CETXP Cemtrex Inc

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES ACT OF 1934

 

For the quarterly period ended June 30, 2023

 

OR

 

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES ACT OF 1934

 

For the transition period from ___________to ____________

 

Commission File Number 001-37464

 

 

CEMTREX, INC.

(Exact name of registrant as specified in its charter)

 

Delaware		30-0399914
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

 

135 Fell Ct. Hauppauge, NY		11788
(Address of principal executive offices)		(Zip Code)

 

631-756-9116

(Registrant’s telephone number, including area code)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading symbol		Name of each exchange on which registered
Common Stock		CETX		Nasdaq Capital Market
Series 1 Preferred Stock		CETXP		Nasdaq Capital Market

 

 

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

 

☒ Yes   ☐ No

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

 

☒ Yes   ☐ No

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

	Large accelerated filer ☐	Accelerated filer ☐
	Non-accelerated filer ☒	Smaller reporting company ☒
		Emerging growth company ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

 

☐ Yes   ☒ No

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:

As of August 8, 2023, the issuer had 998,334 shares of common stock issued and outstanding.

 

Table of Contents

 

 

 

CEMTREX, INC. AND SUBSIDIARIES

 

INDEX

 

		Page
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
	Condensed Consolidated Balance Sheets as of June 30, 2023 (Unaudited) and September 30, 2022	3
	Condensed Consolidated Statements of Operations for the three and nine months ended June 30, 2023 and 2022 (Unaudited)	4
	Condensed Consolidated Statements of Comprehensive Loss for the three and nine months ended June 30, 2023 and 2022 (Unaudited)	5
	Condensed Consolidated Statement of Stockholders’ Equity for the three and nine months ended June 30, 2023 (Unaudited)	6
	Condensed Consolidated Statement of Stockholders’ Equity for the three and nine months ended June 30, 2022 (Unaudited)	7
	Condensed Consolidated Statements of Cash Flow for the nine months ended June 30, 2023 and 2022 (Unaudited)	8
	Notes to Unaudited Condensed Consolidated Financial Statements	10
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		26
Item 4. Controls and Procedures		31
PART II. OTHER INFORMATION
Item 1. Legal Proceedings		32
Item 1A Risk Factors		32
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		32
Item 3. Defaults Upon Senior Securities		32
Item 4. Mine Safety Disclosures		32
Item 5. Other Information		32
Item 6. Exhibits		33
SIGNATURES		34

 

 

Part I. Financial Information

 

Item 1. Financial Statements

 

Cemtrex, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

 

		(Unaudited)
		June 30,				September 30,
		2023				2022
Assets
Current assets
Cash and equivalents		$	5,628,839			$	9,895,761
Restricted cash			805,273				1,577,915
Short-term investments			13,663				13,721
Trade receivables, net			7,507,755				5,399,216
Trade receivables - related party			578,388				-
Trade receivables, net			578,388				-
Inventory –net of allowance for inventory obsolescence			8,719,740				8,487,817
Prepaid expenses and other assets			3,089,416				2,421,644
Assets of discontinued operations			-				3,971,693
Total current assets			26,343,074				31,767,767
Property and equipment, net			6,180,771				5,280,442
Right-of-use assets			2,213,341				2,641,198
Royalties receivable - related party			691,611				-
Note receivable - related party			761,585				761,585
Goodwill			3,906,891				3,906,891
Other			1,646,403				1,399,745
Total Assets		$	41,743,676			$	45,757,628
Liabilities & Stockholders’ Equity
Current liabilities
Accounts payable		$	3,725,105			$	3,050,937
Accounts payable - related party			3,372				19,133
Accounts payable			3,372				19,133
Short-term liabilities, net of unamortized original issue discounts			17,185,167				16,894,743
Lease liabilities - short-term			716,896				754,495
Deposits from customers			34,281				73,144
Accrued expenses			3,536,097				2,271,188
Deferred revenue			2,060,570				1,551,088
Accrued income taxes			49,075				94,848
Liabilities of discontinued operations			-				805,219
Total current liabilities			27,310,563				25,514,795
Long-term liabilities
Loans payable to bank			54,578				110,331
Long-term lease liabilities			1,496,445				1,822,468
Notes payable			1,379,743				-
Mortgage payable			2,110,020				2,160,169
Other long-term liabilities			528,952				807,898
Paycheck Protection Program Loans			60,695				97,120
Deferred Revenue - long-term			623,007				607,309
Total long-term liabilities			6,253,440				5,605,295
Total liabilities			33,564,003				31,120,090
Commitments and contingencies			-				-
Stockholders’ equity
Preferred stock, $0.001 par value, 10,000,000 shares authorized, Series 1, 3,000,000 shares authorized, 2,293,016 shares issued and 2,228,916 shares outstanding as of June 30, 2023 and 2,079,122 shares issued and 2,015,022 shares outstanding as of September 30, 2022 (liquidation value of $10 per share)			2,293				2,079
Series C, 100,000 shares authorized, 50,000 shares issued and outstanding at June 30, 2023 and September 30, 2022			50				50
Common stock, $0.001 par value, 50,000,000 shares authorized, 957,760 shares issued and outstanding at June 30, 2023 and 754,711 shares issued and outstanding at September 30, 2022			958				755
Additional paid-in capital			68,302,617				66,641,698
Accumulated deficit			(62,947,549	)			(54,929,020	)
Treasury stock, 64,100 shares of Series 1 Preferred Stock at June 30, 2023 and September 30, 2022			(148,291	)			(148,291	)
Accumulated other comprehensive income			2,306,346				2,377,525
Total Cemtrex stockholders’ equity			7,516,424				13,944,796
Non-controlling interest			663,249				692,742
Total liabilities and shareholders’ equity		$	41,743,676			$	45,757,628

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

 

Cemtrex, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

(Unaudited)

 

		June 30, 2023				June 30, 2022				June 30, 2023				June 30, 2022
		For the three months ended								For the nine months ended
		June 30, 2023				June 30, 2022				June 30, 2023				June 30, 2022
Revenues		$	14,730,140			$	12,108,904			$	42,773,779			$	33,268,316
Cost of revenues			8,249,497				7,068,797				23,914,249				21,236,178
Gross profit			6,480,643				5,040,107				18,859,530				12,032,138
Operating expenses
General and administrative			5,376,960				5,381,529				16,456,602				16,095,373
Research and development			1,049,909				1,189,875				3,895,717				3,660,883
Total operating expenses			6,426,869				6,571,404				20,352,319				19,756,256
Operating income/(loss)			53,774				(1,531,297	)			(1,492,789	)			(7,724,118	)
Other income/(expense)
Other income			34,652				2,315,500				394,073				3,336,560
Interest expense			(1,254,185	)			(925,545	)			(3,717,557	)			(3,641,432	)
Total other (expense)/income, net			(1,219,533	)			1,389,955				(3,323,484	)			(304,872	)
Net loss before income taxes			(1,165,759	)			(141,342	)			(4,816,273	)			(8,028,990	)
Income tax benefit/(expense)			(19,641	)			247,941				(19,641	)			247,941
(Loss)/income from Continuing operations			(1,185,400	)			106,599				(4,835,914	)			(7,781,049	)
Income/(loss) from discontinued operations, net of tax			13,281				(838,301	)			(3,212,108	)			(2,282,399	)
Net loss			(1,172,119	)			(731,702	)			(8,048,022	)			(10,063,448	)
Less loss in noncontrolling interest			(25,595	)			(50,909	)			(29,493	)			(183,457	)
Net loss attributable to Cemtrex, Inc. shareholders		$	(1,146,524	)		$	(680,793	)		$	(8,018,529	)		$	(9,879,991	)
Income (loss) per share - Basic & Diluted
Continuing Operations		$	(1.29	)		$	0.21			$	(5.83	)		$	(10.94	)
Discontinued Operations		$	0.01			$	(1.14	)		$	(3.89	)		$	(3.29	)
Weighted Average Number of Shares-Basic & Diluted			897,897				736,506				824,689				694,758

 

 

Condensed Consolidated Statements of Comprehensive Loss

(Unaudited)

 

		June 30, 2023				June 30, 2022				June 30, 2023				June 30, 2022
		For the three months ended								For the nine months ended
		June 30, 2023				June 30, 2022				June 30, 2023				June 30, 2022
Other comprehensive loss
Net loss		$	(1,172,119	)		$	(731,702	)		$	(8,048,022	)		$	(10,063,448	)
Foreign currency translation gain/(loss)			22,470				(200,880	)			(71,179	)			(341,011	)
Comprehensive loss			(1,149,649	)			(932,582	)			(8,119,201	)			(10,404,459	)
Less comprehensive income attributable to noncontrolling interest			25,595				50,909				29,493				183,457
Comprehensive loss attributable to Cemtrex, Inc. shareholders		$	(1,175,244	)		$	(983,491	)		$	(8,148,694	)		$	(10,587,916	)

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

 

Cemtrex, Inc. and Subsidiaries

Condensed Consolidated Statement of Stockholders’ Equity

(Unaudited)

 

		Shares				Amount				Shares				Amount				Shares				Amount				Capital				Deficit				Stock				Income(loss)				Equity				interest
		Preferred Stock Series 1								Preferred Stock Series C								Common Stock Par																Treasury Stock, 64,100
		Par Value $0.001								Par Value $0.001								Value $0.001																shares of
		Number of								Number of								Number of								AdditionalPaid-in				Accumulated				Series 1 Preferred				Accumulated otherComprehensive				Cemtrex Stockholders’				Non-controlling
		Shares				Amount				Shares				Amount				Shares				Amount				Capital				Deficit				Stock				Income(loss)				Equity				interest
Balance at September 30, 2022			2,079,122			$	2,079				50,000			$	50				754,711			$	755			$	66,641,698			$	(54,929,020	)		$	(148,291	)		$	2,377,525			$	13,944,796			$	692,742
Foreign currency translation gain/(loss)																																							223,569				223,569
Share-based compensation																											39,842																39,842
Shares issued to pay notes payable																			39,016				39				232,106																232,145
Dividends paid in Series 1 preferred shares			104,341				104																				(104	)															-
Income/(loss) attributable to noncontrolling interest																																											-				(59,163	)
Net loss											-				-																(6,277,211	)			-								(6,277,211	)
Balance at December 31, 2022			2,183,463			$	2,183				50,000			$	50				793,727			$	794			$	66,913,542			$	(61,206,231	)		$	(148,291	)		$	2,601,094			$	8,163,141			$	633,579
Foreign currency translation gain/(loss)																																							(317,218	)			(317,218	)
Share-based compensation																											26,735																26,735
Additional rounding shares issued for reverse stock split																			19,314				19				(19	)															-
Income/(loss) attributable to noncontrolling interest																																											-				55,265
Shares issued to pay for services																			15,529				15				102,485																102,500
Net loss			-				-				-				-																(594,794	)			-								(594,794	)
Balance at March 31, 2023			2,183,463			$	2,183				50,000			$	50				828,570			$	828			$	67,042,743			$	(61,801,025	)		$	(148,291	)		$	2,283,876			$	7,380,364			$	688,844
Foreign currency translation gain/(loss)																																							22,470				22,470
Share-based compensation																											26,736																26,736
Dividends paid in Series 1 preferred shares			109,553				110																				(110	)															-
Shares issued to pay notes payable																			122,702				123				1,193,883																1,194,006
Income/(loss) attributable to noncontrolling interest																																											-				(25,595	)
Shares issued to pay for services																			6,488				7				39,365																39,372
Net loss											-				-				-												(1,146,524	)			-				-				(1,146,524	)			-
Balance at June 30, 2023			2,293,016			$	2,293				50,000			$	50				957,760			$	958			$	68,302,617			$	(62,947,549	)		$	(148,291	)		$	2,306,346			$	7,516,424			$	663,249

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

 

Cemtrex, Inc. and Subsidiaries

Condensed Consolidated Statement of Stockholders’ Equity (Continued)

(Unaudited)

 

		Preferred Stock Series 1								Preferred Stock Series C								Common Stock Par																Treasury Stock,64,100
		Par Value $0.001								Par Value $0.001								Value $0.001																shares of
		Number of								Number of								Number of								Additional Paid-in				Accumulated				Series 1 Preferred				Accumulated other Comprehensive				Cemtrex				Non- controlling
		Shares				Amount				Shares				Amount				Shares				Amount				Capital				Deficit				Stock				Income(loss)				Stockholders’Equity				interest
Balance at September 30, 2021			1,885,151			$	1,885				50,000			$	50				593,777			$	594			$	61,748,022			$	(41,908,062	)		$	(148,291	)		$	2,896,452			$	22,590,650			$	964,026
Foreign currency translation gain/(loss)																																							59,492				59,492
Share-based compensation																											45,371																45,371
Shares issued to pay notes payable																			82,600				83				3,287,988																3,288,071
Dividends paid in Series 1 preferred shares			94,602				95																				(95	)															-
Income/(loss) attributable to noncontrolling interest																																											-				(51,872	)
Net loss											-				-																(4,477,951	)			-								(4,477,951	)
Balance at December 31, 2021			1,979,753			$	1,980				50,000			$	50				676,377			$	677			$	65,081,286			$	(46,386,013	)		$	(148,291	)		$	2,955,944			$	21,505,633			$	912,154
Foreign currency translation gain/(loss)																																							(199,623	)			(199,623	)
Share-based compensation																											27,046																27,046
Shares issued with note payable																			28,571				29				695,371																695,400
Income/(loss) attributable to noncontrolling interest																																											-				(80,676	)
Net loss			-				-				-				-																(4,721,247	)			-								(4,721,247	)
Balance at March 31, 2022			1,979,753			$	1,980				50,000			$	50				704,948			$	706			$	65,803,703			$	(51,107,260	)		$	(148,291	)		$	2,756,321			$	17,307,209			$	831,478
Balance			1,979,753			$	1,980				50,000			$	50				704,948			$	706			$	65,803,703			$	(51,107,260	)		$	(148,291	)		$	2,756,321			$	17,307,209			$	831,478
Foreign currency translation gain/(loss)																																							(200,880	)			(200,880	)
Share-based compensation																											38,985																38,985
Shares issued to pay notes payable																			45,432				45				705,008																705,053
Dividends paid in Series 1 preferred shares			99,369				99																				(99	)															-
Income/(loss) attributable to noncontrolling interest																																											-				(50,909	)
Net loss											-				-																(680,793	)			-								(680,793	)
Balance at June 30, 2022			2,079,122			$	2,079				50,000			$	50				750,380			$	751			$	66,547,597			$	(51,788,053	)		$	(148,291	)		$	2,555,441			$	17,169,574			$	780,569
Balance			2,079,122			$	2,079				50,000			$	50				750,380			$	751			$	66,547,597			$	(51,788,053	)		$	(148,291	)		$	2,555,441			$	17,169,574			$	780,569

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

 

Cemtrex, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(Unaudited)

 

		For the nine months ended
		June 30,
Cash Flows from Operating Activities		2023				2022
Net loss		$	(8,048,022	)		$	(10,063,448	)
Adjustments to reconcile net loss to net cash used by operating activities
Depreciation and amortization			698,269				1,038,138
Loss on disposal of property  and equipment			69,611				161,814
Noncash lease expense			614,254				524,500
Bad debt expense (recovery)			(155	)			(7,584	)
Share-based compensation			93,313				111,402
Income tax expense/ (benefit)			-				(247,941	)
Interest expense paid in equity shares			276,151				1,627,046
Accrued interest on notes payable			1,858,631				635,001
Amortization of original issue discounts on notes payable			1,200,200				908,333
Gain/(loss) on marketable securities			58				(2,234,478	)
Discharge of Paycheck Protection Program Loans			-				(971,500	)
Changes in operating assets and liabilities net of effects from acquisition of subsidiaries:
Trade receivables			(2,108,384	)			445,590
Trade receivables - related party			(578,388	)			14,641
Inventory			(231,923	)			(2,565,778	)
Prepaid expenses and other current assets			(667,772	)			125,344
Other assets			(246,658	)			(159,526	)
Accounts payable			816,040				1,012,206
Accounts payable - related party			(15,761	)			-
Operating lease liabilities			(550,019	)			(456,042	)
Deposits from customers			(38,863	)			(374,978	)
Accrued expenses			1,264,909				(444,238	)
Deferred revenue			525,180				470,685
Income taxes payable			(45,773	)			(59,588	)
Other liabilities			(278,946	)			(159,526	)
Net cash used by operating activities - continuing operations			(5,394,048	)			(10,669,927	)
Net cash provided by operating activities - discontinued operations			2,474,863				41,562
Net cash used by operating activities			(2,919,185	)			(10,628,365	)
Cash Flows from Investing Activities
Purchase of property and equipment			(761,470	)			(727,955	)
Proceeds from sale of property and equipment			26,205				51,262
Investment in MasterpieceVR			-				(500,000	)
Proceeds from sale of marketable securities			-				12,182,932
Purchase of marketable securities			-				(10,214,044	)
Net cash (used in)/provided by investing activities - continuing operations			(735,265	)			792,195
Net cash used by investing activities - discontinued operations			-				(39,388	)
Net cash (used in)/provided by investing activities			(735,265	)			752,807
Cash Flows from Financing Activities
Proceeds from notes payable			-				8,000,000
Payments on debt			(844,370	)			(1,176,763	)
Payments on Paycheck Protection Program Loans			(20,154	)			-
Payments on bank loans			(416,467	)			(920,939	)
Net cash provided by financing activities - continuing operations			(1,280,991	)			5,902,298
Net cash used by financing activities - discontinued operations			-				-
Net cash (used)/provided by financing activities			(1,280,991	)			5,902,298
Effect of currency translation			(104,123	)			(397,840	)
Net decrease in cash, cash equivalents, and restricted cash			(4,935,441	)			(3,973,260	)
Cash, cash equivalents, and restricted cash at beginning of period			11,473,676				17,186,323
Cash, cash equivalents, and restricted cash at end of period		$	6,434,112			$	12,815,223
Balance Sheet Accounts Included in Cash, Cash Equivalents, and Restricted Cash
Cash and equivalents		$	5,628,839			$	11,442,487
Less cash attributed to discontinued operations			-				(145,984	)
Restricted cash			805,273				1,518,720
Total cash, cash equivalents, and restricted cash		$	6,434,112			$	12,815,223

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

 

Cemtrex, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows (Continued)

(Unaudited)

 

Supplemental Disclosure of Cash Flow Information:
Cash paid during the period for interest		$	382,575			$	483,665
Cash paid during the period for income taxes, net of refunds		$	45,773			$	306,729
Supplemental Schedule of Non-Cash Investing and Financing Activities
Shares issued to pay for services		$	141,872			$	-
Shares issued to pay notes payable		$	1,426,151			$	3,993,124
Purchase of property and equipment through vendor financing		$	1,125,000			$	-
Shares issued in connection with note payable		$	-			$	700,400
Investment in right of use asset		$	186,397			$	317,187

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

 

Cemtrex, Inc. and Subsidiaries

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 

NOTE 1 – ORGANIZATION AND PLAN OF OPERATIONS

 

Cemtrex was incorporated in 1998 in the state of Delaware and has evolved through strategic acquisitions and internal growth into a leading multi-industry company. Unless the context requires otherwise, all references to “we”, “our”, “us”, “Company”, “registrant”, “Cemtrex” or “management” refer to Cemtrex, Inc. and its subsidiaries.

 

During the first quarter of fiscal year 2023, The Company reorganized its reporting segments to be in line with its current structure consisting of (i) Security (ii) Industrial Services and (iii) Cemtrex Corporate.

 

Security

 

Cemtrex’s Security segment operates under the brand of its majority owned subsidiary, Vicon Industries, Inc. (“Vicon”), which provides end-to-end security solutions to meet the toughest corporate, industrial and governmental security challenges. Vicon’s products include browser-based video monitoring systems and analytics-based recognition systems, cameras, servers, and access control systems for every aspect of security and surveillance in industrial and commercial facilities, federal prisons, hospitals, universities, schools, and federal and state government offices. Vicon provides innovative, mission critical security and video surveillance solutions utilizing Artificial Intelligence (AI) based data algorithms.

 

Industrial Services

 

Cemtrex’s Industrial Services segment operates under the brand, Advanced Industrial Services (“AIS”), which offers single-source expertise and services for rigging, millwrighting, in plant maintenance, equipment erection, relocation, and disassembly to diversified customers. AIS installs high precision equipment in a wide variety of industrial markets like automotive, printing & graphics, industrial automation, packaging, and chemicals, among others. AIS is a leading provider of reliability-driven maintenance and contracting solutions for machinery, packaging, printing, chemical, and other manufacturing markets. The focus is on customers seeking to achieve greater asset utilization and reliability to cut costs and increase production from existing assets, including small projects, sustaining capital, turnarounds, maintenance, specialty welding services, and high-quality scaffolding.

 

Cemtrex Corporate

 

Cemtrex’s Corporate segment is the holding company of our other two segments.

 

Sale of former Cemtrex Brands

 

On November 22, 2022, the Company entered into two Asset Purchase Agreements and one Simple Agreement for Future Equity (“SAFE”) with the Company’s CEO, Saagar Govil, to secure the sale of the subsidiaries Cemtrex Advanced Technologies, Inc, which include the brand SmartDesk, and Cemtrex XR, Inc., which include the brands Cemtrex XR, Virtual Driver Interactive, Bravo Strong, and good tech (formerly Cemtrex Labs), to Mr. Govil.

On November 22, 2022, the Company completed the above disposition for the following consideration.

 

●

Cemtrex XR, Inc.

 

○

$895,000 comprised of:

 

	■	$75,000 in cash payable at Closing; and
	■	5% royalty of all revenues on the Business to be paid 90 days after the end of each calendar year for the next three years; and should the total sum of royalties due be less than $820,000 at the end of the three-year period, Purchaser shall be obligated to pay the difference between $820,000 and the royalties paid.

 

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●

Cemtrex Advanced Technologies, Inc.

 

	○	$10,000 in cash payable at Closing; and
	○	5% royalty of all revenues on the Business to be paid 90 days after the end of each calendar year for the next 5 years; and
	○	$1,600,000 in SAFE (common equity) at any subsequent fundraising or exit above $5M with a $10M cap.

 

The Company’s Board of Directors, excluding Saagar Govil who abstained from all voting on these agreements, approved these actions and agreements.

 

Common Stock Reverse Stock Split

 

On January 25, 2023, the company completed a 35:1 reverse stock split on its common stock. All share and per share data have been retroactively adjusted for this reverse split.

 

Notice of Delisting, Extension of cure period, and Subsequent Compliance

 

Series 1 Preferred Stock

 

On July 29, 2022, the Company received a notification letter from the Listing Qualifications Department of The Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company that, because the closing bid price for the Company’s Series 1 preferred stock listed on Nasdaq was below $1.00 for 30 consecutive trading days, the Company no longer met the minimum bid price requirement for continued listing on The Nasdaq Capital Market under Nasdaq Marketplace Rule 5550(a)(2), requiring a minimum bid price of $1.00 per share (the “Minimum Bid Price Requirement”).

 

On January 26, 2023, the Company received a notification letter from the Listing Qualifications Department of Nasdaq notifying the Company that, it had been granted an additional 180 days or until July 24, 2023, to regain compliance with the Minimum Bid Price Requirement based on the Company meeting the continued listing requirement for market value of publicly held shares and all other applicable requirements for initial listing on the Capital Market with the exception of the bid price requirement, and the Company’s written notice of its intention to cure the deficiency during the second compliance period by effecting a reverse stock split, if necessary.

 

On July 25, 2023, the Company received a Notice of Staff Determination from the Listing Qualifications Department of Nasdaq notifying the Company that its Series 1 Preferred Stock had not gained compliance and would be suspended from trading at the opening of business on August 3, 2023. The Company has requested a hearing regarding the delisting that has been scheduled for September 14, 2023, which will stay the suspension and filing of Form 25-NSE with the Securities and Exchange Commission.

 

The Company intends to continue actively monitoring the bid price for its Series 1 preferred stock between now and the hearing date and will consider available options to resolve the deficiency and regain compliance with the Minimum Bid Price Requirement.

 

Common Stock

 

On January 24, 2022, the Company received a notification letter from the Listing Qualifications Department of Nasdaq notifying the Company that, because the closing bid price for the Company’s common stock listed on Nasdaq was below $1.00 for 30 consecutive trading days, the Company no longer met the minimum bid price requirement for continued listing on The Nasdaq Capital Market under Nasdaq Marketplace Rule 5550(a)(2), requiring a minimum bid price of $1.00 per share (the “Minimum Bid Price Requirement”).

 

On July 26, 2022, the Company received a notification letter from the Listing Qualifications Department of The Nasdaq Stock Market LLC Nasdaq notifying the Company that, it had been granted an additional 180 days or until January 23, 2023, to regain compliance with the Minimum Bid Price Requirement based on the Company meeting the continued listing requirement for market value of publicly held shares and all other applicable requirements for initial listing on the Capital Market with the exception of the bid price requirement, and the Company’s written notice of its intention to cure the deficiency during the second compliance period by effecting a reverse stock split, if necessary.

 

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On January 26, 2023, the Company received a notification letter from the Listing Qualifications Department of Nasdaq notifying the Company that it has not regained compliance with Listing Rule 5550(a)(2) and accordingly would be delisted from the Capital Market. The Company then requested and had been granted a hearing to occur on March 16, 2023, appealing this determination to a Hearings Panel (the “Panel”), pursuant to the procedures set forth in the Nasdaq Listing Rule 5800 Series.

 

On February 8, 2023, the Company received a notification letter from the Listing Qualifications Department of Nasdaq notifying the Company that it has regained compliance with Listing Rule 5550(a)(2) and is in compliance with all applicable listing standards. The Company’s common stock will continue to be listed and traded on The Nasdaq Stock Market.

 

Going Concern Considerations

 

The accompanying condensed consolidated financial statements of the Company have been prepared assuming the Company will continue as a going concern and in accordance with generally accepted accounting principles in the United States of America. The going concern basis of presentation assumes that the Company will continue in operation one year after the date these financial statements are issued and will be able to realize its assets and discharge its liabilities and commitments in the normal course of business. Pursuant to the requirements of the ASC 205, management must evaluate whether there are conditions or events, considered in the aggregate, which raise substantial doubt about the Company’s ability to continue as a going concern for one year from the date these financial statements are issued.

 

This evaluation does not take into consideration the potential mitigating effect of management’s plans that have not been fully implemented or are not within control of the Company as of the date the financial statements are issued. When substantial doubt exists under this methodology, management evaluates whether the mitigating effect of its plans sufficiently alleviates substantial doubt about the Company’s ability to continue as a going concern. The mitigating effect of management’s plans, however, is only considered if both (1) it is probable that the plans will be effectively implemented within one year after the date that the financial statements are issued, and (2) it is probable that the plans, when implemented, will mitigate the relevant conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued.

 

The Company has incurred substantial losses of $13,020,958 and $7,807,995 for fiscal years 2022 and 2021, respectively, and has losses on continuing operations for the nine months ending June 30, 2023 of $4,835,914 and has debt obligations over the next year of $17,185,167 and working capital deficit of $967,489, that raise substantial doubt with respect to the Company’s ability to continue as a going concern.

 

While our working capital and current debt indicate a substantial doubt regarding the Company’s ability to continue as a going concern, the Company has historically, from time to time, satisfied and may continue to satisfy certain short-term liabilities through the issuance of common stock, thus reducing our cash requirement to meet our operating needs. Additionally, the Company has sold unprofitable brands, reducing the cash required to maintain those brands, reevaluated our pricing model on our Vicon brand to improve margins on those products, and has effected a 35:1 reverse stock split on our common stock to remain trading on the Nasdaq Capital Markets, and improve our ability to potentially raise capital through equity offerings that we may use to satisfy debt. In the event additional capital is raised through equity offerings and/or debt is satisfied with equity, it may have a dilutive effect on our existing stockholders. While the Company believes these plans are sufficient to meet the capital demands of our current operations for at least the next twelve months, the is no guarantee that we will succeed. Overall, there is no guarantee that cash flow from our existing or future operations and any external capital that we may be able to raise will be sufficient to meet our working capital needs. The Company currently does not have adequate cash to meet our short or long-term needs. The condensed consolidated financial statements do not include any adjustments relating to this uncertainty.

 

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NOTE 2 – INTERIM STATEMENT PRESENTATION

 

Basis of Presentation and Use of Estimates

 

The accompanying unaudited condensed consolidated financial information should be read in conjunction with the audited consolidated financial statements and the notes thereto included in the Annual Report on Form 10-K for the year ended September 30, 2022, of Cemtrex, Inc.

 

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the Unites States (“US GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X pursuant to the requirements of the U.S. Securities and Exchange Commission (‘SEC”). Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. The results of operations for the interim periods are not necessarily indicative of the results of operations for the entire year.

 

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the condensed consolidated financial statements, the disclosure of contingent assets and liabilities in the condensed consolidated financial statements and the accompanying notes, and the reported amounts of revenues, expenses and cash flows during the periods presented. Actual amounts and results could differ from those estimates. The estimates and assumptions the Company makes are based on historical factors, current circumstances and the experience and judgment of the Company’s management. The Company evaluates its estimates and assumptions on an ongoing basis.

 

Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations.

 

The condensed consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries, Cemtrex Technologies Pvt. Ltd., Advanced Industrial Services, Inc., Advanced Industrial Leasing, Inc., and the Company’s majority owned subsidiary Vicon Industries, Inc. and its subsidiary, Vicon Industries Ltd. All inter-company balances and transactions have been eliminated in consolidation.

 

Accounting Pronouncements

 

Significant Accounting Policies

 

Note 2 of the Notes to Consolidated Financial Statements, included in the annual report on Form 10-K for the year ended September 30, 2022, includes a summary of the significant accounting policies used in the preparation of the consolidated financial statements.

 

Recently Issued Accounting Standards

 

In June 2016, the FASB issued Accounting Standards Update No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“Update 2016-13”). Update 2016-13 replaced the incurred loss model with an expected loss model, which is referred to as the current expected credit loss (“CECL”) model. The CECL model is applicable to the measurement of credit losses on financial assets measured at amortized cost, including but not limited to trade receivables. For public business entities, the new standard became effective for annual reporting periods beginning after December 15, 2022, including interim periods within that reporting period. The Company is currently evaluating the impact of this ASU on our financial statements.

 

In October 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2021-08, “Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (“ASU No. 2021-08”). ASU No. 2021-08 will require companies to apply the definition of a performance obligation under ASC Topic 606 to recognize and measure contract assets and contract liabilities (i.e., deferred revenue) relating to contracts with customers that are acquired in a business combination. Under current U.S. GAAP, an acquirer generally recognizes assets acquired and liabilities assumed in a business combination, including contract assets and contract liabilities arising from revenue contracts with customers, at fair value on the acquisition date. ASU No. 2021-08 will result in the acquirer recording acquired contract assets and liabilities on the same basis that would have been recorded by the acquiree before the acquisition under ASC Topic 606. ASU No. 2021-08 is effective for fiscal years beginning after December 15, 2022, with early adoption permitted. The Company is currently evaluating the impact of this ASU on our financial statements.

 

13

 

 

On June 30, 2022, the FASB issued ASU 2022-03 Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions (“ASU 2022-03”), which (1) clarifies the guidance in ASC 820 on the fair value measurement of an equity security that is subject to a contractual sale restriction and (2) requires specific disclosures related to such an equity security. Under current guidance, stakeholders have observed diversity in practice related to whether contractual sale restrictions should be considered in the measurement of the fair value of equity securities that are subject to such restrictions. On the basis of interpretations of existing guidance and the current illustrative example in ASC 820-10-55-52 of a restriction on the sale of an equity instrument, some entities use a discount for contractual sale restrictions when measuring fair value, while others view the application of such a discount to be inconsistent with the principles of ASC 820. To reduce the diversity in practice and increase the comparability of reported financial information, ASU 2022-03 clarifies this guidance and amends the illustrative example. ASU No. 2022-03 is effective for fiscal years beginning after December 15, 2023, with early adoption permitted. The Company is currently evaluating the impact of this ASU on our financial statements.

 

The Company does not believe that any other recently issued but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying condensed consolidated financial statements.

 

NOTE 3 – DISCONTINUED OPERATIONS

 

On November 22, 2022, the Company entered into two Asset Purchase Agreements and one Simple Agreement for Future Equity (“SAFE”) with the Company’s CEO, Saagar Govil, to secure the sale of the subsidiaries Cemtrex Advanced Technologies, Inc, which include the brand SmartDesk, and Cemtrex XR, Inc., which include the brands Cemtrex XR, Virtual Driver Interactive, Bravo Strong, and good tech (formerly Cemtrex Labs), to Mr. Govil

 

Due to the on-going losses and risk associated with the SmartDesk business the Company has valued the royalty and SAFE agreement associated with the SmartDesk sale at $0 and considers such consideration to be a gain contingency.

 

Based on sales projections for Cemtrex XR, Inc., the Company does not believe that it will exceed the sales levels required to exceed the $820,000 royalties due and has not accounted for any additional royalties at this time. In accordance with ASC 310 – Receivables, the Company has discounted the royalties due and during the nine-month ended June 30, 2023, has recognized $691,611 of royalties due and will amortize the remaining amount over the period the royalties are due.

 

14

 

 

The following table summarizes the loss on the sale recorded during the three months ended December 31, 2022, included in Income/(loss) from discontinued operations, net of tax in the accompanying condensed consolidated statement of Operations:

 SUMMARY OF LOSS ON SALE 

Purchase Price		$	745,621
Less cash and cash equivalents transferred			(699,423	)
Less liabilities assumed			(10,924	)
Net purchase price		$	35,274
Assets Sold
Accounts receivable, net		$	625,638
Inventory, net			980,730
Prepaid expenses and other assets			502,577
Property and equipment, net			837,808
Goodwill			598,392
Total Assets Sold			3,545,145
Liabilities Transferred
Accounts payable			370,774
Short-term liabilities			364,775
Long-term liabilities			318,981
Total Liabilities Transferred			1,054,530
Net assets sold		$	2,490,615
Pretax loss on sale of Cemtrex Advanced Technologies, Inc, and Cemtrex XR, Inc.Companies		$	(2,455,341	)

 

15

 

 

Assets and liabilities included within discontinued operations on the Company’s Condensed Consolidated Balance Sheets at June 30, 2023, and September 30, 2022, are as follows;

 SCHEDULE OF ASSETS AND LIABILITIES INCLUDED WITHIN DISCONTINUED OPERATIONS

		June 30,				September 30,
		2023				2022
Assets
Current assets
Cash and equivalents		$	-			$	714,420
Trade receivables, net			-				561,470
Inventory –net of allowance for inventory obsolescence			-				1,043,865
Prepaid expenses and other assets			-				153,461
Total current assets			-				2,473,216
Property and equipment, net			-				825,850
Other			-				672,627
Total Assets		$	-			$	3,971,693
Liabilities
Current liabilities
Accounts payable		$	-			$	205,622
Short-term liabilities			-				464,429
Deposits from customers			-				125,032
Accrued expenses			-				10,136
Total current liabilities			-				805,219
Long-term liabilities
Deferred revenue							6,273
Total long-term liabilities			-				6,273
Total liabilities		$	-			$	811,492

 

During the first quarter of fiscal 2023, Vicon completed the closure of its discontinued operating entity Vicon Systems, Ltd. located in Israel. The Company received funds related to benefit obligations of $96,095, which at the time of operational closure were not guaranteed to be retrievable. The company paid $7,010 in consulting fees for assistance in retrieving these funds. The net amount of $89,085 is recognized on the Company’s Condensed Consolidated Income Statement as part of the Loss on Discontinued Operations.

 

16

 

 

Gain/(loss) from discontinued operations, net of tax and the loss on sale of discontinued operations, net of tax, of Cemtrex Advanced Technologies, Inc. and Cemtrex XR, Inc., sold during the first quarter of fiscal year 2023, which are presented in total as discontinued operations, net of tax in the Company’s Condensed Consolidated Statements of Operations for the three and nine month periods ended June 30, 2023 and 2022, are as follows:

 

		2023				2022				2023				2022
		Three months ended June 30,								Nine months ended June 30,
		2023				2022				2023				2022
Total net sales		$	-			$	1,521,942			$	649,061			$	3,763,234
Cost of sales			-				685,693				228,086				1,997,211
Operating, selling, general and administrative expenses			1,443				1,425,801				1,297,507				4,036,614
Other (income)/expenses			-				248,749				3,195				11,808
Income (loss) from discontinued operations			(1,443	)			(838,301	)			(879,727	)			(2,282,399	)
Amortization of discounted royalties			14,724				-				33,875				-
Loss on sale of discontinued operations			-				-				(2,455,341	)			-
Adjustment of benefit obligation			-				-				89,085				-
Income tax provision			-				-				-				-
Discontinued operations, net of tax		$	13,281			$	(838,301	)		$	(3,212,108	)		$	(2,282,399	)

 

NOTE 4 – LOSS PER COMMON SHARE

 

Basic net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period. Diluted net income per common share is computed by dividing net income by the weighted average number of shares of common stock and potentially dilutive outstanding shares of common stock during the period to reflect the potential dilution that could occur from common shares issuable through contingent share arrangements, stock options and warrants. For the three and nine months ended June 30, 2023, and 2022, the following items were excluded from the computation of diluted net loss per common share as their effect is anti-dilutive:

 

 SCHEDULE OF COMPUTATION OF DILUTED NET LOSS PER COMMON SHARE AS ANTI-DILUTIVE EFFECT

		2023				2022				2023				2022
		For the three months ended								For the nine months ended
		June 30,								June 30,
		2023				2022				2023				2022
Options			28,796				34,579				28,796				34,579

 

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NOTE 5 – SEGMENT INFORMATION

During the first quarter of fiscal year 2023, the Company reorganized its reporting segments to be in line with its current structure. The Company reports and evaluates financial information for three current segments: the Security segment, Industrial Services segment and the Corporate segment.

 

The following tables summarize the Company’s segment information:

 SCHEDULE OF SEGMENT INFORMATION

		Security				Industrial Services				Corporate				Consolidated				Security				Industrial Services				Corporate				Consolidated
		Three months ended June 30, 2023																Nine months ended June 30, 2023
		Security				Industrial Services				Corporate				Consolidated				Security				Industrial Services				Corporate				Consolidated
Revenues		$	9,015,279			$	5,714,861			$	-			$	14,730,140			$	25,933,921			$	16,839,858			$	-			$	42,773,779
Cost of revenues			4,610,443				3,639,054				-				8,249,497				13,005,314				10,908,935				-				23,914,249
Gross profit		$	4,404,836			$	2,075,807			$	-			$	6,480,643			$	12,928,607			$	5,930,923			$	-			$	18,859,530
Operating expenses
Sales, general, and administrative			3,182,509				912,387				1,032,183				5,127,079				9,494,634				3,437,565				2,826,134				15,758,333
Depreciation and amortization			90,630				159,251				-				249,881				161,833				484,157				52,279				698,269
Research and development			1,049,909				-				-				1,049,909				3,895,717				-				-				3,895,717
Operating income/(loss)		$	81,788			$	1,004,169			$	(1,032,183	)		$	53,774			$	(623,577	)		$	2,009,201			$	(2,878,413	)		$	(1,492,789	)
Other income/(expense)		$	(282,857	)		$	(7,281	)		$	(929,395	)		$	(1,219,533	)		$	(58,065	)		$	(68,707	)		$	(3,196,712	)		$	(3,323,484	)

 

		Security				Industrial Services				Corporate				Consolidated				Security				Industrial Services				Corporate				Consolidated
		Three months ended June 30, 2022																Nine months ended June 30, 2022
		Security				Industrial Services				Corporate				Consolidated				Security				Industrial Services				Corporate				Consolidated
Revenues		$	6,640,913			$	5,467,991			$	-			$	12,108,904			$	17,740,445				15,527,871			$	-			$	33,268,316
Cost of revenues			3,257,672				3,811,125				-				7,068,797				10,261,376				10,974,802				-				21,236,178
Gross profit		$	3,383,241			$	1,656,866			$	-			$	5,040,107			$	7,479,069			$	4,553,069			$	-			$	12,032,138
Operating expenses
Sales, general, and administrative			3,057,839				1,081,392				814,487				4,953,718				8,483,955				3,706,041				2,867,239				15,057,235
Depreciation and amortization			217,497				174,066				36,248				427,811				398,707				529,779				109,652				1,038,138
Research and development			1,189,875				-				-				1,189,875				3,660,883				-				-				3,660,883
Operating (loss)/income		$	(1,081,970	)		$	401,408			$	(850,735	)		$	(1,531,297	)		$	(5,064,476	)		$	317,249			$	(2,976,891	)		$	(7,724,118	)
Other income/(expense)		$	(83,355	)		$	(104,797	)		$	1,578,107			$	1,389,955			$	741,330			$	(181,586	)		$	(864,616	)		$	(304,872	)

 

		2023				2022
		June 30,				September 30,
		2023				2022
Identifiable Assets
Security		$	20,631,185			$	15,257,235
Industrial Services			17,302,398				16,658,984
Corporate			3,810,093				9,869,716
Discontinued operations			-				3,971,693
Total Assets		$	41,743,676			$	45,757,628

 

NOTE 6 – RESTRICTED CASH

 

A subsidiary of the Company participates in a consortium in order to self-insure group care coverage for its employees. The plan is administrated by Benecon Group and the Company makes monthly deposits in a trust account to cover medical claims and any administrative costs associated with the plan. These funds, as required by the plan are restricted in nature and amounted to $805,237 at June 30, 2023, and $1,577,915 at September 30, 2022.

