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ISGEC Heavy Engineering Ltd.

BSE: 533033 Sector: Engineering
NSE: ISGEC ISIN Code: INE858B01029
BSE 00:00 | 18 Aug 479.20 8.75
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NSE 00:00 | 18 Aug 478.75 8.20
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OPEN 475.85
PREVIOUS CLOSE 470.45
VOLUME 6982
52-Week high 835.00
52-Week low 426.20
P/E 27.26
Mkt Cap.(Rs cr) 3,522
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 475.85
CLOSE 470.45
VOLUME 6982
52-Week high 835.00
52-Week low 426.20
P/E 27.26
Mkt Cap.(Rs cr) 3,522
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

ISGEC Heavy Engineering Ltd. (ISGEC) - Auditors Report

Company auditors report

To the Members of

Isgec Heavy Engineering Limited

REPORT ON THE AUDIT OF THE STANDALONE IND AS FINANCIAL STATEMENTS

OPINION

We have audited the accompanying standalone Ind AS financial statementsof Isgec Heavy Engineering Limited ("the Company") which comprise the BalanceSheet as at 31st March 2022 the Statement of Profit and Loss (including theStatement of Other Comprehensive Income) the Statement of Changes in Equity and the CashFlow Statement for the year then ended and Notes to the financial statements including asummary of significant accounting policies and other explanatory information (hereinafterreferred to as "the standalone Ind AS financial statements").

In our opinion and to the best of our information and according to theexplanations given to us the aforesaid standalone Ind AS 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 accounting principlesgenerally accepted in India of the state of affairs of the Company as at 31stMarch 2022 and its profit including other comprehensive income its cash flows and thechanges in equity for the year ended on that date.

BASIS FOR OPINION

We conducted our audit of the standalone Ind AS financial statements inaccordance with the Standards on Auditing (SAs) as specified under section 143(10) of theAct. Our responsibilities under those Standards are further described in the 'Auditor'sResponsibilities for the Audit of the Standalone Ind AS Financial Statements' section ofour report. We are independent of the Company in accordance with the 'Code of Ethics'issued by the Institute of Chartered

Accountants of India together with the ethical requirements that arerelevant to our audit of the standalone Ind AS financial statements under the provisionsof the Act and the Rules thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the Code of Ethics. We believethat the audit evidence we have obtained is sufficient and appropriate to provide a basisfor our audit opinion on the standalone Ind AS financial statements.

EMPHASIS OF MATTER

We draw attention to Note 58 to the standalone Ind AS financialstatements which describes the uncertainties and the impact of Covid-19 pandemic on theCompany's operations carrying amounts of property plant & equipment intangibleassets investments recoverability of receivables and other assets and Management'sevaluation of the future performance of the Company. In view of the uncertain economicenvironment a definitive assessment of the impact on the subsequent periods is dependentupon circumstances as they evolve. Our opinion is not modified in respect of this matter.

KEY AUDIT MATTERS

Key audit matters are those matters that in our professionaljudgement were of most significance in our audit of the standalone Ind AS financialstatements of the current period. These matters were addressed in the context of our auditof the standalone Ind AS financial statements as a whole and in forming our opinionthereon and we do not provide a separate opinion on these matters. We have determined thematters described below to be the key audit matters to be communicated in our report.

