OPEN 3015.00
CLOSE 3018.90
VOLUME 6727
52-Week high 3055.00
52-Week low 1500.70
P/E 26.20
Mkt Cap.(Rs cr) 4,241
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Ion Exchange (India) Ltd. (IONEXCHANG) - Auditors Report

Company auditors report

To the Members of

Ion Exchange (India) Limited

Report on the Audit of the Standalone Financial Statements Opinion

We have audited the standalone financial statements of Ion Exchange(India) Limited (the "Company") its IEI Shareholding (Staff Welfare) Trusts -Sixty trusts ("trusts") and HMIL Shareholding Trust's (Seventeen trusts)(collectively referred to as the "trusts") which comprise the standalone balancesheet as at 31 March 2022 and the standalone statement of profit and loss (includingother comprehensive income) standalone statement of changes in equity and standalonestatement of cash flows for the year then ended and notes to the standalone financialstatements including a summary of significant accounting policies and other explanatoryinformation in which are included the Returns for the year ended on that date audited bythe branch auditors at Bengaluru and (hereinafter referred to as 'Standalone FinancialStatements').

In our opinion and to the best of our information and according to theexplanations given to us and based on the consideration of reports of the branch auditorand trusts auditors on financial statements of such branch and trusts as were audited bythe branch auditors and trusts auditors the aforesaid standalone financial statementsgive the information required by the Companies Act 2013 ("Act") in the mannerso required and give a true and fair view in conformity with the accounting principlesgenerally accepted in India of the state of affairs of the Company as at 31 March 2022and its profit and other comprehensive loss changes in equity and its cash flows for theyear ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing(SAs) specified under Section 143(10) of the Act. Our responsibilities under those SAs arefurther described in the Auditor's Responsibilities for the Audit of the StandaloneFinancial 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 together with the ethical requirements that are relevant to our audit of thestandalone financial statements under the provisions of the Act and the Rules thereunderand we have fulfilled our other ethical responsibilities in accordance with theserequirements and the Code of Ethics. We believe that the audit evidence obtained by usalong with the consideration of reports of the branch and trusts auditors referred to inparagraph (a) of the "Other Matters" section below is sufficient andappropriate to provide a basis for our opinion on the standalone financial statements.

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.