 

NOTE 7 – FAIR VALUE MEASUREMENTS

 

Fair value is defined as the price that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-level hierarchy is applied to prioritize the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).

 

The three levels of the fair value hierarchy under the guidance for fair value measurements are described below:

 

Level 1 — Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Our Level 1 assets include cash equivalents, banker’s acceptances, trading securities investments and investment funds. The Company measures trading securities investments and investment funds at quoted market prices as they are traded in an active market with sufficient volume and frequency of transactions.

 

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Level 2 — Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. If the asset or liability has a specified contractual term, a Level 2 input must be observable for substantially the full term of the asset or liability.

 

Level 3 — Level 3 inputs are unobservable inputs for the asset or liability in which there is little, if any, market activity for the asset or liability at the measurement date. Level 3 assets and liabilities include cost method investments. Quantitative information for Level 3 assets and liabilities reviewed at each reporting period includes indicators of significant deterioration in the earnings performance, credit rating, asset quality, business prospects of the investee, and financial indicators of the investee’s ability to continue as a going concern.

 

The Company’s fair value assets at June 30, 2023, and September 30, 2022, are as follows.

 SCHEDULE OF FAIR VALUE OF ASSETS

		(Level 1)				(Level 2)				(Level 3)				2023
		Quoted Prices				Significant
		in Active				Other				Significant				Balance
		Markets for				Observable				Unobservable				as of
		Identical Assets				Inputs				Inputs				June 30,
		(Level 1)				(Level 2)				(Level 3)				2023
Assets
Investment in marketable securities
(included in short-term investments)		$	13,663			$	-			$	-			$	13,663
Fair value assets		$	13,663			$	-			$	-			$	13,663

 

		(Level 1)				(Level 2)				(Level 3)				2022
		Quoted Prices				Significant
		in Active				Other				Significant				Balance
		Markets for				Observable				Unobservable				as of
		Identical Assets				Inputs				Inputs				September 30,
		(Level 1)				(Level 2)				(Level 3)				2022
Assets
Investment in marketable securities
(included in short-term investments)		$	13,721			$	-			$	-			$	13,721
Fair value assets		$	13,721			$	-			$	-			$	13,721

 

NOTE 8 – TRADE RECEIVABLES, NET

 

Trade receivables, net consist of the following:

 SCHEDULE OF TRADE RECEIVABLES, NET

		June 30,				September 30,
		2023				2022
Trade receivables		$	7,757,039			$	5,648,655
Allowance for doubtful accounts			(249,284	)			(249,439	)
Accounts receivables, net, total		$	7,507,755			$	5,399,216

 

Trade receivables include amounts due for shipped products and services rendered.

 

Allowance for doubtful accounts includes estimated losses resulting from the inability of our customers to make the required payments.

 

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NOTE 9 – INVENTORY, NET

 

Inventory, net, consist of the following:

 SCHEDULE OF INVENTORY, NET

		June 30,				September 30,
		2023				2022
Raw materials		$	1,130,327			$	1,375,933
Work in progress			95,773				120,026
Finished goods			8,099,426				8,080,235
Inventory, gross			9,325,526				9,576,194
Less: Allowance for inventory obsolescence			(605,786	)			(1,088,377	)
Inventory –net of allowance for inventory obsolescence		$	8,719,740			$	8,487,817

 

 

NOTE  10 – PREPAID AND OTHER CURRENT ASSETS

 

Prepaid and other current assets consisting of the following:

 SUMMARY OF PREPAID AND OTHER CURRENT ASSETS

		June 30, 2023				September 30, 2022
Prepaid expenses		$	344,300			$	536,820
Prepaid inventory			1,427,013				220,553
Deferred costs			60,169				40,626
Prepaid income taxes			402,048				604,840
VAT & GST tax receivable			289,371				236,986
Contract assets			566,515				781,819
Prepaid expenses and other assets total		$	3,089,416			$	2,421,644

 

NOTE 11 – PROPERTY AND EQUIPMENT

 

Property and equipment are summarized as follows:

 SUMMARY OF PROPERTY AND EQUIPMENT

		June 30,				September 30,
		2023				2022
Land		$	790,373			$	790,373
Building and leasehold improvements			2,915,918				2,906,953
Furniture and office equipment			574,645				546,548
Computers and software			1,333,135				365,892
Machinery and equipment			10,725,259				11,242,709
Property and equipment, gross			16,339,330				15,852,475
Less: Accumulated depreciation			(10,158,559	)			(10,572,033	)
Property and equipment, net		$	6,180,771			$	5,280,442

 

Depreciation expense for the three months ended June 30, 2023, and 2022, were $249,881 and $427,811, respectively. Depreciation expense for the nine months ended June 30, 2023, and 2022, were $698,269, and $1,038,138, respectively.

 

20

 

 

NOTE 12 – OTHER ASSETS 

 

On November 13, 2020, Cemtrex made a $500,000 investment and on January 19, 2022, made an additional $500,000 investment via a simple agreement for future equity (“SAFE”) in MasterpieceVR. The SAFE provides that the Company will automatically receive shares of the entity based on the conversion rate of future equity rounds up to a valuation cap, as defined. MasterpieceVR is a software company that is developing software for content creation using virtual reality. The investment is included in other assets in the accompanying balance sheet and the Company accounts for this investment and recorded at cost. No impairment has been recorded for the three and nine months ended June 30, 2023.

 

Other assets consist of the following:

 SCHEDULE OF OTHER ASSETS

		June 30, 2023				September 30, 2022
Rental deposits		$	251,739			$	204,388
Investment in Masterpiece VR			1,000,000				1,000,000
Other deposits			64,626				24,467
Demonstration equipment supplied to resellers			330,038				170,890
Other assets total		$	1,646,403			$	1,399,745

 

NOTE 13 – RELATED PARTY TRANSACTIONS

 

On August 31, 2019, the Company entered into an Asset Purchase Agreement for the sale of Griffin Filters, LLC to Ducon Technologies, Inc., which Aron Govil, the Company’s Founder and former CFO, for total consideration of $550,000. On July 31, 2022, the Company negotiated a payment agreement surrounding the sale of Griffin Filters, LLC and other liabilities due to Cemtrex, Inc. totaling $761,585. This agreement is in the form of a secured promissory note earning interest at a rate of 5% per annum and matures on July 31, 2024.

 

As of June 30, 2023, and September 30, 2022, there was $3,372 and $19,133 payable due to Ducon Technologies, Pvt Ltd., respectively.

 

Receivables of $708,512 that represented the amount due from Ducon to Cemtrex Technologies Pvt. Ltd. the Company’s subsidiary based in India were written off to bad debt in fiscal year 2022.

 

On February 26, 2021, the Company entered into a Settlement Agreement and Release with Aron Govil regarding transactions Cemtrex’s Board of Directors determined were incorrectly handled and accounted for. Mr. Govil executed a secured promissory note (the “Note”) in the amount of $1,533,280. The Note matured and was due in full on February 26, 2023, and bore interest at 9% per annum and was secured by all of Mr. Govil’s assets. On April 27, 2023, the Company and Mr. Govil signed an amendment to the note, extending the maturity date one year to February 28, 2024. Mr. Govil also signed an affidavit confessing judgment in the event of a default on the Note. While the Company believes the note to be fully collectible, in accordance with ASC 450-30, Gain Contingencies, the Company determined the gain was not to be recognized until the note is paid. Accordingly, the note and associated gain is not presented on the Company’s Condensed Consolidated Balance Sheets and Condensed Consolidated Statements of Operations.

 

On November 22, 2022, the Company entered into two Asset Purchase Agreements and one Simple Agreement for Future Equity (“SAFE”) with the Company’s CEO, Saagar Govil, to secure the sale of the subsidiaries Cemtrex Advanced Technologies, Inc, and Cemtrex XR, Inc., which include the brands SmartDesk, Cemtrex XR, Virtual Driver Interactive, Bravo Strong, and good tech (formerly Cemtrex Labs), to Mr. Govil (see NOTE 1).

 

As of June 30, 2023, there was $578,388 in trade receivables due from these companies. Of these receivables $131,922 are related to costs paid by Cemtrex related to payroll during the transition of employees to the new company and some subscription services that are set up on auto pay with a credit card. The remaining $446,466 is related to services provided by Cemtrex Technologies Pvt. Ltd. in the normal course of business.

 

As of June 30, 2023, there were royalties receivable from the sale of Cemtrex, XR, Inc. of $691,611.

 

NOTE 14 – LEASES

 

The Company is party to contracts where we lease property from others under contracts classified as operating leases. The Company primarily leases office and operating facilities, vehicles, and office equipment. The weighted average remaining term of our operating leases was approximately 3 years at June 30, 2023, and 3 years at June 30, 2022. Lease liabilities were $2,213,341 with $716,896 classified as short-term at June 30, 2023, and $2,576,963 with $754,495, classified as short-term at September 30, 2022. The weighted average discount rate used to measure lease liabilities was approximately 5.64% at June 30, 2023, and 5.66% at June 30, 2022. The Company used the rate implicit in the lease, where known, or its incremental borrowing rate as the rate used to discount the future lease payments.

 

21

 

 

The Company also made the accounting policy decision not to recognize lease assets and liabilities for leases with a term of 12 months or less.

 

The Company’s corporate segment leases approximately 100 square feet of office space in Brooklyn, NY on a month-to-month lease at a rent of $600 per month.

 

A reconciliation of undiscounted cash flows to operating lease liabilities recognized in the condensed consolidated balance sheet at June 30, 2023, is set forth below:

 SCHEDULE OF RECONCILIATION OF UNDISCOUNTED CASH FLOWS TO OPERATING LEASE LIABILITIES

Years ending September 30,		Operating Leases
2023			211,721
2024			786,889
2025			764,530
2026			684,449
2027 & Thereafter			289,528
Undiscounted lease payments			2,737,117
Amount representing interest			(523,776	)
Discounted lease payments		$	2,213,341

 

Lease costs for the three and nine months ended June 30, 2023, and 2022 are set forth below.:

 SCHEDULE OF LEASE COSTS

		2023				2022				2023				2022
		For the three months ended								For the nine months ended
		June 30,								June 30,
		2023				2022				2023				2022
Operating lease costs			193,843				223,595				678,489				592,958
Total lease cost		$	193,843			$	223,595			$	678,489			$	592,958

 

NOTE 15 – LINES OF CREDIT AND LONG-TERM LIABILITIES

 

On January 12, 2023, the Company entered into a standstill agreement with Streeterville Capital, LLC. The lender has agreed to refrain and forbear temporarily from making redemptions under the notes for a period ending on April 12, 2023. In addition, the company has agreed to an increase of the outstanding balance of the note issued on September 30, 2021, for the original amount of $5,755,000 by $148,000, and the outstanding balance of the note issued on February 22, 2022, for the original amount of $9,205,000 by $303,422. The aggregate amount of $451,422 has been recorded as interest expense on the Company’s Consolidated Condensed Statement of Operations and Condensed Consolidated Statements of Cash Flow.

 

On February 15, 2023, the Company and Fulton Bank agreed to an amendment to the Master Agreement Regarding Financial Covenants and Financial Deliverables dated September 22, 2020.

 

On March 3, 2023, the Company and NIL Funding agreed at an amendment to the term loan agreement dated September 18, 2018. This agreement amends the maturity date to December 31, 2024, and amends the interest rate to 11.5%. Additionally, the Company paid $10,000 in fees and made an additional principal payment of $100,000 on March 29, 2023, and is required to make another additional principal payment of $100,000 on or before March 29, 2024. The Company has accounted for this amendment as a debt modification.

 

On May 3, 2023, the Company and Streeterville Capital, LLC. agreed to an amendment to the note issued on September 30, 2021, for the original amount of $5,755,000. The agreement extends the maturity date to June 30, 2024, in exchange for a fee of 5% of the outstanding balance or approximately $252,912 added to the outstanding balance of the note. The Company has accounted for this amendment as a debt modification.

 

On April 3, 2023, The Company and SeKureID Solutions Corp., entered into a software license agreement, where the company obtained the right to use source code for its security products in exchange for $1,125,000 payable in (15) fifteen equal monthly installments of $75,000. The current balance of $900,000 is presented on the Condensed Consolidated Balance Sheets as of June 30, 2023, under Short-term liabilities, net of unamortized original issue discounts.

 

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The following table outlines the Company’s lines of credit and secured liabilities.

 SCHEDULE OF LINES OF CREDIT AND LIABILITIES

									June 30,				September 30,
		Interest Rate			Maturity				2023				2022
Fulton Bank line of credit $3,500,000 - The terms of this line of credit are subject to the bank’s review annually on February 1.		Secured Overnight Financing Rate (“SOFR”) plus 2.37% (7.46% as of June 30, 2023 and 5.35% as of September 30, 2022)				N/A			$	-			$	-
Fulton Bank loan $5,250,000 for the purchase of AIS $5,000,000 of the proceeds went to the direct purchase of AIS.		SOFR plus 2.37%(7.46% as of June 30, 2023 and 5.35% as of September 30, 2022)				12-15-2022				-				247,284
Fulton Bank loan $400,000 fund equipment for AIS.		SOFR plus 2.37% (7.46% as of June 30, 2023 and 5.35% as of September 30, 2022)				05-01-2023				-				63,280
Fulton Bank - $360,000 fund equipment for AIS. The Company was in compliance with loan covenants as of June 30, 2023. This loan is secured by certain assets of the Company.		SOFR plus 2.37% (7.46% as of June 30, 2023 and 5.35% as of September 30, 2022).				01-31-2025				128,086				183,839
Fulton Bank mortgage $2,476,000. The Company was in compliance with loan covenants as of June 30, 2023. This loan is secured by the underlying asset		SOFR plus 2.62% (7.71% as of June 30, 2023 and 5.6% as of September 30, 2022).				01-28-2040				2,195,515				2,245,664
Note payable - $439,774. For the purchase of VDI. Payable in two installments on October 26, 2021, and October 26, 2022.		5	%			10-26-2022				-				219,370
Note payable - $5,755,000 - Less original issue discount $750,000 and legal fees $5,000, net cash received $5,000,000 Unamortized original issue discount balance of $0 and $250,000, as of June 30, 2023 and September 30, 2022 respectively.		8	%			06-30-2024				4,899,908				4,943,929
Note payable - $9,205,000. Less original issue discount $1,200,000 and legal fees $5,000,net cash received $8,000,000. 28,572 shares of common stock valued at $700,400 recognized as additional original issue discount. Unamortized original issue discount balance of $105,578 and $1,064,778 as of June 30, 2023 and September 30, 2022 respectivly.		8	%			08-23-2023				10,491,283				9,738,632
Term Loan Agreement with NIL Funding Corporation (“NIL”) - $5,600,000 The Company was in compliance with loan covenants as of June 30, 2023.		11.50	%			12-31-2024				2,179,743				2,804,743
Paycheck Protection Program loan - $121,400 - The issuing bank determined that this loan qualifies for loan forgiveness; however the Company is awaiting final approval from the Small Business Administration.		1	%			05-05-2025				101,246				121,400
Software License Agreement - $1,125,000, for the purchase of software source code for use in our Security segment products		N/A				06-03-2024				900,000				-
Total lines of credit and secured liabilities									$	20,895,781			$	20,568,141
Less: Current maturities										(17,185,167	)			(16,894,743	)
Less: Unamortized original issue discount										(105,578	)			(1,305,778	)
Lines of credit and secured liabilities, Long Term									$	3,605,036			$	2,367,620

 

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NOTE 16 – STOCKHOLDERS’ EQUITY

 

Preferred Stock

 

The Company is authorized to issue 10,000,000 shares of Preferred Stock, $0.001 par value. As of June 30, 2023, and September 30, 2022, there were 2,343,016 and 2,129,122 shares issued and 2,278,916 and 2,065,022 shares outstanding, respectively.

 

Series 1 Preferred Stock

 

During the nine months ended June 30, 2023, 213,894 shares of Series 1 Preferred Stock were issued to pay dividends to holders of Series 1 Preferred Stock.

 

As of June 30, 2023, and September 30, 2022, there were 2,293,016 and 2,079,122 shares of Series 1 Preferred Stock issued and 2,228,916 and 2,015,022 shares of Series 1 Preferred Stock outstanding, respectively.

 

Series C Preferred Stock

 

As of June 30, 2023, and September 30, 2022, there were 50,000 shares of Series C Preferred Stock issued and outstanding.

 

Common Stock

 

The Company is authorized to issue 50,000,000 shares of common stock, $0.001 par value. As of June 30, 2023, there were 957,760 shares issued and outstanding and at September 30, 2022, there were 754,711 shares issued and outstanding.

 

On January 25, 2023, the Company completed a 35:1 reverse stock split on its common stock. All share and per share data have been retroactively adjusted for this reverse split. On February 2, 2023, 19,314 shares were issued for rounding shares of the reverse stock split.

 

During the nine months ended June 30, 2023,161,718 shares of the Company’s common stock have been issued to satisfy $487,716 of notes payable, $662,284 in accrued interest, and $276,151 of excess value of shares issued recorded as interest expense.

 

During the nine months ended June 30, 2023, 22,017 shares of the Company’s common stock have been issued in exchange for services valued at $141,872.

 

NOTE 17 – SHARE-BASED COMPENSATION

 

For the nine months ended June 30, 2023, and 2022, the Company recognized $93,313 and $111,402 of share-based compensation expense on its outstanding options, respectively. As of June 30, 2023, $76,831 of unrecognized share-based compensation expense is expected to be recognized over a period of two years. Future compensation amounts will be adjusted for any change in estimated forfeitures.

 

During the nine months ended June 30, 2023, options to purchase 2,931 shares of the Company’s common stock at an exercise price of $13.65 per share and options to purchase 2,858 shares of the Company’s common stock at an exercise price of $40.95 per share were cancelled.

 

NOTE 18 – COMMITMENTS AND CONTINGENCIES

  

The Company’s Industrial Services segment owns approximately 25,000 square feet of warehouse space in Manchester, PA and approximately 43,000 square feet of office and warehouse space in York, PA. The Industrial Services segment also leases approximately 15,500 square feet of warehouse space in Emigsville, PA from a third party in a three-year lease at a monthly rent of $4,555 expiring on August 31, 2025.

 

24

 

 

The Company’s Security segment leases (i) approximately 6,700 square feet of office and warehouse space in Pune, India from a third party in an five year lease at a monthly rent of $6,453 (INR456,972) expiring on February 28, 2024, (ii) approximately 30,000 square feet of office and warehouse space in Hauppauge, New York from a third party in a seven-year lease at a monthly rent of $28,719 expiring on March 31, 2027, (iii) approximately 9,400 square feet of office and warehouse space in Hampshire, England in a fifteen-year lease with at a monthly rent of $7,329 (£5,771) which expires on March 24, 2031 and contains provisions to terminate in 2026, and (iv) approximately 280 square feet of office space in Clovis, CA on a month-to-month lease at a monthly rent of $1,504.

 

NOTE 19 – SUBSEQUENT EVENTS

 

Heisey Mechanical Acquisition

 

On July 1, 2023, the Company completed the acquisition of a service contractor and steel fabricator that specializes in industrial and water treatment markets, Heisey Mechanical, Ltd. (“Heisey”) based in Columbia, Pennsylvania to expand the Company’s Industrial Services segment.

 

The total consideration given by Cemtrex to the shareholder of Heisey for full control, was approximately $2,400,000 with $2,160,000 in cash, $240,000 in a seller’s note. Cemtrex funded the transaction with a $2,160,000 term loan from Fulton Bank. Approximately $25,000 in acquisition costs will be capitalized. The real estate the business occupies is expected to be purchased later for $1,500,000.

