We have audited the accompanying standalone financial statements of Banganga Paper
Industries Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2025, and
the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Cash
Flows and the Statement of Changes in Equity for the year ended on that date, and notes to the
financial statements, including a summary of material accounting policies and other explanatory
information.
In our opinion and to the best of our information and according to the explanations given to us, the
aforesaid standalone financial statements give the information required by the Companies Act,
2013 ("the Act") in the manner so required and give a true and fair view, except for the matters
described in the basis for qualified opinion paragraph, in conformity with the Indian Accounting
Standards prescribed under section 133 of the Act, ("Ind AS") and other accounting principles
generally accepted in India, of the state of affairs of the Company as at March 31,2025, and its
loss, total comprehensive income, its cash flows and the changes in equity for the year ended on
that date. .
Basis for Opinion .
We conducted our audit of the standalone financial statements in accordance with the Standards
on Auditing ("SAs") specified under section 143(10) of the Act. Our responsibilities under those
Standards are further described in the Auditor’s Responsibility for the Audit of the Standalone
Financial Statements section of our report. We are independent of the Company in accordance
with the Code of Ethics issued by the Institute of Chartered Accountants of India ("ICAI") together
with the ethical requirements that are relevant to our audit of the standalone financial statements
under the provisions of the Act and the Rules made thereunder, and we have fulfilled our other
ethical responsibilities in accordance with these requirements and the ICAI’s Code of Ethics. We
believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for
our qualified audit opinion on the standalone financial statements.
Qualified Opinion
1. We have following observations to make for noncompliance under Section 186(7) of the
companies Act, 2013 which leads to understatement of income accrued to the company
and understatement of the loans and advances given.
a. The Company’s short-term loans and advances include an amount of €356.78 lakh
extended to a subsidiary company. As per Section 186(7) of the Act, any loan provided by
a company must carry an interest rate not lower than the prevailing yield of one-year,
three-year, five-year, or ten-year Government Security, corresponding to the tenor of the
loan. However, the Company has not recognized any interest income receivable from the
subsidiary in respect of the said loan, thereby contravening the statutory requirement.
Furthermore, the Company has not specified the tenure of the loan granted to the
subsidiary. In the absence of appropriate documentation or corroborative evidence
regarding the loan tenor, we are unable to determine the applicable Government Security
yield and consequently, unable to quantify the extent of understatement of income and
loans and advances.
2. As per the provisions of Section 138 of the Companies Act, 2013, a listed company is
required to appoint an internal auditor. However, based on the information and
explanations provided to us, the Company has not appointed an internal auditor during the
financial year under audit. This constitutes a non-compliance with the statutory
requirements of the said section.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the standalone financial statements of the current period. These matters were
addressed in the context of our audit of the standalone financial statements as a whole, and in
forming our opinion thereon, and we do not provide a separate opinion on these matters.
We have determined that there are no key audit matters to be communicated in our report.
Information Other than the Standalone Financial Statements and Auditor’s Report Thereon
• The Company’s Board of Directors is responsible for the other information. The other
information comprises the information included in the Annual Report, but does not include
the consolidated financial statements, standalone financial statements and our auditor’s
report thereon.
• Our opinion on the standalone financial statements does not cover the other information
and we do not express any form of assurance conclusion thereon.
• In connection with our audit of the standalone financial statements, our responsibility is to
read the other information and, in doing so, consider whether the other information is
materially inconsistent with the standalone financial statements or our knowledge obtained
in the audit or otherwise appears to be materially misstated.
• If, based on the work we have performed, we conclude that there is a material
misstatement of this other information; we are required to report that fact, since these
reports are expected to be made available to us after the date of this audit report, hence
currently we have nothing to report in this regard.
Responsibilities of Management and Board of Directors for the Standalone Financial Statements
The Company’s Management and Board of Directors are responsible for the matters stated in
section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these
standalone financial statements that give a true and fair view of the financial position, financial
performance including other comprehensive income, cash flows and changes in equity of the
Company in accordance with the accounting principles generally accepted in India, including Ind
AS specified under section 133 of the Act.
This responsibility also includes maintenance of adequate accounting records in accordance with
the provisions of the Act for safeguarding the assets of the Company and for preventing and
detecting frauds and other irregularities; selection and application of appropriate accounting
policies; making judgments and estimates that are reasonable and prudent; and design,
implementation and maintenance of adequate internal financial controls, that were operating
effectively for ensuring the accuracy and completeness of the accounting records, relevant to the
preparation and presentation of the financial statements that give a true and fair view and are
free from material misstatement, whether due to fraud or error.
In preparing the standalone financial statements, management and Board of Directors are
responsible for assessing the Company’s ability to continue as a going concern, disclosing, as
applicable, matters related to going concern and using the going concern basis of accounting
unless the Board of Directors either intend to liquidate the Company or to cease operations, or has
no realistic alternative but to do so.
The Company’s Board of Directors are also responsible for overseeing the Company’s financial
reporting process.
Auditors’ Responsibility for the Audit of the Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalone financial
statements as a whole are free from material misstatement, whether due to fraud or error, and to
issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of
assurance, but is not a guarantee that an audit conducted in accordance with SAs will always
detect a material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to
influence the economic decisions of users taken on the basis of these standalone financial
statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain
professional skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the standalone financial statements,
whether due to fraud or error, design and perform audit procedures responsive to those
risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our
opinion. The risk of not detecting a material misstatement resulting from fraud is higher than
for one resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the 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 through a separate report on the
complete set of financial statements on whether the Company has adequate internal
financial controls with reference to standalone financial statements in place and the
operating effectiveness of such controls.
• Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures in the standalone financial statement made
by the Management.
• Conclude on the appropriateness of the Management and Board of Directors use of the
going concern basis of accounting and, based on the audit evidence obtained, whether a
material uncertainty exists related to events or conditions that may cast significant doubt on
the appropriateness of this assumption. If we conclude that a material uncertainty exists, we
are required to draw attention in our auditor's report to the related disclosures in the
standalone annual 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's report. However, future events or conditions may cause the Company to cease to
continue as a going concern.
• Evaluate the overall presentation, structure and content of the standalone financial
statements, including the disclosures, and whether the standalone financial statements
represent the underlying transactions and events in a manner that achieves fair
presentation.
• Obtain sufficient appropriate audit evidence regarding the standalone financial
statements of the Company to express an opinion on the standalone financial statements.
Materiality is the magnitude of misstatements in the Standalone Financial Statements that,
individually or in aggregate, makes it probable that the economic decisions of a reasonably
knowledgeable user of the Standalone Financial Statements may be influenced. We consider
quantitative 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 Standalone Financial Statements.
We communicate with those charged with governance regarding, among other matters, the
planned scope and timing of the audit and significant audit findings, including any significant
deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with
relevant ethical requirements regarding independence, and to communicate with them all
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 those
matters that were of most significance in the audit of the standalone financial statements of the
current period and are therefore the key audit matters. We describe these matters in our auditors’
report unless law or regulation precludes public disclosure about the matter or when, in extremely
rare circumstances, we determine that a matter should not be communicated in our report
because the adverse consequences of doing so would reasonably be 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, 2020 ("the Order"), issued by the
Central Government of India in terms of sub-section (11) of section 143 of the Companies Act,
2013, we give in the Annexure A statement on the matters specified in paragraphs 3 and 4 of
the Order, to the extent applicable.
2. As required by Section 143(3) of the Act, based on our audit, we report that:
a) We have sought and obtained all the information and explanations which to the best of 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 the
company so far as it appears from our examination of those books.
c) The Balance Sheet, the Statement of Profit and Loss including Other Comprehensive
Income, the Statement of Cash Flows and Statement of Changes in Equity dealt with by
this Report are in agreement with the books of account.
d) In our opinion, the aforesaid standalone financial statements comply with the Indian
Accounting Standard (Ind AS) 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 31st March
2025 taken on record by the Board of Directors, none of the directors is disqualified as on
31st March 2025 from being appointed as a director in terms of Section 164(2) of the Act;
f) The observation relating to maintenance of accounts and other matters connected
therewith is as stated in the paragraph (b) above;
g) With respect to the adequacy of the internal financial controls with reference to these
standalone financial statements and the operating effectiveness of such controls, refer to
our separate report in “Annexure B” to this report; Our report expresses a qualified opinion
on the adequacy and operating effectiveness of the Company’s internal financial
controls with reference to standalone financial statements.
h) With respect to the other matters to be included in the Auditor’s Report in accordance with
the requirements of section 197(16) of the Act, as amended, in our opinion and to the best
of our information and according to the explanations given to us, the remuneration paid
by the Company to its directors during the year is in accordance with the provisions of
section 197 of the Act.
i) With respect to the other matters to be included in the Auditors’ Report in accordance with
Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended, in our opinion
and to the best of our information and according to the explanations given to us:
i. The Company has disclosed that it does not have any pending litigations as at 31st
March 2025 which would impact on its financial position in its standalone financial
statements - Refer Note 18 to the standalone financial statements.
ii. The Company did not have any long-term contracts including derivative contracts
for which there were any material foreseeable losses as at 31 March 2025.
iii. There has been no delay in transferring amounts, required to be transferred, to the
Investor Education and Protection Fund by the Company.
iv. (a) The management has represented that, to the best of its knowledge and belief,
no funds have been advanced or loaned or invested (either from borrowed funds or
share premium or any other sources or kind of funds) by the Company to or in any
other persons or entities, including foreign entities ("Intermediaries"), with the
understanding, whether recorded in writing or otherwise, that the Intermediary shall,
whether, directly or indirectly lend or invest in other persons or entities identified in
any 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;
(b) The management has represented that, to the best of its knowledge and belief,
no funds have been received by the Company from any persons or entities,
including foreign entities ("Funding Parties"), with the understanding, whether
recorded in writing or otherwise, that the Company shall, whether, directly or
indirectly, lend or invest in other persons or entities identified in any manner
whatsoever by or on behalf of the Funding Party ("Ultimate Beneficiaries") or provide
any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and
(c) Based on such audit procedures performed that have been considered
reasonable and appropriate in the circumstances, nothing has come to our notice
that has caused us to believe that the representations under sub-clause (a) and (b)
contain any material misstatement.
v. The Company has neither declared nor paid any dividend during the year.
vi. Based on our examination, which included test checks, we note that the Company
has used an accounting software for maintaining its books of account for the
financial year ended March 31, 2025. While the software includes a feature for
recording an audit trail (edit log), we observed that this feature was not operated
throughout the year for all relevant transactions recorded in the software.
Consequently, the audit trail was not consistently available for examination during
the course of our audit. We are therefore unable to comment on whether the audit
trail feature was tampered with or preserved in accordance with the statutory
requirements for record retention for the entire financial year.
For JAIN CHHAJED AND ASSOCIATES
Chartered Accountants
FRN No. 127911W
CA Suyash Chhajed
Partner
M. No. 121597
UDIN: 25121597BMIFYW4958
Place: Nashik
Date: May 15, 2025
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