Description of Key Audit Matters

The key audit matter How the matter was addressed in our audit
Revenue Recognition (Refer note 1.17 and note 40 to the standalone financial statements)
The arrangement for EPC business contracts includes fixed price contracts. Revenue for such contracts usually extends beyond a reporting period. Contract revenue is measured based on the proportion of contract costs incurred for work performed to date relative to estimated total contract costs. It is computed as per the input method. The estimate is formed by the Company considering the following: Our audit procedures over estimation of total contract costs and revenue recognition for EPC business included the following:
• Application of the revenue recognition accounting standard is complex. One of the key estimate is total cost-to-completion of these contracts. It is used to determine the percentage of completion of the relevant performance obligation. • Testing the design implementation and operating effectiveness of key internal financial controls and processes. This includes estimation of total project cost-to-completion related revenue;
• This method requires the Company to perform an initial assessment of total estimated cost and further reassess these estimates on a periodic basis including end of each reporting period. • For selected sample of contracts we inspected key contractual terms with signed contracts and assessed revenue recognized in accordance with Ind AS by:
Considering the significant estimate involved in measurement of revenue in EPC business we have considered measurement of revenue as a key audit matter. • Observing the approval of percentage of completion workings.
• Challenging the Company's forecasted cost to completion through comparison of costs incurred with project budgets and executed purchase orders and agreements. Identifying significant variations and testing variations resulting into re-estimating the remaining costs to complete the contract
• Comparing on a sample basis revenue transactions recorded during the year with the underlying contracts progress reports invoices raised on customers and collections in bank accounts. Also checked the related revenue contract costs evaluation for onerous contracts contract assets and unearned revenue had been recognised in accordance with the Company's revenue recognition policies.
• Performing analytical procedures on incurred and estimated contract costs or efforts. It includes assessment of contracts with unusual or negative margins little or no movement in efforts from previous periods.
Recovery of carrying value of investment and receivables from group Companies. (Refer Note 1.13 and 44 to the Standalone Financial Statements)
The Company has investments in subsidiaries and associates. These investments are accounted for at cost less any provision for impairment. The Company evaluates the indicators of impairment of the said investments regularly by reference to the requirements under Ind AS 36 Impairment of Assets. Our audit procedures included the following:
The Company carries out impairment assessment for each investment by: • Assessed the indications of impairment of investments in subsidiaries and associates. We have also examined the basis of estimates of the recoverable amounts of these investments the assumptions used in making such estimates and the allowance for impairment.
• Comparing the carrying value of each investment with the net asset values of each company. • Comparison of the carrying values of the Company's investment in subsidiaries and associates with their respective net asset values/ recoverable values and the consequent allowance for impairment if any.
• Comparing the performance of the investee companies with projections used for valuations and approved business plans. • Evaluated key assumptions in the Company's valuation models used to determine recoverable amount including assumptions of projected adjusted EBITDA growth rate rate used for discounting cash flows etc. We also evaluated the forecasts based on historical performance.
The recoverable amounts of the above investments are estimated in order to determine the extent of the impairment loss. As impairment assessment involves significant assumptions and judgment we regard this as a key audit matter. • Assessment for indications of impairment of such investments. In cases where such indicators existed we have assessed for the estimation made by the Company for the recoverable amounts.
Refer to note 6 - "Investments" of the standalone financial statements. • Tested the arithmetical accuracy of the computation of recoverable amounts of cash generating units.
• Involved internal valuation expert to assist in evaluating the key assumptions of the valuations.
We tested the related disclosures in Note 6 of the financial statements

Other Information

The Company's Management and Board of Directors are responsible for theother information. The other information comprises the information included in theCompany's annual report but does not include the standalone financial statements and ourauditor's report 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 whether theother information is materially inconsistent with the standalone financial statements orour knowledge obtained in the audit or otherwise appears to be materially misstated. Ifbased on the work we have performed and based on the work done/ audit report of otherauditors we conclude that there is a material misstatement of this other information weare required to report that fact. We have nothing to report in this regard.

Management's and Board of Directors' Responsibilities for theStandalone Financial Statements

The Company's Management and Board of Directors are responsible for thematters stated in Section 134(5) of the Act with respect to the preparation of thesestandalone financial statements that give a true and fair view of the state of affairsprofit/loss and other comprehensive income changes in equity and cash flows of theCompany in accordance with the accounting principles generally accepted in Indiaincluding the Indian Accounting Standards (Ind AS) specified under Section 133 of the Act.The respective management and Board of Directors of the company/ branch/ board of trusteesof the welfare trusts are responsible for maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding of the assets of the Companyand for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe standalone financial statements that give a true and fair view and are free frommaterial misstatement whether due to fraud or error.

In preparing the standalone financial statements the respectiveManagement and Board of Directors/ Board of Trustees are responsible for assessing theCompany's ability to continue as a going concern disclosing as applicable mattersrelated to going concern and using the going concern basis of accounting unless the Boardof Directors/ Board of Trustees either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so.

The respective Board of Directors/ Board of Trustees are alsoresponsible for overseeing the Company's financial reporting process of eachcompany/trust.

Auditor's Responsibilities 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 a guarantee that an auditconducted in accordance with SAs will always detect a material misstatement when itexists. Misstatements can arise from fraud or error and are considered material ifindividually or in the aggregate they could reasonably be expected to influence theeconomic decisions of users taken on the basis of these standalone 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 control 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 with reference to financialstatements in place and the operating effectiveness of such controls.

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

• Conclude on the appropriateness of the Management and Board ofDirectors use of the going concern basis of accounting in preparation of standalonefinancial statements 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.