 

Notice of Delisting

 

On July 25, 2023, the Company received a Notice of Staff Determination from the Listing Qualifications Department of Nasdaq notifying the Company that its Series 1 Preferred Stock had not gained compliance and would be suspended from trading at the opening of business on August 3, 2023. The Company has requested a hearing regarding the delisting that has been scheduled for September 15, 2023, which will stay the suspension and filing of Form 25-NSE with the Securities and Exchange Commission.

 

Equity shares issued

 

On July 31, 2023, the Company issued an aggregate of 32,488 shares of common stock to settle $200,000 of notes payable and accrued interest, and $25,792 of excess value of shares issued recorded as interest expense. 

 

On July 6, 2023, the Company issued an aggregate of 1,686 shares of common stock in exchange for services valued at $7,500. 

 

On August 4, 2023, the Company issued an aggregate of 6,400 shares of common stock in exchange for services valued at $45,625.

 

 

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

Except for historical information contained in this report, the matters discussed are forward-looking statements that involve risks and uncertainties. When used in this report, words such as “anticipates”, “believes”, “could”, “estimates”, “expects”, “may”, “plans”, “potential” and “intends” and similar expressions, as they relate to the Company or its management, identify forward-looking statements. Our operations involve risks and uncertainties, many of which are outside our control, and any one of which, or a combination of which, could materially affect our results of operations and whether the forward-looking statements ultimately prove to be correct. We have based these forward-looking statements largely on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives, and financial needs. Such forward-looking statements are based on the beliefs of the Company’s management, as well as assumptions made by and information currently available to the Company’s management. Among the factors that could cause actual results to differ materially are the following: the effect of business and economic conditions; the impact of competitive products and their pricing; unexpected manufacturing or supplier problems; the Company’s ability to maintain sufficient credit arrangements; changes in governmental standards by which our environmental control products are evaluated and the risk factors reported from time to time in the Company’s SEC reports, including its recent report on Form 10-K. The Company undertakes no obligation to update forward-looking statements as a result of future events or developments.

 

General Overview

 

Cemtrex was incorporated in 1998 in the state of Delaware and has evolved through strategic acquisitions and internal growth into a leading multi-industry company. Unless the context requires otherwise, all references to “we”, “our”, “us”, “Company”, “registrant”, “Cemtrex” or “management” refer to Cemtrex, Inc. and its subsidiaries.

 

During the first quarter of fiscal year 2023, the Company reorganized its reporting segments to be in line with its current structure, consisting of (i) Security, (ii) Industrial Services, and (iii) Cemtrex Corporate.

 

Security

 

Cemtrex’s Security segment operates under the brand of its majority owned subsidiary, Vicon Industries, Inc. (“Vicon”), which provides end-to-end security solutions to meet the toughest corporate, industrial and governmental security challenges. Vicon’s products include browser-based video monitoring systems and analytics-based recognition systems, cameras, servers, and access control systems for every aspect of security and surveillance in industrial and commercial facilities, federal prisons, hospitals, universities, schools, and federal and state government offices. Vicon provides innovative, mission critical security and video surveillance solutions utilizing Artificial Intelligence (AI) based data algorithms.

 

Industrial Services

 

Cemtrex’s Industrial Services segment operates under the brand, Advanced Industrial Services (“AIS”), which offers single-source expertise and services for rigging, millwrighting, in plant maintenance, equipment erection, relocation, and disassembly to diversified customers. AIS installs high precision equipment in a wide variety of industrial markets like automotive, printing & graphics, industrial automation, packaging, and chemicals, among others. AIS is a leading provider of reliability-driven maintenance and contracting solutions for machinery, packaging, printing, chemical, and other manufacturing markets. The focus is on customers seeking to achieve greater asset utilization and reliability to cut costs and increase production from existing assets, including small projects, sustaining capital, turnarounds, maintenance, specialty welding services, and high-quality scaffolding.

 

Cemtrex Corporate

 

Cemtrex’s Corporate segment is the holding company of our other two segments.

 

 

Significant Accounting Policies and Estimates

 

Our discussion and analysis of our financial condition and results of operations are based upon the accompanying unaudited condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). The preparation of financial statements in conformity with U.S. GAAP requires management to make judgments, estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses, and the related disclosures at the date of the financial statements and during the reporting period. Although these estimates are based on our knowledge of current events, our actual amounts and results could differ from those estimates. The estimates made are based on historical factors, current circumstances, and the experience and judgment of our management, who continually evaluate the judgments, estimates and assumptions and may employ outside experts to assist in the evaluations.

 

Certain of our accounting policies are deemed “significant”, as they are both most important to the financial statement presentation and require management’s most difficult, subjective or complex judgments as a result of the need to make estimates about the effect of matters that are inherently uncertain. For a discussion of our significant accounting policies, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended September 30, 2022.

 

Results of Operations – For the three months ending June 30, 2023, and 2022

 

Total revenue for the three months ended June 30, 2023, and 2022 was $14,730,140 and $12,108,904, respectively, an increase of $2,621,236, or 22%. Loss from continuing operations for the three months ended June 30, 2023, was $1,185,400 compared to income of $106,599 for the three months ended June 30, 2022, a decrease of $1,291,999, or 1,212%. Total revenue for the quarter increased, as compared to total revenue in the same period last year, due to increased demand for the Company’s products and services. Income from continuing operations became a loss due to other income related to realized and unrealized gain on marketable securities during the same period in the prior year.

 

Revenues

 

Our Security segment revenues for the three months ended June 30, 2023, increased by $2,374,366 or 36% to $9,015,279 from $6,640,913 for the three months ended June 30, 2022. This increase is due to an increased demand for the Security segment’s products and services.

 

Our Industrial Services segment revenues for the three months ended June 30, 2023, increased by $246,870 or 5%, to $5,714,861 from $5,467,991 for the three months ended June 30, 2022. This increase is mainly due to increased demand for the segment’s products and services.

 

Gross Profit

 

Gross Profit for the three months ended June 30, 2023, was $6,480,643 or 44% of revenues as compared to gross profit of $5,040,107 or 42% of revenues for the three months ended June 30, 2022.

 

Gross profit in our Security segment was $4,404,836 or 49% of the segment’s revenues for the three months ended June 30, 2023, as compared to gross profit of $3,383,241 or 51% of the segment’s revenues for the period ended June 30, 2022. Gross profit as a percentage of revenues decreased in the three months ended June 30, 2023, compared to the three months ended June 30, 2022, due to negotiated terms on some sales.

 

Gross profit in our Industrial Services segment was $2,075,807 or 36% of the segment’s revenues for the three months ended June 30, 2023, as compared to gross profit of $1,656,866 or 30% of the segment’s revenues for the period ended June 30, 2022. Gross profit as a percentage of revenues increased in the three months ended June 30, 2023, compared to the three months ended June 30, 2022, was primarily due to lower subcontractor costs.

 

General and Administrative Expenses

 

General and administrative expenses for the three months ended June 30, 2023, decreased $4,569 or less than 1% to $5,376,960 from $5,381,529 for the three months ended June 30, 2022. General and administrative expenses as a percentage of revenues were 37% and 44% of revenues for the three-month periods ended June 30, 2023, and 2022, respectively. The decrease in general and administrative expenses is mainly related to decreased general and administrative expenses and professional fees expenses offset by increased personnel and insurance expenses.

 

 

Research and Development Expenses

 

Research and Development expenses for the three months ended June 30, 2023, were $1,049,909 compared to $1,189,875 for the three months ended June 30, 2022, a decrease of $139,966 or 12%. Research and Development expenses are primarily related to the Security Segment’s development of next generation solutions associated with security and surveillance systems software.

 

Other Income/Expense

 

Other expense for the three months ended June 30, 2023, was $1,219,533, as compared to other income of $1,389,955 for the three months ended June 30, 2022. Other expense for the three months ended June 30, 2023, was mainly driven by interest on the Company’s debt. Other income for the three months ended June 30, 2022, included one-time realized and unrealized gain on marketable securities of $2,075,125.

 

Provision for Income Taxes

 

During the three months ended June 30, 2023, the Company had income tax expense of $19,641 and a benefit of $247,941 for the three months ended June 30, 2022. The provision for income tax is based upon the projected income tax from the Company’s various U.S. and international subsidiaries that are subject to their respective income tax jurisdictions and the Company’s projected ability to utilize net loss carryforwards.

 

Income/(loss) from Discontinued Operations

 

For the three months ended June 30, 2023, the Company had income on discontinued operations of $13,281. This income is mainly related to the recognition of the royalties due from CXR, Inc. Losses on discontinued operations for the three months ended June 30, 2022, were $838,301 attributable to the operations of the Cemtrex brands discussed in Note 3.

 

Results of Operations – For the nine months ending June 30, 2023, and 2022

 

Total revenue for the nine months ended June 30, 2023, and 2022 was $42,773,779 and $33,268,316, respectively, an increase of $9,505,463, or 29%. Loss from continuing operations for the nine months ended June 30, 2023, was $4,835,914 compared to $7,781,049 for the nine months ended June 30, 2022, a decrease on the loss of $2,945,135, or 38%. Total revenue for the period increased, as compared to total revenue in the same period last year, due to increased demand for the Company’s products and services. Loss from continuing operations decreased due to increased revenues and improved gross profit margins as compared to the same period in the prior year.

 

Revenues

 

Our Security segment revenues for the nine months ended June 30, 2023, increased by $8,193,476 or 46% to $25,933,921 from $17,740,445 for the nine months ended June 30, 2022. This increase is due to an increased demand for the Security segment’s products and services.

 

Our Industrial Services segment revenues for the nine months ended June 30, 2023, increased by $1,311,987 or 8%, to $16,839,858 from $15,527,871 for the nine months ended June 30, 2022. This increase is mainly due to increased demand for the segment’s products and services.

 

Gross Profit

 

Gross Profit for the nine months ended June 30, 2023, was $18,859,530 or 44% of revenues as compared to gross profit of $12,032,138 or 36% of revenues for the nine months ended June 30, 2022.

 

Gross profit in our Security segment was $12,928,607 or 50% of the segment’s revenues for the nine months ended June 30, 2023, as compared to gross profit of $7,479,069 or 42% of the segment’s revenues for the nine-month period ended June 30, 2022. Gross profit as a percentage of revenues increased in the nine months ended June 30, 2023, compared to the nine months ended June 30, 2022, due to price increases implemented throughout the segment in January 2023 in response to rising costs of our goods and a reduction in transportation costs in 2023, compared to the same period in 2022.

 

 

Gross profit in our Industrial Services segment was $5,930,923 or 35% of the segment’s revenues for the nine months ended June 30, 2023, as compared to gross profit of $4,553,069 or 29% of the segment’s revenues for the period ended June 30, 2022. Gross profit as a percentage of revenues increased in the nine months ended June 30, 2023, compared to the nine months ended June 30, 2022, was primarily due to lower subcontractor costs.

 

General and Administrative Expenses

 

General and administrative expenses for the nine months ended June 30, 2023, increased $361,229 or 2% to $16,456,602 from $16,095,373 for the nine months ended June 30, 2022. General and administrative expenses as a percentage of revenues were 38% and 48% of revenues for the nine-month periods ended June 30, 2023, and 2022, respectively. The increase in general and administrative expenses is mainly related to increased employee costs and insurance expenses.

 

Research and Development Expenses

 

Research and Development expenses for the nine months ended June 30, 2023, were $3,895,717 compared to $3,660,883 for the nine months ended June 30, 2022, an increase of $234,834 or 6%. Research and Development expenses are primarily related to the Security Segment’s development of next generation solutions associated with security and surveillance systems software.

 

Other Expense

 

Other expense for the nine months ended June 30, 2023, was $3,323,484, as compared to an expense of $304,872 for the nine months ended June 30, 2022. Other expense for the nine months ended June 30, 2023, was mainly driven by interest on the Company’s debt, offset by a one-time income related to employee retention credits of $416,502. Other expense for the nine months ended June 30, 2022, included the gain on the forgiveness of our PPP loans of $971,500 and the realized and unrealized gain on marketable securities of $2,235,738.

 

Provision for Income Taxes

 

During the nine months ended June 30, 2023, and 2022, the Company had income tax expense of $19,641 and a benefit of $247,941 on income taxes. The provision for income tax is based upon the projected income tax from the Company’s various U.S. and international subsidiaries that are subject to their respective income tax jurisdictions and the Company’s projected ability to utilize net loss carryforwards.

 

Loss from Discontinued Operations

 

The Company had losses on discontinued operations of $3,212,108. The losses are comprised of the $2,455,341 loss on the sale of Cemtrex Advanced Technologies, and Cemtrex XR, Inc. The net loss of $879,727 attributable to the operations of the Cemtrex brands, the recognition of discounted royalties of $33,875, and the net gain on the recovery of cash from Vicon Industries Ltd. of $89,085. Losses on discontinued operations for the nine months ended June 30, 2022, were $2,282,399 attributable to the operations of the Cemtrex brands discussed in Note 3.

 

Effects of Inflation

 

The Company’s business and operations have been affected by inflation during the periods for which financial information is presented. In response, the Company has instituted price increases and initiated cost-saving measures to mitigate the effects of inflation on operations.

 

Liquidity and Capital Resources

 

Working capital deficit was $967,489 at June 30, 2023, compared to working capital of $6,252,972 at September 30, 2022. This includes cash and equivalents and restricted cash of $6,434,112 at June 30, 2023, and $11,473,676 at September 30, 2022. The decrease in working capital was primarily due to the Company’s sale of assets and liabilities of discontinued operations and an increase in accounts payable, accrued expenses, and deferred revenue during the nine months ended June 30, 2023.

 

 

Cash used by operating activities for continuing operations for the six months ended June 30, 2023, and 2022 was $5,394,048 and $10,669,927, respectively. Cash provided by operating activities for discontinued operations for the nine months ended June 30, 2023, was $2,474,863, compared to providing cash of $41,562 for the nine months ended June 30, 2022.

 

Trade receivables increased by $2,108,539 or 39% to $7,507,755 at June 30, 2023, from $5,399,216 at September 30, 2022. The increase in trade receivables is attributable to increased sales in the Security segment.

 

Cash used by investment activities for continuing operations for the nine months ended June 30, 2023, was $735,265 compared to providing cash of $792,195 for the nine months ended June 30, 2022. Cash used by investing activities for discontinued operations for the nine months ended June 30, 2022, was $39,388. Investing activities for the nine months ended June 30, 2023, were driven by the Company’s purchase of property and equipment.

 

Cash used by financing activities for the nine months ended June 30, 2023, was $1,280,991 compared to providing cash of $5,902,298 for the nine months ended June 30, 2022. Financing activities were primarily driven by payments on the Company’s debt. Financing activities for the nine months ended June 30, 2022, were primarily driven by proceeds from the note payable issued in February of 2022.

 

While our working capital deficit and current debt indicate a substantial doubt regarding the Company’s ability to continue as a going concern, the Company has historically, from time to time, satisfied and may continue to satisfy certain short-term liabilities through the issuance of common stock, thus reducing our cash requirement to meet our operating needs. Additionally, the Company has recently sold unprofitable brands, reducing the cash required to maintain those brands, reevaluated our pricing model on our Vicon brand to improve margins on those products, and has effected a reverse stock split on our common stock to remain trading on the Nasdaq Capital Markets, and improved our ability to potentially raise capital through equity offerings that we may use to satisfy debt. In the event additional capital is raised through equity offerings and/or debt is satisfied with equity, it may have a dilutive effect on our existing stockholders. While the Company believes these plans are sufficient to meet the capital demands of our current operations for at least the next twelve months, there is no guarantee that we will succeed. Overall, there is no guarantee that cash flow from our existing or future operations and any external capital that we may be able to raise will be sufficient to meet our working capital needs. We currently do not have adequate cash to meet our short or long-term needs. The consolidated financial statements do not include any adjustments relating to this uncertainty.

 

 

Item 4. Controls and Procedures

 

Evaluation of Disclosure Controls and Procedures

 

Disclosure controls and procedures reporting as promulgated under the Exchange Act is defined as controls and procedures that are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act are recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms. Disclosure controls and procedures include without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

 

Our CEO and our CFO have evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of June 30, 2023. Based on their evaluation, our management has concluded that as of June 30, 2023, our disclosure controls and procedures were not effective and there is a material weakness in our internal control over financial reporting. The material weakness relates to the Company lacking sufficient accounting personnel. The shortage of accounting personnel resulted in the Company lacking entity level controls around the review of period-end reporting processes, accounting policies and public disclosures. Additionally, the Company’s current processes and systems do not provide for necessary timely reconciliation of certain accounts and sufficient consideration regarding recoverability of certain assets. This deficiency is common in small companies, similar to ours, with limited personnel.

 

Notwithstanding the conclusion by our Chief Executive Officer and Chief Financial Officer that our disclosure controls and procedures as of June 30, 2023, were not effective, and notwithstanding the material weakness in our internal control over financial reporting described below, management believes that the unaudited condensed financial statements and related financial information included in this Quarterly Report fairly present in all material respects our financial condition, results of operations and cash flows as of the dates presented, and for the periods ended on such dates, in conformity with GAAP.

 

In order to mitigate the material weaknesses, the Company has implemented measures that it believes have mitigated these weaknesses but has not had sufficient time to fully evaluate these measures. These measures include; (i) updating our accounting software to ensure tighter control over entries and providing improved data for timely reconciliation of certain accounts, and (ii) engaged a third-party consulting firm to provide review of period-end reporting processes, accounting policies and public disclosures.  The Company believes that given more time these new measures will be sufficient in remediating the material weakness in internal controls.

 

Changes in Internal Control Over Financial Reporting

 

While there was no change in the Company’s internal control over financial reporting during the Company’s last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting, the Company is continuing to improve its internal controls through the actions mentioned above.

 

Limitations on the Effectiveness of Controls

 

Our management, including our CEO and CFO, does not expect that our disclosure controls and procedures or our internal controls will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our company have been detected.

 

 

Part II Other Information

 

Item 1. Legal Proceedings.

 

None.

 

Item 1A. Risk Factors

 

See Risk Factors included in our Annual Report on Form 10-K filed with the SEC on December 28, 2022.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

 

During the nine months ended June 30, 2023,161,718 shares of the Company’s common stock have been issued to satisfy $487,716 of notes payable, $662,284 in accrued interest, and $276,151 of excess value of shares issued recorded as interest expense.

 

During the nine months ended June 30, 2023, 22,017 shares of the Company’s common stock have been issued in exchange for services valued at $141,872.

 

Subsequent to the reporting period, the Company issued an aggregate of 32,488 shares of common stock to settle $200,000 of notes payable and accrued interest, and $25,792 of excess value of shares issued recorded as interest expense.

 

Subsequent to the reporting period, the Company issued an aggregate of 8,086 shares of common stock in exchange for services valued at $53,125.

 

Such shares were issued pursuant to the exemption contained under Section 4(a)(2) of the Securities Act of 1933, as amended.

 

Item 3. Defaults Upon Senior Securities

 

None.

 

Item 4. Mine Safety Disclosures

 

N/A

 

Item 5. Other Information

 

None.

