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Viceroy Hotels Ltd.

BSE: 523796 Sector: Services
NSE: VICEROY ISIN Code: INE048C01017
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OPEN 3.55
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VOLUME 1434
52-Week high 6.95
52-Week low 2.57
P/E
Mkt Cap.(Rs cr) 15
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Viceroy Hotels Ltd. (VICEROY) - Auditors Report

Company auditors report

To

The Members of Viceroy Hotels Limited M/s VICEROY HOTELS LIMITED

Report on the Audit of Ind AS Standalone Financial Statements QualifiedOpinion

We have audited the accompanying Ind AS Standalone Financial Statementsof M/s VICEROY HOTELS LIMITED ("the company") which comprise the BalanceSheet as at 31st March 2021 the Statement of Profit and Loss (including OtherComprehensive Income) the Statement of changes in equity and the Statement of Cash Flowsfor the year then ended on that date and notes to financial statements including a summaryof significant accounting policies and other explanatory information.

In our opinion and to the best of our information and according to theexplanations given to us except for the effects of the matter described in the"Basis for Qualified Opinion" section of our report the aforesaid standalonefinancial 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 theCompanies (Indian Accounting Standards) Rules 2015 as amended ("IndAS") andother accounting principles generally accepted in India of the state of affairs of"the Company" as at March 31 2020 the Loss and total comprehensive incomechanges in equity and its cash flows for the year ended on that date.

Basis for Qualified Opinion:

We conducted our audit of the standalone financial statements inaccordance with the Standards on Auditing (SAs) specified under section 143(10) of theAct. Our responsibilities under those Standards are further described in the Auditor'sResponsibilities for the Audit of the Standalone Financial Statements section of ourreport. We are independent of "the Company" in accordance with the Code ofEthics issued by the Institute of Chartered Accountants of India (ICAI) together with theethical requirements that are relevant to our audit of the standalone 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 qualified opinion on the standalone financialstatements.

1. Qualified Opinion:

a) Capital Work In progress:

The Company has converted capital work in progress into Fixed Assetsduring the F.Y 2017-18 of an amount of Rs.111.94 Crores. However the company has notsubmitted us any valuation certificate towards capitalization of fixed assets of Rs.111.94crores and the depreciation claimed by the company towards such capitalization of fixedassets for the F.Y 2017-18 is Rs.358.34 Lakhs F.Y 2018-19 Rs.599.98 Lakhs and FY 2019-20is Rs. 601.63 Lakhs and for the Fy 601.63 lakhs which increase the Loss to that ExtentAswe could not obtain sufficient audit evidence in this regard and the capitalization is notin compliance with the generally accepted accounting principles we are unable to commentupon the true and fair view of the same. (Refer Note no.27)

b) Forfeiture of advance:

The Company has forfeited an advance of amounting to Rs.134.65 Croresreceived from Mahal Hotel Private Limited Bhagyanagar Investments and trading privatelimited and Ganga Industrial Corporation Limited in the F.Y 2013-14 and adjusted in slumpsale proceeds as disclosed in the annual report of F.Y 2013-14. In the financial year2017-18 again the company has recognised the forfeited advances in the books of accountsas liability which is not in line with the IND AS accounting policies also the managementof the company has not provided us any supporting document towards re recognition of suchadvances as liability in the books of accounts in the F.Y 2017-18. As per the Businesstransfer agreement (BTA) entered between Viceroy Hotels Limited and Mahal Hotels Limiteddated 02nd April 2011 the company M/s Viceroy Hotels Ltd received an advanceof Rs.124.52 Crores (Included in above said advance Rs.134.65 Crores). The date oftermination of the agreement is 31.12.2011. In the event of termination the company isliable to repay the advance along with the interest @2% per month till the date ofrepayment. However no interest has been paid or provided by the company in its Books ofAccounts since the termination of the agreement which is not in line with the accountingprinciples.

Hence we are unable to comment upon the true and fair view of the same.(Note No:47)

c) Directorate of Enforcement:

The Directorate of Enforcement made a Provisional Attachment Order inPAO No. 04/2019 dated 26.03.2019 passed by the Deputy Director Directorate of Enforcementagainst the M/ s Viceroy Hotels Limited of OC No.1118/2019 pending adjudication before theHonourable Adjudicating Authority PMLA 2002 from alienating the proceeds of crime inthe form of movable and immovable properties which are involved in money laundering andthe non-attachment may seriously affect and frustrate the proceedings under PMLA 2002.The Directorate of Enforcement has also filed an application under Insolvency andBankruptcy code 2016 against M/s Viceroy Hotels Limited in respect advances taken fromMahal Hotels Ltd and the same has been accepted by the Hon'ble NCLT on dated 06-05-2019.The resolution professional has challenged the provisional attachment order of EnforcementDirectorate Chennai before the Hon'ble NCLT Hyderabad on 08-04-2019. NCLT has raisedthe attachment of Enforcement Directorate Chennai. Subsequently Directorate ofEnforcement Chennai has gone to High Court Chennai vide their writ petition number:WP/29970/2019 which was declared in their favour. Then the resolution professional of ViceroyHotels Limited has approached Supreme Court and at present it is pending at Supreme Court.videorder no SLP(C) no. 008259/2020 (Note No:43)

d) NCLT:

The Asset Reconstruction Company (India) Ltd (ARCIL) has filed pleaunder Sec.7 of The Insolvency and Bankruptcy code 2016 against M/s Viceroy Hotels Limitedfor non payment of dues and the same has been accepted by the Hon'ble NCLT. Furtherproceedings are subject to NCLT order. The Resolution Professional has invited Expressionof Interest from the prospective bidders for submission of Resolution Plans for revival ofthe Company. In terms of provisions of the Insolvency and Bankruptcy Code 2016 (IBC) theresolution plan submitted by M/s CFM Asset Reconstruction Company Private Limited for M/sViceroy Hotels Limited has been approved by the Committee of Creditors (COC) of thecompany in its 18th COC meeting and identified as a successful resolutionapplicant subject to the approval of the Hon'ble NCLT Hyderabad bench.(Note No: 42)

e) Loans from Banks or Financial Institutions: During the currentFinancial Year the company has not provided interest on the loans obtained from variousBanks and financial Institutions which is not in accordance with generally acceptedaccounting principles. Confirmations from Banks/Financial Institutions are not yetreceived in this regard due to the non provision of interest in the financial statements;the financial statements may not give a true and fair view in this regard.(Note No:49)

f) Statutory Dues: The Company has not paid the statutory dues fora period more than 6 months is as follows as per the Books and records verified by us ason 31-03-2021.

S.No Particulars Amount In Rs.
1 TDS 33420321/-
Total 33420321/-

g) Non availability of confirmations Trade Receivables TradePayables - In the absence of alternative corroborative evidence we are unable to commenton the extent to which such balances are recoverable.(Note :45)

h) Exceptional items:

The management decided to written off various assets capital work inprogress etc for an amount of Rs. 291.94 crores in the F.Y 2017-18 for which there is noprovision has made for such amount up to F.Y 2016-17 . As there is no sufficientappropriate audit evidence for such written off we are unable to comment on the True andFair Value of such written off. (Refer Note No:28)

i) In respect of investment in subsidiaries those have significantaccumulated Losses as on March 31st 2021 and the Loans and advances given tothose subsidiaries. The Management of the company is of the view that the 100 percentprovision for made for Loss of such investments in the Profit &Loss account made inthis regard. In the absence of fair valuation of those investments in the subsidiaries weare unable to comment on the total provision made by the company in this regard. we areunable to comment upon the carrying value of these investments recoverability of loansand advances and the consequential impact if any on the consolidated financialstatements. We are unable to comment on the provisions if any required for the corporateguarantees given to its Subsidiary Companies and the provision for interest of loans andadvances given to such subsidiaries.(Note No: 50)

j) Tax Disputes:

The company has material tax disputes with the Income Tax department service tax and sales tax departments as given under which is as per the informationsubmitted by the management in this regard. However the company has not made provision forsuch dues in the financial statements for the year ending 31-03-2021. As per theinformation and explanation submitted by the company to us the following are the casespending at different levels. (Note No: 37)

