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Jain Irrigation Systems Ltd.

BSE: 500219 Sector: Industrials
NSE: JISLJALEQS ISIN Code: INE175A01038
BSE 00:00 | 06 Feb 29.15 0.15
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NSE 00:00 | 06 Feb 29.15 0.15
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VOLUME 271379
52-Week high 48.25
52-Week low 28.25
P/E 58.30
Mkt Cap.(Rs cr) 1,797
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 29.00
CLOSE 29.00
VOLUME 271379
52-Week high 48.25
52-Week low 28.25
P/E 58.30
Mkt Cap.(Rs cr) 1,797
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Jain Irrigation Systems Ltd. (JISLJALEQS) - Auditors Report

Company auditors report

To the Members of Jain Irrigation Systems Limited

REPORT ON THE AUDIT OF THE STANDALONE FINANCIAL STATEMENTS

Opinion

We have audited the accompanying Standalone Financial Statements of JainIrrigation Systems Limited ("the Company") which comprise the Balance sheetas at March 312022 the Statement of Profit and Loss (including the Statement of OtherComprehensive Income) the Cash Flow Statement and the Statement of Changes in Equity forthe year then ended and notes to the Standalone Financial Statements including a summaryof significant accounting policies and other explanatory information (The "StandaloneFinancial Statements").

In our opinion and to the best of our information and according to theexplanations given to us the aforesaid standalone financial statements give theinformation required by the Companies Act 2013 as amended ("the Act") in themanner so required and give a true and fair view in conformity with accounting principlesgenerally accepted in India of the state of affairs of the Company as at March 312022of total standalone comprehensive income (comprising of profit and other comprehensiveincome) standalone changes in equity and its standalone cash flows for the year thenended.

Basis for Opinion

We conducted our audit of the Standalone Financial Statements inaccordance with the Standards on Auditing (SAs) 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 Financial Statements' section of ourreport. We are independent of the Company in accordance with the 'Code of Ethics 'issuedby the Institute of Chartered Accountants (ICAI) of India together with the ethicalrequirements that are relevant to our audit of the Standalone Financial Statements underthe provisions of the Act and the Rules thereunder and we have fulfilled our otherethical responsibilities in accordance with these requirements and the ICAI's Code ofEthics. We believe that the audit evidence we have obtained is sufficient and appropriateto provide a basis for our audit 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. We have determined the matter described below to bethe key audit matter to be communicated in our report.