• Obtain sufficient appropriate audit evidence regarding thefinancial statements of branch and trusts of the Company to express an opinion on thestandalone financial statements. We are responsible for the direction supervision andperformance of the audit of financial statements of such branch and trusts included in thestandalone financial statements of which we are the independent auditors. For the otherbranch and trusts included in the standalone financial statements which have been auditedby their respective independent auditors such auditors remain responsible for thedirection supervision and performance of the audits carried out by them. We remain solelyresponsible for our audit opinion. Our responsibilities in this regard are furtherdescribed in paragraph (a) of the section titled "Other Matters" in this auditreport.

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 Matter

(a) We did not audit the financial statements of one branch and seventyseven trusts included in the standalone financial statements of the Company whosefinancial statements reflect total assets of Rs 8347 Lacs as at 31 March 22 totalrevenue of Rs 11538 Lacs total net profit after tax of Rs 1059 Lacs and net cashoutflows of Rs 45 Lacs for the year ended on that date as considered in the standalonefinancial statements. The financial statements of these branch and trusts have beenaudited by their respective independent auditors whose reports have been furnished to usand our opinion in so far as it relates to the amounts and disclosures included in respectof branch and trusts is based solely on the report of such branch and 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 2020("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 to the extent applicable.

2. (A) As required by Section 143(3) of the Act we report 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 and properreturns adequate for the purpose of our audit have been received from the branch notvisited by us.

c) The reports on the accounts of the branch office of the Companyaudited under Section 143(8) of the Act by branch auditor and report on accounts of trustshave been sent to us and have been properly dealt with by us in preparing this report.

d) The standalone balance sheet the standalone statement of profit andloss (including other comprehensive income) the standalone statement of changes in equityand the standalone statement of cash flows dealt with by this Report are in agreement withthe books of account and with the returns received from the branch not visited by us.

e) In our opinion the aforesaid standalone financial statements complywith the Ind AS specified under Section 133 of the Act.

f) On the basis of the written representations received from thedirectors as on 31 March 2022 taken on record by the Board of Directors none of thedirectors is disqualified as on 31 March 2022 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 withreference to financial statements of the Company and the operating effectiveness of suchcontrols refer to our separate Report in "Annexure B".

(B) With respect to the other matters to be included in the Auditor'sReport in accordance with Rule 11 of the Companies (Audit and Auditor's) Rules 2014 inour opinion and to the best of our information and according to the explanations given tous:

a) The Company has disclosed the impact of pending litigations as at 31March 2022 on its financial position in its standalone financial statements - Refer Note49 to the standalone financial statements;

b) the Company did not have any long-term contracts includingderivative contracts for which there were any material foreseeable losses.

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

d) (i) The Company has not advanced or loaned or invested (either fromborrowed funds or share premium or any other sources or kind of funds) any funds thathave been to or in any other persons or entities including foreign entities("Intermediaries") with the understanding whether recorded in writing orotherwise that the Intermediary shall:

¦ directly or indirectly lend or invest in other persons orentities identified in any manner whatsoever ("Ultimate Beneficiaries") by or onbehalf of the Company or

¦ provide any guarantee security or the like to or on behalf ofthe Ultimate Beneficiaries.

(ii) The Company has not received any funds from any persons orentities including foreign entities ("Funding Parties") with theunderstanding whether recorded in writing or otherwise that the Company shall:

¦ directly or indirectly lend or invest in other persons orentities identified in any manner whatsoever ("Ultimate Beneficiaries") by or onbehalf of the Funding Party or

¦ provide any guarantee security or the like from or on behalfof the Ultimate Beneficiaries.

(iii) Based on such audit procedures as considered reasonable andappropriate in the circumstances nothing has come to our notice that has caused us tobelieve that the representations under sub-clause (d) (i) and (d) (ii) contain anymaterial mis-statement.

e) The dividend declared or paid during the year by the Company is incompliance with Section 123 of the Act.

