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Sicagen India Ltd.

BSE: 533014 Sector: Others
NSE: SICAGEN ISIN Code: INE176J01011
BSE 13:04 | 31 Jan 32.75 -0.50
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NSE 05:30 | 01 Jan Sicagen India Ltd
OPEN 32.30
PREVIOUS CLOSE 33.25
VOLUME 3221
52-Week high 42.30
52-Week low 19.90
P/E 14.89
Mkt Cap.(Rs cr) 130
Buy Price 33.05
Buy Qty 300.00
Sell Price 33.50
Sell Qty 108.00
OPEN 32.30
CLOSE 33.25
VOLUME 3221
52-Week high 42.30
52-Week low 19.90
P/E 14.89
Mkt Cap.(Rs cr) 130
Buy Price 33.05
Buy Qty 300.00
Sell Price 33.50
Sell Qty 108.00

Sicagen India Ltd. (SICAGEN) - Auditors Report

Company auditors report

To the Members of SICAGEN INDIA LIMITED Report on the Audit of the Standalone FinancialStatements Opinion

We have audited the accompanying Standalone Financial Statements of SICAGEN INDIALIMITED (?he Company?) which comprises the Balance Sheet as at March 31 2022 theStatement of Profit and Loss (including Other Comprehensive

Income) the Statement of Changes in Equity and the Statement of Cash Flows for theyear then ended and a summary of significant accounting policies and other explanatoryinformation.

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 (?he Act?) in the manner so required and give a true and fairview in conformity with the Indian Accounting Standards prescribed under Section 133 ofthe Act read with the Companies (Indian Accounting Standards) Rules 2015 as amended(?nd AS?) and other accounting principles generally accepted in India of the state ofaffairs of the Company as at March 31 2022 the profit and total comprehensive incomechanges in equity and its cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the

Companies Act 2013. Our responsibilities under those Standards are further describedin the Auditor's Responsibilities for the Audit of the Standalone 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 Standalone Financial Statements underthe provisions of the

Companies Act 2013 and the Rules there under 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 appropriate to provide a basis for ouropinion.

Emphasis of Matter

We draw attentiontoNote1.4.1&25.2tothefinancialstatements which describes theuncertainties and the impact of the

Covid-19 pandemic on the Company's operations and results as assessed by management.The actual results may differ from such estimates depending on future developments.

Our opinion is not modified in respect of this matter.

Investment in Subsidiary

Independent Auditors of Danish Steel Cluster Private Limited one of the wholly ownedsubsidiaries of the Company have reported that the management has applied for mergerwith the holding company but not as a going concern. Hence the accounts of thatsubsidiary have been prepared on the basis of ?ot a going concern?. All the existingassets are restated at realisable value as at 31.03.2022 and all the assets areclassifiedas current assets considering the inability of the company to continue as goingconcern as per Ind-AS-1.

Our opinion is not modified in respect of this matter.

Key Audit Matters

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 contextof our audit of the Standalone Financial Statements as a whole and in forming our opinionthereon and we do not provide a separate opinion on these matters. We have determined thematters described below to be the key audit matters to be communicated in our report.

Revenue Recognition (IND AS 115) Recognition of revenue is complex due to several types of customer contracts across divisions.

Audit Procedure Audit procedure involved review of the Company's IND AS 115 implementation process and key judgments made by management evaluation of customer contracts in light of IND AS 115 on sample basis and comparison of the same with management's evaluation and assessment of design and operating effectiveness of internal controls relating to revenue recognition.

The application of the new standard on recognition of revenue involves significant judgment and estimates made by the management which includes;
• Identification of performance obligations contained in contracts.

Based on the procedures performed it is concluded that management's judgments with respect to recognition and measurement of revenue in light of IND AS 115 is appropriate.

• Determination of the most appropriate method for recognition of revenue relating to the identified performance obligations.
• Assessment of transaction price.
• Allocation of the assessed price to the individual performance obligations
Existence and impairment of Trade Receivables Audit Procedure
Trade Receivables are significant to the Company's financial statements. The Collectability of trade receivables is a key element of the company's working capital management which is managed on an ongoing basis by its management. Due to the nature of the Business and the requirements of customers various contract terms are in place which impacts the timing of revenue recognition. We performed audit procedures on existence of trade receivables which included substantive testing of revenue transactions obtaining trade receivable external confirmations and testing the subsequent payments received.