Sr. No. Key Audit Matter Auditor?s Response
1 Revenue recognition for construction contracts Principal Audit Procedures
The Company's significant portion of business is undertaken through construction contracts. Revenue from these contracts is recognized over a period of time in accordance with the requirements of Ind AS 115 "Revenue from Contracts with Customers". Due to the nature of the contracts revenue recognition involves usage of percentage of completion method which is determined based on proportion of contract costs incurred to date compared to estimated total contract costs. In the context of our work the procedures set up in terms of contribution to revenues of construction contracts consisted of :
The determination of revenues and margin relating to construction contracts depends on total cost at completion estimated by the Management. These estimates are reviewed on a quarterly basis or more frequently in the event of any major development during the progress of projects. • Considering the appropriateness of the Company's revenue recognition accounting policies and assessing compliance with the policies in terms of Ind AS 115.
This method involves significant judgments identification of contractual obligations and the Company's rights to receive payments for performance completed till date changes in scope and consequential revised contract price and recognition of the liability for loss making contracts. • Performing testing of the design and implementation of controls over revenue recognition with specific focus on controls over determination of progress of completion recording of costs incurred and estimation of costs to complete the remaining contract obligations.
Refer Note 2.4 to the standalone Ind AS financial statements. • Performing tests of details on a sample basis and verifying the underlying customer contracts performing review of actual costs incurred with estimated costs to identify significant variations and assess whether those variations have been considered in estimating the remaining costs to complete and consequential determination of stage of completion which formed the basis of revenue recognition under the input method. We reviewed the Management's evaluation process to recognize revenue over a period of time status of completion for projects and total cost estimates. We reviewed and verified the estimated cost of contracts on test check basis arising from contract modifications and analysed current on-going negotiations and settlements that may impair the profitability of such contracts.
• Examining contracts with exceptions including contracts with low or negative margins loss making contracts contracts with significant changes in planned cost estimates to determine the level of provisioning required.
• Verifying the contractual positions and revenue for the year are appropriately presented and disclosed in the standalone Ind AS financial statements.

INFORMATION OTHER THAN THE STANDALONE IND AS FINANCIAL STATEMENTS ANDAUDITOR'S REPORT THEREON

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 Ind AS financial statementsand our auditor's report thereon.

Our opinion on the standalone Ind AS financial statements does notcover the other information and we do not express any form of assurance conclusionthereon.

In connection with our audit of the standalone Ind AS financialstatements our responsibility is to read the other information and in doing so considerwhether the other information is materially inconsistent with the standalone Ind ASfinancial statements or our knowledge obtained in the audit or otherwise appears to bematerially misstated. If based on the work we have performed on the other informationobtained prior to the date of this auditor's report 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 IND AS FINANCIALSTATEMENTS

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 Ind ASfinancial statements that give a true and fair view of the financial position financialperformance including 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 Actread with the Companies (Indian Accounting Standards) Rules 2015 as amended. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding of 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 Ind AS financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

In preparing the standalone Ind AS financial statements Management isresponsible for assessing the Company's ability to continue as a going concerndisclosing as applicable matters related to going concern and using the going concernbasis of accounting unless Management either intends to liquidate the Company or to ceaseoperations 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 IND ASFINANCIAL STATEMENTS

Our objectives are to obtain reasonable assurance about whether thestandalone Ind AS financial statements as a whole are free from material misstatementwhether due 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 Ind AS financialstatements.

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 Ind AS financial statements whether due to fraud or error design and performaudit procedures responsive to those risks and obtain audit evidence that is sufficientand appropriate 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 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 Ind AS financial statements or if such disclosuresare inadequate 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 Ind AS financial statements including the disclosures and whether thestandalone Ind AS financial statements represent the underlying transactions and events ina manner that achieves fair presentation.

Materiality is the magnitude of misstatements in the standalone Ind ASfinancial statements that individually or in aggregate makes it probable that theeconomic decisions of a reasonably knowledgeable user of the standalone Ind AS financialstatements may be influenced. We consider quantitative materiality and qualitative factorsin (i) planning the scope of our audit work and in evaluating the results of our work; and(ii) to evaluate the effect of any identified misstatements in the standalone Ind ASfinancial statements.

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 standalone IndAS financial 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..

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 sub-section(11) of section 143 of the Act we give in the Annexure -A which forms a part of thisreport a statement on the matters specified in paragraph 3 and 4 of the Order to theextent applicable.

2. 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 purpose of our audit;

(b) In our opinion proper books of account as required by law havebeen kept by the Company so far as appears from our examination of such books.

(c) The Balance Sheet Statement of Profit and Loss (including OtherComprehensive Income) the Statement of Changes in Equity and the Cash Flow Statementdealt with by this Report are in agreement with the books of account;

(d) In our opinion the aforesaid standalone Ind AS financialstatements comply with the Indian Accounting Standards specified under Section 133 of theAct read with relevant rules issued thereunder.

(e) On the basis of written representations received from the Directorsand taken on record by the Board of Directors we report that none of the Directors isdisqualified as on 31st March 2022 from being appointed as a Director in termsof Section 164(2) of the Companies Act 2013.

(f) With respect to the adequacy of the internal financial controlsover financial reporting of the Company and the operating effectiveness of such controlsrefer to our separate report in "Annexure- B".

(g) 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 for the year ended 31st March 2022has been paid/provided by the Company to its Directors is in accordance with theprovisions of section 197 read with Schedule V to the Act.

(h) As required by Rule 11 of the Companies (Audit and Auditors) Rules2014 issued by the Central Government of India in terms of clause (j) of subsection (3) ofsection 143 of the Act in our opinion and to the best of our information and according tothe explanation given to us:

i) The Company has disclosed the impact of pending litigations on itsfinancial position in its standalone Ind AS financial statements - Refer Note 43 to thestandalone Ind AS financial statements.

ii) The Company has made provision as required under the applicablelaw and accounting standards for material foreseeable losses if any on long-termcontracts including derivative contracts.

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

iv) a) The Management has represented that to the best of itsknowledge and belief no funds have been advanced or loaned or invested (either fromborrowed fund or share premium or any other sources of kinds of funds) by the Company toor in any other person(s) or entity(ies) including foreign entities ("Intermediaries") with the understanding whether recorded in writing or otherwisethat the intermediary shall whether directly or indirectly lend or invest in otherpersons or entities identified in any manner whatsoever by or on behalf of the Company("Ultimate Beneficiaries") or provide any guarantee security

or the like on behalf of the Ultimate beneficiaries.

b) The Management has represented that to the best of its knowledgeand belief no funds have been received by the Company from any person(s) or entity(ies)including foreign entity ("Funding Parties" with the understanding whetherrecording in writing or otherwise that the Company shall whether directly orindirectly lend or invest in other person or entities identified in any manner whatsoeverby or on behalf of Funding Parties ("Ultimate Beneficiaries") or provide anyguarantee security or the like on behalf of the Ultimate Beneficiaries;

c) Based on such audit procedures that were considered reasonable andappropriate in the circumstances nothing has come to our notice that has caused us tobelieve that the representation under sub-clause (a) and (b) above contains any materialmisstatement.

v) a) The final dividend proposed in the previous year declared andpaid by the Company during the year is in accordance with Section 123 of the Act asapplicable.

b) The Board of Directors of the Company have proposed the finaldividend for the year which is subject to the approval of the members at the ensuingAnnual General Meeting. The amount of dividend proposed is in accordance with section 123of the Act as applicable..

Annexure - A To The Independent Auditor's Report

(Referred to in paragraph 1 to "Report on Other legal andregulatory requirements" of the Independent Auditors' Report of even date to themembers of Isgec Heavy Engineering Limited on the Ind AS Standalone Financial Statementsfor the year ended 31st March 2022)

Based on the audit procedures performed for the purpose of reporting atrue and fair view on the financial statements of the Company and taking intoconsideration the information and explanations given to us and the books of account andother records examined by us in the normal course of audit and to the best of ourknowledge and belief we report that:

(i) (a) (A) The Company has maintained proper records showing fullparticulars including quantitative details and situation of Property Plant and Equipmentand relevant details of 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 usProperty plant and Equipment have been physically verified by the Management during theyear. All Property plant and Equipment of the Company have not been physically verifiedby the Management during the year but there is a regular phased programme of physicalverification which in our opinion is reasonable having regard to the size of the Companyand nature of its Property plant and Equipment. No material discrepancies were noticed onsuch verification.