Descriptions of Key Audit Matter How we addressed the matter in our audit
Revenue Recognition (Refer to Note 17 and 2.4 to the standalone financial statements) Our audit procedures included:
There exists a risk that Revenue is recognised during the cut off period though the control of the goods may not have been passed on to the customer. The Company generates a significant portion of its revenue from engineering contracts which include both contracts related to Micro Irrigation Systems and PE& PVC Pipes. As part of our audit we understood the Company's policies and processes control mechanisms and methods in relation to the revenue recognition and evaluated the design and operative effectiveness of the financial controls from the above through our test of control procedures.
These contracts are accounted under the percentage of completion method (POCM). The application of revenue recognition accounting standards Ind AS 115 is complex and involves a number of judgments and estimates. • Tested a sample of sales transactions for compliance with the Company's accounting principles to assess the completeness occurrence and accuracy of revenue recorded. Also revenue is recognised when the Company satisfies a performance obligation.
Further revenue is accounted for under the POCM which also requires significant judgments and estimates in particular with respect to estimation of the cost to complete. Due to the estimates judgment and complexity involved in the application of the revenue recognition accounting standards we have considered this matter as a key audit matter. • Performing procedures to ensure that the revenue recognition criteria adopted by Company for all major revenue streams is appropriate and in line with the Company's accounting policies.
• We have focused on Management's judgment in applying the methodology and the estimates made to determine the amount of revenue to be recorded in their project calculations.
• We have evaluated the management's process to recognize revenue over a period of time total cost estimates total cost incurred allocation of cost to projects cost to completion and status of the projects.
• We have examined contracts with exceptions including contracts with low or negative margins loss making contracts etc. to determine the level of provisioning.
• Our tests of detail focused on transactions occurring within proximity of the year end and obtaining evidence to support the appropriate timing of revenue recognition based on terms and conditions set out in sales contracts and delivery documents or system generated reports. We considered the appropriateness and accuracy of any cut-off adjustments.
• We have tested the company's system generated reports based on which revenue is accrued at the year end and performed tests of details on the accrued revenue and accounts receivable balances recognized in the balance sheet at the year end.
• Traced disclosure information to accounting records and other supporting documentation.
Valuation of inventories: (Refer to Note 12(a) and 2.12 to the standalone financial statements) Our audit procedures included:
Inventories are carried at the lower of cost and net realizable value. As a result the management applies judgment in determining the appropriate provisions for obsolete stock based upon a detailed analysis of old inventory net realizable value below cost based upon future plans for sale of inventory. We have obtained assurance over the appropriateness of the management's assumptions applied in valuation of inventories and related provisions by:
• Performing walkthrough of the inventory valuation process and assessed the design and implementation of the key controls addressing the risk.
• Verifying the effectiveness of key inventory controls operating over inventories; including sample based physical verification. Reviewing the physical verification working papers conducted by the management.
• Comparing the net realizable value to the cost price of inventories to check for completeness of the associated provision.
• Reviewing the historical accuracy of inventory provisioning and the level of inventory write-offs during the year.
• Traced disclosure information to accounting records and other supporting documentation.
Valuation and existence of Trade Receivables (Refer to Note 8(b) and 2.13 to the standalone financial statements). Our audit procedures included:
As at March 312022 trade receivables constitutes approximately 23 % of total assets of the Company. Trade receivables are mainly comprised of receivables from central and state government owned enterprises. • Evaluated the Company's accounting policies pertaining to impairment of financial assets and assessed compliance with those policies in terms of Ind AS 109 - Financial Instruments.
The majority of trade receivables originate from Government Projects and subsidiaries which are not exposed to high risk. The Company is making specific provisions based on case-to-case reviews and approved by Management. Whereas for other customers provision is determined using the expected credit loss model. • Assessed and tested the design and operating effectiveness of the Company's internal financial controls over provision for expected credit loss.
The provision matrix is based on its historically observed default rates over the expected life of trade receivables and is adjusted for forward looking estimates. This is a key audit matter as significant judgement is involved to establish the provision matrix. The trade receivables balance credit terms and aging as well as the Company's policy on impairment of receivables have been disclosed in note 8(b) to the standalone financial statements. • Evaluated management's assumption and judgment relating to various parameters which included the historical default rates and business environment in which the entity operates for estimating the amount of such provision.
• Evaluated management's assessment of recoverability of the outstanding receivables and recoverability of the overdue / aged receivables through inquiry with management and analysis of collection trends in respect of receivables.
• We have checked supporting of underline documents like Invoices E-way Bills and other related documents on test basis.
• We have checked the ageing analysis on a sample basis and subsequent receipt of the trade receivables to the source documents including bank statements.
• Assessed and reviewed the disclosures made by the Company in the standalone financial statements.
Accounting and disclosure of Debt Resolution Plan as per the Master Restructuring Agreement (MRA). Refer to notes 43 of the standalone financial statements.
The Company has implemented the Debt Resolution effective on March 25 2022 which was approved and announced in the Joint Lenders Meeting on March 29 2022 after fulfilling all Conditions Precedent as per the Master Restructuring Agreement (MRA) signed on February 10 2022. We focused on the accounting of term loans NCD/ECB equity shares and its resultant difference on account of extinguishment of original liabilities as well as the measurement due to the significance of the amounts and complex judgments involved.
As a result the existing facilities (fund base) of ' 32844.80 million of the Company as of June 30 2019 (Cut-off date) are restructured in the following manner and divided into 2 parts: Part A (Sustainable) - Existing facilities to the extent of 19752.50 million are restructured as follows: We performed the following principal audit procedures in relation to an accounting of the resolution plan and the treatment of resultant differences arising from such restructuring:
- Cash Credit facility amounting to ' 15400 million • Evaluated the design and implementation and tested the operating effectiveness of the control relating to accounting and measurement of Term loans NCD/ECB Shares and resultant difference on extinguishment of original borrowings as per the terms of MRA.
- Residual Term Loan amounting to ' 3465.30 million • Involved internal valuation expert to assist in the Valuation of NCD/ ECB
- External Commercial Borrowings are amounting to ' 887.20 million a) Evaluation of the appropriateness of the model adopted for determining the value of the liability;
Part B (Non-Sustainable) - Existing facilities to the extent of 13092.30 million are converted into 12504200 fully paid up 0.01% Secured Non-Convertible Debentures (NCD) of the face value of ' 1000 each of ' 12504.20 million of the Company issued to Lenders and 0.01% External Commercial Borrowings of ' 588.10 million b) Evaluation of key assumptions including discount rates and
In addition to the above 78954908 equity shares of the face value of ' 2/- each of the Company in lieu of additional coupon payable in future (Additional Coupon Convertible debt) on NCD1/NCD2/ECB2 (as applicable) issued to the Lenders. c) Performing sensitivity analysis around the key assumptions to ascertain the extent of change in those assumptions that either individually or collectively would be required for fair valuation of exit option liability.
Further as per the restructuring plan interest accrued and due on PART A from the period from the cut of date to March 312021 has been converted into Funded Interest Term Loan (FITL) amounting to ' 3428.30 million. • Examined the necessary accounting adjustment in relation to implementation of Debt Resolution Plan and related compliance as per requirements of the relevant IND AS.
In addition to the above the company will dispose off the Non-Core Assets of ' 1500 million from the Effective Date and utilize the proceeds of such disposal for making payment of the Special Coupon in respect of the NCDs the IFC Series 2 NcD and the ECB 2 Facilities as a part of Right of Recompense.