(C) With respect to the matter to be included in the Auditor's Reportunder Section 197(16) of the Act:

In our opinion and according to the information and explanations givento us the remuneration paid by the Company to its directors during the current year is inaccordance with the provisions of Section 197 of the Act. The remuneration paid to anydirector is not in excess of the limit laid down under Section 197 of the Act. TheMinistry of Corporate Affairs has not prescribed other details under Section 197(16) ofthe Act which are required to be commented upon by us.

Annexure A to the Independent Auditor?s Report - 31 March 2022

(Referred to in our report of even date)

(i) (a) (A) The Company has maintained proper records showing fullparticulars including quantitative details and situation of Property Plant and Equipmentand right of use assets.

(B) The Company has maintained proper records showing full particularsof intangible assets.

(b) According to the information and explanations given to us and onthe basis of our examination of the records of the Company the Company has a regularprogramme of physical verification of its Property Plant and Equipment and right of useassets by which all property plant and equipment and right of use assets are verified ina phased manner over a period of 3 years. In accordance with this programme certainproperty plant and equipment and right of use assets were verified during the year. Inour opinion this periodicity of physical verification is reasonable having regard to thesize of the Company and the nature of its assets. No discrepancies were noticed on suchverification.

(c) According to the information and explanations given to us and onthe basis of our examination of the records of the Company the title deeds of immovableproperties (other than immovable properties where the Company is the lessee and the leasesagreements are duly executed in favour of the lessee) disclosed in the standalonefinancial statements are held in the name of the Company except for the following whichare not held in the name of the Company:

Description of property Gross carrying value Held in the name of Whether promoter director or their relative or employee Period held- indicate range where appropriate Reason for not being held in the name of the Company. Also indicate if in dispute
Free hold Land - Agriculture Land 18.44 Lacs Alpaiwala MD Dharmadhikari and N M Ranadive Ex-Director Ex-Employee and Employee Since March 1997 Agricultural Land which can not be held in the name of company
Free hold Land - Agriculture Land 9.00 Lacs Ajay Popat Aspi Billimoria J T Merchant Kanhaiyalal Gwalani T S Vishwanathan Vijay Shankar Gangoli Ex-Employee Since July 1998 & Dec 1998 Agricultural Land which can not be held in the name of company
Free hold Building - 2 LIG Flats and 1 MIG Flat Nil State Industrial Promotion Corporation of Tamilnadu (Allotment of Property) NA Since March 1984 Title deeds are awaited from regulatory authorities

(d) According to the information and explanations given to us and onthe basis of our examination of the records of the Company the Company has not revaluedits Property Plant and Equipment (including Right of Use assets) or intangible assets orboth during the year.

(e) According to information and explanations given to us and on thebasis of our examination of the records of the Company there are no proceedings initiatedor pending against the Company for holding any benami property under the Prohibition ofBenami Property Transactions Act 1988 and rules made thereunder.

(ii) (a) The inventory except goods-in-transit and stocks lying withthird parties has been physically verified by the management during the year. For stockslying with third parties at the year-end written confirmations have been obtained and forgoods-in-transit subsequent evidence of receipts has been linked with inventory records.In our opinion the frequency of such verification is reasonable and procedures andcoverage as followed by management were appropriate. No discrepancies were noticed onverification between the physical stocks and the book records that were more than 10% inthe aggregate of each class of inventory.

(b) According to the information and explanations given to us and onthe basis of our examination of the records of the Company the Company has beensanctioned working capital limits in excess of five crore rupees in aggregate from banksor financial institutions on the basis of security of current assets. In our opinion thequarterly returns or statements filed by the Company with such banks or financialinstitutions are in agreement with the books of account of the Company.

(iii) (a) According to the information and explanations given to us andon the basis of our examination of the records of the Company the Company has madeinvestments provided guarantee granted loans and advances in the nature of loanssecured or unsecured to Companies in respect of which the requisite information is asbelow. The Company has not made any investments provided guarantee or security or grantedany loans or advances in the nature of loans secured or unsecured to firms limitedliability partnership or any other parties during the year.

