We have audited the accompanying Standalone Ind AS
Financial Statements of Suraj Estate Developers Limited
('the Company’) which comprise the Standalone Balance
Sheet as at 31st March 2025, the Standalone Statement of
Profit and Loss (including Other Comprehensive Income/
(Loss)), the Standalone Statement of Cash Flows and the
Standalone Statement of Changes in Equity for the year
then ended and notes to the Standalone Ind AS Financial
Statements, including a summary of material accounting
policies and other explanatory information (hereinafter
referred to as "Standalone Ind AS Financial Statements").
In our opinion and to the best of our information and according
to the explanations given to us, the aforesaid Standalone
Ind AS 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 principles generally accepted in India including
the Indian Accounting Standards ("Ind AS") prescribed
under section 133 of the Act, of the state of affairs of the
Company as at 31st March 2025, and its profit (including
other comprehensive income/(loss)), the changes in equity
and its cash flows for the year ended on that date.
BASIS FOR OPINION
We conducted our audit of the Standalone Ind AS Financial
Statements in accordance with the Standards on Auditing
(SAs), as specified under section 143(10) of the Act.
Our responsibilities under those Standards are further
the Standalone Ind AS 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 together with the ethical requirements
that are relevant to our audit of the Standalone Ind AS
Financial Statements under the provisions of the Act and
the Rules thereunder, and we have fulfilled our ethical
responsibilities in accordance with these requirements
and the Code of Ethics. We believe that the audit evidence
we have obtained is sufficient and appropriate to provide
a basis for our opinion on the Standalone Ind AS Financial
Statements.
KEY AUDIT MATTERS
Key audit matters are those matters that, in our professional
judgment, were of most significance in our audit of the
Standalone Ind AS Financial Statements for the year ended
31st March 2025. These matters were addressed in the
context of our audit of the Standalone Ind AS Financial
Statements as a whole, and in forming our opinion thereon,
and we do not provide a separate opinion on these matters.
For each matter below, our description of how our audit
addressed the matter is provided in that context. We have
determined the matters described below to be the key audit
matters to be communicated in our report. We have fulfilled
the responsibilities described in the Auditor’s responsibilities
for the audit of the Standalone Ind AS Financial Statements
section of our report, including in relation to these matters.
Accordingly, our audit included the performance of
procedures designed to respond to our assessment of the
risks of material misstatement of the Standalone Ind AS
Financial Statements. The results of our audit procedures,
including the procedures performed to address the matters
below, provide the basis for our audit opinion on the
accompanying Standalone Ind AS Financial Statements:
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Key Audit Matter
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How our audit addressed the Key Audit Matter
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Revenue recognition for real estate projects (as described in note 3.10 and 31 of the Standalone Ind AS Financial Statements)
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In accordance with the requirements of Ind AS 115
'Revenue from contract with customers’, revenue
from sale of residential units is recognised at a point
in time or over a period of time based on the contract
entered with the customers.
Significant judgement is required in identifying the
performance obligations and determining when
'control’ of the residential units/ commercial units is
transferred to the customer.
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Our audit procedures included:
• Read the Company’s revenue recognition accounting policies
and assessed compliance with Ind AS 115 ’Revenue from
contract with customers’.
• Understood and evaluated the design and implementation and
tested the operating effectiveness of the Company’s internal
financial controls over revenue recognition.
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Key Audit Matter
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How our audit addressed the Key Audit Matter
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Further, the Company assesses various conditions
included in the contract with customer to identify
whether the Company has unconditional right to
payment for performance to date or not. Based on
this revenue is recognised at point in time or over
time.
Considering the above-mentioned factors, revenue
recognition has been considered as a key audit
matter.
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• Read the legal opinion obtained by the Company to determine the
point in time at which the control is transferred and satisfaction
of performance obligation in accordance with the underlying
agreements;
• Tested, revenue related transactions with the underlying
customer contracts, sale deed and handover documents,
evidencing the transfer of control of the asset to the customer
based on which revenue is recognized;
• Assessed the revenue related disclosures included in Note 31 to
the Standalone Ind AS Financial Statements in accordance with
the requirements of Ind AS 115.
