SCL is a prominent, listed Non-Banking Financial Company (NBFC) (non-deposit taking NBFCs with an asset size of 1,000 crore and above) primarily…

SCL is a prominent, listed Non-Banking Financial Company (NBFC) (non-deposit taking NBFCs with an asset size of 1,000 crore and above) primarily engaged in providing corporate loans and retail financing. Mehta & Shah Associates (MSA), a partnership firm with two partners, CA. Karan Mehta and CA. Arjun Shah, was appointed as the statutory auditor of SwiftFin Capital Ltd. (SCL) for the financial year ended 31st March, 2025. During the audit, MSA team led by CA. Mehta, began reviewing SCL's compliance with RBI's Master Directions for NBFCs. They discovered that three large corporate loan accounts, with a total outstanding balance of 15 crores, had principal and/or interest payments overdue for a period ranging from 95 to 110 days as at the balance sheet date. However, these accounts were still classified as 'Standard Assets' in the company's records. The management of SCL argued that these were long-standing, "blue-chip" clients with whom they were in advanced restructuring negotiations. They contended that classifying these accounts as Non-Performing Assets (NPAs) would trigger cross-default clauses in other agreements of those clients and permanently damage valuable business relationships. They insisted that the non-classification was a temporary measure based on commercial judgment. While reviewing the board minutes, the audit team came to know about a lawsuit filed against SCL in January 2025. A group of retail customers alleged that the company had provided loans by charging interest rates that were not transparently disclosed and were in violation of the RBI's Fair Practices Code. SCL's internal legal department had prepared a note for the board estimating a financial outcome of up to 5 crores if the judgment went against the company. However, the financial statements contained no provision or disclosure for this matter. Management asserted that their legal advisors believed the probability of an unfavourable outcome was "remote". In April 2025, impressed with the firm's diligence, the management of SCL also offered the tax audit engagement under Section 44AB of the Income-tax Act, 1961, to MSA for the Assessment Year 2025-26. CA. Mehta reviewed the firm's workload for the assessment year. As on that date, CA. Mehta had already signed 55 tax audit reports, and his partner, CA. Arjun, had signed 60 tax audit reports. Based on the above facts, answer the following: