You are here » Home » Companies » Company Overview » PC Jeweller Ltd

PC Jeweller Ltd.

BSE: 534809 Sector: Consumer
NSE: PCJEWELLER ISIN Code: INE785M01013
BSE 00:00 | 06 Jul 27.00 0.50
(1.89%)
OPEN

26.50

HIGH

27.60

LOW

26.50

NSE 00:00 | 06 Jul 27.05 0.55
(2.08%)
OPEN

26.70

HIGH

27.65

LOW

26.50

OPEN 26.50
PREVIOUS CLOSE 26.50
VOLUME 521542
52-Week high 30.55
52-Week low 18.65
P/E
Mkt Cap.(Rs cr) 1,257
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 26.50
CLOSE 26.50
VOLUME 521542
52-Week high 30.55
52-Week low 18.65
P/E
Mkt Cap.(Rs cr) 1,257
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

PC Jeweller Ltd. (PCJEWELLER) - Auditors Report

Company auditors report

TO THE MEMBERS OF PC JEWELLER LIMITED

Report on the Audit of the Standalone Financial Statements

Qualified Opinion

1. We have audited the accompanying standalone financial statements of PC JewellerLimited (‘the Company') which comprise the Standalone Balance Sheet as at 31March 2021 the Standalone Statement of Profit and Loss (including Other ComprehensiveIncome) the Standalone Cash Flow Statement and the Standalone Statement of Changes inEquity for the year then ended and notes to the financial statements including a summaryof the significant accounting policies and other explanatory information (hereinafterreferred to as "the standalone financial statements").

2. Inouropinionandtothebestofourinformationandaccording to the explanations given tous except for the possible effects of the matter described in the Basis for QualifiedOpinion section of our report the aforesaid standalone financial statements give theinformation required by the Companies Act 2013 (‘Act') in the manner so required andgive a true and fair view in conformity with the Indian Accounting Standards ("IndAS") prescribed under section 133 of the Act read with the Companies (IndianAccounting Standards) Rules 2015 as amended and other accounting principles generallyaccepted in India of the state of affairs of the Company as at 31 March 2021 and itsprofit (including other comprehensive income) its cash flows and the changes in equityfor the year ended on that date.

Basis for Qualified Opinion

3. As explained in Note 51 to the accompanying standalone financial statements theCompany during the financial year ended 31 March 2019 had provided discounts of Rs513.65crore to its export customers which had been adjusted against the revenues for the saidyear. The Company had initiated the process of complying with the requirements of theMaster Circular on Exports of Goods and Services issued by the Reserve Bank of India andhad filed the necessary applications with the appropriate authority for approval of suchdiscounts which is a prerequisite under the Foreign Exchange Management Act 1999.Subsequently the Company has obtained the approvals from the authorized dealer banks forreduction in receivables corresponding to discounts amounting to Rs315.21 crore. For theremaining discounts of Rs198.44 crore in the absence of requisite approvals and materialevidence related to such transactions we are unable to comment on the impact if any ofthe same on the accompanying standalone financial statements. Auditor's Opinion for theyear ended 31 March 2019 and 31 March 2020 were also modified in respect of thismatter.

4. We conducted our audit in accordance with the Standards on Auditing (‘SAs')specified under section 143(10) of the Act. Our responsibilities under those standards arefurther described in the Auditor's Responsibilities for the Audit of the standalonefinancial statements section of our report. We are independent of the Company inaccordance with the Code of Ethics issued by the Institute of Chartered Accountants ofIndia (‘the ICAI') together with the ethical requirements that are relevant to ouraudit of the standalone financial statements under the provisions of the Act and the Rulesthereunder and we have fulfilled our other ethical responsibilities in accordance withthese requirements and the ICAI's Code of Ethics. We believe that the audit evidenceobtained by us is sufficient and appropriate to provide a basis for our qualifiedopinion.