Name of the Statue Nature of Dues Section under which order is passed Amount (Rs) Period to which it relates Case is pending at
Income Tax Act 1961 Income Tax 154 Rs.537832209/- A.Y 2014-15 Commissioner of Income Tax (Appeals)
Income Tax Act 1961 Income Tax 143(3) Rs.92044470/- A.Y 2016-17 Commissioner of Income Tax (Appeals)
Income Tax Act 1961 Income Tax 143(3) Rs.91407210/- A.Y 2017-18 Commissioner of Income Tax (Appeals)

Service Tax

SI.No. SCN O.R. No. OIO/OIA No. and Date Period Demand (Rs.)
1 OR. No.95/2012-Adjn (ST) (Commr) dt.23.04.2012 OIO No.HYD-EXCUS-000- COM-21-16-17 dt.25.05.2016 2006-07 to 2010-11 73165038/-
2 O.RNo. 54/2013-Adjn (ST) (Commr) dt.18.06.2013 OIO No.HYD-EXCUS-000- COM-22-16-17 dt.25.05.2016 April 2011 to March 2012 241663/-
3 O.RNo. 84/2013-Adjn (ST) (Commr) dt. 19.05.2014 OIO No.HYD-EXCUS-000- COM-23-16-17 dt.25.05.2016 April 2012 to June 2012 285941/-
4 O.RNo. 164/2014-Adjn (ST) (Commr) dt.26.09.2014 OIO No.HYD-EXCUS-000- COM-24-16-17 dt.25.05.2016 July 2012 to March 2013 2601002/-
5 O.RNo. 45/2015-Adjn (ST) (Commr) dt.16.04.2015 OIO No.HYD-EXCUS-000- COM-25-16-17 dt.25.05.2016 April 2013 to March 2014 4029335/-
6 O.RNo. 73/2016-Adjn (ST) (JC) dt.30.08.2016 OIA No. HYD-SVTAX-000- AP2-0236-17-18 dt.24.11.2017 July 2012 to March 2015 1314253
7 O.R No.82/2016-Adjn ST Commr. Dt.22.04.16 OIO No.07/2017-ST dt.19.05.2017 April 2014 to March 2015 4526905/-
8 F.No.DRI/CZU/HRU/26B/E NQ-08 (INT-7)/2014 dt.29.12.2016 OIO No.68847/2019 dt.15.05.2019 2012 to 2016 38041131/-
9 C.No.V/15/12/2018-Adjn dt.24.04.2018 OIA No. HYD-EXCUS-SC- AP2-0125-18-19 ST dt.26.03.2019 April 2015 to March 2016 2013146/-
10 C.No.V/15/12/2018-Adjn dt.29.10.2018 OIO No.15/2018 dt.30.01.2019 April 2016 to June 2017 1515857/-
11 O.R.No.57/2018-19-GST- SEC-Adjn-JC dt.15.11.2018 October 2015 to June 2017 12584491/-

Luxury Tax/ Sales T ax

S.No Arrear Notice issued by office of the Assistant Commissioner(ST) Gandhinagar Circle Hyd Period Demand Issue Luxury Tax 50% Paid
1 15.02.2019 2011-12 795429 Dispute of Levy of Luxury Tax on Service Tax 397715
2 15.02.2019 2012-13 1077592 Dispute of Levy of Luxury Tax on Service Tax 538796
3 15.02.2019 2013-14 758952 Dispute of Levy of Luxury Tax on Service Tax 379476
4 15.02.2019 2010-11 to 2012-13 (upto 31.10.2012)01.1 1.2012 to 30.09.2013 1588152 Disputed arrears against completion of Revision of Assessment U/VAT Act 0.00

k) Going Concern

The above conditions indicate the existence of material uncertaintieswhich may caste significant doubt on the Company's abilities to continue as going concern.In the event that the going concern assumption of the company is inappropriateadjustments will have to be made as not a going concern. However the financials has notbeen made with such adjustments for the F.Y 2020-21.(Note No:48)

l) The company has not appointed company secretary for theFinancial Year 2019-20 which is not in compliance of the provisions of Sec 203 of theCompanies Act 2020.(Note No:46)

Emphasis of matter Paragraph:

We draw attention to the notes to financial statements (Note No: ) ofthe financial statements which describes the uncertainties and the impact of Covid-19pandemic on the companys operations and results as assessed by the management. The actualresults may differ from such estimates depending on future developments.

