To the Members of Sarda Papers Limited
Report on the Audit of Financial Statements
We have audited the Financial Statements of Sarda Papers Limited (hereinafterreferred to as"the Company") prepared as per the Indian Accounting Standards(Ind-AS)which comprise the Balance Sheet as at March 31 2021 and the Statement ofProfit and Loss including Other Comprehensive Income the Cash Flow Statement and theStatement of Changes in Equity for the year then ended and Notes to the FinancialStatements including a summary of significant accounting policies and other explanatoryinformation (collectively referred to as Financial Statements').
In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Financial Statements give the information required by theCompanies Act 2013 (hereinafter referred to as "the Act") in the manner sorequired and give a true and fair view in conformity with the accounting principlesgenerally accepted in India of the State of affairs of the Company as at March 31 2021its Loss total Comprehensive Income Cash flows and the Changes in equity for the yearended on that date.
Basis for Opinion
We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Act. Our responsibilities under those Standards are furtherdescribed in the Auditor's Responsibilities for the Audit of the Financial Statementssection of our report. We are independent of the Company in accordance with the Code ofEthics issued by the Institute of Chartered Accountants of India together with the ethicalrequirements that are relevant to our audit of the Financial Statements under theprovisions of the Act and the Rules thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the Code of Ethics. We believethat the audit evidence we have obtained is sufficient and appropriate to provide a basisfor our opinion.
Emphasis of Matter
(i) Attention is drawn to Note No. 20 of the financial statements regardingmanagement's current assessment of the Company's assets and liabilities. The Company hascarried out a detailed study to assess the impact of Covid19 including the second waveon its liquidity position and on the recoverability and carrying values of its assets andhas concluded that there is no significant impact on account of the same on its financialstatements as at 31st March 2021. The impact assessment of Covid19 is a continuousprocess given the uncertainties associated with its nature and duration. The managementwill continue to monitor material changes to the future economic conditions which may havean impact on the operations of the Company.
(ii) In view of the initial lockdown and ongoing lockdown the audit for the year wascarried out online based on remote access of data as provided by the management insteadof standard conventional Audit. This resulted in need for carrying out alternative auditprocedures as per the Standards on Auditing prescribed by the Institute of CharteredAccountants of India (ICAI). The Audit has been carried out based on the advisory on"Specific Considerations while conducting Distance Audit/ Remote Audit/ Online Auditunder current Covid-19 situation" issued by the Auditing and Assurance StandardsBoard of ICAI. We have been represented by the management that the data provided for ouraudit purposes is correct complete reliable and are directly generated by theaccounting system of the Company without any further manual modifications. Audit of thefinancial statements has been performed in the aforesaid conditions. We have beenrepresented by the management that the data provided for our audit purposes is correctcomplete reliable and are directly generated by the accounting system of the Firmwithout any further manual modifications. We bring to the attention of the users that theaudit of the financial statements has been performed in the aforesaid conditions. Ourreport is not modified in respect of the above two matters.
Key Audit Matters
Key Audit Matters are those matters that in our professional judgment were of mostsignificance in our audit of the Financial Statements for the year ended March 31 2021.These matters were addressed in the context of our audit of the Financial Statements as awhole and in forming our opinion thereon and we do not provide a separate opinion on thesematters.
We have determined that there are no key audit matters to be communicated in ourreport.
The Company's Board of Directors are responsible for the other information. The otherinformation comprises the information included in the annual report but does not includethe Financial Statements and our auditor's report thereon. Our opinion on the FinancialStatements does not cover the other information and we do not express any form ofassurance conclusion thereon. In connection with our audit of the Financial Statementsour responsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the Financial Statements or ourknowledge obtained in the audit or otherwise appears to be materially misstated. If basedon the work we have performed we conclude that there is a material misstatement of thisother information we are required to report the fact. We have nothing to report in thisregard.
Responsibilities of Management and Those Charged with Governance for the FinancialStatements
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 Financial Statements that give a true andfair view of the financial position financial performance including Other ComprehensiveIncome Cash Flows and Changes in Equity of the Company in accordance with the Ind AS andother accounting principles generally accepted in India including the accountingStandards specified under section 133 of the Act. This responsibility also includesmaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding of the assets of the Company and for preventing and detecting frauds andother irregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the Financial Statements that give a true and fair viewand are free from material misstatement whether due to fraud or error. In preparing theFinancial Statements management is responsible for assessing the Company's ability tocontinue as a going concern disclosing as applicable matters related to going concernand using the going concern basis of accounting unless management either intends toliquidate the Company or to cease operations or has no realistic alternative but to doso.
The Board of Directors are also responsible for overseeing the Company's financialreporting process.
Auditor's Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the FinancialStatements as a whole are free from material misstatement whether due to fraud or errorand to issue an auditor's report that includes our opinion. Reasonable assurance is a highlevel of assurance but is not a guarantee that an audit conducted in accordance with SAswill always detect a material misstatement when it exists. Misstatements can arise fromfraud or error and are considered material if individually or in the aggregate theycould reasonably be expected to influence the economic decisions of users taken on thebasis of these 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 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 control relevant to the audit in order to designaudit procedures that are appropriate in the circumstances. Under section 143(3)(i) of theAct we are also responsible for expressing our opinion on whether the Company hasadequate internal financial controls system in place and the operating effectiveness ofsuch 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 Financial Statements or if such disclosures are inadequate to modify our opinion.Our conclusions 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 as agoing concern.
Evaluate the overall presentation structure and content of the Financial Statementsincluding the disclosures and whether the Financial Statements represent the underlyingtransactions and events in a manner that achieves fair presentation.
Materiality is the magnitude of misstatements in the Financial Statements thatindividually or in aggregate makes it probable that the economic decisions of areasonably knowledgeable user of the Financial Statements may be influenced. We considerquantitative materiality and qualitative factors in
(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 FinancialStatements.
We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that 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 with those charged with governance we determine thosematters that were of most significance in the audit of the Financial Statements of thecurrent period and are therefore the key audit matters. We describe these matters in ourauditor's report unless law or regulation precludes public disclosure about the matter orwhen in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest 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 Act and on the basis of such checks of the books and records of the Company as weconsidered appropriate and according to the information and explanations given to us wegive in the Annexure-A a statement on the matters specified in paragraphs 3 and 4of the Order to the extent applicable to the Company during the year.
2. Further to our comments in the Annexure referred to in Para 1 above as required bySection 143(3) of the Act 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 appears from our examination of those books;
c) The Balance Sheet the Statement of Profit and Loss the Statement of Changes inEquity and the Cash Flow Statement dealt with by this Report are in agreement with theCompany's books of account;
d) In our opinion the aforesaid Financial Statements comply with the AccountingStandards specified under Section 133 of the Act read with Rule 7 of the Companies(Accounts) Rules 2014;
e) On the basis of written representations received from the directors as on March 312021 and 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) ofthe Act;
f) With respect to the other matters to be included in the Auditor's Report inaccordance with the requirements of Section 197(16) of the Act as amended the Companyhas not paid/provided any managerial remuneration in the current year;
g) As regards the adequacy of the Internal Financial Controls over financial reportingof the Company and the operating effectiveness of such controls refer to our separateReport in Annexure-B;
h) With respect to the matters to be included in the Auditor's Report in accordancewith the Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinion and tothe best of our information and according to the explanations given to us we furtherreport that;
i) The Company does not have any pending litigations which would impact its financialposition;
ii) The Company does not have any long term contracts including derivative contractsfor which there were any material foreseeable losses; and
iii) There were no amounts which were required to be transferred to the InvestorsEducation and Protection Fund by the Company.
Annexure -A to the Independent Auditors' Report to the members of Sarda Papers Limitedfor year ended on 31st March 2021
In terms of the information and explanations given to us and the books and recordsexamined by us and on the basis of such checks as we considered appropriate we furtherreport as under:
1. Property Plant & Equipment (Fixed Assets)
The Company does not have any Property Plant & Equipment (fixed assets) at anytime during the financial year.
Based on the explanations we are of the opinion that the procedures of physicalverification of inventories followed by the management are reasonable and adequate inrelation to the size of the Company and nature of its business. No material discrepancieswere noticed during the said verification we have been explained
3. Loans to parties of Directors' interest
During the year the Company has not granted any loans secured or unsecured to theparties covered in the register maintained under Section 189 of the Act.
4. Loans/Guarantees/Investments in / Provision of Security to certain parties
As per the records of the Company during the year the Company has not given any loans/guarantees to or made any investments or provided any security within the purview of theSections 185 and 186 of the Act.
5. Acceptance of Deposits
According to the information and explanations given to us the Company has not accepteddeposits as per the directives issued by Reserve Bank of India and the provisions ofSections 73 to 76 or any other relevant provisions of the Act and the rules framed thereunder.
6. Maintenance of Cost Records
As explained to us maintenance of cost records has not been prescribed by the CentralGovernment for the Company under Section 148(1) of the Act.
7. Undisputed & Disputed Statutory Dues
(a) According to the information and explanations given to us and as per the recordsverified by us the Company has been regular in depositing undisputed statutory duesinvolving Income Tax with the appropriate authorities and there were no arrears under theabove heads which were due for more than six months from the date they become payable asat the close of the year. Keeping in view the present operations of the Company statutesrelating to Goods & Services Tax Provident Fund Employees' State InsuranceSales-tax Customs Duty Value Added Tax
Excise Duty and Cess are not applicable to the Company during the year under review.(b) As per the Company's records and based on the information available there were nodisputed statutory dues with the Company pertaining to Sales Tax Service Tax CustomsDuty Excise Duty or Value Added Tax. In respect of Income-tax amounting to Rs. 16.41Lacs the following are the disputed dues which have been lying pending with the Companyas at the close of the year under review
|Name of the statute ||Nature of The Dues ||Amount (Rs. in Lacs) ||Period ||Forum where dispute is pending |
|1 Central Excise Act 1944 ||Excise Duty and Penalties ||3.07 ||01/09/1996 to 31/01/1997 ||Deputy Commissioner of Central Excise (Appeals) Nashik |
|2 Central Excise Act 1944 ||Excise Duty and Penalties ||5.70** ||October 1998 to February 2000 ||Central Excise and Service tax Appellate Tribunal Mumbai |
|3 Central Excise Act 1944 ||Excise Duty and Penalties ||7.64 ||FY 2002-03 ||Deputy Commissioner of Central Excise (Appeals) Nashik |
Note: ** includes Rs. 1.00 Lac deposited by the Company under protest but charged torevenue.
8. Loans from Banks/Financial Institutions/ Government/Debentures
As per the records verified by us the Company has not availed any loan/facility frombanks/financial institutions/Government and hence the question of default in repayment ofthe same does not arise. Further no amounts were borrowed by the Company throughDebentures.
9 Proceeds of Public issue (including debt instruments) /Term Loans
The Company has not raised any money during the year through initial / further publicoffer (including debt instruments). Also the Company has not availed any term loansduring the current or earlier years.
10 Frauds on or by the Company
During the course of our examination of the books and records of the Company carriedout in accordance with the generally accepted auditing practices in India and accordingto the information and explanations given to us we have neither come across any instanceof fraud on or by the Company or its officers noticed or reported during the year norhave we been informed of such case by the management.
11 Managerial Remuneration
As per the Company's records no managerial remuneration has been paid/provided forduring the year under review.
12. Nidhi Companies
The Company is not a Nidhi company during the year under review and hence the criteriaas stipulated under Nidhi Rules 2014 is not applicable to the Company.