Assessing the impact of trade receivables requires judgment and we evaluated management's assumptions in determining the provision for impairment of trade receivables by analyzing the ageing of receivables assessing significant overdue individual trade receivables and specific local risks combined with the legal documentations where applicable.

In calculating the Expected Credit Loss as per Ind AS 109 - "Financial Instruments" the company has also considered the estimation of probable future customer default and has taken into account an estimation of possible effect from the pandemic relating to Covid-19.

We tested the timing of revenue and trade receivables recognition based on the terms agreed with the customers. We also reviewed on a sample basis terms of the contract with the customers invoices raised etc. as a part of our audit procedures.

Given the magnitude and judgment involved in the impairment assessment of trade receivables we have identified this as a key audit matter.
Legal cases have been filed in the case of some debtors and we have analyzed the company's chances of succeeding in the litigation.
Furthermore we assessed the appropriateness of the disclosures made in Note 8 & Note 45 to the financial statements. Our procedures did not identify any material exceptions.
Inventory Audit Procedure
Management judgment is required to establish the carrying value of inventory particularly in relation to determining the appropriate level of provisions in relation to obsolete and Surplus items.

Physical Verification of Inventory was conducted by the management and with respect to the Net Realizable value of Inventory the Company has provided Management Representations that there is no significant impact on account of Covid as all contracts are based on fixed prices.

In view of being a Trading concern this has been identified as a Key Audit Matter.
Audit procedures include testing the inventory provisions we assessed the management control and estimation of inventory provisions and their appropriateness. Future salability of inventory was assessed based on past track records.
Based on the audit procedure performed no material discrepancies were identified.

 

Contingent Liability On assessment of Provisions for taxation litigations and claims as at March 31 2022 the Company had a provision in respect of possible or actual taxation disputes litigation and claims to the tune of ? 1943 lakhs. These provisions are estimated using a significant degree of management judgment in interpreting the various relevant rules regulations and practices and in considering precedents in various forums. Audit Procedure The Audit addressed this Key Audit Matter by; Assessing the adequacy of tax Provisions by reviewing correspondence with tax Authorities. Discussing significant litigations and claims with the Company's Internal Legal Counsel. Reviewing previous judgments made by relevant tax Authorities and opinions given by Company's advisors & Assessing the reliability of the past estimates of the management. Our Audit Procedures did not identify any material exceptions
IND AS 116 - Leases Audit Procedure
Ind AS 116 introduces a new lease accounting model wherein lessees are required to recognize a right-of- use (ROU) asset and a lease liability arising from a lease on the balance sheet. The lease liabilities are initially measured by discounting future lease payments during the lease term as per the contract/ arrangement. Adoption of the standard involves significant judgements and estimates including determination of the discount rates and the lease term. Our audit procedures on adoption of Ind AS 116 include:
• Assessed and tested new processes and controls in respect of the lease accounting standard (Ind AS 116).
• Assessed the Company's evaluation on the identification of leases based on the contractual agreements and our knowledge of the business;
• Evaluated the reasonableness of the discount rates applied in determining the lease liabilities.
On a statistical sample we performed the following procedures:
• assessed the key terms and conditions of each lease with the underlying lease contracts; and
• evaluated computation of lease liabilities and challenged the key estimates such as discount rates and the lease term.
• Assessed and tested the presentation and disclosures relating to Ind AS 116 including disclosures.

Information Other than the Standalone Financial Statements and Auditors' Report Thereon

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 the Standalone Financial Statements and our reportthereon.

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 in the 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 report that fact. We havenothing to report in this regard.

Management's Responsibility for the Standalone Financial Statements

The Company's Board of Directors is responsible for the matters stated in section134(5) of the Companies Act 2013 (?he Act?) with respect to the preparation of theseStandalone Financial Statements that give a true and fair view of the financial theCompany in accordance with the accounting principles generally accepted in Indiaincluding the accounting

Standards specified the rule 3 of the Companies (Indian Accounting Standards) Rules2015 and Companies (Indian Accounting Standards

Amendment Rules 2016). This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding of theassets of the Company and for preventing and detecting frauds and other irregularities;selection and application of appropriate implementation and maintenance of 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 standalone financialstatement that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

In preparing the Standalone Financial Statements management 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.

Board of Directors is also responsible for overseeing the Company's financial reportingprocess.

Auditor's Responsibilities for the Audit of 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 control relevant to the audit in order todesign audit procedures that are appropriate in the circumstances. Under section 143(3)

(i) of the Companies Act 2013 we are also responsible for expressing our opinion onwhether the Company has adequate internal financial controls system in place and theoperating effectiveness 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 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 StandaloneFinancial Statements including the disclosures and whether the Standalone FinancialStatements represent the underlying transactions and events in a manner that achieves fairpresentation.

Materiality is the magnitude of misstatements in the Standalone Financial Statementsthat individually or in aggregate makes it probable that the economic decisions of areasonably knowledgeable user of the Standalone Financial Statements may be influenced. Weconsider quantitative materiality and qualitative factors in (i) planning the scope of ouraudit work and in evaluating the results of our work; and (ii) to evaluate the effect ofany identified misstatements in the Standalone Financial Statements.

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 our independence 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

As required by the Companies (Auditor's Report) Order 2020 ("the Order")issued by the Central Government of India in terms of sub-section (11) of section 143 ofthe Act (here in after referred to as the "Order") we give in the"Annexure A" a statement on the matters specified in paragraphs 3 and 4 of theOrder to the extent applicable

As required by Section 143(3) of the Companies Act2013 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) I n 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 the Equity and the Cash Flow Statement dealt with by thisReport are in agreement with the books of account

(d) In our opinion the aforesaid Standalone Financial Statements comply with the INDAS specified under Section 133 of the Act read with Rule 7 of the Companies (Accounts)Rules 2014.

(e) On the basis of the written representations received from the directors as on March31 2022 and taken on record by the Board of Directors none of the directors isdisqualified as on March 312022 from being appointed as a director in terms of Section164 (2) of the Act.

(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".

(g) With respect to the other matters to be included in the Auditor's Report inaccordance with the requirements of section197(16) of the Act as amended:

In our opinion and to the best of our information and according to the explanationsgiven to us

the remuneration paid by the Company to its directors during the year is in accordancewith the provisions 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.41 to theStandalone Financial Statements;

(ii) The Company did not have any long-term contracts including derivative contracts asat March 312022;

(iii) There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.

(iv) (a) Management has represented that to the

best of its knowledge and belief other than as disclosed in the notes to the accountsno funds have been advanced or loaned or invested (either from borrowed funds or sharepremium or any other sources or kind of funds) by the Company to or in any other person(s)or entity(is) including foreign entities ("Intermediaries") with theunderstanding whether recorded in writing or otherwise that the Intermediary shallwhether directly or indirectly lend or invest in other persons or entities identified inany manner whatsoever by or on behalf of the Company ("Ultimate Beneficiaries")or provide any guarantee security or the like on behalf of the Ultimate Beneficiaries.(Refere Note 44 (d))

(b) Management has represented that to the best of its knowledge and belief otherthan as disclosed in the notes to the accounts no funds have been received by the Companyfrom any person(s) or entity(is) including foreign entities ("FundingParties") with the understanding whether recorded in writing or otherwise that theCompany shall whether directly or indirectly lend or invest in other persons or entitiesidentified in any manner whatsoever by or on behalf of the Funding Party ("UltimateBeneficiaries") or provide any guarantee security or the like on behalf of theUltimate Beneficiaries.

(c) Based on the audit procedures adopted by us nothing has come to our notice thathas caused us to believe that the representations made by the Management under sub clause

(a) and (b) above contain any material misstatement.

(v) As stated in Note 46 to the financial statements:

(a) The final dividend proposed in the previous year declared and paid by the companyduring the year is in accordance with Section 123 of the Act as applicable.