Based on the audit procedures carried on by us and as per theinformation and explanations given to us the Company has provided loans or providedadvances in the nature of loans stood guarantee to any other entity as below:

(In Lacs)

Particulars Guarantees Loans
Aggregate amount during the year - Subsidiaries* 418.48 2868.02
Balance outstanding as at balance sheet date (Net of Provision) -
Subsidiaries * 3738.61 8285.72
Associates* 1100.00 -

*As per the Companies Act 2013

(b) According to the information and explanations given to us and basedon the audit procedures conducted by us in our opinion the investments made guaranteesprovided during the year and the terms and conditions of the grant of loans are primafacie not prejudicial to the interest of the Company.

(c) According to the information and explanations given to us and onthe basis of our examination of the records of the Company in the case of loans given inour opinion the repayments or receipts have been regular except for the following caseswhere there is no stipulation of schedule of repayment of principal and payment ofinterest and accordingly we are unable to comment on the regularity of repayment ofprincipal and payment of interest:

Name of the entity Amount Remarks
(Rs. in Lacs)
Ion Exchange Enviro Farms Ltd. 3802.78 There is no stipulation of schedule of repayment of principal or payment of interest
Total Water Management Services (India) Ltd. 8.64
Ion Exchange Asia Pacific Pte. Ltd. Singapore 186.53
IEI Environmental Management (M) Sdn. Bhd. Malaysia 47.15
Ion Exchange Asia Pacific (Thailand) Ltd. Thailand 18.45
Ion Exchange Environment Management Ltd. 1691.71
Ion Exchange Projects And Engineering Ltd. 1603.84
Ion Exchange Purified Drinking Water Pvt. Ltd. 898.96
Ion Exchange Arabia For Water Saudi Arabia 27.66

(d) According to the information and explanations given to us and onthe basis of our examination of the records of the Company there is no overdue amount formore than ninety days in respect of loans given. Further the Company has not given anyadvances in the nature of loans to any party during the year.

(e) According to the information and explanations given to us and onthe basis of our examination of the records of the Company there is no loan or advance inthe nature of loan granted falling due during the year which has been renewed or extendedor fresh loans granted to settle the overdues of existing loans given to same parties.

(f) According to the information and explanations given to us and onthe basis of our examination of the records of the Company in our opinion the Company hasnot granted any loans or advances in the nature of loans either repayable on demand orwithout specifying any terms or period of repayment except for the following loans to itsrelated parties as defined in Clause (76) of Section 2 of the Companies Act 2013("the Act"):

(In Lacs)

All Parties Related Parties
Aggregate of loans/ advances in nature of loan
- Repayable on demand (Net of Provision) (A) 8285.72 8285.72
- Agreement does not specify any terms or period of Repayment (B)
Total (A+B) 8285.72 8285.72
Percentage of loans/ advances in nature of loan to the total loans 100% 100%

(iv) According to the information and explanations given to us and onthe basis of our examination of records of the Company in respect of investments made andloans and guarantees given by the Company in our opinion the provisions of Section 185and 186 of the Companies Act 2013 ("the Act") have been complied with. TheCompany has not provided any security in connection with a loan as specified under section185 and 186 of the Act as such the compliance under those sections are not applicable.

(v) According to the information and explanations given to us and onthe basis of our examination of the records of the Company in our opinion the Company hascomplied with the provisions of Sections 73 to 76 or other relevant provisions of the Actand the rules framed thereunder where applicable and the directives issued by the ReserveBank of India as applicable with regard to deposits accepted from the public or amountswhich are deemed to be deposits. As informed to us there have been no proceedings beforethe Company Law Board or National Company Law Tribunal or Reserve Bank of India or anycourt or any other tribunal in this matter and no order has been passed by any of theaforesaid authorities in this regard. The Company has not accepted any other deposit whichare deemed to be deposits from the public.

(vi) We have broadly reviewed the books of accounts maintained by theCompany pursuant to the rules prescribed by the Central Government for maintenance of costrecords under Section 148(1) of the Act in respect of its manufactured goods (and/orservices provided by it) and are of the opinion that prima facie the prescribed accountsand records have been made and maintained. However we have not carried out a detailedexamination of the records with a view to determine whether these are accurate orcomplete.

(vii) (a) The Company does not have liability in respect of Servicetax Duty of excise Sales tax and Value added tax during the year since effective 1 July2017 these statutory dues has been subsumed into GST

According to the information and explanations given to us and on thebasis of our examination of the records of the Company in our opinion amounts deducted /accrued in the books of account in respect of undisputed statutory dues including Goodsand Services Tax ('GST') Provident fund Employees' State Insurance Income-Tax Duty ofCustoms Cess and other statutory dues have generally been regularly deposited with theappropriate authorities.

According to the information and explanations given to us and on thebasis of our examination of the records of the Company no undisputed amounts payable inrespect of Goods and Services Tax ('GST') Provident fund Employees' State InsuranceIncome-Tax Duty of Customs Cess and other statutory dues were in arrears as at 31 March2022 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us and onthe basis of our examination of the records of the Company there are no statutory duesrelating to Goods and Service Tax Provident Fund Employees State Insurance Income-TaxDuty of Customs or Cess or other statutory dues which have not been deposited with theappropriate authorities on account of any dispute other than those mentioned in theAnnexure I to this report.

(viii) According to the information and explanations given to us and onthe basis of our examination of the records of the Company the Company has notsurrendered or disclosed any transactions previously unrecorded as income in the books ofaccount in the tax assessments under the Income Tax Act 1961 as income during the year.

(ix) (a) According to the information and explanations given to us andon the basis of our examination of the records of the Company the Company has notdefaulted in repayment of loans and borrowing or in the payment of interest thereon to anylender.

(b) According to the information and explanations given to us and onthe basis of our examination of the records of the Company the Company has not beendeclared a wilful defaulter by any bank or financial institution or government orgovernment authority.

(c) In our opinion and according to the information and explanationsgiven to us by the management term loans were applied for the purpose for which the loanswere obtained.

(d) According to the information and explanations given to us and on anoverall examination of the balance sheet of the Company we report that no funds raised onshort-term basis have been used for long-term purposes by the Company.

(e) According to the information and explanations given to us and on anoverall examination of the standalone financial statements of the Company we report thatthe Company has not taken any funds from any entity or person on account of or to meet theobligations of its subsidiaries or associates as defined under the Act.

(f) According to the information and explanations given to us andprocedures performed by us we report that the Company has not raised loans during theyear on the pledge of securities held in its subsidiaries joint ventures or associatecompanies (as defined under the Act).

(a) The Company has not raised any moneys by way of initial publicoffer or further public offer (including debt instruments) Accordingly clause 3(x)(a) ofthe Order is not applicable.

(b) According to the information and explanations given to us and onthe basis of 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 clause 3(x)(b) of the Order is not applicable.

(a) Based on examination of the books and records of the Company andaccording to the information and explanations given to us no fraud by the Company or onthe Company has been noticed or reported during the course of the audit.

(b) According to the information and explanations given to us noreport under sub-section (12) of Section 143 of the Act has been filed by the auditors inForm ADT-4 as prescribed under Rule 13 of the Companies (Audit and Auditors) Rules 2014with the Central Government.

(c) As represented to us by the management there are no whistle blowercomplaints received by the Company during the year.

(xii) According to the information and explanations given to us theCompany is not a Nidhi Company. Accordingly clause 3(xii) of the Order is not applicable.

(xiii) In our opinion and according to the information and explanationsgiven to us the transactions with related parties are in compliance with Section 177 and188 of the Act where applicable and the details of the related party transactions havebeen disclosed in the standalone financial statements as required by the applicableaccounting standards.

(xiv) (a) Based on information and explanations provided to us and ouraudit procedures in our opinion the Company has an internal audit system commensuratewith the size and nature of its business.