 

 

Item 6. Exhibits

 

Exhibit No.		Description
2.2		Stock Purchase Agreement regarding the stock of Advanced Industrial Services, Inc., AIS Leasing Company, AIS Graphic Services, Inc., and AIS Energy Services, LLC, Dated December 15, 2015. (8)
3.1		Certificate of Incorporation of the Company.(1)
3.2		By Laws of the Company.(1)
3.3		Certificate of Amendment of Certificate of Incorporation, dated September 29, 2006.(1)
3.4		Certificate of Amendment of Certificate of Incorporation, dated March 30, 2007.(1)
3.5		Certificate of Amendment of Certificate of Incorporation, dated May 16, 2007.(1)
3.6		Certificate of Amendment of Certificate of Incorporation, dated August 21, 2007.(1)
3.7		Certificate of Amendment of Certificate of Incorporation, dated April 3, 2015.(3)
3.8		Certificate of Designation of the Series A Preferred Shares, dated September 8, 2009.(2)
3.9		Certificate of Designation of the Series 1 Preferred Stock.(11)
3.10		Certificate of Amendment of Certificate of Incorporation, dated September 7, 2017 (12)
3.11		Certificate of Correction to the Certificate of Amendment to the Amended and Restated Certificate of Incorporation, as amended, of Cemtrex, Inc (6)
3.12		Amended Certificate of Designation of the Series 1 Preferred Shares, dated March 30, 2020.(16)
3.13		Certificate of Amendment of Certificate of Incorporation, dated July 29, 2020 (20)
3.14		Certificate of Correction of Certificate of Incorporation, dated July 29, 2021, filed October 7, 2020 (9)
		Certificate of Amendment of Certificate of Incorporation, dated January 12, 2023 (7)
4.1		Form of Subscription Rights Certificate. (10)
4.2		Form of Series 1 Preferred Stock Certificate. (10)
4.3		Form of Series 1 Warrant. (10)
4.4		Form of Common Stock Purchase Warrant, dated March 22, 2019. (14)
10.1		Amendment of the Term Loan Agreement between Vicon and NIL Funding, dated March 3, 2023. (5)
10.2		Amendment to Loan Documents Between Advanced Industrial Services, Inc. and Fulton Bank, N.A. dated February 24, 2023 (5)
10.3		Amendment to Promissory Note Between Cemtrex, Inc. and Streeterville Capital, LLC dated May 3, 2023 (5)
10.4		Securities Purchase Agreement dated June 1, 2020 (18)
10.5		Securities Purchase Agreement dated June 9, 2020 (19)
10.6		Settlement Agreement and Release between Cemtrex, Inc. and Aron Govil dated February 26, 2021 (13)
10.7		Securities Purchase Agreement dated February 22, 2022 (15)
10.8		Amendment of the Term Loan Agreement between Vicon and NIL Funding, dated March 30, 2022. (15)
10.9		Asset Purchase agreement between Cemtrex, Inc. and Saagar Govil, dated November 22, 2022 (22)
10.10		Asset Purchase agreement between Cemtrex, Inc. and Saagar Govil, dated November 22, 2022 (22)
10.11		Simple Agreement for Future Equity (SAFE) between Cemtrex, Inc. and Saagar Govil, dated November 18, 2022 (22)
14.1		Corporate Code of Business Ethics.(4)
21.1*		Subsidiaries of the Registrant
31.1*		Certification of Chief Executive Officer as required by Rule 13a-14 or 15d-14 of the Exchange Act, as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*		Certification of Interim Chief Financial Officer and Principal Financial Officer as required by Rule 13a-14 or 15d-14 of the Exchange Act, as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*		Certification of Chief Executive Officer Pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act 0f of 2002.
32.2*		Certification of Interim Chief Financial Officer and Principal Financial Officer Pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act 0f of 2002.
99.1		Order pursuant to Section 8A of the Securities Act – dated September 30, 2022. (21)
101.INS*		Inline XBRL Instance Document
101.SCH*		Inline XBRL Taxonomy Extension Schema
101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase
101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase
101.LAB*		Inline XBRL Taxonomy Extension Label Linkbase
101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

*	Filed herewith
1	Incorporated by reference from Form 10-12G filed on May 22, 2008.
2	Incorporated by reference from Form 8-K filed on September 10, 2009.
3	Incorporated by reference from Form 8-K filed on August 22, 2016.
4	Incorporated by reference from Form 8-K filed on July 1, 2016.
5	Incorporated by reference from Form 10-Q filed on May 11, 2023.
6	Incorporated by reference from Form 8-K filed on June 12, 2019.
7	Incorporated by reference from Form 8-K filed on January 20, 2023.
8	Incorporated by reference from Form 8-K/A filed on September 26, 2016.
9	Incorporated by reference from Form 10-Q filed on May 28, 2021.
10	Incorporated by reference from Form S-1 filed on August 29, 2016, and as amended on November 4, 2016, November 23, 2016, and December 7, 2016.
11	Incorporated by reference from Form 8-K filed on January 24, 2017.
12	Incorporated by reference from Form 8-K filed on September 8, 2017.
13	Incorporated by reference from Form 8-K filed on February 26, 2021.
14	Incorporated by reference from Form 8-K filed on March 22, 2019.
15	Incorporated by reference from Form 10-Q filed on May 16, 2022.
16	Incorporated by reference from Form 8-K filed on April 1, 2020.
17	Incorporated by reference from Form 8-K filed on March 9, 2020.
18	Incorporated by reference from Form 8-K filed on June 4, 2020.
19	Incorporated by reference from Form 8-K filed on June 12, 2020.
20	Incorporated by reference from Form 10-K filed on January 5, 2021.
21	Incorporated by reference from Form 8-K filed on October 4, 2022.
22	Incorporated by reference from Form 8-K filed on November 29, 2022.

 

 

Signatures

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

	Cemtrex, Inc.
Dated: August 10, 2023	By:	/s/ Saagar Govil.
		Saagar Govil
		Chief Executive Officer
Dated: August 10, 2023		/s/ Paul J. Wyckoff.
		Paul J. Wyckoff
		Interim Chief Financial Officer
		and Principal Financial Officer

 

 

EXHIBIT 21.1

 

Name of consolidated		State or other jurisdiction of incorporation or		Date of incorporation or formation (date of acquisition, if		Attributable
subsidiary or entity		organization		applicable)		interest
Advanced Industrial Services, Inc.		Pennsylvania		July 20, 1984 (December 15, 2015)			100	%
Advanced Industrial Leasing, Inc.		Pennsylvania		July 20, 1984 (December 15, 2015)			100	%
Cemtrex Technologies Pvt Ltd.		India		December 21, 2017			100	%
Vicon Industries, Inc.		New York		March 23, 2018			93	%
Vicon Industries Limited		United Kingdom		March 23, 2018			93	%

 

 

 

EXHIBIT 31.1

 

CERTIFICATION PURSUANT TO RULE 13a/15d OF THE SECURITIES EXCHANGE ACT OF 1934, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Saagar Govil, certify that:

 

	1.	I have reviewed this report on Form 10-Q of Cemtrex, Inc. and subsidiaries (the “registrant);
	2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
	3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
	4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

	a.	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b.	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	c.	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	d.	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5.

The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s Board of Directors (or persons performing the equivalent functions):

 

	a.	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and
	b.	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

	/s/ Saagar Govil.
	Saagar Govil
	Chief Executive Officer
Dated: August 10, 2023

 

 

 

EXHIBIT 31.2

 

CERTIFICATION PURSUANT TO RULE 13a/15d OF THE SECURITIES EXCHANGE ACT OF 1934, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Paul J. Wyckoff, certify that:

 

	1.	I have reviewed this report on Form 10-Q of Cemtrex, Inc. and subsidiaries (the “registrant);
	2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
	3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
	4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

	a.	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b.	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	c.	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	d.	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5.

The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s Board of Directors (or persons performing the equivalent functions):

 

	a.	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and
	b.	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

	/s/ Paul J. Wyckoff.
	Paul J. Wyckoff
	Interim Chief Financial Officer
	and Principal Financial Officer
Dated: August 10, 2023

 

 

 

EXHIBIT 32.1

 

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the quarterly report of Cemtrex, Inc. (the “Company”) on Form 10-Q for the quarter ended June 30, 2023, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Saagar Govil, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge and belief:

 

	(1)	the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
	(2)	the information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

 

	/s/ Saagar Govil.
	Saagar Govil
	Chief Executive Officer
Dated: August 10, 2023

 

 

 

EXHIBIT 32.2

 

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the quarterly report of Cemtrex, Inc. (the “Company”) on Form 10-Q for the quarter ended June 30, 2023, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Paul J. Wyckoff, Interim Chief Financial Officer and Principal Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge and belief:

 

	(1)	the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
	(2)	the information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

 

	/s/ Paul J. Wyckoff.
	Paul J. Wyckoff
	Interim Chief Financial Officer
	and Principal Financial Officer
Dated: August 10, 2023

 

 

v3.23.2

Cover - shares	9 Months Ended
	Jun. 30, 2023	Aug. 08, 2023
Document Type	10-Q
Amendment Flag	false
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Jun. 30, 2023
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2023
Current Fiscal Year End Date	--09-30
Entity File Number	001-37464
Entity Registrant Name	CEMTREX, INC.
Entity Central Index Key	0001435064
Entity Tax Identification Number	30-0399914
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	135 Fell Ct
Entity Address, City or Town	Hauppauge
Entity Address, State or Province	NY
Entity Address, Postal Zip Code	11788
City Area Code	631
Local Phone Number	756-9116
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		998,334
Common Stock [Member]
Title of 12(b) Security	Common Stock
Trading Symbol	CETX
Security Exchange Name	NASDAQ
Series 1 Preferred Stock
Title of 12(b) Security	Series 1 Preferred Stock
Trading Symbol	CETXP
Security Exchange Name	NASDAQ

v3.23.2

Condensed Consolidated Balance Sheets - USD ($)	Jun. 30, 2023	Sep. 30, 2022
Current assets
Cash and equivalents	$ 5,628,839	$ 9,895,761
Restricted cash	805,273	1,577,915
Short-term investments	13,663	13,721
Inventory –net of allowance for inventory obsolescence	8,719,740	8,487,817
Prepaid expenses and other assets	3,089,416	2,421,644
Assets of discontinued operations		3,971,693
Total current assets	26,343,074	31,767,767
Property and equipment, net	6,180,771	5,280,442
Right-of-use assets	2,213,341	2,641,198
Goodwill	3,906,891	3,906,891
Other	1,646,403	1,399,745
Total Assets	41,743,676	45,757,628
Current liabilities
Short-term liabilities, net of unamortized original issue discounts	17,185,167	16,894,743
Lease liabilities - short-term	716,896	754,495
Deposits from customers	34,281	73,144
Accrued expenses	3,536,097	2,271,188
Deferred revenue	2,060,570	1,551,088
Accrued income taxes	49,075	94,848
Liabilities of discontinued operations		805,219
Total current liabilities	27,310,563	25,514,795
Long-term liabilities
Loans payable to bank	54,578	110,331
Long-term lease liabilities	1,496,445	1,822,468
Notes payable	1,379,743
Mortgage payable	2,110,020	2,160,169
Other long-term liabilities	528,952	807,898
Paycheck Protection Program Loans	60,695	97,120
Deferred Revenue - long-term	623,007	607,309
Total long-term liabilities	6,253,440	5,605,295
Total liabilities	33,564,003	31,120,090
Commitments and contingencies
Stockholders’ equity
Common stock, $0.001 par value, 50,000,000 shares authorized, 957,760 shares issued and outstanding at June 30, 2023 and 754,711 shares issued and outstanding at September 30, 2022	958	755
Additional paid-in capital	68,302,617	66,641,698
Accumulated deficit	(62,947,549)	(54,929,020)
Treasury stock, 64,100 shares of Series 1 Preferred Stock at June 30, 2023 and September 30, 2022	(148,291)	(148,291)
Accumulated other comprehensive income	2,306,346	2,377,525
Total Cemtrex stockholders’ equity	7,516,424	13,944,796
Non-controlling interest	663,249	692,742
Total liabilities and shareholders’ equity	41,743,676	45,757,628
Series 1 Preferred Stock [Member]
Stockholders’ equity
Series C, 100,000 shares authorized, 50,000 shares issued and outstanding at June 30, 2023 and September 30, 2022	2,293	2,079
Series C Preferred Stock [Member]
Stockholders’ equity
Series C, 100,000 shares authorized, 50,000 shares issued and outstanding at June 30, 2023 and September 30, 2022	50	50
Nonrelated Party [Member]
Current assets
Trade receivables, net	7,507,755	5,399,216
Current liabilities
Accounts payable	3,725,105	3,050,937
Related Party [Member]
Current assets
Trade receivables, net	578,388
Royalties receivable - related party	691,611
Note receivable - related party	761,585	761,585
Current liabilities
Accounts payable	$ 3,372	$ 19,133

v3.23.2

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Jun. 30, 2023	Sep. 30, 2022
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	2,343,016	2,129,122
Preferred stock, shares outstanding	2,278,916	2,065,022
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	50,000,000	50,000,000
Common stock, shares issued	957,760	754,711
Common stock, shares outstanding	957,760	754,711
Series 1 Preferred Stock [Member]
Preferred stock, shares authorized	3,000,000	3,000,000
Preferred stock, shares issued	2,293,016	2,079,122
Preferred stock, shares outstanding	2,228,916	2,015,022
Preferred stock, liquidation value per share	$ 10	$ 10
Treasury stock, shares authorized	64,100	64,100
Series C Preferred Stock [Member]
Preferred stock, shares authorized	100,000	100,000
Preferred stock, shares issued	50,000	50,000
Preferred stock, shares outstanding	50,000	50,000

v3.23.2

Condensed Consolidated Statements of Operations (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Income Statement [Abstract]
Revenues	$ 14,730,140	$ 12,108,904	$ 42,773,779	$ 33,268,316
Cost of revenues	8,249,497	7,068,797	23,914,249	21,236,178
Gross profit	6,480,643	5,040,107	18,859,530	12,032,138
Operating expenses
General and administrative	5,376,960	5,381,529	16,456,602	16,095,373
Research and development	1,049,909	1,189,875	3,895,717	3,660,883
Total operating expenses	6,426,869	6,571,404	20,352,319	19,756,256
Operating income/(loss)	53,774	(1,531,297)	(1,492,789)	(7,724,118)
Other income/(expense)
Other income	34,652	2,315,500	394,073	3,336,560
Interest expense	(1,254,185)	(925,545)	(3,717,557)	(3,641,432)
Total other (expense)/income, net	(1,219,533)	1,389,955	(3,323,484)	(304,872)
Net loss before income taxes	(1,165,759)	(141,342)	(4,816,273)	(8,028,990)
Income tax benefit/(expense)	(19,641)	247,941	(19,641)	247,941
(Loss)/income from Continuing operations	(1,185,400)	106,599	(4,835,914)	(7,781,049)
Income/(loss) from discontinued operations, net of tax	13,281	(838,301)	(3,212,108)	(2,282,399)
Net loss	(1,172,119)	(731,702)	(8,048,022)	(10,063,448)
Less loss in noncontrolling interest	(25,595)	(50,909)	(29,493)	(183,457)
Net loss attributable to Cemtrex, Inc. shareholders	$ (1,146,524)	$ (680,793)	$ (8,018,529)	$ (9,879,991)
Income (loss) per share - Basic & Diluted
Continuing Operations Income (loss) per share - basic	$ (1.29)	$ 0.21	$ (5.83)	$ (10.94)
Continuing Operations Income (loss) per share - diluted	(1.29)	0.21	(5.83)	(10.94)
Discontinued Operations Income (loss) per share - basic	0.01	(1.14)	(3.89)	(3.29)
Discontinued Operations Income (loss) per share - diluted	$ 0.01	$ (1.14)	$ (3.89)	$ (3.29)
Weighted Average Number of Shares - Basic	897,897	736,506	824,689	694,758
Weighted Average Number of Shares - Diluted	897,897	736,506	824,689	694,758

v3.23.2

Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Other comprehensive loss
Net loss	$ (1,172,119)	$ (731,702)	$ (8,048,022)	$ (10,063,448)
Foreign currency translation gain/(loss)	22,470	(200,880)	(71,179)	(341,011)
Comprehensive loss	(1,149,649)	(932,582)	(8,119,201)	(10,404,459)
Less comprehensive income attributable to noncontrolling interest	25,595	50,909	29,493	183,457
Comprehensive loss attributable to Cemtrex, Inc. shareholders	$ (1,175,244)	$ (983,491)	$ (8,148,694)	$ (10,587,916)

v3.23.2

Condensed Consolidated Statement of Stockholders' Equity (Unaudited) - USD ($)	Preferred Stock [Member] Series 1 Preferred Stock [Member]	Preferred Stock [Member] Series C Preferred Stock [Member]	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Treasury Stock, Preferred [Member]	AOCI Attributable to Parent [Member]	Total	Noncontrolling Interest [Member]
Balance at Sep. 30, 2021	$ 1,885	$ 50	$ 594	$ 61,748,022	$ (41,908,062)	$ (148,291)	$ 2,896,452	$ 22,590,650	$ 964,026
Balance, shares at Sep. 30, 2021	1,885,151	50,000	593,777
Foreign currency translation gain/(loss)							59,492	59,492
Share-based compensation				45,371				45,371
Shares issued to pay notes payable			$ 83	3,287,988				3,288,071
Shares issued to pay notes payable, shares			82,600
Dividends paid in Series 1 preferred shares	$ 95			(95)
Dividends paid in Series 1 preferred shares, shares	94,602
Income/(loss) attributable to noncontrolling interest									(51,872)
Net loss					(4,477,951)			(4,477,951)
Balance at Dec. 31, 2021	$ 1,980	$ 50	$ 677	65,081,286	(46,386,013)	(148,291)	2,955,944	21,505,633	912,154
Balance, shares at Dec. 31, 2021	1,979,753	50,000	676,377
Balance at Sep. 30, 2021	$ 1,885	$ 50	$ 594	61,748,022	(41,908,062)	(148,291)	2,896,452	22,590,650	964,026
Balance, shares at Sep. 30, 2021	1,885,151	50,000	593,777
Net loss								(9,879,991)
Balance at Jun. 30, 2022	$ 2,079	$ 50	$ 751	66,547,597	(51,788,053)	(148,291)	2,555,441	17,169,574	780,569
Balance, shares at Jun. 30, 2022	2,079,122	50,000	750,380
Balance at Sep. 30, 2021	$ 1,885	$ 50	$ 594	61,748,022	(41,908,062)	(148,291)	2,896,452	22,590,650	964,026
Balance, shares at Sep. 30, 2021	1,885,151	50,000	593,777
Net loss								13,020,958
Balance at Sep. 30, 2022	$ 2,079	$ 50	$ 755	66,641,698	(54,929,020)	(148,291)	2,377,525	13,944,796	692,742
Balance, shares at Sep. 30, 2022	2,079,122	50,000	754,711
Balance at Dec. 31, 2021	$ 1,980	$ 50	$ 677	65,081,286	(46,386,013)	(148,291)	2,955,944	21,505,633	912,154
Balance, shares at Dec. 31, 2021	1,979,753	50,000	676,377
Foreign currency translation gain/(loss)							(199,623)	(199,623)
Share-based compensation				27,046				27,046
Income/(loss) attributable to noncontrolling interest									(80,676)
Net loss					(4,721,247)			(4,721,247)
Shares issued with note payable			$ 29	695,371				695,400
Shares issued with note payable, shares			28,571
Balance at Mar. 31, 2022	$ 1,980	$ 50	$ 706	65,803,703	(51,107,260)	(148,291)	2,756,321	17,307,209	831,478
Balance, shares at Mar. 31, 2022	1,979,753	50,000	704,948
Foreign currency translation gain/(loss)							(200,880)	(200,880)
Share-based compensation				38,985				38,985
Shares issued to pay notes payable			$ 45	705,008				705,053
Dividends paid in Series 1 preferred shares	$ 99			(99)
Dividends paid in Series 1 preferred shares, shares	99,369
Income/(loss) attributable to noncontrolling interest									(50,909)
Net loss					(680,793)			(680,793)
Shares issued with note payable, shares			45,432
Balance at Jun. 30, 2022	$ 2,079	$ 50	$ 751	66,547,597	(51,788,053)	(148,291)	2,555,441	17,169,574	780,569
Balance, shares at Jun. 30, 2022	2,079,122	50,000	750,380
Balance at Sep. 30, 2022	$ 2,079	$ 50	$ 755	66,641,698	(54,929,020)	(148,291)	2,377,525	13,944,796	692,742
Balance, shares at Sep. 30, 2022	2,079,122	50,000	754,711
Foreign currency translation gain/(loss)							223,569	223,569
Share-based compensation				39,842				39,842
Shares issued to pay notes payable			$ 39	232,106				232,145
Shares issued to pay notes payable, shares			39,016
Dividends paid in Series 1 preferred shares	$ 104			(104)
Dividends paid in Series 1 preferred shares, shares	104,341
Income/(loss) attributable to noncontrolling interest									(59,163)
Net loss					(6,277,211)			(6,277,211)
Balance at Dec. 31, 2022	$ 2,183	$ 50	$ 794	66,913,542	(61,206,231)	(148,291)	2,601,094	8,163,141	633,579
Balance, shares at Dec. 31, 2022	2,183,463	50,000	793,727
Balance at Sep. 30, 2022	$ 2,079	$ 50	$ 755	66,641,698	(54,929,020)	(148,291)	2,377,525	13,944,796	692,742
Balance, shares at Sep. 30, 2022	2,079,122	50,000	754,711
Net loss								(8,018,529)
Shares issued to pay for services								$ 141,872
Shares issued to pay for services, shares								22,017
Balance at Jun. 30, 2023	$ 2,293	$ 50	$ 958	68,302,617	(62,947,549)	(148,291)	2,306,346	$ 7,516,424	663,249
Balance, shares at Jun. 30, 2023	2,293,016	50,000	957,760
Balance at Dec. 31, 2022	$ 2,183	$ 50	$ 794	66,913,542	(61,206,231)	(148,291)	2,601,094	8,163,141	633,579
Balance, shares at Dec. 31, 2022	2,183,463	50,000	793,727
Foreign currency translation gain/(loss)							(317,218)	(317,218)
Share-based compensation				26,735				26,735
Income/(loss) attributable to noncontrolling interest									55,265
Net loss					(594,794)			(594,794)
Additional rounding shares issued for reverse stock split			$ 19	(19)
Additional rounding shares issued for reverse stock split, shares			19,314
Shares issued to pay for services			$ 15	102,485				102,500
Shares issued to pay for services, shares			15,529
Balance at Mar. 31, 2023	$ 2,183	$ 50	$ 828	67,042,743	(61,801,025)	(148,291)	2,283,876	7,380,364	688,844
Balance, shares at Mar. 31, 2023	2,183,463	50,000	828,570
Foreign currency translation gain/(loss)							22,470	22,470
Share-based compensation				26,736				26,736
Shares issued to pay notes payable			$ 123	1,193,883				1,194,006
Shares issued to pay notes payable, shares			122,702
Dividends paid in Series 1 preferred shares	$ 110			(110)
Dividends paid in Series 1 preferred shares, shares	109,553
Income/(loss) attributable to noncontrolling interest									(25,595)
Net loss					(1,146,524)			(1,146,524)
Shares issued to pay for services			$ 7	39,365				39,372
Shares issued to pay for services, shares			6,488
Balance at Jun. 30, 2023	$ 2,293	$ 50	$ 958	$ 68,302,617	$ (62,947,549)	$ (148,291)	$ 2,306,346	$ 7,516,424	$ 663,249
Balance, shares at Jun. 30, 2023	2,293,016	50,000	957,760

