CLASSIC ELECTRODES (INDIA) LIMITED
Report on the Audit of the Financial Statements
Opinion
We have audited the accompanying financial statements of CLASSIC ELECTRODES (INDIA) LIMITED (the “Company”), which comprise the Balance Sheet as at March 31, 2025, the Statement of Profit and Loss (including Other Comprehensive Income) and the Statement of Cash Flows for the year ended on that date and notes to the financial statements, including a summary of material 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 Financial Statements give the information required by the Companies Act, 2013 (the “Act”) in the manner so required and give a true and fair view in conformity with the accounting standards prescribed under sec 133 of the Act read with the companies (Accounting standards) Rules, 2006, as amended (“Accounting Standards”) and others accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2025 and its profit, its cash flows for the year ended on that date.
Basis for Opinion
We conducted our audit of the Financial Statements in accordance with the Standards on Auditing (“SAs” ) specified under section 143(10) of the Act. 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 (“ICAI”) together with the ethical requirements that are relevant to our audit of the Financial Statements under the provisions of the Act and the Rules there under, 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 opinion on the Financial Statements.
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 Annual Report, 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 during the course of our 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.
Responsibility of Management for the Financial Statements
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 financial statements that give a true and fair view of the state of affairs, profit or loss (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. 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 accounting policies; making judgments and estimates that are reasonable and prudent; and the 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 statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
ln 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. The Board of Directors is also responsible for overseeing the Company's financial reporting process.
Auditor’s Responsibilities for the Audit of the Financial Statements
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 skepticism throughout the audit. We also:
• Identify and assess the risk of material misstatement of the 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 control relevant to the audit in order to design audit procedures that are appropriate in the circumstances.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by 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.
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
1. 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 give in the "Annexure A" a statement on the matters specified in paragraphs 3 and 4 of the Order.
2. As required by Section 143(3) of the Act, we report 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;
(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
(c) The Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement dealt with by this Report are in agreement with the books of account;
(d) In our opinion, the aforesaid financial statements comply with the Accounting Standards specified under section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014;
(e) On the basis of the written representations received from the directors as on March 31th, 2025 taken on record by the Board of Directors, none of the directors is disqualified as on March31th 2025 from being appointed as a director in terms of Section 164 (2) of the Act.
(f) With respect to the adequacy of Internal Financial controls over financial reporting of the company and the operating effectiveness of such controls, refer to our separate report in “Annexure B”.
(g) With respect to the other matters to be included in the Auditor’s report in accordance with the requirements of section 197(16) of the Act, as amended, In our opinion and to the best of our information and according to the explanations given to us the remuneration paid by the company to its directors during the year is in accordance with the provisions of section 197 of the Act.
3. 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:
(a) The Company is subject to certain legal proceedings and claims, which have arisen in the ordinary course of business. The significant matters are disclosed below:
• With reference to Note No. 31 of the Notes to Accounts, we report that the income tax demand of ^3,61,06,335/- as at 31st March, 2025, relating to Assessment Year 2014-15, was subsequently settled under the Government’s “Vivad se Vishwas Scheme.” Pursuant to the closure order issued by the Income Tax Department, the additional tax liability was determined at ^1,37,40,714/-. After adjustment against amounts deposited in earlier years, the balance of ^63,59,686/- has been refunded to the Company.
• Regarding the litigation pending with the customs department of Rs. 79,92,070/-the company’s management is reasonably of a view that due to the complexities involved in this matter, management’s judgment regarding recognition, measurement and disclosure of provisions for this demand is inherently uncertain and might change over time as the outcomes of the legal cases are determined. Facts regarding the case is summarized in Note no. 31 of Notes to accounts of Financial Statements.
• As stated in Note No. 31 of the Notes to Accounts, the Company has disclosed a contingent liability of ^24,56,544 arising from an order issued under Section 74 of the CGST Act, 2017 on 4th February, 2024. The said demand, comprising IGST of ^2,90,842, CGST & SGST of ^4,68,715 each, and penalty equal to 100% of tax liability, aggregating to ^24,56,544 is under appeal.
(b) The Company has made provisions, as required under the applicable law or accounting standards, for material foreseeable losses, If any, as required on long term contracts including derivatives contract.
(c) There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
(d) (i) The management has represented, to the best of its knowledge and belief, other than as disclosed in the notes to the accounts, that 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.
(ii) The management has represented, to the best of its knowledge and belief, other than disclosed in the notes to the accounts, the no funds have been received by the Company from any 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;
(iii) Based on the reasonable and appropriate audit procedures considered in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub clause (i) & (ii) contain any material misstatement.
(e) No dividend was declared or paid during the year by the company.
(f) The company has used such accounting software for maintaining its books of accounts which has a feature of recording audit trail (edit log) facility and the same has been operated throughout the year for all transaction recorded in the software and the audit trail feature has not been tampered with and the audit trail has been preserves by the company as per statutory requirements for record retention.
(g) The Company has disclosed information relating to dues payable to Micro and Small Enterprises as required under the Micro, Small and Medium Enterprises Development Act, 2006, in the notes to its financial statements. Such disclosure is based on information available with the Company and confirmation received from suppliers regarding their MSME registration status. We draw attention that due to non-receipt of MSME registration certificates from certain suppliers, there may be additional parties covered under the Act whose balances are not included in the said disclosures.
For K P M R & ASSOCIATES
Chartered Accountants
Firm Reg. 002504N
CA VISHAL KUMAR AGARWAL
Partner
M.No.303733
UDIN: 25303733BMJQRW5452
Date: 02nd September, 2025
Place: Kolkata
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