(b) We have considered the internal audit reports of the Company issuedtill date for the period under audit.

(xv) In our opinion and according to the information and explanationsgiven to us the Company has not entered into any non-cash transactions with its directorsor persons connected to its directors and hence provisions of Section 192 of the Act arenot applicable to the Company.

(xvi) (a) The Company is not required to be registered under Section45-IA of the Reserve Bank of India Act 1934. Accordingly clause 3(xvi)(a) of the Orderis not applicable.

(b) The Company is not required to be registered under Section 45-IA ofthe Reserve Bank of India Act 1934. Accordingly clause 3(xvi)(b) of the Order is notapplicable.

(c) The Company is not a Core Investment Company (CIC) as defined inthe regulations made by the Reserve Bank of India. Accordingly clause 3(xvi) (c) of theOrder is not applicable.

(d) The Company is not part of any group (as per the provisions of theCore Investment Companies (Reserve Bank) Directions 2016 as amended). Accordingly therequirements of clause 3(xvi)(d) are not applicable

(xvii) The Company has not incurred cash losses in the current and inthe immediately preceding financial year.

(xviii) There has been no resignation of the statutory auditors duringthe year. Accordingly clause 3(xviii) of the Order is not applicable.

(xix) According to the information and explanations given to us and onthe basis of the financial ratios ageing and expected dates of realisation of financialassets and payment of financial liabilities other information accompanying the standalonefinancial statements our knowledge of the Board of Directors and management plans andbased on our examination of the evidence supporting the assumptions nothing has come toour attention which causes us to believe that any material uncertainty exists as on thedate of the audit report that the Company is not capable of meeting its liabilitiesexisting at the date of balance sheet as and when they fall due within a period of oneyear from the balance sheet date. We however state that this is not an assurance as tothe future viability of the Company. We further state that our reporting is based on thefacts up to the date of the audit report and we neither give any guarantee nor anyassurance that all liabilities falling due within a period of one year from the balancesheet date will get discharged by the Company as and when they fall due.

(xx) In our opinion and according to the information and explanationsgiven to us there is no unspent amount under sub-section (5) of Section 135 of the Actpursuant to any project. Accordingly clauses 3(xx)(a) and 3(xx) (b) of the Order are notapplicable.

Annexure I to clause vii (b)

Name of the Statute Nature of Dues Amount (Rs. in Lacs) (net of deposit paid under protest) Period to which amount relates Forum where dispute is pending
Central Sales tax Act and Local Sales tax Act Sales tax (including interest and penalty if applicable) - Disallowance on account of nonsubmission of required forms 116.20 1993-94 1995-96 2004-05 2006-07 2007-08 2009-10 Joint Commissioner Appeals
345.60 2006-07 2007-08 2009-10 2013-14 2015-16 2017-18 Assistant Commissioner Appeals
62.48 2010-11 Commercial tax appeals
6.69 2013-14 2014-15 Deputy Commissioner Appeals
76.99 2010-11 Deputy Commissioner of Sales Tax
43.95 2008-09 2010-11 2011-12 Deputy Commissioner of Commercial Tax
81.82 2016-17 Assistant Commissioner of Commercial Tax
4.20 2008-09 Additional Commissioner of Commercial Taxes
166.19 2010-11 Objection Hearing Authority
The Central Excise Act Excise duty (including interest and penalty if applicable) 16.79 2004-05 Commercials of Central Excise- Appeals
6.01 2006-07 Tribunal Appeals Ahmedabad
1.79 2020-21 JC Appeal Baroda
Finance Act 1994-Service Tax Disallowance of service tax taken on input services 3.41 2006-07 2007-08 and 2008-09 Additional Commissioner of Central Excise
231.30 2020-21 CESTAT Appeals
2.20 2011-12 Assistant commissioner of Central Excise
Income tax Act 1961 Income tax demand 473.96 2009-10 2010-11 2011-12 2013-14 to 2018-19 Commissioner of Income Tax (Appeal)

Annexure B to the Independent Auditors? report on the standalonefinancial statements

Report on the internal financial controls with reference to theaforesaid standalone financial statements under Clause (i) of Sub-section 3 of Section 143of the Companies Act 2013

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

Opinion

We have audited the internal financial controls with reference tostandalone financial statements of Ion Exchange (India) Limited ("the Company")as of 31 March 2022 in conjunction with our audit of the standalone financial statementsof the Company for the year ended on that date.