v3.23.2

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)	9 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Cash Flows from Operating Activities
Net loss	$ (8,048,022)	$ (10,063,448)
Adjustments to reconcile net loss to net cash used by operating activities
Depreciation and amortization	698,269	1,038,138
Loss on disposal of property  and equipment	69,611	161,814
Noncash lease expense	614,254	524,500
Bad debt expense (recovery)	(155)	(7,584)
Share-based compensation	93,313	111,402
Income tax expense/ (benefit)		(247,941)
Interest expense paid in equity shares	276,151	1,627,046
Accrued interest on notes payable	1,858,631	635,001
Amortization of original issue discounts on notes payable	1,200,200	908,333
Gain/(loss) on marketable securities	58	(2,234,478)
Discharge of Paycheck Protection Program Loans		(971,500)
Changes in operating assets and liabilities net of effects from acquisition of subsidiaries:
Trade receivables	(2,108,384)	445,590
Trade receivables - related party	(578,388)	14,641
Inventory	(231,923)	(2,565,778)
Prepaid expenses and other current assets	(667,772)	125,344
Other assets	(246,658)	(159,526)
Accounts payable	816,040	1,012,206
Accounts payable - related party	(15,761)
Operating lease liabilities	(550,019)	(456,042)
Deposits from customers	(38,863)	(374,978)
Accrued expenses	1,264,909	(444,238)
Deferred revenue	525,180	470,685
Income taxes payable	(45,773)	(59,588)
Other liabilities	(278,946)	(159,526)
Net cash used by operating activities - continuing operations	(5,394,048)	(10,669,927)
Net cash provided by operating activities - discontinued operations	2,474,863	41,562
Net cash used by operating activities	(2,919,185)	(10,628,365)
Cash Flows from Investing Activities
Purchase of property and equipment	(761,470)	(727,955)
Proceeds from sale of property and equipment	26,205	51,262
Investment in MasterpieceVR		(500,000)
Proceeds from sale of marketable securities		12,182,932
Purchase of marketable securities		(10,214,044)
Net cash (used in)/provided by investing activities - continuing operations	(735,265)	792,195
Net cash used by investing activities - discontinued operations		(39,388)
Net cash (used in)/provided by investing activities	(735,265)	752,807
Cash Flows from Financing Activities
Proceeds from notes payable		8,000,000
Payments on debt	(844,370)	(1,176,763)
Payments on Paycheck Protection Program Loans	(20,154)
Payments on bank loans	(416,467)	(920,939)
Net cash provided by financing activities - continuing operations	(1,280,991)	5,902,298
Net cash used by financing activities - discontinued operations
Net cash (used)/provided by financing activities	(1,280,991)	5,902,298
Effect of currency translation	(104,123)	(397,840)
Net decrease in cash, cash equivalents, and restricted cash	(4,935,441)	(3,973,260)
Cash, cash equivalents, and restricted cash at beginning of period	11,473,676	17,186,323
Cash, cash equivalents, and restricted cash at end of period	6,434,112	12,815,223
Balance Sheet Accounts Included in Cash, Cash Equivalents, and Restricted Cash
Cash and equivalents	5,628,839	11,442,487
Less cash attributed to discontinued operations		(145,984)
Restricted cash	805,273	1,518,720
Total cash, cash equivalents, and restricted cash	6,434,112	12,815,223
Supplemental Disclosure of Cash Flow Information:
Cash paid during the period for interest	382,575	483,665
Cash paid during the period for income taxes, net of refunds	45,773	306,729
Supplemental Schedule of Non-Cash Investing and Financing Activities
Shares issued to pay for services	141,872
Shares issued to pay notes payable	1,426,151	3,993,124
Purchase of property and equipment through vendor financing	1,125,000
Shares issued in connection with note payable		700,400
Investment in right of use asset	$ 186,397	$ 317,187

v3.23.2

ORGANIZATION AND PLAN OF OPERATIONS	9 Months Ended
	Jun. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
ORGANIZATION AND PLAN OF OPERATIONS	NOTE 1 – ORGANIZATION AND PLAN OF OPERATIONS   Cemtrex was incorporated in 1998 in the state of Delaware and has evolved through strategic acquisitions and internal growth into a leading multi-industry company. Unless the context requires otherwise, all references to “we”, “our”, “us”, “Company”, “registrant”, “Cemtrex” or “management” refer to Cemtrex, Inc. and its subsidiaries.   During the first quarter of fiscal year 2023, The Company reorganized its reporting segments to be in line with its current structure consisting of (i) Security (ii) Industrial Services and (iii) Cemtrex Corporate.   Security   Cemtrex’s Security segment operates under the brand of its majority owned subsidiary, Vicon Industries, Inc. (“Vicon”), which provides end-to-end security solutions to meet the toughest corporate, industrial and governmental security challenges. Vicon’s products include browser-based video monitoring systems and analytics-based recognition systems, cameras, servers, and access control systems for every aspect of security and surveillance in industrial and commercial facilities, federal prisons, hospitals, universities, schools, and federal and state government offices. Vicon provides innovative, mission critical security and video surveillance solutions utilizing Artificial Intelligence (AI) based data algorithms.   Industrial Services   Cemtrex’s Industrial Services segment operates under the brand, Advanced Industrial Services (“AIS”), which offers single-source expertise and services for rigging, millwrighting, in plant maintenance, equipment erection, relocation, and disassembly to diversified customers. AIS installs high precision equipment in a wide variety of industrial markets like automotive, printing & graphics, industrial automation, packaging, and chemicals, among others. AIS is a leading provider of reliability-driven maintenance and contracting solutions for machinery, packaging, printing, chemical, and other manufacturing markets. The focus is on customers seeking to achieve greater asset utilization and reliability to cut costs and increase production from existing assets, including small projects, sustaining capital, turnarounds, maintenance, specialty welding services, and high-quality scaffolding.   Cemtrex Corporate   Cemtrex’s Corporate segment is the holding company of our other two segments.   Sale of former Cemtrex Brands   On November 22, 2022, the Company entered into two Asset Purchase Agreements and one Simple Agreement for Future Equity (“SAFE”) with the Company’s CEO, Saagar Govil, to secure the sale of the subsidiaries Cemtrex Advanced Technologies, Inc, which include the brand SmartDesk, and Cemtrex XR, Inc., which include the brands Cemtrex XR, Virtual Driver Interactive, Bravo Strong, and good tech (formerly Cemtrex Labs), to Mr. Govil. On November 22, 2022, the Company completed the above disposition for the following consideration.   ● Cemtrex XR, Inc.   ○ $895,000 comprised of:   ■ $75,000 in cash payable at Closing; and ■ 5% royalty of all revenues on the Business to be paid 90 days after the end of each calendar year for the next three years; and should the total sum of royalties due be less than $820,000 at the end of the three-year period, Purchaser shall be obligated to pay the difference between $820,000 and the royalties paid.     ● Cemtrex Advanced Technologies, Inc.   ○ $10,000 in cash payable at Closing; and ○ 5% royalty of all revenues on the Business to be paid 90 days after the end of each calendar year for the next 5 years; and ○ $1,600,000 in SAFE (common equity) at any subsequent fundraising or exit above $5M with a $10M cap.   The Company’s Board of Directors, excluding Saagar Govil who abstained from all voting on these agreements, approved these actions and agreements.   Common Stock Reverse Stock Split   On January 25, 2023, the company completed a 35:1 reverse stock split on its common stock. All share and per share data have been retroactively adjusted for this reverse split.   Notice of Delisting, Extension of cure period, and Subsequent Compliance   Series 1 Preferred Stock   On July 29, 2022, the Company received a notification letter from the Listing Qualifications Department of The Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company that, because the closing bid price for the Company’s Series 1 preferred stock listed on Nasdaq was below $1.00 for 30 consecutive trading days, the Company no longer met the minimum bid price requirement for continued listing on The Nasdaq Capital Market under Nasdaq Marketplace Rule 5550(a)(2), requiring a minimum bid price of $1.00 per share (the “Minimum Bid Price Requirement”).   On January 26, 2023, the Company received a notification letter from the Listing Qualifications Department of Nasdaq notifying the Company that, it had been granted an additional 180 days or until July 24, 2023, to regain compliance with the Minimum Bid Price Requirement based on the Company meeting the continued listing requirement for market value of publicly held shares and all other applicable requirements for initial listing on the Capital Market with the exception of the bid price requirement, and the Company’s written notice of its intention to cure the deficiency during the second compliance period by effecting a reverse stock split, if necessary.   On July 25, 2023, the Company received a Notice of Staff Determination from the Listing Qualifications Department of Nasdaq notifying the Company that its Series 1 Preferred Stock had not gained compliance and would be suspended from trading at the opening of business on August 3, 2023. The Company has requested a hearing regarding the delisting that has been scheduled for September 14, 2023, which will stay the suspension and filing of Form 25-NSE with the Securities and Exchange Commission.   The Company intends to continue actively monitoring the bid price for its Series 1 preferred stock between now and the hearing date and will consider available options to resolve the deficiency and regain compliance with the Minimum Bid Price Requirement.   Common Stock   On January 24, 2022, the Company received a notification letter from the Listing Qualifications Department of Nasdaq notifying the Company that, because the closing bid price for the Company’s common stock listed on Nasdaq was below $1.00 for 30 consecutive trading days, the Company no longer met the minimum bid price requirement for continued listing on The Nasdaq Capital Market under Nasdaq Marketplace Rule 5550(a)(2), requiring a minimum bid price of $1.00 per share (the “Minimum Bid Price Requirement”).   On July 26, 2022, the Company received a notification letter from the Listing Qualifications Department of The Nasdaq Stock Market LLC Nasdaq notifying the Company that, it had been granted an additional 180 days or until January 23, 2023, to regain compliance with the Minimum Bid Price Requirement based on the Company meeting the continued listing requirement for market value of publicly held shares and all other applicable requirements for initial listing on the Capital Market with the exception of the bid price requirement, and the Company’s written notice of its intention to cure the deficiency during the second compliance period by effecting a reverse stock split, if necessary.     On January 26, 2023, the Company received a notification letter from the Listing Qualifications Department of Nasdaq notifying the Company that it has not regained compliance with Listing Rule 5550(a)(2) and accordingly would be delisted from the Capital Market. The Company then requested and had been granted a hearing to occur on March 16, 2023, appealing this determination to a Hearings Panel (the “Panel”), pursuant to the procedures set forth in the Nasdaq Listing Rule 5800 Series.   On February 8, 2023, the Company received a notification letter from the Listing Qualifications Department of Nasdaq notifying the Company that it has regained compliance with Listing Rule 5550(a)(2) and is in compliance with all applicable listing standards. The Company’s common stock will continue to be listed and traded on The Nasdaq Stock Market.   Going Concern Considerations   The accompanying condensed consolidated financial statements of the Company have been prepared assuming the Company will continue as a going concern and in accordance with generally accepted accounting principles in the United States of America. The going concern basis of presentation assumes that the Company will continue in operation one year after the date these financial statements are issued and will be able to realize its assets and discharge its liabilities and commitments in the normal course of business. Pursuant to the requirements of the ASC 205, management must evaluate whether there are conditions or events, considered in the aggregate, which raise substantial doubt about the Company’s ability to continue as a going concern for one year from the date these financial statements are issued.   This evaluation does not take into consideration the potential mitigating effect of management’s plans that have not been fully implemented or are not within control of the Company as of the date the financial statements are issued. When substantial doubt exists under this methodology, management evaluates whether the mitigating effect of its plans sufficiently alleviates substantial doubt about the Company’s ability to continue as a going concern. The mitigating effect of management’s plans, however, is only considered if both (1) it is probable that the plans will be effectively implemented within one year after the date that the financial statements are issued, and (2) it is probable that the plans, when implemented, will mitigate the relevant conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued.   The Company has incurred substantial losses of $13,020,958 and $7,807,995 for fiscal years 2022 and 2021, respectively, and has losses on continuing operations for the nine months ending June 30, 2023 of $4,835,914 and has debt obligations over the next year of $17,185,167 and working capital deficit of $967,489, that raise substantial doubt with respect to the Company’s ability to continue as a going concern.   While our working capital and current debt indicate a substantial doubt regarding the Company’s ability to continue as a going concern, the Company has historically, from time to time, satisfied and may continue to satisfy certain short-term liabilities through the issuance of common stock, thus reducing our cash requirement to meet our operating needs. Additionally, the Company has sold unprofitable brands, reducing the cash required to maintain those brands, reevaluated our pricing model on our Vicon brand to improve margins on those products, and has effected a 35:1 reverse stock split on our common stock to remain trading on the Nasdaq Capital Markets, and improve our ability to potentially raise capital through equity offerings that we may use to satisfy debt. In the event additional capital is raised through equity offerings and/or debt is satisfied with equity, it may have a dilutive effect on our existing stockholders. While the Company believes these plans are sufficient to meet the capital demands of our current operations for at least the next twelve months, the is no guarantee that we will succeed. Overall, there is no guarantee that cash flow from our existing or future operations and any external capital that we may be able to raise will be sufficient to meet our working capital needs. The Company currently does not have adequate cash to meet our short or long-term needs. The condensed consolidated financial statements do not include any adjustments relating to this uncertainty.

v3.23.2

INTERIM STATEMENT PRESENTATION	9 Months Ended
	Jun. 30, 2023
Accounting Policies [Abstract]
INTERIM STATEMENT PRESENTATION	NOTE 2 – INTERIM STATEMENT PRESENTATION   Basis of Presentation and Use of Estimates   The accompanying unaudited condensed consolidated financial information should be read in conjunction with the audited consolidated financial statements and the notes thereto included in the Annual Report on Form 10-K for the year ended September 30, 2022, of Cemtrex, Inc.   The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the Unites States (“US GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X pursuant to the requirements of the U.S. Securities and Exchange Commission (‘SEC”). Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. The results of operations for the interim periods are not necessarily indicative of the results of operations for the entire year.   The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the condensed consolidated financial statements, the disclosure of contingent assets and liabilities in the condensed consolidated financial statements and the accompanying notes, and the reported amounts of revenues, expenses and cash flows during the periods presented. Actual amounts and results could differ from those estimates. The estimates and assumptions the Company makes are based on historical factors, current circumstances and the experience and judgment of the Company’s management. The Company evaluates its estimates and assumptions on an ongoing basis.   Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations.   The condensed consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries, Cemtrex Technologies Pvt. Ltd., Advanced Industrial Services, Inc., Advanced Industrial Leasing, Inc., and the Company’s majority owned subsidiary Vicon Industries, Inc. and its subsidiary, Vicon Industries Ltd. All inter-company balances and transactions have been eliminated in consolidation.   Accounting Pronouncements   Significant Accounting Policies   Note 2 of the Notes to Consolidated Financial Statements, included in the annual report on Form 10-K for the year ended September 30, 2022, includes a summary of the significant accounting policies used in the preparation of the consolidated financial statements.   Recently Issued Accounting Standards   In June 2016, the FASB issued Accounting Standards Update No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“Update 2016-13”). Update 2016-13 replaced the incurred loss model with an expected loss model, which is referred to as the current expected credit loss (“CECL”) model. The CECL model is applicable to the measurement of credit losses on financial assets measured at amortized cost, including but not limited to trade receivables. For public business entities, the new standard became effective for annual reporting periods beginning after December 15, 2022, including interim periods within that reporting period. The Company is currently evaluating the impact of this ASU on our financial statements.   In October 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2021-08, “Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (“ASU No. 2021-08”). ASU No. 2021-08 will require companies to apply the definition of a performance obligation under ASC Topic 606 to recognize and measure contract assets and contract liabilities (i.e., deferred revenue) relating to contracts with customers that are acquired in a business combination. Under current U.S. GAAP, an acquirer generally recognizes assets acquired and liabilities assumed in a business combination, including contract assets and contract liabilities arising from revenue contracts with customers, at fair value on the acquisition date. ASU No. 2021-08 will result in the acquirer recording acquired contract assets and liabilities on the same basis that would have been recorded by the acquiree before the acquisition under ASC Topic 606. ASU No. 2021-08 is effective for fiscal years beginning after December 15, 2022, with early adoption permitted. The Company is currently evaluating the impact of this ASU on our financial statements.     On June 30, 2022, the FASB issued ASU 2022-03 Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions (“ASU 2022-03”), which (1) clarifies the guidance in ASC 820 on the fair value measurement of an equity security that is subject to a contractual sale restriction and (2) requires specific disclosures related to such an equity security. Under current guidance, stakeholders have observed diversity in practice related to whether contractual sale restrictions should be considered in the measurement of the fair value of equity securities that are subject to such restrictions. On the basis of interpretations of existing guidance and the current illustrative example in ASC 820-10-55-52 of a restriction on the sale of an equity instrument, some entities use a discount for contractual sale restrictions when measuring fair value, while others view the application of such a discount to be inconsistent with the principles of ASC 820. To reduce the diversity in practice and increase the comparability of reported financial information, ASU 2022-03 clarifies this guidance and amends the illustrative example. ASU No. 2022-03 is effective for fiscal years beginning after December 15, 2023, with early adoption permitted. The Company is currently evaluating the impact of this ASU on our financial statements.   The Company does not believe that any other recently issued but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying condensed consolidated financial statements.