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Claims, litigations and contingencies (as described in note 40.2 and 40.3 to the Standalone Ind AS Financial Statements)
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The Company is having various ongoing litigations,
court and other legal proceedings before tax
authorities and courts, which could have significant
financial impact, if the potential exposure were to
materialize.
Management estimates the possible outflow of
economic resources based on legal counsel opinion
and available information on the legal status of the
proceedings.
Considering the determination by the management
of whether, and how much, to provide and/ or
disclose for such contingencies involves significant
judgement and estimation, the same has been
considered as key audit matter.
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Our audit procedures included:
• Understood management’s process relating to the identification
and impact analysis of claims, litigations and contingencies;
• Obtained legal status from legal team of the Company and
analysed their responses; Read the minutes of meetings of the
Board of Directors of the Company related to noting of status of
material litigations;
• Assessed management’s assumptions and estimates related
to disclosures of contingent liabilities in the Standalone Ind AS
Financial Statements.
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Assessing the carrying value of Inventory of construction work in progress, land, development rights and advances given
for acquisition of projects (as described in note 10 and 17 to the Standalone Ind AS Financial Statements)
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• The Company’s inventory comprises
construction work in progress of ongoing
projects, land and development rights in the
land and projects which are at initial stage
of acquisition. These are stated at the lower
of cost and NRV. As at 31st March 2025 the
carrying value of inventories is ' 4,322.82
million.
NRV determination involves estimates based
on prevailing market conditions, current prices,
the estimated future selling price, cost to
complete projects and selling costs.
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Our audit procedures in relation to management’s assessment of
valuation of inventories at lower of cost and NRV includes following:
• Read and evaluated the accounting policies and disclosures
made in the Standalone Ind AS Financial Statements with respect
to inventories;
• Understood and reviewed the management’s process and
methodology of using key assumptions for determination of NRV
of the inventories;
• With respect to ongoing real estate projects, tested the NRV of
the inventories to carrying value in books on sample basis;
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Key Audit Matter
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How our audit addressed the Key Audit Matter
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• The Company has given ' 626.75 million in
relation to acquisition of projects/ development
rights and incidental costs thereof.
Considering the significance of the carrying
value of inventories in the Standalone Ind AS
Financial Statements and the involvement
of significant estimation and judgement
in assessment of NRV, the same has been
considered as a key audit matter.
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• In respect of real estate project (Construction work in progress)
which are at initial preparatory stage [i.e. acquisition of land /
development rights and incidental expenses], realization of the
construction work in progress have been determined based
on management estimates of commercial feasibility and
management expectation of future economic benefits from
the project. These estimates are dynamic in nature and are
dependent upon various factors such as eligibility of the tenants,
changes in the saleable area, acquisition of new Floor Space
Index (FSI) and other factors
In respect of advances for acquisition of projects/ development rights,
our audit procedures included the following:
• Obtained status update from the management and verified the
underlying documents for related developments;
• Understood and evaluated the design and implementation and
tested the operating effectiveness of the Company’s internal
financial controls for advances given for acquisition of land/
development rights.
• With respect to advances, obtained the external balance
confirmations for the key advances given.
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Assessing impairment of Investments and loans given to subsidiary (as described in note 7 and 8 to the Standalone Ind AS
Financial Statements)
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The Company has significant investments and
loans in its subsidiaries. As at 31st March 2025,
the carrying values of Company’s investments and
loans in its subsidiaries amounts to '255.93 million
and '4,584.92 million respectively.
Management reviews regularly whether there are
any indicators of impairment by reference to the
requirements under Ind AS 36 "Impairment of
Assets".
For investments and loans where impairment
indicators exist, significant judgements are required
to determine the key assumptions used in the
valuation model and methodology, such as revenue
growth, discount rates, etc.
Considering, the impairment assessment involves
significant assumptions and judgement, the same
has been considered as key audit matter.
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Our procedures in assessing the management’s judgement for the
impairment assessment included, among others, the following:
• Obtained details of underlying assets/ real estate projects in the
respective entities and realizable value thereof;
• Obtained management estimates of commercial feasibility and
management expectation of future economic benefits from the
investments made in subsidiary entities;
• Assessed the Company’s valuation methodology applied in
determining the recoverable amount of the investments and
loans.
