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Paras Defence and Space Technologies Ltd.

BSE: 543367 Sector: Engineering
NSE: PARAS ISIN Code: INE045601015
BSE 00:00 | 01 Jul 596.50 -7.50
(-1.24%)
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604.00

HIGH

605.90

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589.30

NSE 00:00 | 01 Jul 595.85 -7.45
(-1.23%)
OPEN

604.50

HIGH

604.90

LOW

589.00

OPEN 604.00
PREVIOUS CLOSE 604.00
VOLUME 10766
52-Week high 1272.05
52-Week low 456.00
P/E 86.45
Mkt Cap.(Rs cr) 2,326
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 604.00
CLOSE 604.00
VOLUME 10766
52-Week high 1272.05
52-Week low 456.00
P/E 86.45
Mkt Cap.(Rs cr) 2,326
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Paras Defence and Space Technologies Ltd. (PARAS) - Auditors Report

Company auditors report

TO THE MEMBERS OF

PARAS DEFENCE AND SPACE TECHNOLOGIES LIMITED

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the accompanying Standalone Financial Statements of PARAS DEFENCEAND SPACE TECHNOLOGIES LIMITED ("the Company") which comprise theStandalone Balance sheet as at March 31 2021 the Statement of Standalone Profit and Loss(including Other Comprehensive Income) the Statement of Standalone Changes in Equity andthe Statement of Standalone Cash Flows for the year then ended and notes to theStandalone Financial Statements including a summary of significant accounting policiesand other explanatory information (hereinafter referred to as "the StandaloneFinancial Statements").

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Standalone Financial Statements give the information requiredby the Companies Act 2013 (‘the Act') in the manner so required and give a true andfair view in conformity with the accounting principles generally accepted in India of thestate of affairs of the Company as at March 31 2021 and its profit including othercomprehensive income the changes in equity and its cash flows for the year ended on thatdate.

Basis for Opinion

We conducted our audit of the Standalone Financial Statements in accordance with theStandards on Auditing (SAs) specified under section 143(10) of the Act. Ourresponsibilities 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 issued bythe Institute of Chartered Accountants of India (‘ICAI') 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 opinion on the Standalone Financial Statements.

Emphasis of Matter

We draw your attention to the Note no. 40 to the Standalone Financial Statements whichdescribes the uncertainties related to COVID-19 Pandemic and its consequential effects onthe affairs of the Company. Our opinion is not modified in respect of this matter.

Other Information

The Company's Board of Directors is responsible for the other information. The otherinformation comprises the Directors report and Chairman's statement included in the annualreport but does not include the Standalone Financial Statements and our auditor's reportthereon. Our opinion on the Standalone Financial Statements does not cover the otherinformation and we do not express any form of assurance conclusion thereon.

In connection with our audit of the Standalone Financial Statements our responsibilityis to read the other information and in doing so consider whether the other informationis materially inconsistent with the Standalone Financial Statements or our knowledgeobtained in the audit or otherwise appears to be materially misstated. If based on thework we have performed we conclude that there is a material misstatement of this otherinformation; we are required to report that fact. We have nothing to report in thisregard.

Responsibilities of Management and Those Charged with Governance for the StandaloneFinancial Statements

The Company's Board of Directors is responsible for the matters stated in Section134(5) of the Act with respect to the preparation of these Standalone Financial Statementsthat give a true and fair view of the financial position financial performance includingother comprehensive income cash flows and changes in equity of the Company in accordancewith the accounting principles generally accepted in India including Indian AccountingStandards (‘Ind AS') prescribed under Section 133 of the Act read with relevant rulesissued thereunder.

This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding of the assets of the Companyand for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe Standalone Financial Statements that give a true and fair view and are free frommaterial misstatement whether due to fraud or error.

In preparing the Standalone Financial Statements management is responsible forassessing the Company's ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessmanagement either intends to liquidate the Company or to cease operations or has norealistic alternative but to do so. Those Board of Directors are also responsible foroverseeing the Company's financial reporting process.

