We have audited the accompanying Standalone Financial Statements of McNally Bharat Engineering Company Limited
(“the Company”), which comprise the Standalone Balance Sheet as at 31st March, 2025, the Standalone Statement
of Profit and Loss (including Other Comprehensive Income), the Standalone Statement of Changes in Equity and the
Standalone Statement of Cash Flows for the year then ended, and notes to the Standalone Financial Statements including
a summary of material accounting policies and other explanatory information (hereinafter referred to as “Standalone
Financial Statements”).

In our opinion and to the best of our information and according to the explanations given to us because of the significance
of the matter described in the Basis for Adverse Opinion section of our report, the aforesaid Standalone Financial
Statements do not give the information required by the Companies Act, 2013 (“the Act”) in the manner so required and
also does not give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133
of the Act read with the Companies (Indian Accounting Standards) Rules, 2015 as amended (Ind AS) and other accounting
principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2025, its loss including
Other Comprehensive Income, its changes in equity and Statement of cash flows for the year ended on that date.

Basis for Adverse Opinion

a) Current Assets and Current Liabilities

i. We draw attention to Note 43 to the Standalone Financial Statements regarding Trade Receivables, Advance
to Supplier, Trade Payable, Other Financial Assets and Advance from customers are subject to confirmation
and reconciliation from respective parties and consequential reconciliation, outcomes of pending arbitration/
settlements of claims and adjustments arising therefrom, if any. The management, however, does not expect
any material variation. Management is also hopeful for recovery/realisation of trade receivables which include
Rs. 27,052.24 Lakhs under Arbitration/ Proposed Arbitration in the normal course of business, hence no
impairment has been considered at this stage.

ii. We draw attention to Note 6(d) to the Standalone Financial Statements, Claims Recoverable (BG Encashed)
amounting to Rs. 36,183.70 Lakhs, out of which specific provision is made of Rs. 32,377.38 Lakhs, including
Rs. 3,806.32 Lakhs under arbitration whose fair value is Rs. 2,828.72 Lakhs are doubtful. Recoverability/
Adjustments/ Impacts with respect to these are currently not ascertainable and as such cannot be commented
upon by us.

b) Non-adjustment of the Carrying Value of Loan

In earlier years, the Company had given unsecured loan to Vedica Sanjeevani Projects Private Limited (“VSPL”).
VSPL vide their letter dated 15th February, 2022 informed the Company that it was unable to service the debt and
requested the Company for a moratorium on the repayment of the loan, including interest for two years i.e., Financial
Year 2021-22 and Financial Year 2022-23. Subsequently, the Company has stopped recognizing interest income on
the same. In absence of any further communication between the Company and VSPL made available to us, we are
unable to comment on the realizability of loan and its interest and consequential adjustment to be made in the books.

This constitutes a material departure from the requirements of Indian Accounting Standard - 109 “Financial
Instrument”.

c) Recognition of Deferred Tax Assets

Note 7 to the Standalone Financial Statements mentions that the Company had recognized deferred tax assets of
Rs. 51,706.60 lakhs up to 31st March, 2018, which is being carried forward in the books by the Company expecting
adequate future taxable profits after infusion of fresh funds in the Company by the successful Resolution Applicant
against which such deferred tax assets would be adjusted.

The Company has been continually incurring losses and its net worth has been fully eroded. We are unable to obtain
sufficient appropriate audit evidence with respect to the management's assertions and are therefore, unable to
comment on the carrying value of the aforesaid net deferred tax assets on 31st March, 2025.

This constitutes a material departure from the requirements of Indian Accounting Standard 12 “Income Taxes”.

Material Uncertainty Related to Going Concern

The Company has reported a net loss in the current year amounting to Rs. 1,71,608.57 Lakhs (previous year Rs.
88,326.28 Lakhs) before other comprehensive income and is unable to meet its financial commitments/covenants
to lenders and various other stakeholders. The ability to continue as a going concern is dependent upon many
factors including continued support from the financial creditors, operational creditors, customers and the successful
implementation of the resolution plan as approved by the Hon’ble National Company Law Tribunal. These events and
conditions indicate a material uncertainty that may cast significant doubt on the Company's ability to continue as a
going concern.

However, we could not gather sufficient evidence with respect to the management's assertion and in the absence of
required documents/evidence are unable to comment on the preparation of the Statement.