Emphasis of Matters

5. We draw attention to Note 52 to the accompanying standalone financial statementsregarding the delays in receipt of proceeds denominated in foreign currency against exportof goods made by the Company to its overseas customers aggregating to Rs1109.40 crores ason 31 March 2021 beyond the timelines stipulated under the Foreign Exchange ManagementAct 1999. The management of the Company has filed the necessary applications with theappropriate authority for condonation of such delays to regularize the default. Pendingcondonation of such delay by the appropriate authority management is of the view that thepossible penalties that may be levied are currently unascertainable but would not bematerial and accordingly no consequential adjustments have been made to the accompanyingstandalone financial statements with respect to such delay/default.

6. We draw attention to Note 50 to the accompanying standalone financial statementswhich describes the uncertainties and management's assessment of the impact of the COVID19 pandemic on the operations and financial results of the Company. In view of theuncertainties in the economic environment due to the outbreak of COVID-19 pandemic theimpact on the financial position and performance of the Company is significantly dependenton the future developments as they evolve.

7. WedrawattentiontoNote53totheaccompanyingstandalone financial statements regardingimpairment assessment of company's total exposure in its subsidiaries in the form ofinvestments and receivables (loan interest accrued and trade receivables). The managementof the Company has carried out the impairment assessment using the 'Discounted Cash FlowValuation Model' which is complex and involves the use of significant managementestimates and assumptions that are dependent on expected future market and economicconditions and accordingly recognized additional provision for impairment amounting toRs4.26 crores in respect of exposure in PC Universal Private Limited in the standalonefinancial statements of the Company.

Our opinion is not modified in respect of the above matters.

Key Audit Matters

8. Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the standalone financial statements of the current period.These matters were addressed in the context of our audit of the standalone financialstatements as a whole and in forming our opinion thereon and we do not provide aseparate opinion on these matters.

9. In addition to the matters described in the Basis for Qualified Opinion section wehave determined the matters described below to be the key audit matters to be communicatedin our report.

Key Audit Matter How our audit addressed the key audit matter
Existence and valuation of inventory
The Company has an inventory balance of Rs5793.72 crore as at 31 March 2021 as disclosed in Note 10 of the accompanying standalone financial statements. Refer Note 3(j) for the corresponding accounting policy adopted by the management with respect to the inventory balance. Our audit work in relation to the existence and valuation of inventory included but was not limited to performing the following procedures:
Obtained an understanding of the management's process for physical verification recognition and measurement of purchase cost of gold diamonds and manufactured jewellery items.
The Company purchases gold from nominated agencies prescribed by Reserve Bank of India. Further the Company also purchases gold and diamonds from institutional parties and from the customers as per the exchange schemes announced by the Company. Evaluated the design and tested the operating effectiveness of controls implemented by the Company with respect to such process including controls around safeguarding the high value inventory items.
With respect to existence of inventory as at year end there is an inherent risk of loss from theft or possible mala_de intent due to the high intrinsic value and portable nature of individual inventory items. Assessed the appropriateness of accounting policy and management valuation methodology adopted by the management.
On a sample basis tested invoices and other underlying records to validate the costs and characteristics basis which the inventory is categorized for inventory management and valuation.
In addition to the physical verification performed by the management with the help of an independent professional gemologist the lenders of the Company also conduct stock counts with the help of their appointed independent gemologists. Obtained the physical verification records performed by the management as at the year end.
Inspected reports of physical verification done by gemologists appointed by the lenders of the Company for corroborative evidence.
With respect to valuation of the inventory the Company categorizes diamonds purchased into the respective cost categories defined by the management based on price bands and other physical characteristics of the diamonds. Considering the complexities involved portable nature of diamonds high inherent risk and high level of estimation uncertainty involved in valuation of the inventory the existence and valuation of inventory has been determined as key audit matter for the current year audit. Performed independent test counts for certain locations subsequent to year-end and other safeguarding procedures and performed roll-back procedures to corroborate management counts and valuation based on management categorization with the help of an independent professional gemologist.
On a sample basis tested samples of inventory sold near year-end to corroborate management's assessment of net realizable value of closing inventory balance. Obtained valuation report from independent Gemologist to corroborate management's assessment of net realizable value of closing inventory balance of Diamonds.
Evaluated disclosures made in the accompanying financial statements for appropriateness and adequacy in accordance with the requirements of the accounting standards.

Information other than the Standalone Financial Statements and Auditor's Report thereon

10. The company's Board of Directors is responsible for the preparation of otherinformation. The other information comprises the information included in the ManagementDiscussion and Analysis Report on Corporate Governance Director's Report includingannexures to Director's Report but does not include the standalone financial statementsand our auditor's report thereon.

Our opinion on the standalone financial statements does not cover the other informationand 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 during the course of audit or otherwise appears to be materially misstated.

If based on the work we have performed we conclude that there is a materialmisstatement of this other information we are required to communicate the matter to thosecharged with governance and take necessary actions as per applicable laws and regulations.As described in the Basis for Qualified Opinion section above in the absence of requisiteapprovals and material evidence related to discount to export customers we are unable tocomment on the impact if any of the same on the accompanying standalone financialstatements. We have concluded that the other information is materially misstated for thesame reason with respect to the amounts or other items in the Management Discussion andAnalysis and Directors' Report affected by the absence of requisite approvals and materialevidence relating to the aforementioned transaction.

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

11. The accompanying standalone financial statements have been approved by theCompany's Board of Directors. The Company's Board of Directors is responsible for thematters stated in section 134(5) of the Act with respect to the preparation of thesestandalone financial statements that give a true and fair view of the financial positionfinancial performance including other comprehensive income changes in equity and cashflows of the Company in accordance with the accounting principles generally accepted inIndia including the Ind AS specified under section 133 of the Act. This responsibilityalso includes maintenance of adequate accounting records in accordance with the provisionsof the Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and designimplementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the financial statements thatgive a true and fair view and are free from material misstatement whether due to fraud orerror.

12. 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.

13. The Board of Directors are also responsible for overseeing the company's financialreporting process.

Auditor's Responsibilities for the Audit of the Standalone Financial Statements

14. 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.

15. 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 standalone financialstatements whether due to fraud or error design and perform audit procedures responsiveto those risks and obtain audit evidence that is sufficient and appropriate to provide abasis for our opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error as fraud may involve collusionforgery intentional omissions misrepresentations or the override of internal control.

Obtain an understanding of internal financial controls relevant to the audit in orderto 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 with reference to standalone financialstatements in place and the operating effectiveness of such controls.

Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by management.

Conclude on the appropriateness of management's use of the going concern basis ofaccounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe standalone financial statements or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor's report. However future events or conditions may cause the company to cease tocontinue as a going concern.

Evaluate the overall presentation structure and content of the standalone financialstatements including the disclosures and whether the standalone financial statementsrepresent the underlying transactions and events in a manner that achieves fairpresentation.

16. We communicate with those charged with governance regarding among other mattersthe planned scope and timing of the audit and significant audit findings including anysignificant de_ciencies in internal control that we identify during our audit.

17. 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.

18. From the matters communicated with those charged with governance we determinethose matters that were of most significance in the audit of the standalone financialstatements of the current period and are therefore the key audit matters. We describethese matters in our auditor's report unless law or regulation precludes public disclosureabout the matter or when in extremely rare circumstances we determine that a mattershould not be communicated in our report because the adverse consequences of doing sowould reasonably be expected to outweigh the public interest benefits of suchcommunication.

Other Matters

19. The standalone financial statements of the Company for the year ended 31 March 2020were audited by the previous auditors of the Company who have expressed a modified opinionvide their report dated 29 June 2020 on such standalone financial statements.

Report on Other Legal and Regulatory Requirements

20. As required by section 197(16) of the Act based on our audit and to the best ofour information and according to the explanations given to us we report that theremuneration paid by the Company to its directors during the year is within the limitprescribed under Schedule V of the Companies Act 2013. However on account of bankdefaults in payment of dues during the year requisite approvals required from the bankersand shareholders as per Schedule V of the Act in this regard are yet to be obtained.

