We have audited the accompanying standalone financial statements of SAMTEX FASHIONS LIMITED,
which comprise the Balance Sheet as at 31st March 2025, the Statement of Profit and Loss (including
other comprehensive income), the Statement of Changes in Equity and the Cash Flow Statement for the
year then ended, and a summary of the significant 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 Ind AS financial statements give the information required by the Act in the manner
so required and give a true and fair view (subject to the matters of Basis of Qualified Opinion and
emphasis mentioned below) in conformity with the Ind AS and other accounting principles generally
accepted in India, of the state of affairs of the Company as at 31st March, 2025, and its profit/loss, total
comprehensive income/ loss, its cash flows and the changes in equity for the year ended on that date.
Basis for Qualified Opinion
We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section
143(10) of the Companies Act, 2013. Our responsibilities under those Standards are further described in
the Auditor's Responsibilities 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 together with the ethical requirements that are relevant to our audit of the
financial statements under the provisions of the Companies Act, 2013 and the Rules thereunder, and we
have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of
Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
i. Originally the plant of the company was setup at NSEZ, Noida which was later on shifted outside
NSEZ during the FY 2017-18 and in March 2019 the company further changed its business
premises from time to time and since then no manufacturing activity has been carried on. The
Company is required to determine impairment in respect of fixed assets, However the Company
has not done impairment testing. In the absence of any working for impairment of the fixed assets
as per Ind AS 36, the impact of impairment, if any on the financial statements is not ascertainable.
The depreciation has not been charged on its property, plant and equipment during the year
ending 31st March, 2025.
ii. Balance of debtors are outstanding from long period and are subject to confirmation and
consequential effect if any on the financial statements remains uncertain. The trade receivables of
the company could not be verified as the confirmation of balances have not been provided and
made available to us. Trade receivables amounting to Rs 587.34 lacs which are long overdue and
not provided for. Allowance for expected credit loss have not been recognized on these financial
assets. The company has neither carried out impairment exercises of Trade Receivables nor
provided for the same and recognized the same as non-current assets since long outstanding. In
the absence of recovery and confirmation from the party, we are unable to comment on the
recoverability and consequential impact of reconciliation and adjustment arising there from in the
results, if any, is not ascertainable.
iii. The company has not followed the treatment for recognition and remeasurement of employee
benefit costs as detailed in the Ind AS 19.
Material Uncertainty Related to Going Concern
The company has accumulated losses and net worth of the company is continuously eroding. The
company has incurred a net loss during the current and previous year(s) and the current liabilities
exceeds its current assets. Moreover, no business activity has been undertaken throughout the
year. These conditions indicate the existence of a material uncertainty that may cast significant
doubt about the company's ability to continue as a going concern. However, the financial
statements of the company have been prepared on a going concern basis.
These conditions indicate the existence of a material uncertainty that may cast significant doubt
on the group's ability to continue as going concern and therefore the group may be unable to
realize its assets and discharge its liabilities in the normal course of business. As a result of
ongoing matters, we are unable to determine as to whether any adjustment that would have
been necessary and required to be made in respect of trade receivable, trade payables,
borrowings, current liabilities, loans and advances and contingent liabilities as at 31st March, 2025
and in respect of the corresponding possible impact of such items and associated elements on the
statement for the year ended on that date, should the group be unable to continue as a going
concern. The ultimate outcome of these matters is at present not ascertainable. Accordingly, we
are unable to comment on the consequential impact. if any, on the accompanying consolidated
financial statements. However, the financial statements of the group have been prepared on a
going concern basis.
Emphasis of Matter
i. The company had already given a corporate guarantee for an amount of Rs 807.46 crores against
secured loans taken by its wholly owned subsidiary, namely M/s SSA International Limited, which has
been classified as nonperforming assets by the banks. The company has also received the notice u/s
13(2) of the SARFAESI Act 2002 from consortium of banks for revocation of its corporate guarantee.
The company has also received a notice from IDBI Bank Ltd as to why the company along with its
subsidiary SSA International Ltd (Main Borrower) and others should not be declared as wilful defaulters.
The consortium bankers have filed a petition against the holding company and its subsidiary M/s
SSA International Limited regarding recovery of the outstanding dues, before the Debt
Restructuring Tribunal-II, Delhi, and the company has received an intimation vide O.A 530/18
dated 24/05/2018.Further, IDBI Bank has declared the main borrower (M/s SSA International Ltd), its
directors and Guarantors (including M/s Samtex Fashions Ltd) as willful defaulters in terms with RBI
Guidelines. The updated details of proceedings against the company and its subsidiary M/s SSA
International Ltd has not been made available, in absence of such details we are unable to comment
on the possible impact, it any, arising out of the said matters.
ii. We have not been provided with sufficient, appropriate audit evidence relating to physical
verification of fixed assets and inventory. Pending completion of such verification, we are unable
to comment on the possible impact, it any, arising out of the said matters.
iii. The company had given loans and advances as on 31.03.2025 which are outstanding from long
time. In the absence of recovery and confirmation from the party, we are unable to comment on
the recoverability and consequential impact of reconciliation and adjustment arising there from in
the results, if any, is not ascertainable. Moreover, we have not been provided with justification
giving said advance and sufficient, appropriate audit evidence relating to verification of the same.