# Evaluated disclosures made in the Standalone financial statements.

The accounting of Term Loans 0.01% NCD/ECB equity share and its resultant difference on account of extinguishment of original borrowings are based on complex assumptions and interpretations that require the management to exercise their judgment.
Due to the estimates judgment and complexity involved in the application of Indian Accounting standards in the respect of accounting and disclosure of the Debt Resolution Plan as per the MRA we have considered this matter as a key audit matter.

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

The Company's Board of Directors is responsible for the otherinformation. The other information comprise the information included in the annual reportbut does not include the financial statements and our auditor's report thereon. The annualreport is expected to be made available to us after the date of this auditor's report.

Our opinion on the financial statements does not cover the otherinformation and we will not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements ourresponsibility is to read the other information identified above when it becomes availableand in doing so consider whether the other information is materially inconsistent withthe standalone financial statements or our knowledge obtained in the audit or otherwiseappears to be materially misstated. When we read the annual report if we conclude thatthere is a material misstatement therein we are required to communicate the matter tothose charged with governance and take appropriate action as applicable under the relevantlaws and regulations.

Responsibilities of Management and Those Charged with Governance forthe Standalone Financial Statements

The Company's Board of Directors is responsible for the matters statedin section 134(5) of the Act with respect to the preparation of these Standalone FinancialStatements that give a true and fair view of the financial position financial performanceincluding other comprehensive income cash flows and changes in equity of the Company inaccordance with the accounting principles generally accepted in India including theIndian Accounting Standards (Ind AS) specified under section 133 of the Act read with theCompanies (Indian Accounting Standards) Rules 2015 as amended. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for

safeguarding the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and the designimplementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the Standalone FinancialStatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

In preparing the Standalone Financial Statements 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 charged with governanceare also responsible for overseeing the Company's financial reporting process.

Auditor's Responsibilities for the Audit of the StandaloneFinancial Statements

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 standalonefinancial 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 management.

• Conclude on the appropriateness of management's use of the goingconcern basis of accounting and based on the audit evidence obtained whether a materialuncertainty exists related to events or conditions that may cast significant doubt on theCompany's ability to continue as a going concern. If we conclude that a materialuncertainty exists we are required to draw attention in our auditor's report to therelated disclosures in the Standalone Financial Statements or if such disclosures areinadequate to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditor's report. However future events or conditions maycause the Company to cease to continue as a going concern.

• Evaluate the overall presentation structure and content of theStandalone Financial Statements including the disclosures and whether the StandaloneFinancial Statements represent the underlying transactions and events in a manner thatachieves fair presentation.

Materiality is the magnitude of misstatements in the StandaloneFinancial Statements that individually or in aggregate makes it probable that theeconomic decisions of a reasonably knowledgeable user of the Standalone 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 FinancialStatements.

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

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

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

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" a statement on thematters specified in paragraphs 3 and 4 of the Order.

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 purposes of ouraudit.

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

c) The Balance Sheet the Statement of Profit and Loss including theStatement of Other Comprehensive Income the Cash Flow Statement and Statement of Changesin Equity dealt with by this Report are in agreement with the books of account.

d) In our opinion the aforesaid Standalone Financial Statements complywith the Accounting Standards specified under Section 133 of the Act.

e) On the basis of the written representations received from thedirectors as on March 312022 taken on record by the Board of Directors none of thedirectors are disqualified as on March 31 2022 from being appointed as a director interms of Section 164(2) of the Act.

f) With respect to the adequacy of the internal financial controls withreference to standalone financial statements of the Company and the operatingeffectiveness of such controls refer 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 requirement of section 197(16) of the Act:

In our opinion and to the best of our information and according to theexplanations given to us the remuneration paid/ provided by the Company to its directorsduring the year is in accordance with the provisions of section 197 of the Act and

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

I) The Company has disclosed the impact of pending litigations on itsfinancial position in its Standalone Financial Statements - Note 29(i) to the StandaloneFinancial Statements.

II) The Company did not have any long-term contracts includingderivative contracts for which there were any material foreseeable losses as on March312022.

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 to us that to the best of itsknowledge and belief no funds have been advanced or loaned or invested (either fromborrowed funds or share premium or any other sources or kind of funds) by the company toor in any other person(s) or entities including foreign entities("Intermediaries") with the understanding whether recorded in writing orotherwise that the Intermediary shall whether directly or indirectly lend or invest inother persons or entities identified in any manner whatsoever by or on behalf of thecompany ("Ultimate Beneficiaries") or provide any guarantee security or thelike on behalf of the Ultimate Beneficiaries.

b) The management has represented to us that to the best of itsknowledge and belief no funds have been received by the company from any person(s) orentities including foreign entities ("Funding Parties") with theunderstanding whether recorded in writing or otherwise that the company shall whetherdirectly or indirectly lend or invest in other persons or entities identified in anymanner whatsoever by or on behalf of the Funding Party ("UltimateBeneficiaries") or provide any guarantee security or the like on behalf of theUltimate Beneficiaries and

c) Based on our audit procedures that are considered reasonable andappropriate in the circumstances nothing has come to our notice that has caused us tobelieve that the representations under paragraph 2(h) (iv)(a) &(b) above contain anymaterial misstatement.

V) The Company has not declared any dividend in previous financial yearwhich has been paid in current year. Further no dividend has been declared/proposed forthe current year. Accordingly the provision of section 123 of the Act is not applicableto the company.

For Singhi & Co.
Chartered Accountants
Firm Registration Number: 302049E
Sd/-
(Navindra Kumar Surana)
Partner
Place: Kolkata Membership Number: 053816
Date: May 30 2022 UDIN22053816AJVVCQ6186

ANNEXURE- A

TO THE iNDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 1 under ‘Report on Other Legal andRegulatory

Requirements' section of our report to the Members of the Companyof even date)

i) In the respect of matters specified in clause (i) of paragraphs 3the Order:

a) (A) The Company has maintained proper records showing fullparticulars including quantitative details and situation of Property Plant andEquipment.

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

b) The property plant and equipment were physically verified duringthe year by the Management in accordance with a regular programme of verification whichin our opinion provides for physical verification of all the property plant andequipment at reasonable intervals. According to the information and explanation given tous no material discrepancies were noticed on such verification.

c) The title deeds of immovable properties (other than properties wherethe Company is the lessee and the lease agreements are duly executed in favour of thelessee) are held in the name of the Company except below mentioned immovable property asindicated for which title deeds are not in the name of the Company:

Description of property Gross carrying value (in million) Held in name of Whether promoter director or their relative or employee Period held - indicate range where appropriate Reason for not being held in name of company
Land at Thangadancha Village Dist - Kurnool AP admeasuring 372.40 acres 186.2 Andhra Pradesh Industrial Infrastructure Corp Ltd. No 03-06-2017 Certain stipulations mentioned in the agreement are yet to be completed

d) The Company has not revalued its Property Plant and Equipment(including Right of use assets) or intangible assets during the year ended March 312022.Accordingly the reporting under Clause 3(i)(d) of the Order is not applicable to theCompany.

e) Based on the information and explanations furnished to us noproceedings have been initiated on or are pending against the Company for holding benamiproperty under the Prohibition of Benami Property Transactions Act 1988 (as amended in2016) (formerly the Benami Transactions (Prohibition) Act 1988 (45 of 1988)) and Rulesmade thereunder and therefore the question of our commenting on whether the Company hasappropriately disclosed the details in its standalone financial statements does not arise.

ii) In the respect of matters specified in clause (ii) of paragraphs 3the Order:

a) The physical verification of inventory (excluding stocks with thirdparties) has been conducted at reasonable intervals by the Management during the year andin our opinion the coverage and procedures of such verification by Management isappropriate. In respect of inventory lying with third parties these have substantiallybeen confirmed by them. The discrepancies noticed on physical verification of inventory ascompared to book records were not 10% or more in aggregate for each class of inventory.

b) During the year the Company has been sanctioned working capitallimits in excess of ' 5 crores in aggregate from banks on the basis of security ofcurrent assets. The Company has filed quarterly returns or statements with such bankswhich are in agreement with the books of account other than those as set out below.

