INDEPENDENT AUDITOR’S REPORT

TO THE MEMBERS OF STARLIT POWER SYSTEMS LTD.

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the accompanying standalone financial statements of STARLIT POWER
SYSTEM LIMITED (the "Company “), which comprise the Balance Sheet as at March 31.2023,
the statement of Profit and Loss (including Other Comprehensive Income), the Statement of
changes in Equity and the statement of Cash Flow for the year ended on that date and a
summary of significant accounting policies and other explanatory information (hereinafter
referred to as the "standalone financial statements").

In our opinion and to the best of our information and according to the explanations given to
us, subject to the matters described in " Basis for qualified opinion" para of our report, the
aforesaid standalone financial statements give the information required by the Companies
Act, 2013 (the "Act") in the manner so required and gave 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) Rule 2015, as amended ("Ind AS") and other
accounting principles generally accepted in India, of the state of affairs of the company as at
March 31,2023 and its profit, total comprehensive income, changes in equity and its cash
flows for the year ended on that date.

Basis for qualified opinion

1. Provision for leave encashment and gratuity is not being made on actuarial basis which is
noncompliance of IND-AS19fAS151 “Employee benefits. As such we are unable to quantify the
effect on profits or loss of the company for the year 31-03-2023.

2. Physical verification/report of valuer for property plant and equipment including an asset
sold during the year is not made available to us and in absence whereof we are unable to
ascertain fair realizable value of such items and impact on financial statements for the year
ending 31-03-2023

3. The company has, based on internal valuation, valued inventories at 28.95 lacs wherein
there is no addition or much movement during the year. In absence of inventory valuation
report, we are unable to ascertain the realizable value of inventories and the effect on
financial results of the company.

5.Balances under the Sundry Debtors, Sundry Creditors including borrowings (secured and
unsecured), Loans and advances are subject to confirmation and adjustments. As such we are
unable to quantify consequential impact on financial statements.

We conducted our audit of the standalone financial statements in accordance with the
Standards on Auditing (“SA"s) specified under section 143(10) of Act. Our responsibilities
under those standards are further described in the Auditors Responsibilities 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
Accountant of India ("iCAl") together with the ethical requirements that are relevant to our
audit of the standalone financial statement under the provision 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 standalone
financial statements.

Key Audit Matters

Key audit matters are those matters that, in our professional judgement, were of most
significance in our audit of the standalone financial statement of 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 the matters described below to be the key audit matters
to be communicated in our report.

1 Borrowings

1ND-AS 23

Company has substantially high borrowings to the tune of 30.91 Cr. secured against assets of
the company and 10.08 Cr. unsecured. It had been unable to serve few of its debts.

Auditor's response:

Discussed with management to plan an arrangement for continuous flow of funds for timely
discharge of debts as per agreements and so also a definite plan for future course of action
not to encounter such a situation again.

2. NCLT proceedings underway

Company at the fag end of this year went into insolvency resolution process.

Auditor's response:

Management was advised to inform shareholders about the circumstances which led to NCLT
proceedings and appointment of IRP by tribunal for conducting day to day affairs of company.

3. Internal audit and standard operating procedures

During the year under audit company was in a very bad financial shape. It could not appoint
any internal auditor nor could abide wholeheartedly, by the standard operating procedures of
the company which we consider a significant key matter keeping in view the nature and size
of the company.

Auditor's response:

These issues of internal audit and internal financial controls were discussed with
management at length who have assured necessary compliance in current fiscal.

Information Other than the Financial Statement and Auditor's Report Thereon

The Company's Board of Directors is responsible for 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 and Sustainability
Report, Corporate Governance and Shareholder's Information, but does not include the
standalone financial statements and auditor's report thereon.

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

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

1. The company under Audit is under corporate insolvency resolution process vide
Company Petition No. (IB) -744 (ND)/2022 pursuant to the provisions of the
Insolvency and Bankruptcy Code, 2016.

With effect from March 20, 2023, its affairs, business and assets are being
managed by, and the powers of the board of directors are vested in, the Interim
Resolution Professional, Mr. Khushvinder Sing ha I (IP Registration No. IBBI/IPA-
002/IP-N00888/2019-2020/12833, appointed by the National Company Law
Tribunal, Delhi Bench-11 by order dated 20.03.2023.

2. The statement has been prepared on the basis of annual financial statements The
Company’s IRP/ Board of Directors are responsible for the preparation of these financial
results that subject to our qualified opinion stated above, give a true and fair view of the net
profit/loss and other financial information in accordance with the recognition and
measurement principles laid down in Indian Accounting Standard prescribed under Section
133 of the Act read with relevant rules issued there under and other accounting principles
generally accepted in India and in compliance with Regulation 33 of the Listing Regulations.

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 standalone financial statements that give a
true and fair view of the financial position, financial performance, including other
comprehensive income, changes in equity and cash flow 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 asset of the company and for preventing and detecting frauds
and other irregularities; selection and application of appropriate accounting policies; making
judgements 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 statement that give a true and fair
view and a free from material misstatement, whether due to fraud or error.

In preparing the standalone 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 basis of accounting unless the Board of Directors either intends to liquidate
the Company or to cease operations, or has no realistic alternatives but to do so.

The Board of Directors is also responsible for overseeing the Company's financial reporting
process.

Auditors Responsibilities 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. Responsible assurance is a high
level of assurance, but is not a guarantee that an audit conducted in accordance with SA’s 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 decision of users taken on the basis of these standalone
financial statements.

As a part of an audit in accordance with SAs, we exercise professional judgment and maintain
professional scepticism throughout the audit. We also:

• Identity and assess the risks of the material misstatement of the standalone financial
statements, whether due to fraud or error, design and perform audit procedures responsive
to those risk 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)(0 of the
Act, we are also responsible for expressing our opinion 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 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.

• Materially 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 work; and (ii)
to evaluate the effect of any identified misstatements in the standalone financial statements.

• 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 relationship and other matters that may reasonably be thought to be 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 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 consequence of doing so would reasonably be expected to
outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirement

l.As a required by section 143(3) of the Act, based on our audit we report that;

a) We have sought and obtain 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 appears from our examination of those books, with the exception of matters
specified in para “Basis for qualified opinion" stated above.

c) The Balance Sheet, the Statement of Profit and Loss including other comprehensive Income,
Statement of changes in Hquity and the Statement of Cash Flow dealt with by this report are
in agreement with the books of account.

d) In our opinion, the aforesaid standalone financial statement complies with the Ind AS
specified under section 133 of the Act with the exception of matters specified in para “Basis
for qualified opinion" stated above

e) On the basis of the written representations received from the directors as on March 31,2023
taken on record by the Board of Directors, none of the director is disqualified as on March
31,2023 from the being appointed as a director in the terms of Section 164(2) of the Act.

2.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 Act, we
enclose in Annexure ’B', a statement on the matters specified in paragraphs 3 & 4 of the
Order, to the extent applicable.

For R C SHARMA & ASSOCIATES

C h a rte red Acco u n ta n ts

(Firm Registration No: 021847N)

(CA. R CSHARAMA)

Partner

Membership Number: 083543
Place: New Delhi
Date: 30-05-2023
UDIN:23083543BGYZLP9531