Our opinion is not modified with respect to the above matter.

Key Audit Matters:

Key audit matters are those matters that on our professional judgmentwe are of most significance in our audit of the financial statements of the currentperiod.

These matters were addressed in the context of our audit of financialstatements as a whole and in forming opinion thereon and we do not provide a separateopinion on these matters.

Except for the matters discussed in the Basis of Qualified OpinionParagraph there are no Key aud matters to be discussed in the Auditor's report.

Information Other than the Standalone Financial Statements andAuditor's Report Thereon:

The Company's is responsible for the preparation of the otherinformation. The other information comprises the information included in the ManagementDiscussion and Analysis Board's Report including Annexure to Board's Report BusinessResponsibility Report Corporate Governance and Shareholder's Information but does notinclude the standalone financial statements and our auditor's report thereon.

Our opinion on the standalone financial statements does not cover theother information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statementsour responsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the standalone financial statements orour 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 Responsibility for the Standalone Financial Statements:

The Company's Board of Directors is responsible for the matters statedin section 134(5) of "the Act" with respect to the preparation of thesestandalone financial statements that give a true and fair view of the financial positionfinancial performance total comprehensive income changes in equity and cash flows of theCompany in accordance with the Ind AS and other accounting principles generally acceptedin India including the accounting Standards specified under section 133 of "theAct". This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the standalonefinancial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

In preparing the standalone financial statements management isresponsible 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 is also responsible for overseeing the Company'sfinancial reporting process

Auditor's Responsibilities for the Audit of the Standalone FinancialStatements:

Our objective is to obtain reasonable assurance whether the standalonefinancial statements as a whole are free from material misstatement whether due to fraudor error and to issue an audit report that includes our opinion. Reasonable assurance isa high level of assurance but is not a guarantee that an audit conducted in accordancewith Standards on Auditing will always detect a material misstatement when it exists.Misstatements can arise from fraud or error and are considered material if individuallyor in the aggregate they could reasonably be expected to influence the economic decisionsof users taken on the basis of these standalone financial statements.

As our audit is conducted in accordance with Standards on Auditing weexercise professional judgment and maintain professional skepticism throughout the audit.We also:

• Identify and assess the risks of material misstatement of thestandalone financial statements whether due to fraud or error design and perform auditprocedures responsive to those risks and obtain audit evidence that is sufficient andappropriate to provide a basis for our opinion. The risk of not detecting a materialmisstatement resulting from fraud is higher than for one resulting from error as fraudmay involve collusion forgery intentional omissions misrepresentations or the overrideof internal control. Obtain an understanding of internal financial controls relevant tothe audit in order to design audit procedures that are appropriate in the circumstances.Under section 143(3)(i) of the Act 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 thereasonableness of accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management's use of the goingconcern basis of accounting and based on the audit evidence obtained whether a materialuncertainty exists related to events or conditions that may cast significant doubt on theCompany's ability to continue as a going concern. If we conclude that a materialuncertainty exists we are required to draw attention in our auditor's report to therelated disclosures in the standalone financial statements or if such disclosures areinadequate to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditor's rep ort. However future events or conditions maycause the Company to cease to continue as a going concern.

• Evaluate the overall presentation structure and content of thestandalone financial statements including the disclosures and whether the standalonefinancial statements represent the underlying transactions and events in a manner thatachieves fair presentation.

• Obtain sufficient appropriate audit evidence regarding thefinancial information of the entity or business activities of the Company to express anopinion on the financial statements.

