To the Members of Rana Sugars Limited
Report on the Audit of Standalone Ind AS Financial Statements Opinion
We have audited the accompanying Ind AS financial statements of Rana Sugars Limited("the Company") which comprise the Balance Sheet as at March 31 2021 theStatement of Profit and Loss (including Other Comprehensive Income) the Statement ofChanges in Equity and the Statement of Cash Flows for the year then ended and notes to theStandalone Ind AS financial statements including a summary of the significant accountingpolicies and other explanatory information (hereinafter referred to as "thestandalone Ind AS financial statements"). In our opinion and to the best of ourinformation and according to the explanations given to us the aforesaid Standalone Ind ASfinancial statements give the information required by the Companies Act 2013 ("theAct") in the manner so required and give a true and fair view in conformity with theIndian Accounting Standards prescribed under section 133 of the Act read with Companies(Indian Accounting Standards) Rules 2015 as amended ("Ind AS") and otheraccounting principles generally accepted in India of the state of affairs of the Companyas at March 31 2021 the Profit and total comprehensive Income changes in equity and itscash flows for the year ended on that date.
Basis for Opinion
We conducted our audit of Standalone Ind AS financial statements in accordance with theStandards on Auditing ("SA"s) specified under section 143(10) of the Act (SAs).Our responsibilities under those Standards are further described in the
Auditor's Responsibilities for the Audit of the Standalone Ind AS Financial Statements sectionof our report. We are independent of the Company in accordance with the Code of Ethicsissued by the Institute of Chartered Accountants of India (ICAI) together with the ethicalrequirements that are relevant to our audit of the Standalone Ind AS financial statementsunder the provisions of the Act and the Rules made there under and we have fulfilled ourother ethical responsibilities in accordance with these requirements and the ICAI's Codeof Ethics. We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our opinion on the Standalone Ind AS financialstatements.
Key Audit Matters
Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the Standalone Ind AS financial statements of the currentperiod. These matters were addressed in the context of our audit of the Standalone Ind ASfinancial statements as a whole and in forming our opinion thereon and we do not providea separate opinion on these matters.
Emphasis of Matter:
(a) We draw attention to Note No. 38 to the Ind AS financial statements which describethe uncertainties and the impact of COVID-19 on the Company's operations and results asassessed by the Management. Our opinion is not modified in respect of this matter. (b)Attention is invited to Note no. 40 of the IND AS financial statements regardingExceptional item which includes Rs. 7204.84 Lacs recognized as gain on settlement of OTSliability with Bank. Our opinion is not modified in respect of this matter.
The Company's management and Board of Directors are responsible for the otherinformation. The other information comprises the information included in the Company'sannual report but does not include Standalone Ind AS financial statements and ourauditors' report thereon. Our opinion on Standalone Ind AS financial statements does notcover the other information and we do not express any form of assurance conclusionthereon. In connection with our audit of the Standalone Ind AS financial statements ourresponsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with Standalone Ind AS financial statementsor our knowledge obtained during the course of our audit or otherwise appears to bematerially misstated. If based on the work we have performed we conclude that there is amaterial misstatement of this other information; we are required to report that fact. Wehave nothing to report in this regard.
Management's Responsibilities for Standalone Ind AS Financial Statements
The Company's management and Board of Directors are responsible for the matters statedin Section 134(5) of the Act with respect to the preparation of these standalone Ind ASfinancial statements that give a true and fair view of the state of affairs profit / loss(including other comprehensive income) changes in equity and cash flows 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. Thisresponsibility also includes maintenance of adequate accounting records in accordance withthe provisions of the Act for safeguarding of the assets of the Company and for preventingand detecting frauds and other irregularities; selection and application of appropriateaccounting policies; making judgments and estimates that are reasonable and prudent; anddesign implementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of Standalone Ind AS financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error. In preparing the Standalone Ind AS financial statements managementis responsible 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. The Board of Directors areresponsible for overseeing the Company's financial reporting process.