Auditors' Responsibility for the Standalone Financial Statements

Our objectives are to obtain reasonable assurance about whether the StandaloneFinancial Statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these Standalone Financial Statements.

As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the StandaloneFinancial Statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.

• Obtain an understanding of internal financial controls relevant to the audit inorder to design audit procedures that are appropriate in the circumstances. Under section143(3) (i) of the Act we are also responsible for expressing our opinion on whether theCompany has adequate internal financial controls system in place and the operatingeffectiveness of such controls.

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

• Conclude on the appropriateness of management's use of the going concern basisof accounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the ability ofthe Company to continue as a going concern. If we conclude that a material uncertaintyexists we are required to draw attention in our auditor's report to the relateddisclosures in the Standalone Financial Statements or if such disclosures are inadequateto modify our opinion. Our conclusions are based on the audit evidence obtained up to thedate of our auditor's report. However future events or conditions may cause the Companyto cease to continue as a going concern.

• Evaluate the overall presentation structure and content of the StandaloneFinancial Statements including the disclosures and whether the Standalone FinancialStatements represent the underlying transactions and events in a manner that achieves fairpresentation. We communicate with those charged with governance regarding among othermatters 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 we havecomplied with relevant ethical requirements regarding independence and to communicatewith them all relationships and other matters that may reasonably be thought to bear onour independence and where applicable related safeguards.

Report on Other Legal and Regulatory Requirements

1. As required by Section 143 (3) of the Act we report that: a. We have sought andobtained all the information and explanations which to the best of our knowledge andbelief were necessary for the purposes of our audit. b. In our opinion proper books ofaccount as required by law have been kept by the Company so far as it appears from ourexamination of those books. c. The Standalone Balance Sheet the Statement of StandaloneProfit and Loss (Including other comprehensive income) the Statement of StandaloneChanges in Equity and the Statement of Standalone Cash Flows dealt with by this Report arein agreement with the books of account. d. In our opinion the aforesaid StandaloneFinancial Statements comply with the Ind AS prescribed under Section 133 of the Act. e. Onthe basis of the written representations received from the directors as on March 31 2021and taken on record by the Board of Directors none of the directors is disqualified as onMarch 31 2021 from being appointed as a director in terms of Section 164 (2) of the Act.f. With respect to the adequacy of the internal financial controls with reference tostandalone financial statements"of the Company and the operating effectiveness ofsuch controls refer to our separate Report in "Annexure A". g. Withrespect to the other matters to be included in the Auditor's Report in accordance with therequirements of section 197(16) of the Act as amended: In our opinion and to the best ofour information and according to the explanations given to us the remuneration paid /provided by the Company to its directors during the year is in accordance with theprovisions of section 197 of the Act.

h. With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 as amended inour opinion and to the best of our information and according to the explanations given tous: i. The Company has disclosed the impact of pending litigations on its financialposition in its Standalone Financial Statements as referred to in Note No. 33 to theStandalone Financial Statements; ii. The Company did not have any long-term contractsincluding derivative contracts for which there were any material foreseeable losses; iii.There were no amounts which were required to be transferred to the Investor Education andProtection Fund by the Company.

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

For CHATURVEDI & SHAH LLP
Chartered Accountants
Firm Reg. No. 101720W / W100355
R. KORIA
Partner
Membership No. 35629
UDIN No.: 21035629AAAACA6300
Mumbai
Date: July 06 2021

