Page 124 - KRCL ENglish

(xiii) According to the information and explanation given to us and based on our
examination of records, during the year the Company has entered into transactions
with related parties which majorly comprises of governments namely different
railways and government companies.

In respect of the Transactions with Governments (namely different railways) and other
related parties, to whom the provisions of section 188 of Companies Act 2013 are
applicable, the provisions of section 177 and section 188 have been complied in
respect of those transactions.

In respect of the Transactions with Governments Companies, to whom the provisions
of section 188 of Companies Act 2013 are not applicable vide Notication No G.S.R
463 (E) dated 5th June 2015 issued by Ministry of Corporate Affairs. However, the
provisions of section 177 of the Companies Act have been complied in respect of
transactions with Government Companies.

As prescribed in Para 25 of Ind AS 24, the company has claimed the exemption of
detailed disclosure requirements of Related Party transactions. However, as per Para
26 of Ind AS the requisite disclosure have been incorporated in the Notes to
standalone nancial statement

(xiv) During the year, the company has made 2nd right issue of equity share capital and the
requirement of section 42 of the Companies Act 2013 related to it has been complied
except that the share application money is not kept in a separate bank account in a
scheduled bank and the company has not allotted shares within 60 days from the date
of receipt of amount to one of the shareholder - Government of Karnataka of Rs. 19
Crores.

Further the company has allotted the shares after 229 days from the date of receipt of
share application money, contrary to the provisions of section 42 of the Companies
act 2013 which says that if the company is not able to allot the securities within that
period, it shall repay the application money to the subscribers within fteen days from
the date of completion of sixty days and if the company fails to repay the application
money within the aforesaid period, it shall be liable to repay that money with interest at
the rate of twelve percent per annum from the expiry of the sixtieth day. As informed
since the share application amount was received in 2 tranches the share capital is
issued after receipt of nal instalment.

The details of non-allotment of shares within 60 days are as under:

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