INDEPENDENT AUDITOR'S REVIEW REPORT

Corporate Insolvency Resolution Process Details

  • NCLT Chandigarh Bench admitted petition under Section 7 of IBC on February 2, 2022 (Insolvency Commencement Date)
  • Mr. Darshan Singh Anand (IBBI Registration No. IBBI/IPA-002/IP-N00326/2017-18/10931) appointed as Interim Resolution Professional, later confirmed as Resolution Professional on March 17, 2022
  • Hon'ble NCLT approved Resolution Plan submitted by Arcbolt Space and Foods Private Limited on September 9, 2026 (Order IA(IBC)/1538/(CH)/2022 in CP(IB) No. 315/Chd/Hry/2019)
  • Resolution Plan became effective on September 9, 2026

Monitoring Committee Structure

  • Comprises one representative of Financial Creditors (Bank of India), one representative of Resolution Applicant (Mr. Karan Jakhar, Director of Arcbolt Space and Foods Pvt Ltd), and Mr. Darshan Singh Anand (erstwhile RP) as Chairman
  • Monitoring Committee supervises and oversees implementation of Resolution Plan
  • Existing board of directors suspended post-approval date, all powers vested with Monitoring Committee
  • Implementation period (Term) is 90 days from approval date until closing date

Financial Results Summary (Quarter Ended September 30, 2026)

Income Statement (₹ in Lakhs):

  • Revenue from operations: ₹0.00
  • Other income: ₹7.29
  • Total income: ₹7.29
  • Employee benefits expense: ₹4.35
  • Finance costs: ₹0.03
  • Depreciation: ₹12.49
  • Other expenses: ₹143.66
  • Total expenses: ₹160.53
  • Loss from operations before tax: ₹(153.24)
  • Tax expense: ₹0.00
  • Net loss for quarter: ₹(153.24)
  • Basic and diluted EPS: ₹(0.07)

Half Year Ended September 30, 2026 (₹ in Lakhs):

  • Total income: ₹11.34
  • Total expenses: ₹194.77
  • Net loss: ₹(183.43)
  • Basic and diluted EPS: ₹(0.09)

Balance Sheet Position (as of September 30, 2026)

Assets (₹ in Lakhs):

  • Property, plant and equipment: ₹46,264.10
  • Other financial assets: ₹3.15
  • Other non-current assets: ₹33,251.87
  • Deferred tax assets: ₹8,722.35
  • Total non-current assets: ₹88,241.47
  • Inventories: ₹207.38
  • Trade and other receivables: ₹49,198.81
  • Cash and cash equivalents: ₹8.91
  • Other bank balances: ₹36.91
  • Other current assets: ₹10.50
  • Total current assets: ₹49,462.52
  • Total assets: ₹137,703.99

Liabilities and Equity (₹ in Lakhs):

  • Equity share capital: ₹2,044.40
  • Reserves & surplus: ₹69,865.22
  • Total equity: ₹71,909.62
  • Long term provisions: ₹425.04
  • Borrowings: ₹30,666.87
  • Trade payables: ₹4,598.26
  • Other financial liabilities: ₹6,957.55
  • Other current liabilities: ₹23,123.63
  • Short term provisions: ₹23.02
  • Total current liabilities: ₹65,369.33
  • Total liabilities: ₹65,794.37

Cash Flow Statement (Six Months Ended September 30, 2026)

  • Cash flow from operating activities: ₹3.04
  • Cash flow from investing activities: ₹0.00
  • Cash flow from financing activities: ₹0.00
  • Cash and cash equivalents at beginning: ₹5.87
  • Cash and cash equivalents at end: ₹8.91

Auditor's Qualified Conclusion Basis

1. Asset Impairment Issues: Company has not assessed impairment of tangible assets as required by Ind AS 36 and Ind AS 10. No consideration of impact on carrying value of tangible assets.

2. Unconfirmed Balances: Pending comprehensive review of carrying amount of all assets and liabilities including trade receivables (₹49,198.81 lakhs), advances paid, trade payables (₹4,598.26 lakhs), advances received, and other short-term liabilities. No documentary evidence available for verification.

3. Creditor Claims Reconciliation: Financial and operational creditor claims under CIRP are undergoing reconciliation process. No provision/accounting adjustments made for excess/short or non-receipt of claims.

4. Missing Fixed Asset Register: Fixed Asset Register not produced as it was not handed over by past management. Unable to verify accuracy of Property, Plant and Equipment value (₹46,264.10 lakhs) and depreciation calculation.

5. Confidential Information Restrictions: Certain CIRP procedures and COC meeting minutes deemed confidential and not shared with auditors.

Emphasis of Matter

  • Company has incurred continuous losses, current liabilities exceed current assets, defaults in repayment of borrowings and statutory dues
  • Material uncertainty exists regarding company's ability to continue as going concern
  • Accounts prepared on going concern basis due to approved Resolution Plan implementation

Additional Notes from Financial Statements

  • Records Issues: Records not completely handed over to Monitoring Committee. Application u/s 19(2) of IBC submitted to NCLT. Ransomware attack resulted in loss of Tally data, fixed assets register, and records before April 1, 2021.
  • Workmen Claims Contingency: Difference between financial statement liability (₹23,34,76,371) and COC-admitted claims (₹49,62,72,600) creates contingent liability of ₹26,27,99,829.
  • Doubtful Advances: Capital advance (₹20.43 lakhs) and advance to suppliers (₹6,674.45 lakhs) subject to confirmation with doubtful recoverability. No provision made pending resolution plan implementation.
  • Reconciliation Required: VAT recoverable and GST credit receivable (₹172.28 lakhs), bank balances (₹1.85 lakhs), and interest income (₹7.29 lakhs) require reconciliation.
  • Moratorium Impact: No interest provided on dues payable to banks and institutions due to moratorium imposed by NCLT order dated February 2, 2022.
  • Segment Reporting: No segment revenue reported for USA, Europe, or Domestic markets. All income classified as unallocable revenue.

Implementation Status

As of the financial results date, implementation of the approved Resolution Plan is in progress. The Resolution Plan provides for settlement of creditor claims, infusion of funds for working capital and capital expenditure, restructuring of existing share capital, and reconstitution of Board of Directors.