(c) The title deed of all the immovable properties (other thanproperties where the Company is lessee and the lease agreements are duly executed infavour of the lessee) disclosed in the financial statement included under property plantand equipment are held in the name of the Company.

(d) According to the information and explanations given to us and onthe basis of our audit procedures we report that the Company has neither revalued itProperty Plant and Equipment (Including Right of Use Assets) nor intangible assets duringthe year ended March 31 2022.

(e) According to the information and explanations given to us and onthe basis of our audit procedures we report that there are no proceedings that have beeninitiated or are pending against the Company for holding any benami property under theProhibition of Benami Property Transactions (Prohibitions) Act 1988 (45 of 1988) asamended and rules made thereunder.

(ii) (a) According to the information and explanations given to us andon the basis of our audit procedures we report that Physical Verification of Inventoryhas been conducted at reasonable intervals by the Management and in our opinion thecoverage and procedure of such verification is appropriate. No discrepancy of 10% or morein the aggregate for each class of inventory were noticed during such verificationconducted during the year.

(b) The Company has been sanctioned working capital limits in excess of' Five Crore in aggregate from banks during the year on the basis of security of currentassets. Quarterly returns or statements filed by the Company with such banks are inagreement with the books of account of the Company. According to the information andexplanations given to us and on the basis of our audit procedures we report that theCompany has not been sanctioned working capital limits from financial institutions.

(iii) (a) According to information and explanation given to us and onthe basis of our audit procedures we report that the Company has not made investments inprovided any security or granted any advances in the nature of loans to companies firmsLimited Liability Partnership or any other parties during the year ended March 31 2022.In respect of any guarantee provided and loan given during the year details are as below:

Guarantees Loans
Aggregate amount granted /provided during the year:
- Subsidiaries 4004.72 4546.38
- Joint ventures Nil Nil
- Associates Nil Nil
- Others Nil Nil
Balance outstanding at the balance sheet date in respect of above cases:
- Subsidiaries 60137.50 8876.03
- Joint ventures Nil Nil
- Associates Nil Nil
- Others Nil Nil

(b) According to information and explanation given to us and based onaudit procedures performed by us we are of the opinion that guarantees provided and theterms and conditions of the grant of all loans and guarantees are prima facie notprejudicial to the Company's interest. According to information and explanation given tous the Company has not made investments provided security given advances in nature ofloans to companies firms Limited Liability Partnership or any other parties during theyear.

(c) According to information and explanation given to us and on thebasis of our audit procedures we report that in respect of loans the schedule ofrepayment of principle and payment of interest has been stipulated and repayment orreceipts of interest are not due during the year.

(d) According to information and explanation given to us and on thebasis of our audit procedures we report that no amount is overdue in respect of loansgranted by the Company for more than ninety days in respect of principle and interest.

(e) According to information and explanation given to us and on thebasis of our audit procedures we report that no loan granted which has fallen due duringthe year has been renewed or extended or fresh loans granted to settle the overdues ofexisting loans given to the same parties.

(f) According to information and explanation given to us and on thebasis of our audit procedures we report that the Company has not granted any loans oradvances in the nature of loan either repayable on demand or without specifying any termsor period of repayment. Accordingly reporting under clause (iii)(f) is not applicable.

(iv) In our opinion and according to the information and explanationsgiven to us during the year the Company has not made investments given security which iscovered under provisions of section 185 and 186 of the Companies Act 2013. In respect ofloan given and guarantee provided during the year the same in our opinion is incompliance of section 185 and 186 of Companies Act 2013.

(v) According to information and explanation given to us and on thebasis of our audit procedures we report that the Company has neither accepted anydeposits from the public nor accepted any amounts which are deemed to be deposits withinthe meaning of the provisions of section 73 to 76 or any other relevant provisions of theCompanies Act2013 and the rules made thereunder. Accordingly the paragraph 3(v) of theOrder is not applicable to the Company.

(vi) We have broadly reviewed the cost records maintained by theCompany pursuant to the sub-section (1) of section 148 of the Companies Act specified bythe Central Government and are of the opinion that prima facie the prescribed costrecords have been maintained. We have however not made a detailed examination of thecost records with a view to determine whether they are accurate or complete.

(vii) (a) The Company is regular in depositing undisputed statutorydues including Goods and Services Tax Provident Fund Employees' State InsuranceIncome-Tax Duty of Customs Cess and any other statutory dues applicable to it to theappropriate authorities. The provisions related to sales-tax service tax duty of exciseand value added tax are not applicable to Company.

According to the information and explanation given to us and based onaudit procedures performed by us no undisputed amount payable in respect of thesestatutory dues were outstanding at the year end for a period of more than six months fromthe date they became payable.

(b) According to the information and explanations given to us and onthe basis of our audit procedures we report that there are no dues of Provident FundEmployees' State Insurance Income Tax Sales Tax Service Tax Duty of Customs Duty ofExcise Goods and Service Tax or Value Added Tax or any other statutory dues which havenot been deposited on account of any dispute except as given under:

Name Of the Statute Nature of Due Amount Involved (Rs in lakhs) Amount Unpaid (Rs in lakhs) Period to which it relates Forum where Dispute is pending
Central Excise Act Excise Duty 5.00 5.00 1994-95 Hon'ble High Court Allahabad
Central Excise Act Excise Duty 8.00 8.00 1994-96 Tribunal New Delhi
Central Excise Act Excise Duty 3.57 3.57 2011-12 Assistant commissioner Yamunanagar
Central Excise Act Excise Duty 0.37 0.37 2015-17 Superintendent (Yamunanagar)
Central Excise Act Excise Duty 30.06 27.06 2016-17 Assistant Commissioner (Yamunanagar)
Central Excise Act Excise Duty 7.18 7.18 2017-18 Superintendent CGST Division
Local Area Tax Local Area Tax 22.00 22.00 2006-07 to 2015-16 Hon'ble Supreme Court of India
Water Cess Water Cess 18.49 18.49 1992-93 Hon'ble Supreme Court of India
Goods and services tax act Goods and services tax 5.24 - 2020-21 Addl. Commissioner Appeal commercial tax MP
Goods and services tax act Goods and services tax 3.09 - 2020-21 Asstt. Commissioner
Sales Tax Act Sales Tax 271.90 271.90 2014-15 Appeal yet to be filed
Sales Tax Act Sales Tax 7.42 7.42 2016-17 Appeal yet to be filed
Sales Tax Act Sales Tax 4.00 4.00 1987-88 Dy Comm. of Commercial Taxes(appeals) Kolkata
Sales Tax Act Sales Tax 61.00 61.00 1994-95 Dy Comm. of Commercial Taxes(appeals) Kolkata
Sales Tax Act Sales Tax 34.00 34.00 1995-96 Dy Comm. of Commercial Taxes(appeals) Kolkata
Sales Tax Act Sales Tax 18.30 16.67 2009-10 to 2013-14 Joint Commissioner of Sales Tax
Sales Tax Act Sales Tax 0.82 0.82 2006-07 Dy Comm. Of Commercial Taxes Tamil Nadu.
Sales Tax Act Sales Tax 76.86 76.86 2010-11 Commercial Tax Tribunal
Sales Tax Act Sales Tax 53.77 21.33 2013-14 High Court Lukhnow
Sales Tax Act Sales Tax 57.68 - 2014-15 Commercial Tax Tribunal
Sales Tax Act Sales Tax 84.06 64.16 2015-16 Commercial Tax Tribunal
Sales Tax Act Sales Tax 6.42 6.42 2015-16 Commercial Tax Tribunal
Sales Tax Act Sales Tax 35.89 3.89 2016-17 Addl. Commissioner Grade-2 Appeals
Sales Tax Act Sales Tax 1.30 - 2020-21 Addl. Commissioner Appeal Commercial tax UP
Sales Tax Act Sales Tax 3.26 3.26 2014-15 Dy Comm. Of Commercial Taxes Kerala.
Sales Tax Act Sales Tax 0.58 0.58 2016-17 Dy Comm. Of Commercial Taxes Kerala.
Sales Tax Act Sales Tax 59.32 53.10 2009-10 Assistant Commissioner (WC) Department of Commercial Taxes Ernakulam
Sales Tax Act Sales Tax 0.37 0.33 2010-11 Assistant Commissioner (WC) Department of Commercial Taxes Ernakulam
Sales Tax Act Sales Tax 71.06 70.44 2015-16 Dy. Commissioner of Sales Tax Mumbai
Sales Tax Act Sales Tax 8.31 7.95 2015-16 Dy. Commissioner of Sales Tax Mumbai
Sales Tax Act Sales Tax 559.88 559.88 2016-17 Deputy Commissioner State Tax LTU Mumbai
Sales Tax Act Sales Tax 3.54 3.54 2016-17 Deputy Commissioner State Tax LTU Mumbai
Sales Tax Act Sales Tax 6.00 6.00 1971-73 Commissioner Sales Tax Lucknow
Sales Tax Act Sales Tax 7.35 4.59 2017-18 Additional Commissioner Grade -2 Appeals
Sales Tax Act Sales Tax 0.38 0.38 2017-18 Additional Commissioner Grade -2 Appeals
Sales Tax Act Sales Tax 64.24 64.24 2017-18 Joint Commissioner State Tax
Finance Act 1994 Service Tax 60.31 60.31 2012-13 Tribunal Ahmedabad
Finance Act 1994 Service Tax 19.66 19.66 2014-15 Additional Commissioner (Audit) C.Ex. Surat. Order awaited.
Finance Act 1994 Service Tax 60.77 60.77 2015-16 & 2016-17 Commissioner Central goods and service tax (Appeals Noida)
Custom Act Custom Duty 3.28 3.28 2017-18 Tribunal New Delhi
Custom Act Custom Duty 563.8 513.65 2017-18 Tribunal Ahemdabad