v3.23.2

DISCONTINUED OPERATIONS	9 Months Ended
	Jun. 30, 2023
Discontinued Operations and Disposal Groups [Abstract]
DISCONTINUED OPERATIONS	NOTE 3 – DISCONTINUED OPERATIONS   On November 22, 2022, the Company entered into two Asset Purchase Agreements and one Simple Agreement for Future Equity (“SAFE”) with the Company’s CEO, Saagar Govil, to secure the sale of the subsidiaries Cemtrex Advanced Technologies, Inc, which include the brand SmartDesk, and Cemtrex XR, Inc., which include the brands Cemtrex XR, Virtual Driver Interactive, Bravo Strong, and good tech (formerly Cemtrex Labs), to Mr. Govil   Due to the on-going losses and risk associated with the SmartDesk business the Company has valued the royalty and SAFE agreement associated with the SmartDesk sale at $0 and considers such consideration to be a gain contingency.   Based on sales projections for Cemtrex XR, Inc., the Company does not believe that it will exceed the sales levels required to exceed the $820,000 royalties due and has not accounted for any additional royalties at this time. In accordance with ASC 310 – Receivables, the Company has discounted the royalties due and during the nine-month ended June 30, 2023, has recognized $691,611 of royalties due and will amortize the remaining amount over the period the royalties are due.     The following table summarizes the loss on the sale recorded during the three months ended December 31, 2022, included in Income/(loss) from discontinued operations, net of tax in the accompanying condensed consolidated statement of Operations:  SUMMARY OF LOSS ON SALE          Purchase Price   $ 745,621   Less cash and cash equivalents transferred     (699,423 ) Less liabilities assumed     (10,924 ) Net purchase price   $ 35,274             Assets Sold         Accounts receivable, net   $ 625,638   Inventory, net     980,730   Prepaid expenses and other assets     502,577   Property and equipment, net     837,808   Goodwill     598,392   Total Assets Sold     3,545,145   Liabilities Transferred         Accounts payable     370,774   Short-term liabilities     364,775   Long-term liabilities     318,981   Total Liabilities Transferred     1,054,530   Net assets sold   $ 2,490,615             Pretax loss on sale of Cemtrex Advanced Technologies, Inc, and Cemtrex XR, Inc.Companies   $ (2,455,341 )     Assets and liabilities included within discontinued operations on the Company’s Condensed Consolidated Balance Sheets at June 30, 2023, and September 30, 2022, are as follows;  SCHEDULE OF ASSETS AND LIABILITIES INCLUDED WITHIN DISCONTINUED OPERATIONS     June 30,     September 30,       2023     2022   Assets                 Current assets                 Cash and equivalents   $ -     $ 714,420   Trade receivables, net     -       561,470   Inventory –net of allowance for inventory obsolescence     -       1,043,865   Prepaid expenses and other assets     -       153,461   Total current assets     -       2,473,216                     Property and equipment, net     -       825,850   Other     -       672,627   Total Assets   $ -     $ 3,971,693                     Liabilities                 Current liabilities                 Accounts payable   $ -     $ 205,622   Short-term liabilities     -       464,429   Deposits from customers     -       125,032   Accrued expenses     -       10,136   Total current liabilities     -       805,219                     Long-term liabilities                 Deferred revenue             6,273   Total long-term liabilities     -       6,273   Total liabilities   $ -     $ 811,492     During the first quarter of fiscal 2023, Vicon completed the closure of its discontinued operating entity Vicon Systems, Ltd. located in Israel. The Company received funds related to benefit obligations of $96,095, which at the time of operational closure were not guaranteed to be retrievable. The company paid $7,010 in consulting fees for assistance in retrieving these funds. The net amount of $89,085 is recognized on the Company’s Condensed Consolidated Income Statement as part of the Loss on Discontinued Operations.     Gain/(loss) from discontinued operations, net of tax and the loss on sale of discontinued operations, net of tax, of Cemtrex Advanced Technologies, Inc. and Cemtrex XR, Inc., sold during the first quarter of fiscal year 2023, which are presented in total as discontinued operations, net of tax in the Company’s Condensed Consolidated Statements of Operations for the three and nine month periods ended June 30, 2023 and 2022, are as follows:       2023     2022     2023     2022       Three months ended June 30,     Nine months ended June 30,       2023     2022     2023     2022   Total net sales   $ -     $ 1,521,942     $ 649,061     $ 3,763,234   Cost of sales     -       685,693       228,086       1,997,211   Operating, selling, general and administrative expenses     1,443       1,425,801       1,297,507       4,036,614   Other (income)/expenses     -       248,749       3,195       11,808   Income (loss) from discontinued operations     (1,443 )     (838,301 )     (879,727 )     (2,282,399 ) Amortization of discounted royalties     14,724       -       33,875       -   Loss on sale of discontinued operations     -       -       (2,455,341 )     -   Adjustment of benefit obligation     -       -       89,085       -   Income tax provision     -       -       -       -   Discontinued operations, net of tax   $ 13,281     $ (838,301 )   $ (3,212,108 )   $ (2,282,399 )

v3.23.2

LOSS PER COMMON SHARE	9 Months Ended
	Jun. 30, 2023
Earnings Per Share [Abstract]
LOSS PER COMMON SHARE	NOTE 4 – LOSS PER COMMON SHARE   Basic net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period. Diluted net income per common share is computed by dividing net income by the weighted average number of shares of common stock and potentially dilutive outstanding shares of common stock during the period to reflect the potential dilution that could occur from common shares issuable through contingent share arrangements, stock options and warrants. For the three and nine months ended June 30, 2023, and 2022, the following items were excluded from the computation of diluted net loss per common share as their effect is anti-dilutive:    SCHEDULE OF COMPUTATION OF DILUTED NET LOSS PER COMMON SHARE AS ANTI-DILUTIVE EFFECT     2023     2022     2023     2022       For the three months ended     For the nine months ended       June 30,     June 30,       2023     2022     2023     2022                                     Options     28,796       34,579       28,796       34,579

v3.23.2

SEGMENT INFORMATION	9 Months Ended
	Jun. 30, 2023
Segment Reporting [Abstract]
SEGMENT INFORMATION	NOTE 5 – SEGMENT INFORMATION During the first quarter of fiscal year 2023, the Company reorganized its reporting segments to be in line with its current structure. The Company reports and evaluates financial information for three current segments: the Security segment, Industrial Services segment and the Corporate segment.   The following tables summarize the Company’s segment information:  SCHEDULE OF SEGMENT INFORMATION     Security     Industrial Services     Corporate     Consolidated     Security     Industrial Services     Corporate     Consolidated       Three months ended June 30, 2023     Nine months ended June 30, 2023       Security     Industrial Services     Corporate     Consolidated     Security     Industrial Services     Corporate     Consolidated   Revenues   $ 9,015,279     $ 5,714,861     $ -     $ 14,730,140     $ 25,933,921     $ 16,839,858     $ -     $ 42,773,779   Cost of revenues     4,610,443       3,639,054       -       8,249,497       13,005,314       10,908,935       -       23,914,249   Gross profit   $ 4,404,836     $ 2,075,807     $ -     $ 6,480,643     $ 12,928,607     $ 5,930,923     $ -     $ 18,859,530   Operating expenses                                                                 Sales, general, and administrative     3,182,509       912,387       1,032,183       5,127,079       9,494,634       3,437,565       2,826,134       15,758,333   Depreciation and amortization     90,630       159,251       -       249,881       161,833       484,157       52,279       698,269   Research and development     1,049,909       -       -       1,049,909       3,895,717       -       -       3,895,717   Operating income/(loss)   $ 81,788     $ 1,004,169     $ (1,032,183 )   $ 53,774     $ (623,577 )   $ 2,009,201     $ (2,878,413 )   $ (1,492,789 )                                                                   Other income/(expense)   $ (282,857 )   $ (7,281 )   $ (929,395 )   $ (1,219,533 )   $ (58,065 )   $ (68,707 )   $ (3,196,712 )   $ (3,323,484 )       Security     Industrial Services     Corporate     Consolidated     Security     Industrial Services     Corporate     Consolidated       Three months ended June 30, 2022     Nine months ended June 30, 2022       Security     Industrial Services     Corporate     Consolidated     Security     Industrial Services     Corporate     Consolidated   Revenues   $ 6,640,913     $ 5,467,991     $ -     $ 12,108,904     $ 17,740,445       15,527,871     $ -     $ 33,268,316   Cost of revenues     3,257,672       3,811,125       -       7,068,797       10,261,376       10,974,802       -       21,236,178   Gross profit   $ 3,383,241     $ 1,656,866     $ -     $ 5,040,107     $ 7,479,069     $ 4,553,069     $ -     $ 12,032,138   Operating expenses                                                                 Sales, general, and administrative     3,057,839       1,081,392       814,487       4,953,718       8,483,955       3,706,041       2,867,239       15,057,235   Depreciation and amortization     217,497       174,066       36,248       427,811       398,707       529,779       109,652       1,038,138   Research and development     1,189,875       -       -       1,189,875       3,660,883       -       -       3,660,883   Operating (loss)/income   $ (1,081,970 )   $ 401,408     $ (850,735 )   $ (1,531,297 )   $ (5,064,476 )   $ 317,249     $ (2,976,891 )   $ (7,724,118 )                                                                   Other income/(expense)   $ (83,355 )   $ (104,797 )   $ 1,578,107     $ 1,389,955     $ 741,330     $ (181,586 )   $ (864,616 )   $ (304,872 )       2023     2022       June 30,     September 30,       2023     2022   Identifiable Assets                 Security   $ 20,631,185     $ 15,257,235   Industrial Services     17,302,398       16,658,984   Corporate     3,810,093       9,869,716   Discontinued operations     -       3,971,693   Total Assets   $ 41,743,676     $ 45,757,628

v3.23.2

RESTRICTED CASH	9 Months Ended
	Jun. 30, 2023
Cash and Cash Equivalents [Abstract]
RESTRICTED CASH	NOTE 6 – RESTRICTED CASH   A subsidiary of the Company participates in a consortium in order to self-insure group care coverage for its employees. The plan is administrated by Benecon Group and the Company makes monthly deposits in a trust account to cover medical claims and any administrative costs associated with the plan. These funds, as required by the plan are restricted in nature and amounted to $805,237 at June 30, 2023, and $1,577,915 at September 30, 2022.

v3.23.2

FAIR VALUE MEASUREMENTS	9 Months Ended
	Jun. 30, 2023
Fair Value Disclosures [Abstract]
FAIR VALUE MEASUREMENTS	NOTE 7 – FAIR VALUE MEASUREMENTS   Fair value is defined as the price that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-level hierarchy is applied to prioritize the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).   The three levels of the fair value hierarchy under the guidance for fair value measurements are described below:   Level 1 — Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Our Level 1 assets include cash equivalents, banker’s acceptances, trading securities investments and investment funds. The Company measures trading securities investments and investment funds at quoted market prices as they are traded in an active market with sufficient volume and frequency of transactions.     Level 2 — Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. If the asset or liability has a specified contractual term, a Level 2 input must be observable for substantially the full term of the asset or liability.   Level 3 — Level 3 inputs are unobservable inputs for the asset or liability in which there is little, if any, market activity for the asset or liability at the measurement date. Level 3 assets and liabilities include cost method investments. Quantitative information for Level 3 assets and liabilities reviewed at each reporting period includes indicators of significant deterioration in the earnings performance, credit rating, asset quality, business prospects of the investee, and financial indicators of the investee’s ability to continue as a going concern.   The Company’s fair value assets at June 30, 2023, and September 30, 2022, are as follows.  SCHEDULE OF FAIR VALUE OF ASSETS     (Level 1)     (Level 2)     (Level 3)     2023       Quoted Prices     Significant               in Active     Other     Significant     Balance       Markets for     Observable     Unobservable     as of       Identical Assets     Inputs     Inputs     June 30,       (Level 1)     (Level 2)     (Level 3)     2023   Assets                                 Investment in marketable securities                                      (included in short-term investments)   $ 13,663     $ -     $ -     $ 13,663                                                                        Fair value assets   $ 13,663     $ -     $ -     $ 13,663         (Level 1)     (Level 2)     (Level 3)     2022       Quoted Prices     Significant               in Active     Other     Significant     Balance       Markets for     Observable     Unobservable     as of       Identical Assets     Inputs     Inputs     September 30,       (Level 1)     (Level 2)     (Level 3)     2022   Assets                                 Investment in marketable securities                                        (included in short-term investments)   $ 13,721     $ -     $ -     $ 13,721                                     Fair value assets    $ 13,721     $ -     $ -     $ 13,721

v3.23.2

TRADE RECEIVABLES, NET	9 Months Ended
	Jun. 30, 2023
Receivables [Abstract]
TRADE RECEIVABLES, NET	NOTE 8 – TRADE RECEIVABLES, NET   Trade receivables, net consist of the following:  SCHEDULE OF TRADE RECEIVABLES, NET     June 30,     September 30,       2023     2022   Trade receivables   $ 7,757,039     $ 5,648,655   Allowance for doubtful accounts     (249,284 )     (249,439 ) Accounts receivables, net, total   $ 7,507,755     $ 5,399,216     Trade receivables include amounts due for shipped products and services rendered.   Allowance for doubtful accounts includes estimated losses resulting from the inability of our customers to make the required payments.

v3.23.2

INVENTORY, NET	9 Months Ended
	Jun. 30, 2023
Inventory Disclosure [Abstract]
INVENTORY, NET	NOTE 9 – INVENTORY, NET   Inventory, net, consist of the following:  SCHEDULE OF INVENTORY, NET     June 30,     September 30,       2023     2022   Raw materials   $ 1,130,327     $ 1,375,933   Work in progress     95,773       120,026   Finished goods     8,099,426       8,080,235   Inventory, gross     9,325,526       9,576,194   Less: Allowance for inventory obsolescence     (605,786 )     (1,088,377 ) Inventory –net of allowance for inventory obsolescence   $ 8,719,740     $ 8,487,817

v3.23.2

PREPAID AND OTHER CURRENT ASSETS	9 Months Ended
	Jun. 30, 2023
Prepaid And Other Current Assets
PREPAID AND OTHER CURRENT ASSETS	NOTE  10 – PREPAID AND OTHER CURRENT ASSETS   Prepaid and other current assets consisting of the following:  SUMMARY OF PREPAID AND OTHER CURRENT ASSETS     June 30, 2023     September 30, 2022                 Prepaid expenses   $ 344,300     $ 536,820   Prepaid inventory     1,427,013       220,553   Deferred costs     60,169       40,626   Prepaid income taxes     402,048       604,840   VAT & GST tax receivable     289,371       236,986   Contract assets     566,515       781,819   Prepaid expenses and other assets total   $ 3,089,416     $ 2,421,644

v3.23.2

PROPERTY AND EQUIPMENT	9 Months Ended
	Jun. 30, 2023
Property, Plant and Equipment [Abstract]
PROPERTY AND EQUIPMENT	NOTE 11 – PROPERTY AND EQUIPMENT   Property and equipment are summarized as follows:  SUMMARY OF PROPERTY AND EQUIPMENT     June 30,     September 30,       2023     2022   Land   $ 790,373     $ 790,373   Building and leasehold improvements     2,915,918       2,906,953   Furniture and office equipment     574,645       546,548   Computers and software     1,333,135       365,892   Machinery and equipment     10,725,259       11,242,709   Property and equipment, gross     16,339,330       15,852,475   Less: Accumulated depreciation     (10,158,559 )     (10,572,033 ) Property and equipment, net   $ 6,180,771     $ 5,280,442     Depreciation expense for the three months ended June 30, 2023, and 2022, were $249,881 and $427,811, respectively. Depreciation expense for the nine months ended June 30, 2023, and 2022, were $698,269, and $1,038,138, respectively.

v3.23.2

OTHER ASSETS	9 Months Ended
	Jun. 30, 2023
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
OTHER ASSETS	NOTE 12 – OTHER ASSETS    On November 13, 2020, Cemtrex made a $500,000 investment and on January 19, 2022, made an additional $500,000 investment via a simple agreement for future equity (“SAFE”) in MasterpieceVR. The SAFE provides that the Company will automatically receive shares of the entity based on the conversion rate of future equity rounds up to a valuation cap, as defined. MasterpieceVR is a software company that is developing software for content creation using virtual reality. The investment is included in other assets in the accompanying balance sheet and the Company accounts for this investment and recorded at cost. No impairment has been recorded for the three and nine months ended June 30, 2023.   Other assets consist of the following:  SCHEDULE OF OTHER ASSETS     June 30, 2023     September 30, 2022   Rental deposits   $ 251,739     $ 204,388   Investment in Masterpiece VR     1,000,000       1,000,000   Other deposits     64,626       24,467   Demonstration equipment supplied to resellers     330,038       170,890   Other assets total   $ 1,646,403     $ 1,399,745

v3.23.2

RELATED PARTY TRANSACTIONS	9 Months Ended
	Jun. 30, 2023
Related Party Transactions [Abstract]
RELATED PARTY TRANSACTIONS	NOTE 13 – RELATED PARTY TRANSACTIONS   On August 31, 2019, the Company entered into an Asset Purchase Agreement for the sale of Griffin Filters, LLC to Ducon Technologies, Inc., which Aron Govil, the Company’s Founder and former CFO, for total consideration of $550,000. On July 31, 2022, the Company negotiated a payment agreement surrounding the sale of Griffin Filters, LLC and other liabilities due to Cemtrex, Inc. totaling $761,585. This agreement is in the form of a secured promissory note earning interest at a rate of 5% per annum and matures on July 31, 2024.   As of June 30, 2023, and September 30, 2022, there was $3,372 and $19,133 payable due to Ducon Technologies, Pvt Ltd., respectively.   Receivables of $708,512 that represented the amount due from Ducon to Cemtrex Technologies Pvt. Ltd. the Company’s subsidiary based in India were written off to bad debt in fiscal year 2022.   On February 26, 2021, the Company entered into a Settlement Agreement and Release with Aron Govil regarding transactions Cemtrex’s Board of Directors determined were incorrectly handled and accounted for. Mr. Govil executed a secured promissory note (the “Note”) in the amount of $1,533,280. The Note matured and was due in full on February 26, 2023, and bore interest at 9% per annum and was secured by all of Mr. Govil’s assets. On April 27, 2023, the Company and Mr. Govil signed an amendment to the note, extending the maturity date one year to February 28, 2024. Mr. Govil also signed an affidavit confessing judgment in the event of a default on the Note. While the Company believes the note to be fully collectible, in accordance with ASC 450-30, Gain Contingencies, the Company determined the gain was not to be recognized until the note is paid. Accordingly, the note and associated gain is not presented on the Company’s Condensed Consolidated Balance Sheets and Condensed Consolidated Statements of Operations.   On November 22, 2022, the Company entered into two Asset Purchase Agreements and one Simple Agreement for Future Equity (“SAFE”) with the Company’s CEO, Saagar Govil, to secure the sale of the subsidiaries Cemtrex Advanced Technologies, Inc, and Cemtrex XR, Inc., which include the brands SmartDesk, Cemtrex XR, Virtual Driver Interactive, Bravo Strong, and good tech (formerly Cemtrex Labs), to Mr. Govil (see NOTE 1).   As of June 30, 2023, there was $578,388 in trade receivables due from these companies. Of these receivables $131,922 are related to costs paid by Cemtrex related to payroll during the transition of employees to the new company and some subscription services that are set up on auto pay with a credit card. The remaining $446,466 is related to services provided by Cemtrex Technologies Pvt. Ltd. in the normal course of business.   As of June 30, 2023, there were royalties receivable from the sale of Cemtrex, XR, Inc. of $691,611.