(b) The Board of Director of the Company have proposed final dividend for the yearwhich is subject the approval of the members at the

ensuing Annual General Meeting. The amount of dividend proposed is in accordance withSection 123 of the Act as applicable.

For SRSV & Associates
Chartered Accountants
F.R.No. 015041S
V. Rajeswaran
Partner
Place: Chennai Membership .No. 020881
Dated: May 252022 UDIN : 22020881AJNXGZ6192

Annexure A to Independent Auditors' Report

The Annexure referred to in our Independent Auditor's Report to the members of SICAGENINDIA LIMITED on the

Standalone Financial Statements for the year ended March 312022 we report that:

(i) In respect of the Property Plant & Equipment:

(a) (A) According to the information and explanations given to us and the records ofthe Company examined by us

in our opinion the Company has maintained proper records showing full particularsincluding quantitative details and situation of Property Plant & Equipment.

(B) According to the information and explanations given to us and the records of theCompany examined by us in our opinion the Company has maintained proper records showingfull particulars including quantitative details and situation of Intangible Assets.

(b) The Company has a regular program of physical verification of its Property Plant& Equipment by which Property Plant & Equipment are verified in a phasedperiodical manner designed to cover all the items over a period of three years. Inaccordance with this program certain Property Plant & Equipment were verified duringthe year and no discrepancies were noticed on such verification. In our opinion thisperiodicity of physical verification is reasonable having regard to the size of theCompany and nature 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 all the immovable properties(other than properties where the company is the lessee and the lease agreements are dulyexecuted in favour of the lessee) disclosed in the financial statements are held in thename of the Company.

(d) The Company has not revalued its Property Plant and Equipment (including Right ofUse assets) or intangible assets or both during the year. Accordingly clause (i)(d) ofPara 3 of the Order is not applicable.

(e) Based on the information and explanations furnished to us no proceedings have beeninitiated on or are pending against the Company for holding benami property under theProhibition of Benami Property Transactions Act 1988 (as amended in 2016) (formerly theBenami Transactions (Prohibition) Act 1988 (45 of 1988)) and Rules made thereunder andtherefore the question of our commenting on whether the Company has appropriatelydisclosed the details in its financial statements does not arise.

(ii) (a) The physical verification of inventory has been conducted at reasonableintervals by the Management during the year and in our opinion the coverage andprocedure of such verification by Management is appropriate. The discrepancies noticed onphysical verification of inventory as compared to book records were not 10% or more inaggregate for each class of inventory.

(b) According to the records of the Company and information and explanations given tous the Company has been sanctioned working capital limits in excess of Rs. Five croresin aggregate from banks or financial institutions on the basis of security of currentassets during the year. The quarterly returns or statements filed by the company with thebanks or financial institutions are not in agreement with the unaudited books of accountsof the Company.

( Rs. in Lakhs)

Quarter Ending Value as per Books of accounts Value as per quarterly return/Statement filed with lenders Difference Reason for discrepancies
June 302021 4115.84 4099.51 16.33 As explained by the
September 302021 4477.54 4085.23 392.30 management the variance
December 312021 4273.27 4267.26 6.02

is mainly on account of submission of provisional value.

March 312022 3798.43 3795.81 2.63

(a) I n our opinion and according to the explanations given to us during the year theCompany has made investments provided loans or provided advances in the nature of loansor stood guarantee or provided security to any other entities as detailed below:

(A) To Subsidiaries
Name of the Entity Type (Loan/advance/ guarantee/ security) Aggregate Amount ( Rs. in Lakhs) Balance outstanding at Balance sheet date ( Rs. in Lakhs)
South India House Estates & Properties Ltd. Loan 181 4842
Danish Steel Cluster Private Limited Loan 5.70 400
(B) To others not mentioned under (A) :
Name of the Parties Type (Loan/advance/ guarantee /security) Aggregate Amount ( Rs. in Lakhs) Balance outstanding at Balance sheet date ( Rs. in Lakhs)
EDAC Engineering Limited ICD 1650 1550
Greenstar Fertilizers Limited ICD 1500 1500

(b) In our opinion and according to the explanations given to us the investments madeand the terms and conditions of the grant of all loans and advances in the nature of loansare not prejudicial to the Company's interest.

