We have audited the accompanying financial statements of
ECOBOARD 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 Changes in Equity and the
Statement of Cash Flows for the year then ended on that
date and a summary of significant accounting policies and
other explanatory information (hereinafter referred to as the
"financial statements").
In our opinion and to the best of our information and according
to the explanations given to us, the aforesaid 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 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
March 31, 2025, and its losses, total comprehensive income,
the changes in equity and its cash flows for the year ended on
that date.
Basis for Opinion
We conducted our audit of the financial statements in
accordance with the Standards on Auditing ("SA's") 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 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
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 audit opinion on the financial statements.
Emphasis of Matter
Without qualifying our report, we draw attention to
(i) Note No. 38(b)(i) of the standalone Ind AS financial
statements, regarding the various appeals filed by
the Company against demand of excise-duty on its
lamination papers for the years 2008-09 to 2017-18, the
Custom, Excise & Service Tax Appellate Tribunal (CESTAT)
had allowed partial relief to the Company but confirmed
demands aggregating H 1114.64 lakh (subject to Input
Tax Credit), excluding interest and penalties. Company's
application for rectification of apparent mistake in the
said Appellate Order has been dismissed by the CESTAT.
Company's appeal against the order of the CESTAT has
been admitted by the Supreme court of India for hearing.
(ii) Note No. 38(b)(ii) of the standalone Ind AS financial
statements, regarding the Income-tax, Assessing Officer
has passed assessment orders for the AY 2017-18 and AY
2018-19 and has raised income-tax demands of C 510.44
lakh against the Company. Company has filed appeals
before the Income-tax Appellate Tribunal (ITAT) against
the said demands.
(iii) Note No. 38(c) of the standalone Ind AS financial
statements, regarding the Income-tax, Income-tax
Assessing officer has passed assessment order for the AY
2023-24 and has raised income-tax demand of C 179.45
lakh against the company. Company is in the process of
filing appeal to the CIT(A).
No provision is made in the books for above liabilities
pending outcome of appeal proceedings.
Key Audit Matters
Key audit matters are those matters that, in our professional
judgment, were of most significance in our audit of the
financial statements of the current period. These matters
were addressed in the context of our audit of the 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 the matter described below to be the key
audit matters to be communicated in our report.
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Key Audit Matter
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Auditor's Response
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Trade Receivable
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Our audit procedures included:
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Trade receivables, net of impairment allowance, amount to H 367.49
lakh as on 31st March 2025. Impairment provision carried in the books
as on 31st March 2025 is H 304.20 lakh.
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We have performed the following process in relation to
management's judgment in identification of impairment of value
of receivables and adequacy of impairment provision.
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Management judgement is involved in identifying impairment in the
value of the receivables as well as in formulating a policy for creating
provision against impairment which has adverse effect on the profits
of the company.
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(i) We have referred to the defined policy stipulating the
methodology of making impairment provision in respect of
overdue receivable amounts. We have also reviewed age
wise analysis in respect of receivables and ensured that the
provisioning is made according to such policy.
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(ii) We have sought information and explanations from
management regarding the status of receivables for the
purpose of ensuring adequate impairment provision.
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(iii) We have also tested subsequent collection made from the
overdue receivables.
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Loss on sale/ impairment of WIP and FG stock of discontinued
product line
Company has decided to discontinue product line of size 13'x6' particle
boards and dispose off its inventory at discounted price.
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Our audit procedures included:
(i) We have obtained an understanding of management's rationale
for discontinuation of the existing product line and disposal of
related stock of WIP and Finished goods.
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Management judgement is involved in assessing the net realisable
value (NRV) of such inventory.
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(ii)
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Evaluated the Company's policy for inventory valuation and loss
recognition in accordance with Ind AS 2 Inventories.
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Loss recognised on this account is material to financial statements
and has a direct bearing on users' understanding of the financial
statements.
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(iii)
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Tested, on a sample basis, the sales transactions of WIP stock
to verify actual disposal prices and compared them with carrying
values.
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(iv)
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Assessed the reasonableness of management's NRV estimation
by comparing with subsequent realisations from disposal.
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(v)
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Evaluated the adequacy of disclosures in the financial statements
in respect of the disposal of stock and recognition of loss.