21. As required by the Companies (Auditor's Report) Order 2016 ("theOrder") issued by the Central Government of India in terms of sub-section (11) ofsection 143 of the Act we give in the "Annexure A" a statement on thematters specified in paragraphs 3 and 4 of the Order to the extent applicable.

22. As required by Section 143(3) of the Act we report that:

(a) we have sought and except for the matter described in the Basis for QualifiedOpinion section obtained all the information and explanations which to the best of ourknowledge and belief were necessary for the purpose of our audit of the accompanyingstandalone financial statements;

(b) except for the possible effects of the matter described in the Basis for QualifiedOpinion section in our opinion proper books of account as required by law have been keptby the Company so far as it appears from our examination of those books;

(c) the standalone financial statements dealt with by this report are in agreement withthe books of account;

(d) except for the possible effects of the matter described in the Basis for QualifiedOpinion section in our opinion the aforesaid standalone financial statements comply withInd AS specified under section 133 of the Act;

(e) on the basis of the written representations received from the directors and takenon record by the Board of Directors none of the directors is disqualified as on 31 March2021 from being appointed as a director in terms of section 164(2) of the Act;

(f) the qualification relating to the maintenance of accounts and other mattersconnected therewith are as stated in the Basis for Qualified Opinion section;

(g) we have also audited the internal financial controls with reference to financialstatements of the Company as on 31 March 2021 in conjunction with our audit of thestandalone financial statements of the Company for the year ended on that date and ourreport as per "Annexure B" expressed unmodified opinion; and

(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 as detailed in Note 44 to the standalone financials statements hasdisclosed the impact of pending litigations on its financial position as at 31 March 2021;

ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses as at 31 March 2021.

iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the company during the year ended 31 March2021.

For Arun K Agarwal & Associates
Chartered Accountants
(Firm's Registration No. 003917N)
Sd/-
Arun Kumar Agarwal
(Partner)
M. No. 082899
UDIN: 21082899AAAADO6955
Place: New Delhi
Date: 27.05.2021

Annexure A to the Independent Auditor's Report of even date to the members of PCJeweller Limited on the standalone financial statements for the year ended 31 March 2021

Based on the audit procedures performed for the purpose of reporting a true and fairview on the standalone financial statements of the Company and taking into considerationthe information and explanations given to us and the books of account and other recordsexamined by us in the normal course of audit and to the best of our knowledge and beliefwe report that:

i. (a) The company has maintained proper records showing full particulars includingquantitative details and situation of property plant and equipment ("PPE").

(b) ThePPEhavebeenphysicallyverifiedbythemanagement during the year and no materialdiscrepancies were noticed on such verification. In our opinion the frequency ofverification of the PPE is reasonable having regard to the size of the Company and thenature of its assets.

(c) According to the information and explanations given to us and on the basis of ourexamination of the records of the company the title deeds of immovable properties (whichare included under the head ‘Property plant and equipment') are held in the name ofthe company.

ii. In our opinion the management has conducted physical verification of inventory atreasonable intervals during the year except for stocks lying with third parties. Forstocks lying with the third parties at the year-end written confirmations have beenobtained by the management. No material discrepancies were noticed on the aforesaidverification.

iii. The company has not granted any loan secured or unsecured to companies firmsLimited Liabilities Partnership (LLPs) or other parties covered in the register maintainedunder section 189 of the Act. Accordingly paragraphs 3 (iii) (a) (b) and (c) of the Orderare not applicable.

iv. In our opinion the company has complied with the provisions of section 185 and 186of the Act with respect to the grant of loan and making investment. Further in ouropinion the Company has not entered into any transaction covered under Section 185 andSection 186 of the Act in respect of guarantees and security.