ANNEXURE "A" TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 1 (f) under ‘Report on Other Legal and RegulatoryRequirements' of our report of even date on Standalone Financial Statements of PARASDEFENCE AND SPACE TECHNOLOGIES LIMITED for the year ended March 31 2021) Report on theInternal Financial Controls with reference to standalone financial statements under Clause(i) of Sub-section 3 of Section 143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls with reference to standalone financialstatements of PARAS DEFENCE AND SPACE TECHNOLOGIES LIMITED (‘the Company') asof March 31 2021 in conjunction with our audit of the Standalone 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 and maintaining internalfinancial controls based on the internal control with reference to standalone financialstatements 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 implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the orderly and efficient conduct of its business including adherence tocompany's policies the safeguarding of its assets the prevention and detection of fraudsand 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's internal financialcontrols with reference to standalone financial statements based on our audit. Weconducted our audit in accordance with the Guidance Note issued by the ICAI and theStandards of Auditing prescribed under Section 143(10) of the Companies Act 2013 to theextent applicable to an audit of internal financial controls. 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 controlswith reference to standalone financial statements was established and maintained and ifsuch controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system with reference to standalone financial statementsand their operating effectiveness. Our audit of internal financial controls with referenceto standalone financial statements included obtaining an understanding of internalfinancial controls with reference to standalone financial statements assessing the riskthat a material 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 Standalone Financial Statements whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company's internal financial controls systemwith reference to standalone financial statements.

Meaning of Internal Financial Controls with reference to standalone financialstatements

A company's internal financial control with reference to standalone 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 control with reference to standalone financial statements includes thosepolicies and procedures that (1) pertain to the maintenance of records that in reasonabledetail accurately and fairly reflect the transactions and dispositions of the assets ofthe company; (2) provide reasonable assurance that transactions are recorded as necessaryto permit 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 to standalonefinancial statements

Because of the inherent limitations of internal financial controls with reference tostandalone 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 standalone financial statements to future periods are subjectto the risk that the internal financial control with reference to standalone financialstatements may become inadequate because of changes in conditions or that the degree ofcompliance with the policies or procedures may deteriorate.

Opinion

In our opinion to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlssystem with reference to standalone financial statements and such internal financialcontrols with reference to standalone financial statements were operating effectively asat March 31 2021 based on the internal control with reference to standalone financialstatements criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note issued by the ICAI.

For CHATURVEDI & SHAH LLP
Chartered Accountants
Firm Reg. No. 101720W / W100355
R. KORIA
Partner
Membership No. 35629
UDIN No.: 21035629AAAACA6300
Mumbai
Date: July 06 2021

ANNEXURE "B" TO INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 2 under the heading "Report on Other Legal andRegulatory Requirements" of our report of even date to the members of PARAS DEFENCEAND SPACE TECHNOLOGIES LIMITED on the Standalone Financial Statements for the year endedMarch 31 2021) a. The Company has maintained proper records showing full particularsincluding quantitative details and situation of fixed assets on the basis of availableinformation. b. As explained to us the Company has physically verified certain assets inaccordance with a phased program of verification which in our opinion is reasonablehaving regard to the size of the Company and the nature of its assets. No materialdiscrepancies were noticed on such physical verification as compared with the availablerecords. c. According to the information and explanations given to us and on the basis ofour examination of the records of the Company the original title deeds of immovableproperties as disclosed in Note no. 2 to the Standalone Financial Statements have beendeposited with the lenders we have been produced the photocopy of the title deeds ofthose immovable properties and based on such documents the title deeds are held in thename of the Company. ii. As explained to us inventories have been physically verifiedduring the year by the management except for inventories with job worker for whichmanagement confirmation has been received. In our opinion the frequency of verification isreasonable. Discrepancies noticed on physical verification of the inventories between thephysical inventories and book records were not material having regard to the size of theoperations of the Company and the same have been properly dealt with. iii. In respect ofloans secured or unsecured granted by the Company to companies firms Limited liabilitypartnerships or other parties covered in the register maintained under section 189 of theAct: a. The Company has granted unsecured loan to only its subsidiaries. In our opinionand according to the information and explanation given to us the terms and conditions onwhich the loan had been granted were not prima facie prejudicial to the interest of theCompany.