In our opinion the Company has in all material respects adequateinternal financial controls with reference to standalone financial statements and suchinternal financial controls were operating effectively as at 31 March 2022 based on theinternal financial controls with reference to financial statements criteria established bythe Company considering the essential components of internal control stated in theGuidance Note on Audit of Internal Financial Controls Over Financial Reporting issued bythe Institute of Chartered Accountants of India (the "Guidance Note").

Management's Responsibility for Internal Financial Controls

The Company's management and the Board of Directors are responsible forestablishing and maintaining internal financial controls based on the internal financialcontrols with reference to standalone financial statements criteria established by theCompany considering the essential components of internal control stated in the GuidanceNote. 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 (hereinafterreferred to as "the Act").

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internalfinancial controls with reference to standalone financial statements based on our audit.We conducted our audit in accordance with the Guidance Note and the Standards on Auditingprescribed under section 143(10) of the Act to the extent applicable to an audit ofinternal financial controls with reference to standalone financial statements. ThoseStandards and the Guidance Note require that we comply with ethical requirements and planand perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls with reference to standalone financial statements were established andmaintained and whether such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence aboutthe adequacy of the internal financial controls with reference to standalone financialstatements and their operating effectiveness. Our audit of internal financial controlswith reference to standalone financial statements included obtaining an understanding ofsuch internal financial controls assessing the risk that a material weakness exists andtesting and evaluating the design and operating effectiveness of internal control based onthe assessed risk. The procedures selected depend on the auditor's judgement includingthe assessment of the risks of material misstatement of the standalone financialstatements whether due to fraud or error.

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 with reference to standalone financial statements.

Meaning of Internal Financial controls with Reference to FinancialStatements

A company's internal financial controls with reference to standalonefinancial statements is a process designed to provide reasonable assurance regarding thereliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles. A company'sinternal financial controls with reference to standalone financial statements includethose policies and procedures that (1) pertain to the maintenance of records that inreasonable detail accurately and fairly reflect the transactions and dispositions of theassets of the company; (2) provide reasonable assurance that transactions are recorded asnecessary to permit preparation of financial statements in accordance with generallyaccepted accounting principles and that receipts and expenditures of the company arebeing made only in accordance with authorisations of management and directors of thecompany; and (3) provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the company's assets that could have amaterial effect on the Standalone financial statements.

Inherent Limitations of Internal Financial controls with Reference toStandalone Financial Statements

Because of the inherent limitations of internal financial controls withreference to standalone financial statements including the possibility of collusion orimproper management override of controls material misstatements due to error or fraud mayoccur and not be detected. Also projections of any evaluation of the internal financialcontrols with reference to Standalone financial statements to future periods are subjectto the risk that the internal financial controls with reference to standalone financialstatements may become inadequate because of changes in conditions or that the degree ofcompliance with the policies or procedures may deteriorate.

Other Matter

We did not audit the internal financial controls with reference tofinancial statements of a branch of the Company. The internal financial controls withreference to financial statements of a

branch have been audited by the branch auditor whose reports have beenfurnished to us and our opinion in so far as it relates to the internal financialcontrols with reference to financial statements included in respect of these branch isbased solely on the report of such branch auditor.

Our opinion is not modified in respect of this matter.

For B S R & Co. LLP Suhas Pai
Chartered Accountants Partner
Firm's Registration No. 101248W/W-100022 Membership No. 119057
Mumbai UDIN: 22119057AJTNNM2809
Date: 27 May 2022

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