Auditor's Responsibilities for the Audit of the Standalone Ind AS Financial Statements
Our objectives are to obtain reasonable assurance about whether the Standalone Ind ASfinancial 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 Ind AS financial statements. As part of an audit inaccordance with SAs we exercise professional judgment and maintain professionalskepticism throughout the audit. We also: Identify and assess the risks of materialmisstatement of the Standalone Ind AS financial statements whether due to fraud or errordesign and perform audit procedures responsive to those risks and obtain audit evidencethat is sufficient and appropriate to provide a basis for our opinion. The risk of notdetecting a material misstatement resulting from fraud is higher than for one resultingfrom error as fraud may involve collusion forgery intentional omissionsmisrepresentations or the override of internal control. Obtain an understanding ofinternal financial controls relevant to the audit in order to design audit procedures thatare appropriate in the circumstances. Under section 143(3)(i) of the Act we are alsoresponsible for expressing our opinion on whether the Company has adequate internalfinancial controls system 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 theappropriateness of management's use of the going concern basis of accounting and based onthe audit evidence obtained whether a material uncertainty exists related to events orconditions that may cast significant doubt on the Company's ability to continue as a goingconcern. If we conclude that a material uncertainty exists we are required to drawattention in our auditor's report to the related disclosures in the Standalone Ind ASfinancial statements or if such disclosures are inadequate to modify our opinion. Ourconclusions are based on the audit evidence obtained up to the date of our auditor'sreport. However future events or conditions may cause the Company to cease to continue asa going concern. Evaluate the overall presentation structure and content of theStandalone Ind AS financial statements including the disclosures and whether theStandalone Ind AS financial statements represent the underlying transactions and events ina manner that achieves fair presentation. Materiality is the magnitude of misstatements inthe Standalone Ind AS financial statements that individually or in aggregate makes itprobable that the economic decisions of a reasonably knowledgeable user of Standalone IndAS financial statements may be influenced. We consider quantitative materiality andqualitative factors in (i) planning the scope of our audit work and in evaluating theresults of our work; and (ii) to evaluate the effect of any identified misstatements inthe Standalone Ind AS financial statements. We communicate with those charged withgovernance regarding among other matters the planned scope and timing of the audit andsignificant audit findings including any significant deficiencies in internal controlthat we identify during our audit.
We also provide those charged with governance with a statement that we have compliedwith relevant ethical requirements regarding independence and to communicate with themall relationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards. From the matters communicated withthose charged with governance we determine those matters that were of most significancein the audit of the Standalone Ind AS financial statements of the current period and aretherefore the key audit matters. We describe these matters in our auditor's report unlesslaw or regulation precludes public disclosure about the matter or when in extremely rarecircumstances we determine that a matter should not be communicated in our report becausethe adverse consequences of doing so would reasonably be expected to outweigh the publicinterest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in terms of sub-section (11) of section 143 ofthe Companies Act 2013 we give in the "Annexure A" a statement on the mattersspecified in paragraphs 3 and 4 of the Order to the extent applicable.
(A) As required by Section 143(3) of the Act based on our audit we report that:
a) We have sought and obtained all the information and explanations which to the bestof our knowledge and belief were necessary for the purposes of our audit.
b) In our opinion proper books of account as required by law have been kept by theCompany so far as it appears from our examination of those books.
c) The Balance Sheet the Statement of Profit and Loss (including Other ComprehensiveIncome) Statement of Changes in Equity and the Statement of Cash Flow dealt with by thisReport are in agreement with the relevant books of account.
d) In our opinion the aforesaid Standalone Ind AS financial statements comply with theInd AS specified under Section 133 of the Act.
e) On the basis of the written representations received from the directors as on March31 2021 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2021 from being appointed as a director in terms of Section 164 (2) of theAct.
f) With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in "Annexure B".
(B) 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 Ind AS financial statements. Refer to the Note No. 28 of thefinancial statements.
ii. The Company did not have any Long term contracts including derivatives forwhich there were any material foreseeable losses.
iii. There has been no delay in transferring amounts if any required to betransferred to the Investor Education and Protection Fund by the Company.
(C) With respect to the matter to be included in the Auditors' Report under section197(16): In our opinion and according to the information and explanations given to us thecompany has not paid any managerial remuneration. Hence the provisions of schedule V ofthe companies Act 2013 are not applicable.
ANNEXURE "A" TO THE AUDITORS' REPORT
REFERRED TO IN PARAGRAPH 5 OF OUR REPORT TO THE MEMBERS OF RANA SUGARS LIMITED ON THESTANDALONE FINANCIAL STATEMENT FOR THE YEAR ENDED 31st MARCH 2021;
1. In respect of its fixed assets:
(a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.
(b) The fixed assets were physically verified during the year by the Management inaccordance with a regular programme of verification which in our opinion is reasonablehaving regard to the size of the company and nature of its assets. According to theinformation and explanations given to us no material discrepancies were noticed on suchverification.
(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 areheld in the name of the Company.
2. In respect of its inventory:
(a) As explained to us the inventories were physically verified during the year by themanagement at reasonable intervals.
(b) As explained to us no material discrepancies were noticed on such physicalverification.
3. As per information and explanation given to us the Company has not granted anyloan secured or unsecured to companies firms limited liability partnerships or otherparties covered in the register maintained under Section 189 of the Companies Act 2013.Accordingly provisions of clause 3 (iii) of the Companies (Auditor Reports) Order 2016are not applicable to the Company.
4. According to the information and explanations given to us the Company has notentered into any transactions to which provisions of Section 185 of the Act applies.Further the Company is engaged in the business of providing infrastructural facilities interms of Schedule VI of the Act which is covered under exceptions as provided u/s 186(11)of the Companies Act 2013 thus the provisions of Section 186 do not apply to the Company.
5. In our opinion and according to the information and explanations given to us theCompany has not accepted any deposits attracting the provisions of sections 73 to 76 orany other relevant provisions of the Companies Act 2013.