• Made inquiries with management to understand key drivers of
the cash flow forecasts, discount rates, etc.;
• Reviewed the disclosures made in the Standalone Ind AS
Financial Statements regarding such investments and loans.
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Related party transactions (as described in note 42 to the Standalone Ind AS Financial Statements)
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The Company has undertaken transactions with its
related parties in the ordinary course of business at
arm’s length.
These include making new or additional investments
in its subsidiaries; lending loans to related parties;
etc. as disclosed in note 42 to the Standalone Ind AS
Financial Statements.
We identified the accuracy and completeness of
the related party transactions and its disclosure as
set out in respective notes to the Standalone Ind AS
Financial Statements as a key audit matter due to
the significance of transactions with related parties
and regulatory compliances thereon, during the year
ended 31st March 2O25.
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Our procedures/ testing included the following:
• Obtained and read the Company’s policies, processes and
procedures in respect of identifying related parties, obtaining
approval, recording and disclosure of related party transactions;
• Read minutes of shareholder’s meetings, board meetings
and minutes of meetings of those charged with governance
in connection with Company’s assessment of related party
transactions being in the ordinary course of business at arm’s
length;
• Tested related party transactions with the underlying contracts,
confirmation letters and other supporting documents;
• Agreed the related party information disclosed in the Standalone
Ind AS Financial Statements with the underlying supporting
documents, on a sample basis.
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INFORMATION OTHER THAN THE STANDALONE IND
AS FINANCIAL STATEMENTS AND AUDITOR'S REPORT
THEREON
The Company’s Board of Directors is responsible for the
other information. The other information comprises the
message from Chairman, Board’s report including annexure
to board report, Management discussion and analysis report
and corporate governance report, but does not include the
Standalone Ind AS Financial Statements and our auditor’s
report thereon. The Company’s annual report is expected to
be made available to us after the date of this auditor’s report.
Our opinion on the Standalone Ind AS 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 Standalone Ind AS
Financial Statements, our responsibility is to read the other
information identified above when it becomes available
and, in doing so, consider whether the other information is
materially inconsistent with the Standalone Ind AS Financial
Statements or our knowledge obtained in the audit or
otherwise appears to be materially misstated.
When we read the message from Chairman, Board’s report
including annexure to board report, Management discussion
and analysis report and corporate governance report, if we
conclude that there is a material misstatement therein, we
are required to communicate the matter to those charged
with governance.
RESPONSIBILITIES OF MANAGEMENT AND THOSE
CHARGED WITH GOVERNANCE FOR THE STANDALONE
IND AS 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 Standalone Ind AS
Financial Statements that give a true and fair view of the
financial position, financial performance including other
comprehensive income and cash flows of the Company and
changes in equity of the Company in accordance with the
accounting principles generally accepted in India, including
the Indian Accounting Standards prescribed under Section
133 of the Act, read with the Companies (Indian Accounting
Standard) Rules, 2015, as amended.
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 judgements 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 Standalone Ind AS Financial Statements
that give a true and fair view and are free from material
misstatement, whether due to fraud or error.
In preparing the Standalone Ind AS 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.
Those charged with governance are also responsible for
overseeing the Company’s financial reporting process.
AUDITOR'S RESPONSIBILITIES FOR THE AUDIT OF THE
STANDALONE IND AS FINANCIAL STATEMENTS
Our objectives are to obtain reasonable assurance about
whether the Standalone Ind AS 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 Standalone
Ind AS Financial Statements.
As part of an audit in accordance with SAs, we exercise
professional judgment and maintain professional scepticism
throughout the audit. We also:
• Identify and assess the risks of material misstatement
of the Standalone Ind AS Financial Statements,
whether due to fraud or error, design and perform audit
procedures responsive to those risks, 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. Under section 143(3)
(i) of the Companies Act, 2013, we are also responsible
for expressing our opinion on whether the Company
has adequate internal financial controls system 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 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 Standalone Ind AS 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 standalone Ind AS financial statements,
including the disclosures, and whether the Standalone
Ind AS 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 Standalone Ind AS Financial
Statements for the financial year ended 31st March 2025
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.