' in Million

Quarter ending Value per books of account Value per quarterly return/statement Difference
Inventory
30-06-2021 7579.92 7538.80 41.12
30-09-2021 8175.78 8170.10 5.68
31-12-2021 8725.40 8725.40 -
31-03-2022 8294.43 8294.40 0.03
Trade Receivable (Gross)
30-06-2021 25138.67 25371.30 (232.63)
30-09-2021 24888.39 24718.10 170.29
31-12-2021 23767.47 23559.80 207.67
31-03-2022 23201.98 23270.90 (68.92)

Also Refer note 40 to the standalone financial statements.

iii) During the year the Company has not made investments providedsecurity and granted loans and advances in the nature of loans to companies firmsLimited Liability Partnerships or any other parties except bank guarantees to companies.

a) The Company has provided guarantee during the year and details ofwhich are given below:

Particulars Guarantees ' in Million
Aggregate amount granted/ provided during the year
- Subsidiaries (including step down subsidiaries) 20989.31
Balance outstanding as at balance sheet date in respect of above cases
- Subsidiaries (including step down subsidiaries) 22088.77
- Associates 940.00

b) During the year the Company has provided guarantees to companies asstated above which are not prejudicial to the Company's interest.

c) During the year the Company has not granted loans and advances inthe nature of loans to companies firms Limited Liability Partnerships or any otherparties. Accordingly the requirement to report on clause 3(iii) (c) is not applicable tothe Company.

d) There are no amounts of loans and advances in the nature of loansgranted to companies which are overdue for more than ninety days.

e) There were no loans or advance in the nature of loan granted tocompanies firms Limited Liability Partnerships or any other parties which was fallen dueduring the year that have been renewed or extended or fresh loans granted to settle theoverdues of existing loans given to the same parties. However during the year the companyhas converted the loan amounting to ' 879.36 million given to one of its subsidiaryinto Zero Coupon Debenture as per the Debt Resolution plan approved by lenders of thatsubsidiary company.

f) The Company has not granted any loans or advances in the nature ofloans either repayable on demand or without specifying any terms or period of repaymentto companies firms Limited Liability Partnerships or any other parties. Accordingly therequirement to report on clause 3(iii)(f) of the Order is not applicable to the Company.

iv) In our opinion and according to the information andexplanations given to us the Company has complied with the provisions of Sections 185 and186 of the Companies Act 2013 in respect of the loans and investments made andguarantees and security provided by it as applicable.

v) The Company has neither accepted any deposits from the publicnor accepted any amounts which are deemed to be deposits within the meaning of sections 73to 76 of the Companies Act and the rules made thereunder to the extent applicable.Accordingly the requirement to report on clause 3(v) of the Order is not applicable tothe Company.

vi) We have broadly reviewed the books of accounts maintained byCompany in respect of product where pursuant to the rule made by the Central Governmentof India the maintenance of cost records has been prescribed under section 148 (1) of theCompanies Act 2013 and are of the opinion that prima facie the prescribed records havebeen maintained. We have not however made a detailed examination of the records with aview to determine whether they are accurate or complete.

vii) In the respect of matters specified in clause (vii) ofparagraphs 3 the Order:

a) Undisputed statutory dues including goods and services taxprovident fund employees' state insurance income-tax duty of custom duty of excisecess and other statutory dues have not been regularly deposited with the appropriateauthorities and there have been serious delays in large number of cases.

According to the information and explanations given to us and based onaudit procedures performed by us undisputed dues in respect of goods and services taxprovident fund employees' state insurance income-tax duty of custom cess and otherstatutory dues which were outstanding at the year end for a period of more than sixmonths from the date they became payable are as follows:

Name of statute Nature of dues Amount (' in million) Period to which the amount relates Due Date Date of payment
Income Tax Act 1961 Dividend Distribution Tax (Including interest) 150.51 Sep'18 14th Oct 2018 Outstanding as on date
Tax Deducted at Source (Including Interest) 52.31 FY 2020-21 7th of following month
84.20 Apr'21 to Aug'21
Employees Provident Fund Act 1932 Provident Fund 67.20 May'21 to Aug'21 15th of following month

' 0.89 Million Paid on 22nd April 2022. ' 9.40 Million Paid on 5th May 2022. Balance Outstanding as on date.