Materiality is the magnitude of misstatements in the standalonefinancial statements that individually or in aggregate makes it probable that theeconomic decisions of a reasonably knowledgeable user of the financial statements may beinfluenced. We consider quantitative materiality and qualitative factors in (i) planningthe scope of our audit work and in evaluating the results of our work; and (ii) toevaluate the effect of any identified misstatements in the financial statements.

We communicate with those charged with governance regarding amongother matters the planned scope and timing of the audit and significant audit findingsincluding any significant deficiencies in internal control that we identify during ouraudit.

We also provide those charged with governance with a statement that wehave complied with relevant ethical requirements regarding independence and tocommunicate with them all relationships and other matters that may reasonably be thoughtto bear on our independence and where applicable related safeguards.

From the matters communicated with those charged with governance wedetermine those matters that were of most significance in the audit of the standalonefinancial Statements of the current period and are therefore the key audit matters. Wedescribe these matters in our auditor's report unless law or regulation precludes publicdisclosure about the matter or when in extremely rare circumstances we determine that amatter should not be communicated in our report because the adverse consequences of doingso would reasonably be expected to outweigh the public interest benefits of suchcommunication.

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 in terms of Section 143(11) ofthe Act we give in "Annexure A" a statement on the matters specified inparagraphs 3 and 4 of the Order.

2. As required by Section 143(3) of the Act based on our audit wereport that:

a) We have sought and obtained all the information and explanationswhich to the best of our knowledge and belief were necessary for the purposes of ouraudit.

b) In our opinion proper books of account as required by law have beenkept by the Company except for the matters given in the qualified opinion paragraph so faras it appears from our examination of those books.

c) The Balance Sheet the Statement of Profit and Loss including OtherComprehensive Income Statement of Changes in Equity and the Statement of Cash Flow dealtwith by this Report are in agreement with the relevant books of account.

d) In our opinion the aforesaid standalone financial statements complywith the Ind AS specified under Section 133 of the Act read with Rule 7 of the Companies(Accounts) Rules 2014 .

e) The Honorable National Company Law Tribunal Hyderabad Bench("NCLT") vide order dated 12 March 2018 initiation Corporate InsolvencyResolution Process ("CIRP") in respect of Viceroy Hotels Limited as per theprovisions of the Insolvency and Bankruptcy Code 2016 (IBC) and as per Section 17 of theCode the powers of the Board of Directors of Viceroy Hotels Limited (Corporate Debtor)stands suspended and such powers shall be vested with Mr. Karuchola Koteswara RaoResolution Professional.

f) With respect to the adequacy of the internal financial controls overfinancial reporting of the Company and the operating effectiveness of such controls referto our separate Report in "Annexure B". Our report expresses a modified opinionon the adequacy and operating effectiveness of the Company's internal financial controlsover financial reporting.

g) With respect to the other matters to be included in the Auditor'sReport in accordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 asamended in our opinion and to the best of our information and according to theexplanations given to us:

i. The Company has disclosed the pending litigations in its notes toaccounts in the financial statements of the company (Note No:37)

ii. The Company does not have any long term contracts includingderivative contracts for which there were any material foreseeable losses.

iii. There were no amounts which were required to be transferred to theInvestor Education and Protection Fund by the Company.

iv. The company has not appointed Company Secretary for the F.Y 2020-21as per Provisions of Sec. 203 of The companies Act 2013 read with Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014(Refer note no:46)

ANNEXURE 'A' TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 1 under 'Report on Other Legal and RegulatoryRequirements' section of our report to the Members of VICEROY HOTELS LIMITED of even date)

i. In respect of the Company's fixed assets:

a) The Company has not produced Fixed Assets Register.

b) As per the information and explanations given by the management thefixed assets have been physically verified by the management in a phased periodicalmanner. But as per the "Basis for Qualified opinion" given by us there iscapitalization of Rs. 111.94 crores in the FY 2017-18 as we haven't obtained any valuationcertificate towards capitalization of fixed assets; we are unable to ascertain theverification of fixed assets by the management.