OTHER MATTER
1. We did not audit the financial statements and other
financial information, in respect of three partnership
firm, whose financial statements include Company’s
share of loss (post tax) of ' 2.52 Million for the year ended
31st March 2025 included in accompanying Standalone
Ind AS Financial Statements. These Standalone Ind AS
Financial Statements and other financial information
of the said partnership firm have been audited by
other auditor, whose financial statements, other
financial information and auditor's reports have been
furnished to us by the management. Our opinion on
the Standalone Ind AS Financial Statements, in so far
as it relates to the amounts and disclosures included
in respect of these partnership firm and our report in
terms of sub-sections (3) of Section 143 of the Act, in
so far as it relates to the aforesaid partnership firms, is
based solely on the report(s) of such other auditors.
Our opinion is not modified in respect of this matter.
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 section 143(11) of the Act, 2013,
we give in "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 Standalone Balance Sheet, the Standalone
Statement of Profit and Loss (including Other
Comprehensive Income), the Standalone Cash
Flow Statement and the Standalone Statement of
Changes in Equity dealt with by this Report are in
agreement with the books of account maintained
for the purpose of preparation of the Standalone
Ind AS Financial Statements.
d) I n our opinion, the aforesaid Standalone Ind AS
Financial Statements comply with the Ind AS
specified under Section 133 of the Act, read with
Companies (Indian Accounting Standards) Rules,
2015, as amended.
e) On the basis of the written representations
received from the directors as on 01st April 2025
taken on record by the Board of Directors, none
of the directors are disqualified as on 31st March
2025 from being appointed as a director in terms
of Section 164(2) of the Act.
f) With respect to the adequacy of the internal
financial controls with reference to Standalone
Ind AS financial statements and the operating
effectiveness of such controls, refer to our
separate Report in "Annexure B" to this report.
g) I n our opinion and according to the information
and explanations given to us, the Company has
paid/ provided for managerial remuneration
in accordance with the requisite approvals
mandated by the provisions of Section 197 read
with Schedule V to the Act.
The Ministry of Corporate Affairs has not
prescribed other details under Section 197(16) of
the Act which are required to be commented upon
by us.
h) With respect to the other matters to be included in
the Auditor’s Report in accordance with Rule 11 of
the Companies (Audit and Auditors) Rules, 2014,
in our opinion and to the best of our information
and according to the explanations given to us:
i. The Company has disclosed the impact of
pending litigations on its financial position in
its Standalone Ind AS Financial Statements
- Refer note 40.2 and 40.3 to the Standalone
Ind AS Financial Statements;
ii. The Company did not have any long-term
contracts including derivative contracts for
which there were any material foreseeable
losses;
iii. There were no amounts which were required
to be transferred to the Investor Education
and Protection Fund by the Company;
iv. (a) The management has represented
that, to the best of it’s knowledge and
belief, 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;
(b) The management has represented,
that, to the best of it’s knowledge and
belief, other than as disclosed in the
notes to the accounts, no funds have
been received by the Company from
any person(s) or entity(ies), including
foreign entities ("Funding Parties"), with
the understanding, whether recorded in
writing or otherwise, that the Company
shall, whether, directly or indirectly, lend
or invest in other persons or entities
identified in any manner whatsoever
by or on behalf of the Funding Party
("Ultimate Beneficiaries") or provide any
guarantee, security or the like on behalf
of the Ultimate Beneficiaries; and
(c) Based on such audit procedures
performed that have been considered
reasonable and appropriate in the
circumstances, nothing has come to
their notice that has caused them to
believe that the representations under
sub-clause (a) and (b) contain any
material mis-statement.
v. The dividend declared and paid during the
year by the Company is in compliance with
Section 123 of the Act.
vi. Based on our examination, the Company has
used an accounting software for maintaining
its books of account which has a feature
of recording audit trail (edit log) facility.
The audit trail feature has been operated
throughout the year for all transactions
recorded in the accounting software. Further,
during the course of our audit, we did not
come across any instance of the audit trail
feature being tampered with.
For S K L R & CO LLP
Chartered Accountants
ICAI Firm Registration Number: W100362
Rakesh Jain
Partner
Membership No.: 123868
UDIN: 25123868BMTCHV7787
Place: Mumbai
Date: 27th May 2025
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