Provident Fund (Interest on Provident Fund) 53.09 Apr'20 to Dec'21 15th of following month Outstanding as on date

As informed the provisions of sales Tax Service Tax duty of exciseand value added tax are currently not applicable to the Company.

b) According to the information and explanations given to us and therecords of the Company examined by us. The particulars of statutory dues referred to insub-clause (a) as at March 31 2022 which have not been deposited on account of a disputeare as follows:

Name of the statute Nature of Dues Amount ' (In million) Period to which the amount relates Forum where dispute is pending
Central Sales Tax and Local Sales Tax Sales Tax 60.57 FY 2008-09 2010-11201112 2012-13 2017-18 High court of Madhya Pradesh
11.67 FY 2015-16 2016-17 Commissioner of Sales Tax Maharashtra
1.68 FY 2016-17 Commissioner of Sales Tax Telangana
2.68 FY 2009-10 Commissioner of Sales Tax Chhattisgarh
The Central Excise Act 1994 Excise Duty 23.39 FY 2013-14 Customs Excise and Service Tax Appellate Tribunal Coimbatore
The Goods & Services Tax Act 2017 GST 13.02 Jul'17 to Feb'20 Commissioner CGST Bhubaneshwar

viii) The Company has not surrendered or disclosed any transactionpreviously unrecorded in the books of account in the

tax assessments under the Income Tax Act 1961(43 of 1961) as incomeduring the year. Accordingly the requirement

to report on clause 3(viii) of the Order is not applicable to theCompany.

ix) In the respect of matters specified in clause (ix) ofparagraphs 3 the Order:

a) The Company has defaulted in repayment of dues to Banks andfinancial institutions during the Financial Year 202122. However the Company hassuccessfully implemented the Debt Resolution plan effective on March 25 2022 (havingcut-off date June 30 2019) which was approved and announced in the Joint Lenders Meetingon March 29 2022 after fulfilling all Conditions Precedent as per the MasterRestructuring Agreement (MRA) signed on February 10 2022. (Refer note 43 of theStandalone Financial Statements).

b) According to the information and explanations given to us and on thebasis of our audit procedures we report that the Company has not been declared WilfulDefaulter by any bank or financial institution or government or any government authority.

c) The Company has not raised any term loans outstanding during theyear hence the requirement to report on clause (ix)(c) of the Order is not applicable tothe Company.

d) On an overall examination of the financial statements of theCompany funds raised on short-term basis have prima facie not been used during the yearfor long-term purposes by the Company.

e) According to the information and explanations given to us and on anoverall examination of the financial statements of the company we report that the companyhas not taken any funds from any entity or person on account of or to meet the obligationsof its subsidiaries associates or joint ventures as defined under Companies Act 2013.

f) The Company has not raised loans during the year on the pledge ofsecurities held in its subsidiaries joint ventures or associate companies. However interms of Debt Resolution plan the company has transferred 10866148 (one crore eightlakhs sixty-six thousand one hundred forty eight) equity shares of Jain Farm Fresh FoodLimited (Subsidiary/ JFFFL) held as on the on March 25 2022 to an escrow account.

x) In the respect of matters specified in clause (x) of paragraphs3 the Order:

a) The Company has not raised any money during the year by way ofinitial public offer / further public offer (including debt instruments) hence therequirement to report on clause 3(x)(a) of the Order is not applicable to the Company.

b) The Company has complied with provisions of sections 42 of theCompanies Act 2013 in respect of the preferential allotment of shares during the year.During the year the company has allotted 62362110 Ordinary Equity Shares of face valueof ' 2/- and 16592798 Ordinary Equity Shares of face value of ' 2/-towards consideration in nature of additional coupon convertible debt payable onNCD1/NCD2/ECB2 (as applicable) issued to the Domestic Lenders and non-domestics lendersrespectively in accordance with the Debt Resolution Plan on preferential basis pursuant torestructuring of existing loans. Accordingly the company has not realised any money incash for the captioned allotment. Further the company has allotted 17283100 equityshares at an issue price of ' 28.87/- per equity share of face value of '2/- to its promoter. The amount raised has been used for the purposes for which the fundswere raised. Further the company has not made any allotment of shares /fully or partiallyor optionally convertible debentures during the year under audit as per provisions of 62of the Companies Act 2013.