Emphasis of Matters

a) Approval of Resolution Plan by the Committee of Creditors/ NCLT

Note 39 to the Statement informs that the Hon'ble National Company Law Tribunal (NCLT), Kolkata Bench admitted
the Corporate Insolvency Resolution Process (CIRP) against the Holding Company and appointed Mr. Ravi Sethia
(IBBI/IPA-001/IP-P01305/2018- 2019/12052) as the Resolution Professional (RP). The RP received Resolution
Plans from 4 applicants. Out of the 4, the Resolution Plan of one of the applicants received approval from the
Committee of Creditors by the requisite majority and thereafter the RP submitted the application before the Hon’ble
NCLT on 3rd August 2023 for its final approval. On the 19th December 2023, Hon’ble NCLT pronounced its order in
favour of one of the successful Resolution Applicants i.e. BTL EPC Limited. Pursuant to the approval of the Plan by the
Hon’ble NCLT, the Implementation and Monitoring Committee (“IMC”) is duly constituted on 19th December 2023 as
per the terms of the plan to oversee the implementation.

Since, the Approved Resolution Plan could not be implemented within the “effective date” i.e 17.02.2024 owing to
uncontrollable challenges faced by the SRA, the MC filed an application with the Hon’ble NCLT to seeking appropriate
directions and recourse with respect to the approved Resolution Plan. On 3rd December 2024, Hon’ble NCLT passed
a subsequent order granting extension of the “effective date” for the implementation of the Resolution Plan up to 21
days from the date of uploading the NCLT Order i.e. up to 06.01.2025.

b) Implementation of Resolution Plan

i. BTL EPC Limited, the SRA nominated Mandal Vyapar Private Limited (“MVPL”) as its Special Purpose Vehicle
(“SPV”) which was noted at the 5th Monitoring Committee meeting held on 16th December, 2024 for the purpose
of implementing the approved Resolution Plan.

ii. In terms of the approved Resolution Plan, the SRA was required to disburse payments in three tranches. As
of March 31, 2025, the SRA had disbursed the first tranche and a part of the second tranche. These Financial
Statements have been prepared basis the payment of tranches mentioned hereinabove. The MC on receipt of
the tranche amount had been distributed the same to the respective claimants in accordance with the approved
Resolution Plan as detailed in Note No. 4(f) of the Management Notes to the Financial Statements.

At the 12th MC Meeting held on 12th February 2025, the SRA indicated its inability to honour the 2nd tranche
payment on the scheduled date and agreed to make a partial payment immediately, and the balance amount on/
before 10th March 2025 with interest for the delayed payment. However, at the 13th MC Meeting held on 13th
March 2025, SRA informed that the funds have not been infused owing to procedural delays at its end.

At the 15th MC Meeting held on 27th March 2025, the SRA reiterated that while it was keen to make balance
tranche payments, certain challenges had caused delays in the infusion of funds. Accordingly, the SRA requested
the MC Members to allow additional time and extend their support until 30th June 2025 to make the balance
payment along with interest. Subsequently, the SRA filed Interlocutory Application No. 1908134/01611/2025
dated 22nd April 2025 before the Hon’ble NCLT seeking extension of time till 30th September 2025 for payment
of the outstanding tranches. As on the date of approval of these Financial Statements, the application is under
consideration of the Hon’ble NCLT.

iii. Upon implementation of the Resolution Plan, the entire existing share capital of the Company stood extinguished
and cancelled to the extent of 95% in accordance with the terms set forth in the Resolution Plan.

Subsequent to such extinguishment, the Company has issued fresh equity shares to Mandal Vyapar Private
Limited (acting as the Special Purpose Vehicle nominated by the Successful Resolution Applicant) and the
Assenting Financial Creditors. As per plan, SRA has to pay Re. 0.01 per share to all the existing shareholders as a
“goodwill gesture” amounting to Rs. 21.16 Lakhs which is transferred to a separate escrow account for payment
to existing shareholders. The Company’s capital structure as on 31st March 2025 was as follows:

iv. The Company has duly complied with all applicable legal and regulatory requirements, including but not limited
to those prescribed under the Securities and Exchange Board of India (Listing Obligations and Disclosure
Requirements) Regulations, 2015. The Company has filed all requisite forms and disclosures with the Bombay
Stock Exchange (BSE), National Stock Exchange (NSE) and Ministry of Corporate Affairs relevant to the allotment
and listing of the newly issued equity shares. And is awaiting approval from the respective stock exchange.

v. By virtue of implementation of the Resolution Plan, Mandal Vyapar Private Limited as on 31st March 2025
holds 300,00,000 equity shares of nominal value Rs. 10 each of Mcnally Bharat Engineering Company Limited
constituting 90% of its paid up share capital and hence, a holding company of the latter.