c) According to the information and explanation given to us and onverification of documents provided to us we are of the opinion that the title deeds ofimmovable properties are held as per note no: 41 of the financial statements. Accordinglythe title deeds are not on the Name of the company M/s Viceroy Hotels Limited

ii. As per the information and explanations given to us and as per thebooks and records maintained by the company the physical verification of inventory hasbeen conducted at reasonable intervals by the management during the year and no materialdiscrepancies were noticed on such verification.

iii. The company has not granted any loans secured unsecured tocompanies firms limited liability partnerships covered in the register maintained undersection 189 of the Companies Act 2013.

iv. In our opinion and according to the information and explanationprovided to us in respect to loans investments guarantees and securities provisions ofsection 185 and 186 of the Companies Act 2013 has been complied with.

v. The Company has not accepted any deposits during the year from thepublic within the meaning of the provisions of section 73 of "the Act" and hencedirectives issued by the reserve bank of India and the provisions of section 73 to 76 orany other relevant provisions of "the Act" the Rules framed there under are notapplicable to the Company at present.

vi. The maintenance of cost records has not been specified by theCentral Government under section 148(1) of the Companies Act 2013 for business activitiescarried out by the Company. Thus reporting under clause 3(vi) of the order is notapplicable to the company.

vii.

1. The Company is not regular in depositing statutory dues includingTDS PF ESI with the appropriate authorities. As at the end of the financial year theamounts which were due for more than 6 months from the date they became payable as perbooks and records of the company are as follows:

S.No Particulars Amount
1 TDS 33420321/-
Total 33420321/-

2. According to the information and explanations given to us nodisputed amounts are payable in respect of Income Tax and any other statutory dues as atthe end of the period except for the below mentioned due to income tax service taxluxury tax as per the information and explanations given by the company and as per thebooks and records verified by us.(Note no.37)

Name of the Statue Nature of Dues Section under which order is passed Amount (Rs) Period to which it relates Case is pending at
Income Tax Act 1961 Income Tax 154 Rs.537832209/- A.Y 2014-15 Commissioner of Income Tax (Appeals)
Income Tax Act 1961 Income Tax 143(3) Rs.92044470/- A.Y 2016-17 Commissioner of Income Tax (Appeals)
Income Tax Act 1961 Income Tax 143(3) Rs.91407210/- A.Y 2017-18 Commissioner of Income Tax (Appeals)

Service Tax:

SI. No. SCN O.R. No. OIO/OIA No. and Date Period Demand (Rs.)
1 O.R. No.95/2012-Adjn (ST) (Commr) dt.23.04.2012 OIO No.HYD-EXCUS-000- COM-21-16-17 dt.25.05.2016 2006-07 to 2010-11 73165038/-
2 O.R.No. 54/2013-Adjn (ST) (Commr) dt.18.06.2013 OIO No.HYD-EXCUS-000- COM-22-16-17 dt.25.05.2016 April 2011 to March 2012 241663/-
3 O.R.No. 84/2013-Adjn (ST) (Commr) dt.19.05.2014 OIO No.HYD-EXCUS-000- COM-23-16-17 dt.25.05.2016 April 2012 to June 2012 285941/-
4 O.R.No. 164/2014-Adjn (ST) (Commr) dt.26.09.2014 OIO No.HYD-EXCUS-000- COM-24-16-17 dt.25.05.2016 July 2012 to March 2013 2601002/-
5 O.R.No. 45/2015-Adjn (ST) (Commr) dt.16.04.2015 OIO No.HYD-EXCUS-000- COM-25-16-17 dt.25.05.2016 April 2013 to March 2014 4029335/-
6 O.R.No. 73/2016-Adjn (ST) (JC) dt.30.08.2016 OIA No. HYD-SVTAX-000- AP2-0236-17-18 dt.24.11.2017 July 2012 to March 2015 1314253
7 O.R No.82/2016-Adjn ST Commr. Dt.22.04.16 OIO No.07/2017-ST dt.19.05.2017 April 2014 to March 2015 4526905/-
8 F. No. DRI/CZU /HRU /26B /ENQ-08 (INT-7)/2014 dt.29.12.2016 OIO No.68847/2019 dt.15.05.2019 2012 to 2016 38041131/-
9 C.No.V/15/12/ 2018-Adjn dt.24.04.2018 OIA No. HYD-EXCUS-SC- AP2-0125-18-19 ST dt.26.03.2019 April 2015 to March 2016 2013146/-
10 C.No.V/15/12/ 2018-Adjn dt.29.10.2018 OIO No.15/2018 dt.30.01.2019 April 2016 to June 2017 1515857/-
11 O.R.No.57/2018-19-GST- SEC-Adjn-JC dt.15.11.2018 October 2015 to June 2017 12584491/-