(viii) According to the information and explanations given to us and onthe basis of our audit procedures we report that the Company has not surrendered ordisclosed any transaction previously unrecorded in the books of accounts in the taxassessment under the Income Tax Act 1961 as income during the year accordingly theprovisions of paragraph 3 (viii) of the Order are not applicable to the Company.

(ix) (a) According to the information and explanations given to us andon the basis of our audit procedures we report that the Company has not defaulted inrepayment of loans or other borrowings or in the payment of interest thereon to any lenderduring the year.

(b) According to the information and explanations given to us and onthe basis of our audit procedures we report that the Company has not been declared awilful defaulter by any bank or financial institution or other lender.

(c) In our opinion and according to the information and explanationsgiven to us the Company has utilised the money obtained by way of term loans during theyear for the purposes for which they were obtained.

(d) According to the information and explanations given to us and onthe basis of our audit procedures we report that no funds raised on short term basis havebeen utilised for long term purposes during the year.

(e) According to the information and explanations given to us and on anoverall examination of the financial statement of the Company we report that the Companyhas not taken any funds from any entity or person on account of or to meet the obligationof its subsidiaries or associates.

(f) According to the information and explanations given to us and onthe basis of our audit procedures we report that the Company has not raised loans duringthe year on the pledge of securities held in its subsidiaries or associate companies.

(x) (a) According to the information and explanations given to us andon the basis of our audit procedures we report that the Company has not raised any moneysby way of initial public offer/ further public offer (including debt instruments) duringthe year. Accordingly the provisions of paragraph 3(x)(a) of the Order are not applicableto the Company.