v. In our opinion the Company has complied with the directives issued by the ReserveBank of India the provisions of Sections 73 to 76 and other relevant provisions of theAct and the Companies (Acceptance of Deposits) Rules 2014 (as amended) as applicablewith regard to the deposits accepted. According to the information and explanations givento us no order has been passed by the Company Law Board or National Company Law Tribunalor Reserve Bank of India or any Court or any other Tribunal in this regard.

vi. The Central Government has not specified maintenance of cost records undersub-section (1) of Section 148 of the Act in respect of Company's products. Accordinglythe provisions of clause 3(vi) of the Order are not applicable.

vii. (a) Undisputed statutory dues including provident fund employees' stateinsurance income-tax goods and services tax sales tax service tax duty of customsduty of excise value added tax cess and other material statutory dues as applicablehave generally been regularly deposited to the appropriate authorities though there hasbeen a slight delay in a few cases. Undisputed amounts payable in respect thereof whichwere outstanding at the year-end for a period of more than six months from the date theybecame payable are as follows:

Name of the Statute Nature of the dues Amount (Rs in crore) Period to which amount relates Due Date Date of Payment
Income-tax Act 1961 Income-tax (including interest) 112.25 AY 2018-19 15.03.2018 Not yet paid

(b) The dues outstanding in respect of income-tax sales-tax service-tax duty ofcustoms duty of excise and value added tax on account of any dispute are as follows:

Name of the Statute Nature of the dues Amount (Rs in crore) Paid under Protest (Rs in crores) Period to which it pertains Forum at which case is pending
Income-tax Act 1961 Income-tax 0.19 - AY 2009-10 Income-tax Appellate
0.85 - AY 2013-14 Tribunal
4.43 - AY 2014-15
0.23 - AY 2017-18 Appeal yet to be filed
Customs Act 1962 Custom duty 2.43 2.43 FY 2010-11 Principal Commissioner of
Customs New Delhi
Rajasthan Value Added Value added 0.05 - FY 2010-11 The Rajasthan High
Tax Act 2003 tax 0.44 - FY 2011-12 Court
0.50 - FY 2012-13
2.73 - FY 2013-14
2.31 - FY 2014-15
2.21 - FY 2015-16

viii. The Company has delayed in repayment of loans or borrowings to Banks in respectof Rs213.88 Crores as on 31 March 2021. Refer Note 19 to the standalone financialstatements. There are no loans or borrowings to government or dues to debenture holders.The lender wise details are tabulated as under:

PARTICULARS Amount of Default Period of Default
(Rs in crore)
Bank Dues (Working Capital Loans Cash Credit Facilities and SBLC
Devolvement)
- Punjab National Bank 59.62
- Corporation bank 0.89
Bank Dues (Funded Interest Term Loan Facilities)
- State Bank of India 43.40
- Punjab National Bank 27.49
- Union Bank of India 11.84
- Corporation Bank 12.79
- Allahabad Bank 11.08
- Bank of India 12.00 The delay in repayments is ranging between 1 to 360 days as on 31 March 2021
- Indian Overseas Bank 9.45
- Syndicate Bank 7.25
- IDBI BANK 5.92
- Bank of Baroda 2.20
- Axis Bank 1.58
- IDFC 3.71
- Canara Bank 1.68
- KVB Bank 1.70
- Induslnd Bank 1.28
Total 213.88

ix. The company did not raise any money by way of initial public offer or furtherpublic offer (including debt instruments). In our opinion the term loans were applied forthe purposes for which the loans were obtained.

x. No material fraud by the company or on the company by its officers or employees hasbeen noticed or reported during the year.

xi. Managerial remuneration paid by the Company to its directors during the year iswithin the limit prescribed under Schedule V of the Act. However on account of bankdefaults in payment of dues during the year requisite approvals required from the bankersand shareholders as per Schedule V of the Act in this regard are yet to be obtained. Anamount of Rs33.33 lacs has been paid as managerial remuneration to the whole time directorduring the year. Steps for recovery or otherwise in this regard are yet to be taken by theCompany.