iv) Luxury Tax/ Sales Tax

S.No Arrear Notice issued by office of the Assistant Commissioner(ST) Gandhinagar Circle Hyd Period Demand issue Luxury Tax 50% Paid
1 15.02.2019 2011-12 795429 Dispute of Levy of Luxury Tax on Service Tax 397715
2 15.02.2019 2012-13 1077592 Dispute of Levy of Luxury Tax on Service Tax 538796
3 15.02.2019 2013-14 758952 Dispute of Levy of Luxury Tax on Service Tax 379476
4 15.02.2019 2010-11 to 2012-13 (upto 31.10.2012)01.1 1.2012 to 30.09.2013 1588152 Disputed arrears against completion of Revision of Assessment U/VAT Act 0.00

viii. According to the information and explanations given to us and asthe books and records produced by the company it has defaulted in repayment of dues tovarious banks and financial institutions which are as follows as on 31-03-2021 as perbooks and records verified by us . However the company has not made interest provisionwith regarding to those loans in the books of accounts from financial year 2012-13.(Noteno.39)

Name of the Bank/Institution Principle Due Interest Due Total Dues
ARCIL 131.68 91.79 223.47
EARCL 0.88 - 0.88
IARC LTD 1.95 - 1.95
State Bank of India 56.18 50.55 106.73
Canara Bank 24.07 34.81 58.88
Total 214.76 177.15 391.91

We not yet received confirmations from Banks/ Financialinstitutions/Asset Reconstruction

companies for the above outstanding balances.

ix. The Company has not raised moneys by way of initial public offer orfurther public offer during the year under consideration (including debt instruments) andthe loans defaulted by the company has been given in the Notes to accounts of thefinancial statements in Note no: 39 and the company is not providing interest in theirbooks of accounts with respect those loans as such the qualification has been given in theAudit report in the Basis of qualified opinion paragraph.

x. To the best of our knowledge and according to the information andexplanations given to us no fraud by the Company or no material fraud on the Company byits officers or employees has been noticed or reported during the year.

xi. According to information and explanations given to us the companyand verification of the records of the company the company has provided and paidmanagerial remuneration during the year under consideration in compliance with theprovisions of Section 197 of The companies Act 2013.

xii. The Company is not a Nidhi Company and hence reporting underclause 3 (xii) of the Order is not applicable to the Company.

xiii. In our opinion and according to the information and explanationsgiven to us the Company is in compliance with Section 177 and 188 of the Companies Act2013 wherever applicable for all transactions with the related parties and the details ofrelated party transactions have been disclosed in the standalone financial statements asrequired by the applicable accounting standards (Refer Note no. 40)

xiv. During the year the Company has not made any preferentialallotment or private placement of shares or fully or partly paid convertible debenturesand hence reporting under clause 3 (xiv) of the Order is not applicable to the Company.

xv. In our opinion and according to the information and explanationsgiven to us during the year the Company has not entered into any non-cash transactionswith its Directors or persons connected to its directors and hence provisions of section192 of "the Act" are not applicable to the Company.

xvi. The Company is not required to be registered under section 45-IAof the Reserve Bank of India Act 1934.

ANNEXURE "B" TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 2(f) under 'Report on Other Legal andRegulatory Requirements' section of our report to the Members of VICEROY HOTELS LIMITEDof even date)

Report on the Internal Financial Controls over Financial Reportingunder clause(i) of Sub-section 3 of Section 143 of the Companies Act 2013 ("theAct")

We have audited the internal financial controls over financialreporting of VICEROY HOTELS LIMITED ("the Company") as of March 31 2020in conjunction with our audit of the standalone financial statements of the Company forthe year ended on that date.