xi) In the respect of matters specified in clause (xi) ofparagraphs 3 the Order:

a) During the course of our examination of the books and records of theCompany and according to the information and explanations given to us no material fraudby the Company or on the Company has been noticed or reported during the year.

b) During the course of our examination of the books and records of theCompany carried out in accordance with the generally accepted auditing practices inIndia and according to the information and explanations given to us during the year noreport under sub-section (12) of section 143 of the Companies Act 2013 has been filed bycost auditor/ secretarial auditor or by us in Form ADT - 4 as prescribed under Rule 13 ofCompanies (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.

xii) The Company is not a nidhi Company as per the provisions ofthe Companies Act 2013. Therefore the requirement to report on clause 3(xii)(a)(b) &(c) of the Order is not applicable to the Company.

xiii) In our opinion and according to the information andexplanations given to us transactions with the related parties are in compliance withsections 177 and 188 of Companies Act 2013 where applicable and the details have beendisclosed in the notes to the financial statements as required by the applicableaccounting standards.

xiv) In the respect of matters specified in clause (xiv) ofparagraphs 3 the Order:

a) Though the Company is required to have an internal audit systemunder section 138 of the Act it does not have the internal audit system commensurate withthe size and nature of the business of the Company.

b) We were unable to obtain any internal audit reports of the Companyhence the internal audit reports have not been considered by us.

xv) In our opinion during the year the Company has not entered intoany non-cash transactions with its Directors or persons connected with its directors. andhence provisions of section 192 of the Companies Act 2013 are not applicable to theCompany.

xvi) In the respect of matters specified in clause (xvi) ofparagraphs 3 the Order:

a) The provisions of section 45-IA of the Reserve Bank of India Act1934 (2 of 1934) are not applicable to the Company. Accordingly the requirement to reporton clause (xvi)(a) of the Order is not applicable to the Company.

b) The Company has not conducted any Non-Banking Financial or HousingFinance activities without obtained a valid Certificate of Registration (CoR) from theReserve Bank of India as per the Reserve Bank of India Act 1934. Accordingly therequirement to report on clause (xvi)(b) of the Order is not applicable to the Company.

c) The Company is not a Core Investment Company as defined in theregulations made by Reserve Bank of India. Accordingly the requirement to report onclause 3(xvi)(c) of the Order is not applicable to the Company.

d) As represented by the Management there is no core investmentcompany within the Group (as defined in the Core Investment Companies (Reserve Bank)Directions 2016) and accordingly reporting under clause 3(xvi)(d) of the Order is notapplicable. We have not however separately evaluated whether the information provided bythe management is accurate and complete.

xvii) The Company has not incurred cash losses in the current year.However the Company has incurred cash losses amounting to ' 3107.68 million inthe immediately preceding financial year.

xviii) There has been no resignation of the statutory auditorsduring the year and accordingly requirement to report on Clause 3(xviii) of the Order isnot applicable to the Company.

xix) According to the information and explanations given to us andon the basis of the financial ratios (refer note 39 to standalone financial statements)ageing and expected dates of realization of financial assets and payment of financialliabilities other information accompanying the financial statements our knowledge of theBoard of Directors and management plans and based on our examination of the evidencesupporting the assumptions nothing has come to our attention which causes us to believethat any material uncertainty exists as on the date of the audit report that company isnot capable of meeting its liabilities existing at the date of balance sheet as and whenthey fall due within a period of one year from the balance sheet date. The appropriatenessof assumption of going concern dependent upon the Company's ability to generate cash flowsin future to meet its obligations and to earn profits in future. We however state thatthis is not an assurance as to the future viability of the company. We further state thatour reporting is based on the facts up to the date of the audit report and we neither giveany guarantee nor any assurance that all liabilities falling due within a period of oneyear from the balance sheet date will get discharged by the company as and when they falldue.

xx) In the respect of matters specified in clause (xvi) ofparagraphs 3 the Order:

a) In our opinion and according to the information and explanationsgiven to us in respect of other than ongoing projects there are no unspent amounts thatare required to be transferred to a fund specified in Schedule VII of the Companies Act(the Act) in compliance with second proviso to sub section 5 of section 135 of the Act.

b) In our opinion and according to the information and explanationsgiven to us there are no unspent amounts in respect of ongoing projects that arerequired to be transferred to a special account in compliance of provision of sub section(6) of section 135 of Companies Act.