(b) According to the information and explanations given to us and onthe basis of our audit procedures we report that the Company has not made anypreferential allotment or private placement of shares or convertible debentures (fullypartially or optionally convertible) during the year. Accordingly the provisions ofparagraph 3(x) (b) of the Order are not applicable to the Company.

(xi) (a) According to the information and explanations given to us andon the basis of our audit procedures we report that no fraud by the Company or nomaterial fraud on the Company has been noticed or reported during the year.

(b) During the year no report under Sub-section (12) of section 143 ofCompanies Act 2013 has been filed in form ADT-4 as prescribed under rule 13 of Companies(Audit and Auditors) Rules 2014 with the Central Government.

(c) As represented to us by the Management there are no whistle blowercomplaints received by the Company during the year. Accordingly the provisions ofparagraph 3(xi)(c) of the Order are not applicable to the Company.

(xii) According to the information and explanations given to us and onthe basis of our audit procedures we report that the Company is not a Nidhi Company.Therefore the provisions of paragraph 3(xii)(a) (b) (c) of the Order are not applicableto the Company.

(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 section 177 and 188 of the Companies Act 2013. Further thedetails of the transactions have been disclosed in the standalone Ind AS financialstatements as required by the applicable accounting standards.

(xiv) (a) In our opinion and based on our examination the

Company has an adequate internal audit system commensurate with thesize and nature of its business.

(b) We have considered the internal audit reports for the year underaudit issued to the Company till date in determining the nature timing and extent of ouraudit procedures.

(xv) In our opinion and based on our examination the Company has notentered into any non-cash transactions with its Directors or persons connected with itsDirectors. Accordingly the provisions of paragraph 3(xv) of the Order is not applicableto the Company.

(xvi) (a) According to the information and explanations given to us andon the basis of our audit procedures we report that the Company is not required to beregistered under section 45-IA of the Reserve Bank of India Act 1934 (2 of 1934).Accordingly requirement to report on paragraph (xvi)(a) of the Order are not applicableto the Company.

(b) According to the information and explanations given to us and onthe basis of our audit procedures we report that the Company has not conducted anyNon-Banking Financial or Housing Finance activities without obtaining a valid certificateof Registration (COR) from the Reserve Bank of India as per the Reserve Bank of India Act1934.

(c) According to the information and explanations given to us and onthe basis of our audit procedures we report that the Company is not a Core InvestmentCompany (CIC) as defined in the regulations made by Reserve Bank of India. Accordinglythe requirement to report on paragraph 3 (xvi)(c) of the Order is not applicable to theCompany.

(d) According to the information and explanations given to us and onthe basis of our audit procedures we report that the group does not have any CIC as partof the group hence the provisions of paragraph (xvi)(d) of the Order are not applicableto the Company.

(xvii) According to the information and explanations given to us and onthe basis of our audit procedures we report that the Company has not incurred cashlosses in the current financial year and in the immediately preceding financial year.

(xviii) There has been no resignation of the Statutory Auditor duringthe year.

(xix) On the basis of the financial ratios disclosed in note no 54 tothe financial statements ageing and expected dates of realisation of financial assets andpayment of financial liabilities other information accompanying the financial statementour knowledge of the Board of Directors and Management plan and based on our examinationof the evidence supporting the assumption nothing has come to our attention which causesus to believe that any material uncertainty exists as on the date of audit report thatCompany is not capable of meeting its liabilities existing at date of balance sheet as andwhen they fall due within a period of one year from the balance sheet date. We howeverstate that this is not the assurance as to the future viability of the Company. We furtherstate that our reporting is based on the facts up to the date of audit report and weneither give any guarantee nor any assurance that all the liabilities falling due within aperiod of one year from the balance sheet date will get discharged by the Company as andwhen they fall due.