vi. As per the approved Resolution Plan read with the NCLT Order dated 3rd December 2024, the SRA was required
to pay the agreed consideration in 3 (three) tranches at the scheduled dates. The SRA having paid the first
tranche in full and a part of the second tranche, the Monitoring Committee proportionately distributed the
amount as under:

The above amounts have been adjusted with the existing liabilities admitted by the Resolution Professional.

vii. In accordance with the Resolution Plan, the Company was required to disburse payments against admitted
claims to the extent of the funds received. However, the full settlement has not yet been completed and therefore,
the balance unutilized funds have been maintained in an escrow account held by the Company. This balance is
presented under 'Other Bank Balances’ in the Financial Statements.

viii. After the date of approval of the Resolution Plan, a Bank Guarantee amounting to Rs. 275.34 Lakhs was invoked
by a customer. The related cost has been duly recognized in the Company’s books and funded entirely through
internal accruals. In accordance with the provisions of the Plan, this shall be treated as a payment made to
secured financial creditors, under the protection extended by the SRA.

c) Non-Assessment of Pending Litigations

Note 41 to the Standalone Financial Statements refers to the Company’s receipt of regulatory Enquiries/ Notices/
Summons/ Show-Cause/ Demand/ Orders from various government authorities such as departments of Goods and
Services Tax, Income Tax, etc. In view of Company’s admission under CIRP, all existing civil / legal proceedings will
be kept in abeyance as moratorium is in force under section 14 of the Insolvency and Bankruptcy Code, 2016 till the
conclusion of CIRP. Therefore, no impact has been considered in the Standalone Financial Statements as of now.

d) Recognition of Interest Expense

As referred to in Note 42 of the Statement, the Company has recognized interest expense for the year ended 31st
March, 2025 on Bank Borrowings, Inter Corporate Deposits, and claim of EIG (Mauritius) Limited under the head
'Finance Costs’ amounting to Rs. 83,806.02 Lakhs as estimated by the management.

e) Recognition of interest on outstanding balances of MSME vendors

The company has not provided us with the appropriate audit evidence relating to the identification of balances of
MSME parties on which the interest is recognised.

Our opinion on the Standalone Financial Statements is not modified in respect of these matters.

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. In addition to the matters described in the Basis for Adverse Opinion section
and Emphasis of Matters section of our report, we have determined the matters described below to be the key audit
matters to be communicated in our Report.

Information Other than the Standalone Financial Statements and Auditor's Report Thereon ('Other Information')

In view of ongoing Corporate Insolvency Resolution Process (CIRP), the management under Monitoring Committee is
responsible for the preparation of the Other Information. The Other Information comprises of the information included
in the Management Discussion and Analysis, Board’s Report including Annexures thereto, Corporate Governance and
Shareholders Information but does not include the 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 or conclusion thereon.

In connection with our audit of the Standalone Financial Statements, our responsibility is to read the other information
identified and, in doing so, consider whether the other information is materially inconsistent with the Standalone Financial
Statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated.

If we conclude, based on the work we have performed, and on the other information obtained prior to the date of the
auditor’s report, that there is a material misstatement in this other information, we are required to report that fact.

We have nothing to report in this regard.

Responsibilities of Management and Those Charged with Governance for the Standalone Financial Statements

The Hon’ble National Company Law Tribunal (NCLT), Kolkata Bench admitted the Corporate Insolvency Resolution
Process (CIRP) against the Company and appointed Mr. Ravi Sethia (IBBI/IPA-001/IP-P01305/2018- 2019/12052) as
the Resolution Professional (RP). The RP received Resolution Plans from 4 applicants. Out of the 4, the Resolution Plan
of one of the applicants received approval from the Committee of Creditors by the requisite majority and thereafter the
RP submitted the application before the Hon’ble NCLT on 3rd August 2023 for its final approval. On the 19th December
2023, Hon’ble NCLT pronounced its order in favour of one of the successful Resolution Applicants i.e. BTL EPC Limited.
Pursuant to the approval of the Plan by the Hon’ble NCLT, the Implementation and Monitoring Committee (“IMC”) is duly
constituted on 19th December 2023 as per the terms of the plan to oversee the implementation.

However, until the implementation of the Resolution Plan submitted by the Successful Resolution Applicant as per the
conditions set out in the NCLT order, the management under the Monitoring Committee is responsible for the preparation
of these Standalone Financial Statements that give a true and fair view of the financial position, financial performance,
including total comprehensive loss, changes in equity, and cash flows of the Company in accordance with the accounting
principles generally accepted in India including the Indian Accounting Standards prescribed 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
Standalone 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, the management under the Monitoring Committee is 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 management either intends to liquidate the Company or to
cease operations or has no realistic alternative but to do so. The management under the Monitoring Committee is also
responsible for overseeing the Company’s financial reporting process.

Auditor's 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 scepticism
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 on whether the Company has adequate internal financial controls with reference to 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 made by the management under the Monitoring Committee.

• Conclude on the appropriateness of management under the Monitoring Committee’s 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 Company’s ability to continue as a going concern. 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 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.

• 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.

Materiality is the magnitude of misstatements in the Standalone Financial Statements that, individually or in the
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 Auditor’s 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 in
terms of section 143(11) of the Act, we give in the “Annexure A” a statement on the matters specified in the paragraphs
3 and 4 of the Order to the extent applicable.

2. As required by Section 143(3) of the Act, we report that:

a) we have sought and except for possible effects of the matters described in the basis for Adverse Opinion section
above, obtained all the information and explanations which to the best of our knowledge and belief were
necessary for the purposes of our audit of the aforesaid financial statements;

b) except for the possible effects of the matter described in the Basis for Adverse Opinion Section above, 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 Standalone Balance Sheet, the Standalone Statement of Profit and Loss including Other Comprehensive
Income, the Standalone Statement of Changes in Equity and the Standalone Statement of Cash Flows dealt with
by this Report are in agreement with the relevant books of account maintained for the purpose of preparation
of the financial statement.

d) considering the significance of the matter described in the Basis for Adverse Opinion Section above, in our
opinion, the aforesaid Standalone Financial Statements do not comply with the Indian Accounting Standards
specified under Section 133 of the Act;

e) on the basis of the written representations received from the directors of the Company, 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) with respect to the adequacy of the internal financial controls over financial reporting of the Company with
reference to these Standalone Financial Statements and the operating effectiveness of such controls, refer to
our separate report in "Annexure B”. Our report expresses Adverse Opinion on the adequacy and operating
effectiveness of internal financial control with reference to the financial statements.

g) The adverse remarks on the maintenance of accounts and other matters connected therewith are as stated in
the Basis for Adverse Opinion section above.

h) The matters described in the Basis for Adverse Opinion section above, specially that relating to Non Adjustment
of the carrying value of loan stated in para (b) of that section, adjustment of balances of Current Assets and
current liabilities as per the basis stated in para (a) about pending confirmations and adjustments and Material
uncertainty relating to going concern assumption pending implementation of Resolution Plan, in our opinion,
may have adverse effect on the functioning of the company.

i) with respect to the other matters to be included in the Auditor's 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. except for the possible effect of the matter described in the Basis for Adverse Opinion section above, the
Company has disclosed the impact of pending litigations on its financial position in the Standalone Financial
Statements (Refer Note 29 to the Standalone Financial Statements);

ii. the Company has made provision as required under the applicable law or accounting standards for material
foreseeable losses if any on long term contract including derivative contracts; and

iii. there were no amounts which were 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 person or entity, including foreign
entities (“Intermediaries”), with the understanding, whether recorded in writing or otherwise, that
the Intermediary shall, whether, directly or indirectly lend to 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 person or entity, including foreign entities (“Funding Parties”),
with the understanding, whether recorded in writing or otherwise, that the company shall, whether,
directly or indirectly, lend to 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 our audit procedure that has 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) or (b) contain any material misstatement. However, in respect of the earlier year
transactions dealing with loans and advances, securities, guarantees etc. as stated in those years which
are forming part of the Basis for Adverse Opinion as given above, we are unable to ascertain and/or
comment as required under this para.

v. The Company has not declared or paid any dividend during the financial year.

vi. Based on our examination, which included test checks, the company has used accounting software for
maintaining its books of account which has a feature of recording audit trail in the software, except that the audit
log is not maintained in case of modification by certain users with specific access and that the audit trail features
has not been enabled at the database level to log any direct data changes. During the course of performing our
procedures, other than the aforementioned instances where the question of our commenting on the audit trail
feature being tampered with did not arise, we did not come across any instances of the audit trail feature being
tampered with.

3. With respect to the matter to be included in the Auditor’s Report under Section 197(16) of the Act:

In our opinion and according to the information and explanations given to us, the Company has paid/ provided for
managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197
read with Schedule V of the Act.

For V. Singhi & Associates

Chartered Accountants
Firm Registration No. 311017E

(Aniruddha Sengupta)

Partner

Place: Kolkata Membership No. 051371

Date: 22nd May 2025 UDIN: 25051371BMUIZS6564