For Singhi & Co.
Chartered Accountants
Firm Registration Number: 302049E
Sd/-
(Navindra Kumar Surana)
Partner
Place: Kolkata Membership Number: 053816
Date: May 30 2022 UDIN22053816AJVVCQ6186

ANNEXURE-B

TO THE iNDEPENDENT AUDITOR'S REPORT

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

Report on the Internal Financial Controls with reference to FinancialStatements under clause (i) of sub-section 3 of Section 143 of the Act

1) We have audited the internal financial controls with reference tofinancial statements of Jain Irrigation System Limited ("the Company") as ofMarch 31 2022 in conjunction with our audit of the standalone financial statements of theCompany for the year ended on that date.

Management's Responsibility for Internal Financial Controls

2) 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 designimplementation and maintenance of adequate internal financial controls that were operatingeffectively for ensuring the orderly and efficient conduct of its business includingadherence to company's policies the safeguarding of its assets the prevention anddetection of frauds and errors the accuracy and completeness of the accounting recordsand the timely preparation of reliable financial information as required under the Act.

Auditor's Responsibility

3) Our responsibility is to express an opinion on the Company'sinternal financial controls with reference to financial statements based on our audit. Weconducted our audit in accordance with the Guidance Note and the Standards on Auditingdeemed to be prescribed under Section 143(10) of the Act to the extent applicable to anaudit of internal financial controls both applicable to an audit of internal financialcontrols and both issued by the ICAI. Those Standards and the Guidance Note require thatwe comply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether adequate internal financial controls with reference to financialstatements was established and maintained and if such controls operated effectively in allmaterial respects.

4) An audit involves performing procedures to obtain audit evidenceabout the adequacy of the internal financial controls system with reference to financialstatements and their operating effectiveness. Our audit of internal financial controlswith reference to financial statements included obtaining an understanding of internalfinancial controls with reference to financial statements assessing the risk that amaterial weakness exists and testing and evaluating the design and operatingeffectiveness of internal control based on the assessed risk. The procedures selecteddepend on the auditor's judgement including the assessment of the risks of materialmisstatement of the financial statements whether due to fraud or error.

5) We believe that the audit evidence we have obtained is sufficientand appropriate to provide a basis for our audit opinion on the Company's internalfinancial controls system with reference to financial statements.

Meaning of Internal Financial Controls with reference to financialstatements

6) A company's internal financial controls with reference to financialstatements is a process designed to provide reasonable assurance regarding the reliabilityof financial reporting and the preparation of financial statements for external purposesin accordance with generally accepted accounting principles. A company's internalfinancial controls with reference to financial statements includes those policies andprocedures that (1) pertain to the maintenance of records that in reasonable detailaccurately and fairly reflect the transactions and dispositions of the assets of thecompany; (2) provide reasonable assurance that transactions are recorded as necessary topermit preparation of financial statements in accordance with generally acceptedaccounting principles and that receipts and expenditures of the company are being madeonly in accordance with authorisations of management and directors of the company; and (3)provide reasonable assurance regarding prevention or timely detection of unauthorisedacquisition use or disposition of the company's assets that could have a material effecton the financial statements.

Inherent Limitations of Internal Financial Controls with reference tofinancial statements

7) Because of the inherent limitations of internal financial controlswith reference to financial statements including the possibility of collusion or impropermanagement override of controls material misstatements due to error or fraud may occurand not be detected. Also projections of any evaluation of the internal financialcontrols with reference to financial statements to future periods are subject to the riskthat the internal financial controls with reference to financial statements may becomeinadequate because of changes in conditions or that the degree of compliance with thepolicies or procedures may deteriorate.

Opinion

8) In our opinion the Company has in all material respects anadequate internal financial controls system with reference to financial statements andsuch internal financial controls with reference to financial statements were operatingeffectively as at March 312022 based on the internal control over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note issued by ICAI.

For Singhi & Co.
Chartered Accountants
Firm Registration Number: 302049E
Sd/-
(Navindra Kumar Surana)
Partner
Place: Kolkata Membership Number : 053816
Date: May 30 2022 UDIN : 22053816AJVVCQ6186

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