(xx) (a) According to the information and explanations given to us andon the basis of our audit procedures we report that the Company does not have unspentamount towards Corporate Social Responsibility (CSR) in respect of other than ongoingprojects.

(b) According to the information and explanations given to us and onthe basis of our audit procedures we report that in respect of the ongoing projects theCompany has transferred unspent CSR amount as at the end of previous financial year andcurrent financial year to a special account with in a period of thirty days from the endof the financial year in compliance with section 135(6) of Companies Act 2013..

Annexure - B To The Independent Auditor's Report

(Referred to in paragraph 2(f) under ‘Report on Other Legal andRegulatory Requirements' section of the independent Auditor's Report of even date to themembers of Isgec Heavy Engineering Limited on the standalone Ind AS financial statementsfor the year ended 31st March 2022)

REPORT ON THE INTERNAL FINANCIAL CONTROLS UNDER CLAUSE (I) OFSUB-SECTION 3 OF SECTION 143 OF THE COMPANIES ACT 2013 ("THE ACT")

We have audited the internal financial controls over financialreporting of Isgec Heavy Engineering Limited ("the Company") as of 31stMarch 2022 in conjunction with our audit of the standalone Ind AS financial statements ofthe 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 over financialreporting criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note on Audit of Internal Financial Controls overFinancial Reporting (the "Guidance Note") issued by the Institute of CharteredAccountants of India ('ICAI'). These responsibilities include the design implementationand maintenance of adequate internal financial controls that were operating effectivelyfor ensuring the orderly and efficient conduct of its business including adherence toCompany?s policies the safeguarding of its assets the prevention and detection offrauds and errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Companies Act 2013.

AUDITOR'S RESPONSIBILITY

Our responsibility is to express an opinion on the Company?sinternal financial controls over financial reporting based on our audit. We conducted ouraudit in accordance with the Guidance Note and the Standards on Auditing issued byInstitute of Chartered Accountants of India and deemed to be prescribed under section143(10) of the Companies Act 2013 to the extent applicable to an audit of internalfinancial controls both applicable to an audit of Internal Financial Controls and bothissued by the Institute of Chartered Accountants of India. Those Standards and theGuidance Note require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether adequate internal financial controlsover financial reporting 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 over financial reporting and theiroperating effectiveness. Our audit of internal financial controls over financial reportingincluded obtaining an understanding of internal financial controls over financialreporting assessing the risk that a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal control based on the assessed risk. Theprocedures selected depend on the auditor?s judgment including the assessment of therisks of material misstatement of the standalone Ind AS financial statements whether dueto 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 system over financial reporting.

MEANING OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING

A Company's internal financial control over financial reporting is aprocess designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles. A Company's internal financial control overfinancial reporting includes those policies and procedures that (1) pertain to themaintenance of records that in reasonable detail accurately and fairly reflect thetransactions and dispositions of the assets of the Company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of financialstatements in accordance with generally accepted accounting principles and that receiptsand expenditures 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 FINANCIALREPORTING

Because of the inherent limitations of internal financial controls overfinancial reporting including the possibility of collusion or improper Managementoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projections of any evaluation of the internal financial controls overfinancial reporting to future periods are subject to the risk that the internal financialcontrol over financial reporting may become inadequate because of changes in conditionsor that the degree of compliance with the policies or procedures may deteriorate.

OPINION

In our opinion the Company has in all material respects an adequateinternal financial controls system over financial reporting and such internal financialcontrols over financial reporting were operating effectively as at 31st March2022 based on the internal control over financial reporting criteria established by theCompany considering the essential components of internal control stated in the GuidanceNote on Audit of Internal Financial Controls Over Financial Reporting issued by theInstitute of Chartered Accountants of India.

For SCV & Co. LLP
Chartered Accountants
Firm Reg. No: 000235N/ N500089
Abhinav Khosla
Partner
Place: Noida Membership No.: 087010
Dated: May 28 2022 ICAI UDIN: 22087010AJUQLL3490

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