(c) In our opinion and according to the explanations given to us in respect of loansand advances in the nature of loans given to entities as detailed in clause iii (a) (B)above the schedule of repayment of principal and payment of interest has been stipulatedand the repayments of principal and interest are regular.

(d) In our opinion and according to the explanations given to us in respect of loansand advances in the nature of loans no amounts are overdue for a period of more than 90days.

(e) In our opinion and according to the explanations given to us loans or advance inthe nature of loan granted which has fallen due during the year has been renewed orextended or fresh loans have been granted to settle the overdue of existing loans given tothe same parties as mentioned below

Name of the parties Aggregate amount of overdues of existing loans renewed or extended or settled by fresh loans ( Rs. in Lakhs) Percentage* of the aggregate to the total loans or advances in the nature of loans granted during the year
Greenstar Fertilizers Limited 1500 45%

(f) I n our opinion and according to the explanations given to us the Company hasgranted loans or advances in the nature of loans given to entities as details in clauseiii (a) (A) are either repayable on demand or without specifying any terms or period ofrepayment.

( Rs. in Lakhs)

All Parties Promoters Related Parties
Aggregate amount of loans/ advances in nature of loans - Repayable on demand (A) - Nil -
- Agreement does not specify
any terms or period of repayment (B) 5242 Nil 5242
Total (A+B) 5242 Nil 5242
Percentage of loans/advances in nature of loans to the total loans 63% 63%

(b) The Company has not made any preferential allotment or private placement of sharesor fully or partially or optionally convertible debentures during the year. Accordinglythe reporting under clause 3(x)(b) of the Order is not applicable to the Company.

(xi) (a) During the course of our examination of the books and records of the Companycarried out in accordance with the

generally accepted auditing practices in India and according to the information andexplanations given to us we have neither come across any instance of material fraud bythe Company or on the Company noticed or reported during the year nor have we beeninformed of any such case by the Management.

(b) During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing practices in India andaccording to the information and explanations given to us a report under Section 143(12)of the Act in Form ADT-4 as prescribed under rule 13 of Companies (Audit and Auditors)Rules 2014 was not required to be filed with the Central Government. Accordingly thereporting under clause 3(xi)(b) of the Order is not applicable to the Company.

(c) During the course of our examination of the books and records of the Companycarried out in accordance with the generally accepted auditing practices in India andaccording to the information and explanations given to us and as represented to us by themanagement no whistle-blower complaints have been received during the year by theCompany. Accordingly the reporting under clause 3(xi)(c) of the Order is not applicableto the Company.

(xii) In our opinion the Company is not a Nidhi Company. Accordingly clause xii (a)xii(b) and xii(c) of Para 3 of the Order are not applicable.

(xiii) In our opinion and according to the information and explanation given to us alltransactions with the related parties are in compliance with sections 177 and 188 ofCompanies Act 2013 where applicable and the details have been disclosed in the StandaloneFinancial Statements as required by the applicable accounting standards.

(xiv) (a) I n our opinion and according to the information and explanation given to usthe Company has an internal audit

system commensurate with the size and nature of its business.

(b) The reports of the Internal Auditors for the period under audit were considered byus.

(xv) l n our opinion and according to the information and explanations given to us theCompany has not entered into any non - cash transactions with directors or personsconnected with the Directors. Accordingly clause (xv) of Para 3 of the Order is notapplicable.

(xvi) (a) The Company is not required to be registered under Section 45-IA of theReserve Bank of India Act 1934. Accordingly

the reporting under clause 3(xvi)(a) of the Order is not applicable to the Company.

(b) The Company has not conducted non-banking financial activities or housing financeactivities during the year. Accordingly the reporting under clause 3(xvi)(b) of the Orderis not applicable to the Company.

(c) The Company is not a Core Investment Company (CIC) as defined in the regulationsmade by the Reserve Bank of India. Accordingly the reporting under clause 3(xvi)(c) ofthe Order is not applicable to the Company.