6. We have broadly reviewed the books of accounts maintained by the Company pursuant tothe rules made by the Central Government for the maintenance of cost records undersub-Section (1) of section 148 of the Act and are of the opinion that the prescribedaccounts and records have been made and maintained. However we have not vouched for thecorrectness of the cost records maintained by the Company.
7. (a) According to the information and explanations given to us and on the basis ofour examination of the records of the
Company the Company has been generally regular in depositing undisputed statutory duesincluding Provident Fund Employees' State Insurance Investor Education and ProtectionFund Income Tax Customs Duty Excise Duty Goods and Services Tax Cess and othermaterial statutory dues as applicable with the appropriate authorities in India. We areinformed that there are no undisputed statutory dues as at the end of the year which areoutstanding for a period of more than six months from the date they became payable exceptRs. 175.90 Lacs on account of Cess on Sugar Cane (Punjab) & Rs. 20.07 Lacs on accountof IT Cess on PML(Punjab) and Purchase Tax as mentioned in Note No. 28(b)(iii).
(b) According to the information and explanation given to us and as per records of theCompany examined by us the particulars of Income Tax Service Tax Sales Tax CustomDuty Excise Duty Entry Tax Value Added Tax & Goods and Service Tax which have notbeen deposited on account of any dispute are as detailed below:
|Statute ||Natures of Dues ||Amount (Rs. in Lakh) ||Period to which the amount relates A.Y. ||Forum where dispute is pending |
|Income Tax Act 1961 ||Income Tax ||2001.31 ||2017-18 ||CIT (A) Gurgaon-3 |
|Income Tax Act 1961 ||Income Tax ||30.15 ||2016-17 ||ITAT Chandigarh |
|UP Tax on Entry of Goods Act ||Entry Tax ||864.41 ||2011-12 to 2017-18 ||Hon'able Supreme Court |
|Punjab VAT Act 2005 ||VAT & CST ||348.47 ||2013-14 ||DETC (Appeals) Amritsar |
|Central Excise Act 1944 ||Excise Duty ||204.62 ||2010-11 ||CESTAT Allahabad |
|Central Excise Act 1944 ||Excise Duty ||114.28 ||July 2016 to June 2017 ||Commissioner (Appeals) Excise & Customs Meerut |
8. According to the information and explanations given to us the Company has notdefaulted in repayment of loans and borrowings from Banks and Financial Institutions.
9. In our opinion and according to the information and explanations given to us duringthe year the Company did not raise any money by way of initial public offer or furtherpublic offer (including debt instruments) or term loans and hence Clause 3(xi) of theorder is not applicable to the company. 10. According to the information and explanationgiven to us no material fraud by the Company or on the Company by its officers oremployees has been noticed or reported during the course of our audit. 11. In our opinionand according to the information and explanation given to us the company has not paid anymanagerial remuneration. Hence the provisions of schedule V of the companies Act 2013are not applicable. 12. In our opinion and according to the information and explanationsgiven to us the Company is not a Nidhi Company.
Accordingly paragraph 3(xii) of the Order is not applicable.
13. According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the Standalone Ind AS financial statements as requiredby the applicable accounting standards. 14. According to the information and explanationsgive to us and based on our examination of the records of the Company the
Company has not made any preferential allotment or private placement of shares or fullyor partly convertible debentures during the year. 15. According to the information andexplanations given to us and based on our examination of the records the Company the
Company has not entered into non-cash transactions with directors or persons connectedwith them. Accordingly paragraph 3(xv) of the Order is not applicable. 16. According toinformation and explanations given to us the Company is not required to be registeredunder section 45 IA of the Reserve Bank of India Act 1934.
Annexure "B" to the Auditors' Report
REPORT ON THE INTERNAL FINANCIAL CONTROLS UNDER CLAUSE (I) OF SUB-SECTION 3 OF SECTION143 OF THE COMPANIES ACT 2013 ("THE ACT")
We have audited the internal financial controls over financial reporting of RANASUGARS LIMITED ("the Company") as on 31st March 2021 inconjunction with our audit of the standalone Ind AS financial statements of the Companyfor 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 over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls over Financial Reportingissued by the Institute of Chartered Accountants of India (ICAI'). Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to Company's policies the safeguarding ofits assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required under the Companies Act 2013.
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 both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively 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 auditors' 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 systemover financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal financial control over financialreporting includes those policies and procedures that:
(1) Pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;
(2) Provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorizations of the Management and directors of the Company; and
(3) Provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the Company's assets that could have amaterial effect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of change in conditions or thatthe degree of compliance with the policies or procedure may deteriorate.
In our opinion the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at 31st March 2021based on the internal control over financial reporting criteria established by the Companyconsidering the essential components of internal control stated in the Guidance Note onAudit of Internal Financial Controls over Financial Reporting issued by the Institute ofChartered Accountants of India.
| ||For Ashwani K. Gupta & Associates |
| ||Chartered Accountants |
| ||Firm Regn. No.: 003803N |
|Place: Panchkula ||(Arvinder Singh) |
|Dated: 21-06-2021 ||Partner |
| ||M. No.: 091721 |