xii. In our opinion the company is not a Nidhi company. Accordingly paragraph 3(xii)of the Order is not applicable.

xiii. In our opinion transactions with the related parties are in compliance withsections 177 and 188 of the Act where applicable and requisite details of suchtransactions have been disclosed in the standalone financial statements as required by theapplicable Ind AS.

xiv. During the year the Company has made allotment of 70330000 equity shareshaving face value of Rs 10 /- each at an issue price of Rs 30/- per share to Shri BalramGarg promoter of the company on preferential basis pursuant to conversion of unsecuredloan amounting to Rs 210.99 crores extended by him to the company in the earlier years. Asper the information and explanations given to us the Company has made compliance ofprovisions of section 42 of the Act as applicable.

xv. In our opinion the company has not entered into non-cash transactions withdirectors or persons connected with them covered under section 192 of the Act.Accordingly paragraph 3(xv) of the Order is not applicable.

xvi. The company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934.

For Arun K Agarwal & Associates
Chartered Accountants
(Firm's Registration No. 003917N)
Sd/-
Arun Kumar Agarwal
(Partner)
M. No. 082899
UDIN: 21082899AAAADO6955
Place: New Delhi
Date: 27.05.2021

Annexure B to Independent Auditors' Report

Referred to Para 22(g) under the heading of "Report on Other Legal and RegulatoryRequirements" of our report of even date

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls over financial reporting of PCJEWELLER LIMITED ("the company") as of 31 March 2021 in conjunction with ouraudit of the standalone financial statements of the company for the year ended on thatdate.

Responsibilities of Management and Those Charged with Governance for Internal FinancialControls

The Company's Board of Directors is responsible for establishing and maintaininginternal financial controls based on the internal financial controls with reference tofinancial statements criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls over Financial Reporting (‘the Guidance Note') issued by the Institute ofChartered Accountants 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 the Company's businessincluding adherence to the Company's policies the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Act.

Auditor's Responsibility for the Audit of the Internal Financial Controls withReference to Financial Statements

Our responsibility is to express an opinion on the company's internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting(the "Guidance Note") and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls. Those Standards and the GuidanceNote require that we comply with ethical requirements and plan and perform the audit toobtain reasonable assurance about whether adequate internal financial controls overfinancial reporting was established and maintained and if such controls operatedeffectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor's judgment including the assessment of the risks ofmaterial misstatement of the 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 withreference to financial statements.

Meaning of Internal Financial Controls with Reference to Financial Statements

A company's internal financial controls with reference to financial statements 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 controlswith reference to financial statements include those policies and procedures that (1)pertain to the maintenance of records that in reasonable detail accurately and fairlyreflect the transactions and dispositions of the assets of the company; (2) providereasonable assurance that transactions are recorded as necessary to permit preparation offinancial statements in accordance with generally accepted accounting principles and thatreceipts and expenditures of the company are being made only in accordance withauthorisations of management and directors of the company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorised acquisition use ordisposition of the company's assets that could have a material effect on the financialstatements.

Inherent Limitations of Internal Financial Controls with Reference to FinancialStatements

Because of the inherent limitations of internal financial controls with reference tofinancial statements 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 withreference to financial statements to future periods are subject to the risk that theinternal financial controls with reference to financial statements may become inadequatebecause of changes in conditions or that the degree of compliance with the policies orprocedures may deteriorate.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the company has in all material respects an adequate internal financialcontrols system with reference to financial statements and such controls were operatingeffectively as at 31 March 2021 based on the internal financial control with reference tofinancial statements criteria established by the company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting issued by the Institute of Chartered Accountants ofIndia.

For Arun K Agarwal & Associates
Chartered Accountants
(Firm's Registration No. 003917N)
Sd/-
Arun Kumar Agarwal
(Partner)
M. No. 082899
UDIN: 21082899AAAADO6955
Place: New Delhi
Date: 27.05.2021

.