(d) Based on the information and explanation provided by the Management of the Companythe Group does not have any CICs which are part of the Group. We have not howeverseparately evaluated whether the information provided by the Management is accurate andcomplete. Accordingly the reporting under clause 3(xvi)(d) of the Order is not applicableto the Company.

(xvii) The Company has not incurred cash losses in the financial year and in theimmediately preceding financial year. Accordingly clause (xvii) of Para 3 of the Order2020 is not applicable.

(xviii) There has been no resignation of the statutory auditors during the year andaccordingly the reporting under clause (xviii) of Para 3 of the Order is not applicable.

(xix) According to the information and explanations given to us and on the basis of thefinancial ratios (Also refer Note 8 to 10 to the financial statements) ageing andexpected dates of realisation of financial assets and payment of financial liabilitiesother information accompanying the financial statements our knowledge of the Board ofDirectors and management plans and based on our examination of the evidence supporting theassumptions nothing has come to our attention which causes us to believe that anymaterial uncertainty exists as on the date of the audit report that Company is not capableof meeting its liabilities existing at the date of Balance Sheet as and when they fall duewithin a period of one year from the Balance Sheet date. We however state

that this is not an assurance as to the future viability of the Company. We furtherstate that our reporting is based on the facts up to the date of the audit report and weneither give any guarantee nor any assurance that all liabilities falling due within aperiod of one year from the Balance Sheet date will get discharged by the Company as andwhen they fall due.

(xx) (a) In our opinion in respect of other than ongoing projects as per the limitsspecified u/s 135 of the Companies Act

2013 the Company is not liable to transfer unspent amount to a Fund specified inSchedule VII to the Companies Act within a period of six months of the expiry of thefinancial year in compliance with second proviso to sub-section (5) of section 135 of thesaid Act. Accordingly reporting under clause (xx)(a) of the Order is not applicable.

(b) In our opinion there is no amount remaining unspent under sub-section (6) ofsection 135 of the Companies Act pursuant to any ongoing project. Accordingly reportingunder clause (xx)(b) of the Order is not applicable.

(xxi) The reporting under clause 3(xxi) of the Order is not applicable in respect ofaudit of Standalone Financial Statements. Accordingly no comment in respect of the saidclause has been included in this report.

For SRSV & Associates Chartered Accountants F.R.No. 015041S

V. Rajeswaran
Partner
Place: Chennai Membership .No. 020881
Dated: May 25 2022 UDIN : 22020881AJNXGZ6192

ANNEXURE "B" TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 2 (f) under ‘Report on Other Legal and RegulatoryRequirements' section of the Independent Auditor's 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 SICAGENINDIA LIMITED ("the Company") as of March 312022 in conjunction with our auditof the Standalone Financial Statements of the 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 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.

Auditor's Responsibility

Our responsibility is to express an opinion on the internal financial controls overfinancial reporting of the Company based on our audit. We conducted our audit inaccordance with the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting (the "Guidance Note") and the Standards on Auditing issued by ICAIand deemed to be prescribed under Section 143(10) of the Companies Act 2013 to theextent applicable to an audit of internal financial controls both issued by the Instituteof Chartered Accountants of India. Those Standards and the Guidance Note require that wecomply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether adequate internal financial controls over financial reporting wasestablished and maintained and if such controls operated effectively in all materialrespects.

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 judgement including the assessment of the risks ofmaterial misstatement of the Standalone Financial Statements whether due to fraud orerror.

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 Standalone Financial Statements for external purposes in accordance withgenerally accepted accounting principles. A Company's internal financial control overfinancial reporting 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 Standalone Financial Statements in accordance with generally acceptedaccounting principles and that receipts and expenditures of the Company are being madeonly in accordance with authorizations of 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 Standalone 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 changes in conditions or thatthe degree of compliance 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 over financial reporting and such internal financial controls over financialreporting were operating effectively as at March 31 2022 based on the internal controlover financial reporting 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 SRSV & Associates Chartered Accountants F.R.No. 015041S

V. Rajeswaran
Partner
Place: Chennai Membership.No. 020881
Dated: May 25 2022 UDIN : 22020881AJNXGZ6192

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