have been stipulated and the receipts are regular where applicable. c. There is nooutstanding amount in respect of such loans as on March 31 2021 so the question ofoverdue doesn't arise. iv. In our opinion and according to the information andexplanations given to us the Company has complied with the provisions of section 185 and186 of the Act as applicable in respect of grant of loans and making investments. TheCompany has not provided any guarantee or security. v. According to the information andexplanations given to us the Company has not accepted any deposit from the public.Therefore the provisions of paragraph 3 (v) of the CARO 2016 are not applicable to theCompany. vi. We have broadly reviewed the cost records maintained by the Company pursuantto the Companies (Cost Records and Audit) Rules 2014 prescribed by the Central Governmentunder Section 148 (1) of the Companies Act 2013 as applicable and are of the opinionthat prima facie the prescribed accounts and records have been maintained. We havehowever not made a detailed examination of the cost records with a view to determinewhether they are accurate or complete. vii. According to the information and explanationsgiven to us in respect of statutory dues: a. The company has been generally regular indepositing undisputed statutory dues including provident fund employees' stateinsurance duty of customs cess goods and service tax and any other statutory dues asapplicable with the appropriate authorities during the year however delays have beennoticed in respect of income tax. According to the information and explanations given tous no undisputed amounts payable in respect of such statutory dues were outstanding as atMarch 31 2021 for a period of more than six months from the date they became payableexcept income tax amounting to H 221.07 Lakhs.

b. According to information and explanations given to us there are no dues of incometax or sales tax or service tax or duty of customs or duty of excise or value added tax orgoods and service tax which have not been deposited with the appropriate authorities onaccount of any dispute except as mentioned below:-

Nature of Dues Statute Period Involved Amount (Rs in Lakhs) Forum where dispute is pending
Custom Duty The Customs Act 1962 2019-20 12.00 Additional Commissioner
Income Tax The Income Tax Act 1961 2007-08 2009-10 to 2015-16 2019-20 88.74 Commissioner / CPC
Total 100.74

viii. Based on our audit procedures and information and explanations given by theManagement during the year the company has not defaulted in repayment of loans orborrowing to any financial institution bank and Government. The Company does not have anyborrowings from debenture holders. ix. According to the information and explanations givento us the Company has not raised any money by way of initial public offer or furtherpublic offer (including debt instruments). The term loans raised during the year wereutilised for the purpose for which it has been raised. x. Based on our audit proceduresperformed for the purpose of reporting the true and fair view of the Standalone FinancialStatements and on the basis of information and explanations given by the management nofraud by the Company or on the Company by its officers or employees has been noticed orreported during the year. xi. In our opinion and according to the information andexplanations given to us the managerial remuneration has been paid or provided inaccordance with the requisite approvals mandated by the provisions of section 197 readwith Schedule V to the Act. xii. In our opinion and according to the information andexplanations given to us the Company is not a nidhi company. Therefore the provisions ofparagraph 3 (xii) of the CARO 2016 are not applicable to the Company. xiii. According tothe information and explanations given to us and based on our examination of the recordsof the Company transactions with the related parties are in compliance with sections 177and 188 of the Act where applicable and details of such transactions have been disclosedin the Standalone Financial Statements etc. as required by the applicable accountingstandards.

xiv. According to the information and explanations given to us and based on ourexamination of the records of the Company during the year the Company has not made anyallotment of fully or partly convertible debentures. The Company has made preferentialallotment / private placement of equity shares and Optionally Convertible PreferenceShares in compliance with Section 42 of the Companies Act 2013 and the amount raised havebeen used for the purpose for which the funds were raised. xv. According to theinformation and explanations given to us the Company has not entered into non-cashtransactions with directors or persons connected with him. Therefore the provisions ofparagraph 3 (xv) of the CARO 2016 are not applicable to the Company xvi. In our opinionand according to information and explanations provided to us the Company is not requiredto be registered under section 45-IA of the Reserve Bank of India Act 1934.

For CHATURVEDI & SHAH LLP
Chartered Accountants
Firm Reg. No. 101720W / W100355
R. KORIA
Partner
Membership No. 35629
UDIN No.: 21035629AAAACA6300
Mumbai
Date: July 06 2021

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