Management's Responsibility for Internal Financial Controls

The Board of Directors of the Company is responsible for establishingand maintaining internal financial controls based on the internal control over financialreporting criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note on Audit of Internal Financial Controls overFinancial Reporting issued by the Institute of Chartered Accountants of India. 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 respective company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Companies Act 2013.

Auditor's Responsibility

Our responsibility is to express an opinion on the internal financialcontrols over financial reporting of the Company based on our audit. We conducted ouraudit in accordance with the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting (the "Guidance Note") issued by the Institute of CharteredAccountants of India and the Standards on Auditing prescribed under Section 143(10)of theCompanies Act 2013 to the extent applicable to an audit of internal financial controls.Those Standards and the Guidance Note require that we comply with ethical requirements andplan and perform the 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 performing procedures to obtain audit evidence aboutthe adequacy of the internal financial controls system over financial reporting and theiroperating effectiveness. Our audit of internal financial controls over financial reportingincluded obtaining an understanding of internal financial controls over financialreporting assessing the risk that a material weakness exists and testing and evaluatingthe design and operating We believe that the audit evidence we have obtained is sufficientand appropriate to provide a basis for qualified opinion on the internal financialcontrols system over financial reporting of the Company.

Meaning of Internal Financial Controls over Financial Reporting

A company's internal financial control over financial reporting is aprocess designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of financial statements for external purposes in accordancewith generally accepted accounting principles. A company's internal financial control overfinancial reporting includes those policies and procedures that

(1) pertain to the maintenance e of records that in reasonable detailaccurately and fairly reflect the transactions and dispositions of the assets of thecompany;

(2) provide reasonable assurance that transactions are recorded asnecessary to permit preparation of financial statements in accordance with generallyaccepted accounting principles and that receipts and expenditures of the company arebeing made only in accordance with authorizations of management and directors of thecompany; and

(3)provide reasonable assurance regarding prevention or timelydetection of unauthorized acquisition use or disposition of the company's assets thatcould have a material effect on the financial statements.

Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls overfinancial reporting including the possibility of collusion or improper managementoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projections of any evaluation of the internal financial controls overfinancial reporting to future periods are subject to the risk that the internal financialcontrol over financial reporting may become inadequate because of changes in conditionsor that the degree of compliance with the policies or procedures may deteriorate.

Basis for Qualified Opinion:

1. The company did not have appropriate internal controls forconfirmation and reconciliation of trade receivables trade payables other current assetsand current liabilities.

2. The company did not have fixed asset register as on 31.03.2020.

3. The company has written off various assets and liabilities asexceptional items during the F.Y 2017-18 due to which we couldn't get appropriate auditevidence in relation to such written off.

4. The company has not appointed company secretary for the F.Y 2019-20which is not in compliance with the provisions of Sec.203 of Companies Act 2013.

As a result of these matters we have not been able to obtainsufficient and appropriate audit evidence in relation to Internal Financial Controls overFinancial Reporting and consequently we are unable to determine whether the company hasestablished adequate internal financial controls over Financial Reporting and also whethersuch internal financial controls were operating effectively as at March 31st2020.

Qualified Opinion

In our opinion as am result of the matters given in the Basis ofQualified opinion paragraph given in the Audit report the company as we have not obtainedsufficient appropriate audit evidence in respect of those matters specifies in the Basisof Qualified opinion paragraph we are unable to determine whether the company hasestablished adequate internal financial controls over Financial Reporting and also whethersuch internal financial controls were operating effectively as at March 31st2020. Based internal control stated in the Guidance Note on Audit of Internal FinancialControls over Financial Reporting issued by the Institute Of Chartered Accountants ofIndia.

For P C N & Associates
Chartered Accountants
Firm Registration no: 016016S
K.Gopala krishna
Partner
M No.: 0203605
Place: Hyderabad
Date: 28/06/2021
Udin 21203605AAAAGZ7328

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