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Information Other than the 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 Management Discussion and Analysis and
Board's Report including Annexures to Board's Report (the
"reports"), but does not include the financial statements and
our auditor's report thereon. The reports are expected to be
made available to us after the date of this auditor's report.
Our opinion on the financial statements does not cover the
other information and we do not and will not express any form
of assurance conclusion thereon.
In connection with our audit of the financial statements, our
responsibility is to read the other information identified above
when it becomes available and, in doing so, consider whether the
other information is materially inconsistent with the financial
statements or our knowledge obtained during the course of
our audit or otherwise appears to be materially misstated.
When we read the reports, if we conclude that there is a material
misstatement therein, we are required to communicate the
matter to those charged with governance as required under
SA 720 'The Auditor's responsibilities Relating to Other
Information'.
Responsibilities of Management and Those
Charged with Governance for the Financial
Statements
The Company's Board of Directors is responsible for the
matters stated in section 134(5) of the Act with respect to
the preparation of these financial statements that give a true
and fair view of the financial position, financial performance,
including other comprehensive income, changes in equity
and cash flows of the Company in accordance with the Ind AS
and other accounting principles generally accepted in India.
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 statement that give a true and fair view and are free
from material misstatement, whether due to fraud or error.
In preparing the financial statements, management 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 management either intends to liquidate the Company or
to cease operations, or has no realistic alternative but to do so.
The Board of Directors is responsible for overseeing the
Company's financial reporting process.
Auditor's Responsibility for the Audit of the
Financial Statements
Our objectives are to obtain reasonable assurance about
whether the 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 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 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 financial 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 system 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.
• Conclude on the appropriateness of management'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 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 financial statements, including the disclosures, and
whether the financial statements represent the underlying
transactions and events in a manner that achieves
fair presentation.
Materiality is the magnitude of misstatements in the financial
statements that, individually or in aggregate, makes it probable
that the economic decisions of a reasonably knowledgeable
user of the 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 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 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 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, Statement
of Changes in Equity and the Statement of Cash
Flows dealt with by this Report are in agreement
with the books of account.
d) I n our opinion, the aforesaid financial statements
comply with the Ind AS specified under Section 133
of the Act.
e) On the basis of the written representations received
from the directors as on March 31, 2025 taken
on record by the Board of Directors, none of the
directors is disqualified as on March 31, 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 and
the operating effectiveness of such controls, refer
to our separate Report in "Annexure A". Our report
expresses an unmodified opinion on the adequacy
and operating effectiveness of the Company's
internal financial controls over financial reporting.
g) 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,
I n 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 ended 31st March, 2025 is in
accordance with the provisions of section 197 read
with the schedule V to the Act.
h) 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. The Company has disclosed the impact of
pending litigations on its financial position in
its financial statements- Refer Note 38(A)(b) to
the financial statements;
ii. The Company did not have any long-term
contracts including derivative contracts, as at
the year-end for which there were any material
foreseeable losses.
iii. Currently there are no amounts held by the
company that are required to be transferred
to the Investor Education and Protection Fund
hence we do not comment on the same.
iv. (a) The Management has represented that,
to the best of its knowledge and belief
no funds (which are material either
individually or in the aggregate) 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
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 (which are material either
individually or in the aggregate) 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
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;
(c) Based on audit procedures 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 (i) and (ii) of Rule 11(e), as provided
under (a) and (b) above, contain any
material misstatement.
v. The Company has not declared or paid dividend
during the year.
vi. Based on our examination which includes test
checks, the company has used an accounting
software for maintaining its books of accounts
which has a feature of recording audit trail (edit
log) facility and same has operated throughout
the year for all relevant transactions recorded
in the software. Further, during the course of
audit we did not come across any instances
audit trail feature being tempered with.
2. 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 "Annexure
B" a statement on the matters specified in paragraphs 3
and 4 of the Order.
For CHATURVEDI SK & FELLOWS LLP
Chartered Accountants
(Firm's Registration No. 112627W/100843W)
Subhash Salvi
Partner
(Membership No. 127661)
UDIN: - 25127661BMOUAA8017
Place: - Mumbai
Date: - 15/05/2025
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