13. Related Party Transactions
As per the information and explanations given during the course of our verification inour opinion all transactions with the related parties made by the Company were incompliance with Sections 177 and 188 of the Act to the extent applicable to the Companyduring the year. The relevant details in respect of the same have been appropriatelydisclosed as per the requirements of the Accounting Standard.
14. Preferential Issue
During the year the Company has not made any preferential allotment or privateplacement of shares or convertible debentures and hence the requirements of Section 42 ofthe Act are not applicable.
15. Non-cash Transactions with Directors etc.
As per the information and explanations provided to us during the year the Companyhas not entered into any non-cash transactions with directors or persons connected withthe directors within the purview of Section 192 of the Act.
16. Provisions of 45-IA of the Reserve Bank of India Act1934
In our opinion and according to the information and explanations given to us theCompany is not a Non-banking Finance Company (NBFC) and hence is not required to beregistered under section 45 IA of the Reserve Bank of India Act 1934.
Annexure-B to Independent Auditor's Report
The Annexure referred to in paragraph 2(g) under the Report on Other Legal andRegulatory Requirements' our report to the members of Sarda Papers Limited (theCompany') for the year ended on March 31 2021.
Report on the Internal Financial Controls under Clause (i) of Sub-Section 3 of Section143 of the Act
We have audited internal financial controls over financial reporting of the Company asof March 31 2021 in conjunction with our Audit of the Financial Statements of the Companyfor the year then ended on that date.
Management's Responsibility for the 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 Guidance Note on Audit of Internal Financial Controls over Financial Reporting issuedby the Institute of Chartered Accountants of India (ICAI). These responsibilities includesdesign implementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the orderly and efficient conduct of businessincluding adherence to Company's policies the safeguarding of the assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe Act.
Our responsibility is to express an opinion on Company's internal financial controlsover financial reporting based on our audit. We conducted our audit in accordance with theGuidance Note on Audit of Internal Financial Controls over Financial Reporting (theGuidance Note') and the Standards on Auditing deemed to be prescribed under Section143(10) of the Act to the extent applicable to an audit of internal financial controlsboth applicable to an audit of internal financial controls and both issued by the ICAI.Those Standards and Guidance note require that we comply with ethical requirements andplan and perform audit to obtain reasonable assurance about whether adequate internalfinancial controls over financial reporting was established and maintained and if suchcontrols operated effectively in all material respects. Our audit involves performingprocedure to obtain audit evidence about the adequacy of the internal financial controlssystem over financial reporting and their operating effectiveness. Our audit of internalfinancial controls over financial reporting included obtaining an understanding ofinternal financial controls over financial reporting assessing the risk that a materialweakness exists and testing and evaluating the design and operating effectiveness ofinternal controls based on the assessed risk. The procedures selected depend on theauditor's judgement including the assessment of the risks of material misstatement of thefinancial statements whether due to fraud or error. We believe that the audit evidence wehave obtained is sufficient and appropriate to provide a basis for our audit opinion onthe Company's internal financial controls system over financial reporting.
Meaning of Internal Financial Controls over Financial Reporting
A Company's internal financial control over financial reporting is a process designedto provide a reasonable assurance regarding the reliability of financial reporting andpreparation of financial statements for external purpose 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 the transactions are recorded as necessary topermit preparation of financial statements in accordance with the 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 ofunauthorised 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 control over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.
In our opinion the Company has in all material aspects an adequate internalfinancial control system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at March 31 2021 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in Guidance Note on Audit of InternalFinancial Controls over Financial Reporting issued by the Institute of CharteredAccountants of India.
| ||For S K H D & Associates |
| ||Chartered Accountants |
| ||Firm registration No. 105929 W |
| ||Hemanshu Solanki |
| ||Partner |
| ||Membership No. 132835 |
| ||UDIN:21132835AAAABW2256 |
|Mumbai dated 30th June 2021 || |