Pending completion of such verification/ reconciliation, we are unable to comment on the
possible impact, it any, arising out of the said matters.
iv. As of 31st March 2025, inventories amounting to Rs 25.32 lacs and as no business activity has been
taken out during the year, the inventories have not been used for a long period of time, the
company may provide for if any inventory item is damaged or has become obsolete or if the
selling price has declined.
v. The Company has outstanding balance of amounting Rs. 132.28 Lacs of deferred tax assets upto
March 31, 2025, in absence of probable certainty and convincing evidence for taxable income in
future, we are unable to ascertain the extent to which these deferred tax assets can be utilized.
vi. Balances of input tax credit under goods and service tax are not in confirmation with balances as
appearing in the online portal.
vii. The Identification and classification of trade payable dues to MSME and trade payable dues other
than MSME of Micro, Small and Medium enterprises is based on the management's knowledge of
their status.
viii. Balance of trade payables are outstanding from long period and are subject to confirmation and
consequential effect if any on the financial statements remains uncertain. The trade payables of
the company could not be verified as the confirmation of balances have not been provided and
made available to us.
ix. Confirmation of balances of security deposits, balances with government authorities, bank
balances, Bank FDRs have not been provided to us, we are unable to comment on the possible
impact, it any, arising out of the said matters.
x. As informed to us the bank accounts of the company were put on debit freeze by EPF department
and we have not been provided with detailed explanation regarding the litigation with the EPF
department. Moreover, several litigations are ongoing with the Income Tax Department against
which the company has also deposited Rs 118.67 lacs for different financial years under protest,
however we have not been provided with details and current status of the said litigations. We are
unable to comment on possible impact, if any arising out of the said matter.
Our report is not modified in respect of the above matter stated
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.
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, Board's Report
including Annexures to Board's Report, Business Responsibility Report, Corporate Governance and
Shareholder's Information, but does not include the financial statements and our auditor's report
thereon.
Our opinion on the 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 financial statements, our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with the
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. We have nothing to report in this regard.
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
Companies Act, 2013 ("the Act") with respect to the preparation of these financial statements that give
a true and fair view of the financial position, financial performance, and cash flows of the Company in
accordance with the accounting principles generally accepted in India, including the accounting
Standards specified under section 133 of the Act read with relevant rule there under and other
accounting principles generally accepted in India in compliance with Regulation 33 of the Listing
Regulations.. This responsibility also includes maintenance of adequate accounting records in
accordance with the provisions of the Act for safeguarding of the assets of the Company and for
preventing and detecting frauds and other irregularities; selection and application of appropriate
implementation and maintenance of 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.
Those Board of Directors are also responsible for overseeing the company's financial reporting process.
Auditor's Responsibilities for the Audit of financial statement
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 control relevant to the audit in order to design audit procedures
that are appropriate in the circumstances. Under section 143(3)(i) of the Companies Act, 2013, we are
also responsible for expressing our opinion on whether the company has 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 management.
• Evaluate the appropriateness and reasonableness of disclosures made by the Board of Directors in
terms of the requirements specified under Regulation 33 of the Listing Regulations.
• 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.
• Obtain sufficient appropriate audit evidence regarding the Financial Results of the Company to express
an opinion on the Financial Results.
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
.. As required by the Companies (Auditor's Report) Order, 2020 (the 'Order') issued by the Central
Government of India in terms of Section 143(11) of the Act, we give in the Annexure A, a statement on
the matters specified in paragraphs 3 and 4 of the Order.
. As required by Section 143(3) of the Act, based on our audit and on the consideration of the reports of
the branch auditors and other auditors on the separate financial statements/ financial information of
the branches and joint operations, referred to in the Other Matters paragraph above we report, to the
extent applicable 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 of the aforesaid standalone Ind AS financial
statements.
b) In our opinion, proper books of account as required by law relating to preparation of the aforesaid
standalone Ind AS financial statements have been kept so far as it appears from our examination of
those books.
c) The standalone Balance Sheet, the standalone Statement of Profit and Loss, the standalone Statement
of Changes in Equity and the standalone Statement of Cash Flow dealt with by this Report are in
agreement with the books of account maintained for the purpose of preparation of the standalone Ind
AS financial statements.
d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Indian Accounting
Standards prescribed under Section 133 of the Act.
e) On the basis of the written representations received from the directors of the Company, as on 31 March
2025 and taken on record by the Board of Directors of respective companies, none of the directors of
the Group companies incorporated in India is disqualified 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 B". Our
report expresses a qualified / adverse opinion on the operating effectiveness of the Company's internal
financial controls over financial reporting.
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:
ii. The Company has disclosed the impact of pending litigations on its financial position in its standalone
Ind AS financial statements refer note no. 22(a).
iii. The Company did not have any long-term contracts including derivative contracts for which there were
any material foreseeable losses.
iv. There were no amounts which were required to be transferred to the Investor Education and Protection
Fund by the Company.
v. The management has represented that, to the best of its knowledge and belief, other than as disclosed
in the notes to the accounts, 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(s) or entity(ies), 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;
vi. The management has represented, that, to the best of its knowledge and belief, other than as disclosed
in the notes to the accounts, no funds have been received by the company from any person(s) or
entity(ies), 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
vii. Based on our examination which included test checks, management does not provide us sufficient audit
evidences which give us assurance that the company has enabled audit trail feature in its accounting
software, hence we are unable to comment on audit trail feature of the said software.
FOR KAPIL KUMAR & CO
CHARTERED ACCOUNTANTS
FIRM REGISTRATION NO: 006241N
MOHIT KAKKAR
(PARTNER)
MEMBERSHIP NUMBER: 538844
New Delhi
28th May, 2025
UDIN: 25538844BMIWOO8380
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