Page 108 - KRCL ENglish

J) We draw attention to Note No. 47 of the standalone nancial statements related to
Taxes on Income whereby, considering the huge accumulated losses and current
trend of income, the management is of the view that the future taxable prot shall not
be sufcient to recoup/recover the carried forward unabsorbed losses & unabsorbed
depreciation in future. In view of this, Provision for Income Tax on taxable income
earned during current nancial year and deferred tax asset related to carried forward
unabsorbed losses & unabsorbed depreciation have not been created by the
company.

K) We draw attention to Note No. 47 of the standalone nancial statements that the
amount of ineligible Input Tax Credit (ITC) of Goods and Services Tax (GST) has not
been nalized for the Financial Year 2018-19 due to pending reconciliation with the
ITC reected in GST portal.

L) We draw attention to the face of Balance Sheet related to Trade payables and Note
No. 26 of the standalone nancial statements, wherein amount are not disclosed
related to Micro and Small Enterprises as per the disclosure requirement of Schedule
III of the Companies Act 2013.

M) We draw attention to Non-compliances of the Company Law Matters related to:

i) Non Compliance of Section 149 (4) of Companies Act, 2013, Regulation 17 (b) of the
SEBI Listing Obligation and Disclosure Requirement and Clause 3.1.4 of the
Guidelines on Corporate Governance for Central Public Sector Enterprises w.r.t.
composition of the Board of Directors of the Company.

ii) Non Compliance of Section 177 (2) and Section 178 (1) of Companies Act, 2013 and
Rule 6 of Companies (Meetings of Board and its Powers) Rules 2014 and Clause 18
(1) and 19 (1) of SEBI Listing Obligation and Disclosure Requirement regarding
composition of Audit Committee and Nomination and Remuneration Committee.

iii) Non Compliance of Section 62 (1) (a) (i) of Companies Act 2013, regarding the
closure of Right Issue within 30 days. In the F.Y. 2018-19 the company has come out
with the 2nd Rights Issue for INR 196 Crore to the shareholders in their existing
shareholding proportion which was kept open from 1.12.2018 to 29.12.2018 (both
days inclusive).

During F.Y. 19-20 the company has allotted shares against 2nd rights issue to the tune
of Rs. 23.52 Crores whereas in June'2020 the remaining shares of 2nd Right issue
were allotted to the shareholder amounting to Rs. 29.40 Crores.

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