v3.23.2

LEASES	9 Months Ended
	Jun. 30, 2023
Leases
LEASES	NOTE 14 – LEASES   The Company is party to contracts where we lease property from others under contracts classified as operating leases. The Company primarily leases office and operating facilities, vehicles, and office equipment. The weighted average remaining term of our operating leases was approximately 3 years at June 30, 2023, and 3 years at June 30, 2022. Lease liabilities were $2,213,341 with $716,896 classified as short-term at June 30, 2023, and $2,576,963 with $754,495, classified as short-term at September 30, 2022. The weighted average discount rate used to measure lease liabilities was approximately 5.64% at June 30, 2023, and 5.66% at June 30, 2022. The Company used the rate implicit in the lease, where known, or its incremental borrowing rate as the rate used to discount the future lease payments.     The Company also made the accounting policy decision not to recognize lease assets and liabilities for leases with a term of 12 months or less.   The Company’s corporate segment leases approximately 100 square feet of office space in Brooklyn, NY on a month-to-month lease at a rent of $600 per month.   A reconciliation of undiscounted cash flows to operating lease liabilities recognized in the condensed consolidated balance sheet at June 30, 2023, is set forth below:  SCHEDULE OF RECONCILIATION OF UNDISCOUNTED CASH FLOWS TO OPERATING LEASE LIABILITIES Years ending September 30,   Operating Leases   2023     211,721   2024     786,889   2025     764,530   2026     684,449   2027 & Thereafter     289,528   Undiscounted lease payments     2,737,117   Amount representing interest     (523,776 ) Discounted lease payments   $ 2,213,341     Lease costs for the three and nine months ended June 30, 2023, and 2022 are set forth below.:  SCHEDULE OF LEASE COSTS     2023     2022     2023     2022       For the three months ended     For the nine months ended       June 30,     June 30,       2023     2022     2023     2022   Operating lease costs     193,843       223,595       678,489       592,958   Total lease cost   $ 193,843     $ 223,595     $ 678,489     $ 592,958

v3.23.2

LINES OF CREDIT AND LONG-TERM LIABILITIES	9 Months Ended
	Jun. 30, 2023
Debt Disclosure [Abstract]
LINES OF CREDIT AND LONG-TERM LIABILITIES	NOTE 15 – LINES OF CREDIT AND LONG-TERM LIABILITIES   On January 12, 2023, the Company entered into a standstill agreement with Streeterville Capital, LLC. The lender has agreed to refrain and forbear temporarily from making redemptions under the notes for a period ending on April 12, 2023. In addition, the company has agreed to an increase of the outstanding balance of the note issued on September 30, 2021, for the original amount of $5,755,000 by $148,000, and the outstanding balance of the note issued on February 22, 2022, for the original amount of $9,205,000 by $303,422. The aggregate amount of $451,422 has been recorded as interest expense on the Company’s Consolidated Condensed Statement of Operations and Condensed Consolidated Statements of Cash Flow.   On February 15, 2023, the Company and Fulton Bank agreed to an amendment to the Master Agreement Regarding Financial Covenants and Financial Deliverables dated September 22, 2020.   On March 3, 2023, the Company and NIL Funding agreed at an amendment to the term loan agreement dated September 18, 2018. This agreement amends the maturity date to December 31, 2024, and amends the interest rate to 11.5%. Additionally, the Company paid $10,000 in fees and made an additional principal payment of $100,000 on March 29, 2023, and is required to make another additional principal payment of $100,000 on or before March 29, 2024. The Company has accounted for this amendment as a debt modification.   On May 3, 2023, the Company and Streeterville Capital, LLC. agreed to an amendment to the note issued on September 30, 2021, for the original amount of $5,755,000. The agreement extends the maturity date to June 30, 2024, in exchange for a fee of 5% of the outstanding balance or approximately $252,912 added to the outstanding balance of the note. The Company has accounted for this amendment as a debt modification.   On April 3, 2023, The Company and SeKureID Solutions Corp., entered into a software license agreement, where the company obtained the right to use source code for its security products in exchange for $1,125,000 payable in (15) fifteen equal monthly installments of $75,000. The current balance of $900,000 is presented on the Condensed Consolidated Balance Sheets as of June 30, 2023, under Short-term liabilities, net of unamortized original issue discounts.     The following table outlines the Company’s lines of credit and secured liabilities.  SCHEDULE OF LINES OF CREDIT AND LIABILITIES                 June 30,     September 30,       Interest Rate     Maturity     2023     2022   Fulton Bank line of credit $3,500,000 - The terms of this line of credit are subject to the bank’s review annually on February 1.   Secured Overnight Financing Rate (“SOFR”) plus 2.37% (7.46% as of June 30, 2023 and 5.35% as of September 30, 2022)       N/A     $ -     $ -                                   Fulton Bank loan $5,250,000 for the purchase of AIS $5,000,000 of the proceeds went to the direct purchase of AIS.   SOFR plus 2.37%(7.46% as of June 30, 2023 and 5.35% as of September 30, 2022)       12-15-2022       -       247,284                                   Fulton Bank loan $400,000 fund equipment for AIS.   SOFR plus 2.37% (7.46% as of June 30, 2023 and 5.35% as of September 30, 2022)       05-01-2023       -       63,280                                   Fulton Bank - $360,000 fund equipment for AIS. The Company was in compliance with loan covenants as of June 30, 2023. This loan is secured by certain assets of the Company.   SOFR plus 2.37% (7.46% as of June 30, 2023 and 5.35% as of September 30, 2022).       01-31-2025       128,086       183,839                                   Fulton Bank mortgage $2,476,000. The Company was in compliance with loan covenants as of June 30, 2023. This loan is secured by the underlying asset   SOFR plus 2.62% (7.71% as of June 30, 2023 and 5.6% as of September 30, 2022).       01-28-2040       2,195,515       2,245,664                                   Note payable - $439,774. For the purchase of VDI. Payable in two installments on October 26, 2021, and October 26, 2022.   5 %     10-26-2022       -       219,370                                   Note payable - $5,755,000 - Less original issue discount $750,000 and legal fees $5,000, net cash received $5,000,000 Unamortized original issue discount balance of $0 and $250,000, as of June 30, 2023 and September 30, 2022 respectively.   8 %     06-30-2024       4,899,908       4,943,929                                   Note payable - $9,205,000. Less original issue discount $1,200,000 and legal fees $5,000,net cash received $8,000,000. 28,572 shares of common stock valued at $700,400 recognized as additional original issue discount. Unamortized original issue discount balance of $105,578 and $1,064,778 as of June 30, 2023 and September 30, 2022 respectivly.   8 %     08-23-2023       10,491,283       9,738,632                                   Term Loan Agreement with NIL Funding Corporation (“NIL”) - $5,600,000 The Company was in compliance with loan covenants as of June 30, 2023.   11.50 %     12-31-2024       2,179,743       2,804,743                                   Paycheck Protection Program loan - $121,400 - The issuing bank determined that this loan qualifies for loan forgiveness; however the Company is awaiting final approval from the Small Business Administration.   1 %     05-05-2025       101,246       121,400                                   Software License Agreement - $1,125,000, for the purchase of software source code for use in our Security segment products   N/A       06-03-2024       900,000       -   Total lines of credit and secured liabilities                 $ 20,895,781     $ 20,568,141   Less: Current maturities                   (17,185,167 )     (16,894,743 ) Less: Unamortized original issue discount                   (105,578 )     (1,305,778 ) Lines of credit and secured liabilities, Long Term                 $ 3,605,036     $ 2,367,620

v3.23.2

STOCKHOLDERS’ EQUITY	9 Months Ended
	Jun. 30, 2023
Equity [Abstract]
STOCKHOLDERS’ EQUITY	NOTE 16 – STOCKHOLDERS’ EQUITY   Preferred Stock   The Company is authorized to issue 10,000,000 shares of Preferred Stock, $0.001 par value. As of June 30, 2023, and September 30, 2022, there were 2,343,016 and 2,129,122 shares issued and 2,278,916 and 2,065,022 shares outstanding, respectively.   Series 1 Preferred Stock   During the nine months ended June 30, 2023, 213,894 shares of Series 1 Preferred Stock were issued to pay dividends to holders of Series 1 Preferred Stock.   As of June 30, 2023, and September 30, 2022, there were 2,293,016 and 2,079,122 shares of Series 1 Preferred Stock issued and 2,228,916 and 2,015,022 shares of Series 1 Preferred Stock outstanding, respectively.   Series C Preferred Stock   As of June 30, 2023, and September 30, 2022, there were 50,000 shares of Series C Preferred Stock issued and outstanding.   Common Stock   The Company is authorized to issue 50,000,000 shares of common stock, $0.001 par value. As of June 30, 2023, there were 957,760 shares issued and outstanding and at September 30, 2022, there were 754,711 shares issued and outstanding.   On January 25, 2023, the Company completed a 35:1 reverse stock split on its common stock. All share and per share data have been retroactively adjusted for this reverse split. On February 2, 2023, 19,314 shares were issued for rounding shares of the reverse stock split.   During the nine months ended June 30, 2023,161,718 shares of the Company’s common stock have been issued to satisfy $487,716 of notes payable, $662,284 in accrued interest, and $276,151 of excess value of shares issued recorded as interest expense.   During the nine months ended June 30, 2023, 22,017 shares of the Company’s common stock have been issued in exchange for services valued at $141,872.

v3.23.2

SHARE-BASED COMPENSATION	9 Months Ended
	Jun. 30, 2023
Share-Based Payment Arrangement [Abstract]
SHARE-BASED COMPENSATION	NOTE 17 – SHARE-BASED COMPENSATION   For the nine months ended June 30, 2023, and 2022, the Company recognized $93,313 and $111,402 of share-based compensation expense on its outstanding options, respectively. As of June 30, 2023, $76,831 of unrecognized share-based compensation expense is expected to be recognized over a period of two years. Future compensation amounts will be adjusted for any change in estimated forfeitures.   During the nine months ended June 30, 2023, options to purchase 2,931 shares of the Company’s common stock at an exercise price of $13.65 per share and options to purchase 2,858 shares of the Company’s common stock at an exercise price of $40.95 per share were cancelled.

v3.23.2

COMMITMENTS AND CONTINGENCIES	9 Months Ended
	Jun. 30, 2023
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	NOTE 18 – COMMITMENTS AND CONTINGENCIES    The Company’s Industrial Services segment owns approximately 25,000 square feet of warehouse space in Manchester, PA and approximately 43,000 square feet of office and warehouse space in York, PA. The Industrial Services segment also leases approximately 15,500 square feet of warehouse space in Emigsville, PA from a third party in a three-year lease at a monthly rent of $4,555 expiring on August 31, 2025.     The Company’s Security segment leases (i) approximately 6,700 square feet of office and warehouse space in Pune, India from a third party in an five year lease at a monthly rent of $6,453 (INR456,972) expiring on February 28, 2024, (ii) approximately 30,000 square feet of office and warehouse space in Hauppauge, New York from a third party in a seven-year lease at a monthly rent of $28,719 expiring on March 31, 2027, (iii) approximately 9,400 square feet of office and warehouse space in Hampshire, England in a fifteen-year lease with at a monthly rent of $7,329 (£5,771) which expires on March 24, 2031 and contains provisions to terminate in 2026, and (iv) approximately 280 square feet of office space in Clovis, CA on a month-to-month lease at a monthly rent of $1,504.

v3.23.2

SUBSEQUENT EVENTS	9 Months Ended
	Jun. 30, 2023
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	NOTE 19 – SUBSEQUENT EVENTS   Heisey Mechanical Acquisition   On July 1, 2023, the Company completed the acquisition of a service contractor and steel fabricator that specializes in industrial and water treatment markets, Heisey Mechanical, Ltd. (“Heisey”) based in Columbia, Pennsylvania to expand the Company’s Industrial Services segment.   The total consideration given by Cemtrex to the shareholder of Heisey for full control, was approximately $2,400,000 with $2,160,000 in cash, $240,000 in a seller’s note. Cemtrex funded the transaction with a $2,160,000 term loan from Fulton Bank. Approximately $25,000 in acquisition costs will be capitalized. The real estate the business occupies is expected to be purchased later for $1,500,000.   Notice of Delisting   On July 25, 2023, the Company received a Notice of Staff Determination from the Listing Qualifications Department of Nasdaq notifying the Company that its Series 1 Preferred Stock had not gained compliance and would be suspended from trading at the opening of business on August 3, 2023. The Company has requested a hearing regarding the delisting that has been scheduled for September 15, 2023, which will stay the suspension and filing of Form 25-NSE with the Securities and Exchange Commission.   Equity shares issued   On July 31, 2023, the Company issued an aggregate of 32,488 shares of common stock to settle $200,000 of notes payable and accrued interest, and $25,792 of excess value of shares issued recorded as interest expense.    On July 6, 2023, the Company issued an aggregate of 1,686 shares of common stock in exchange for services valued at $7,500.    On August 4, 2023, the Company issued an aggregate of 6,400 shares of common stock in exchange for services valued at $45,625.

v3.23.2

INTERIM STATEMENT PRESENTATION (Policies)	9 Months Ended
	Jun. 30, 2023
Accounting Policies [Abstract]
Basis of Presentation and Use of Estimates	Basis of Presentation and Use of Estimates   The accompanying unaudited condensed consolidated financial information should be read in conjunction with the audited consolidated financial statements and the notes thereto included in the Annual Report on Form 10-K for the year ended September 30, 2022, of Cemtrex, Inc.   The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the Unites States (“US GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X pursuant to the requirements of the U.S. Securities and Exchange Commission (‘SEC”). Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. The results of operations for the interim periods are not necessarily indicative of the results of operations for the entire year.   The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the condensed consolidated financial statements, the disclosure of contingent assets and liabilities in the condensed consolidated financial statements and the accompanying notes, and the reported amounts of revenues, expenses and cash flows during the periods presented. Actual amounts and results could differ from those estimates. The estimates and assumptions the Company makes are based on historical factors, current circumstances and the experience and judgment of the Company’s management. The Company evaluates its estimates and assumptions on an ongoing basis.   Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations.   The condensed consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries, Cemtrex Technologies Pvt. Ltd., Advanced Industrial Services, Inc., Advanced Industrial Leasing, Inc., and the Company’s majority owned subsidiary Vicon Industries, Inc. and its subsidiary, Vicon Industries Ltd. All inter-company balances and transactions have been eliminated in consolidation.
Accounting Pronouncements	Accounting Pronouncements   Significant Accounting Policies   Note 2 of the Notes to Consolidated Financial Statements, included in the annual report on Form 10-K for the year ended September 30, 2022, includes a summary of the significant accounting policies used in the preparation of the consolidated financial statements.   Recently Issued Accounting Standards   In June 2016, the FASB issued Accounting Standards Update No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“Update 2016-13”). Update 2016-13 replaced the incurred loss model with an expected loss model, which is referred to as the current expected credit loss (“CECL”) model. The CECL model is applicable to the measurement of credit losses on financial assets measured at amortized cost, including but not limited to trade receivables. For public business entities, the new standard became effective for annual reporting periods beginning after December 15, 2022, including interim periods within that reporting period. The Company is currently evaluating the impact of this ASU on our financial statements.   In October 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2021-08, “Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (“ASU No. 2021-08”). ASU No. 2021-08 will require companies to apply the definition of a performance obligation under ASC Topic 606 to recognize and measure contract assets and contract liabilities (i.e., deferred revenue) relating to contracts with customers that are acquired in a business combination. Under current U.S. GAAP, an acquirer generally recognizes assets acquired and liabilities assumed in a business combination, including contract assets and contract liabilities arising from revenue contracts with customers, at fair value on the acquisition date. ASU No. 2021-08 will result in the acquirer recording acquired contract assets and liabilities on the same basis that would have been recorded by the acquiree before the acquisition under ASC Topic 606. ASU No. 2021-08 is effective for fiscal years beginning after December 15, 2022, with early adoption permitted. The Company is currently evaluating the impact of this ASU on our financial statements.     On June 30, 2022, the FASB issued ASU 2022-03 Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions (“ASU 2022-03”), which (1) clarifies the guidance in ASC 820 on the fair value measurement of an equity security that is subject to a contractual sale restriction and (2) requires specific disclosures related to such an equity security. Under current guidance, stakeholders have observed diversity in practice related to whether contractual sale restrictions should be considered in the measurement of the fair value of equity securities that are subject to such restrictions. On the basis of interpretations of existing guidance and the current illustrative example in ASC 820-10-55-52 of a restriction on the sale of an equity instrument, some entities use a discount for contractual sale restrictions when measuring fair value, while others view the application of such a discount to be inconsistent with the principles of ASC 820. To reduce the diversity in practice and increase the comparability of reported financial information, ASU 2022-03 clarifies this guidance and amends the illustrative example. ASU No. 2022-03 is effective for fiscal years beginning after December 15, 2023, with early adoption permitted. The Company is currently evaluating the impact of this ASU on our financial statements.   The Company does not believe that any other recently issued but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying condensed consolidated financial statements.

v3.23.2

DISCONTINUED OPERATIONS (Tables)	9 Months Ended
	Jun. 30, 2023
Discontinued Operations and Disposal Groups [Abstract]
SUMMARY OF LOSS ON SALE	The following table summarizes the loss on the sale recorded during the three months ended December 31, 2022, included in Income/(loss) from discontinued operations, net of tax in the accompanying condensed consolidated statement of Operations:  SUMMARY OF LOSS ON SALE          Purchase Price   $ 745,621   Less cash and cash equivalents transferred     (699,423 ) Less liabilities assumed     (10,924 ) Net purchase price   $ 35,274             Assets Sold         Accounts receivable, net   $ 625,638   Inventory, net     980,730   Prepaid expenses and other assets     502,577   Property and equipment, net     837,808   Goodwill     598,392   Total Assets Sold     3,545,145   Liabilities Transferred         Accounts payable     370,774   Short-term liabilities     364,775   Long-term liabilities     318,981   Total Liabilities Transferred     1,054,530   Net assets sold   $ 2,490,615             Pretax loss on sale of Cemtrex Advanced Technologies, Inc, and Cemtrex XR, Inc.Companies   $ (2,455,341 )
SCHEDULE OF ASSETS AND LIABILITIES INCLUDED WITHIN DISCONTINUED OPERATIONS	Assets and liabilities included within discontinued operations on the Company’s Condensed Consolidated Balance Sheets at June 30, 2023, and September 30, 2022, are as follows;  SCHEDULE OF ASSETS AND LIABILITIES INCLUDED WITHIN DISCONTINUED OPERATIONS     June 30,     September 30,       2023     2022   Assets                 Current assets                 Cash and equivalents   $ -     $ 714,420   Trade receivables, net     -       561,470   Inventory –net of allowance for inventory obsolescence     -       1,043,865   Prepaid expenses and other assets     -       153,461   Total current assets     -       2,473,216                     Property and equipment, net     -       825,850   Other     -       672,627   Total Assets   $ -     $ 3,971,693                     Liabilities                 Current liabilities                 Accounts payable   $ -     $ 205,622   Short-term liabilities     -       464,429   Deposits from customers     -       125,032   Accrued expenses     -       10,136   Total current liabilities     -       805,219                     Long-term liabilities                 Deferred revenue             6,273   Total long-term liabilities     -       6,273   Total liabilities   $ -     $ 811,492     During the first quarter of fiscal 2023, Vicon completed the closure of its discontinued operating entity Vicon Systems, Ltd. located in Israel. The Company received funds related to benefit obligations of $96,095, which at the time of operational closure were not guaranteed to be retrievable. The company paid $7,010 in consulting fees for assistance in retrieving these funds. The net amount of $89,085 is recognized on the Company’s Condensed Consolidated Income Statement as part of the Loss on Discontinued Operations.     Gain/(loss) from discontinued operations, net of tax and the loss on sale of discontinued operations, net of tax, of Cemtrex Advanced Technologies, Inc. and Cemtrex XR, Inc., sold during the first quarter of fiscal year 2023, which are presented in total as discontinued operations, net of tax in the Company’s Condensed Consolidated Statements of Operations for the three and nine month periods ended June 30, 2023 and 2022, are as follows:       2023     2022     2023     2022       Three months ended June 30,     Nine months ended June 30,       2023     2022     2023     2022   Total net sales   $ -     $ 1,521,942     $ 649,061     $ 3,763,234   Cost of sales     -       685,693       228,086       1,997,211   Operating, selling, general and administrative expenses     1,443       1,425,801       1,297,507       4,036,614   Other (income)/expenses     -       248,749       3,195       11,808   Income (loss) from discontinued operations     (1,443 )     (838,301 )     (879,727 )     (2,282,399 ) Amortization of discounted royalties     14,724       -       33,875       -   Loss on sale of discontinued operations     -       -       (2,455,341 )     -   Adjustment of benefit obligation     -       -       89,085       -   Income tax provision     -       -       -       -   Discontinued operations, net of tax   $ 13,281     $ (838,301 )   $ (3,212,108 )   $ (2,282,399 )

v3.23.2

LOSS PER COMMON SHARE (Tables)	9 Months Ended
	Jun. 30, 2023
Earnings Per Share [Abstract]
SCHEDULE OF COMPUTATION OF DILUTED NET LOSS PER COMMON SHARE AS ANTI-DILUTIVE EFFECT	SCHEDULE OF COMPUTATION OF DILUTED NET LOSS PER COMMON SHARE AS ANTI-DILUTIVE EFFECT     2023     2022     2023     2022       For the three months ended     For the nine months ended       June 30,     June 30,       2023     2022     2023     2022                                     Options     28,796       34,579       28,796       34,579

v3.23.2

SEGMENT INFORMATION (Tables)	9 Months Ended
	Jun. 30, 2023
Segment Reporting [Abstract]
SCHEDULE OF SEGMENT INFORMATION	The following tables summarize the Company’s segment information:  SCHEDULE OF SEGMENT INFORMATION     Security     Industrial Services     Corporate     Consolidated     Security     Industrial Services     Corporate     Consolidated       Three months ended June 30, 2023     Nine months ended June 30, 2023       Security     Industrial Services     Corporate     Consolidated     Security     Industrial Services     Corporate     Consolidated   Revenues   $ 9,015,279     $ 5,714,861     $ -     $ 14,730,140     $ 25,933,921     $ 16,839,858     $ -     $ 42,773,779   Cost of revenues     4,610,443       3,639,054       -       8,249,497       13,005,314       10,908,935       -       23,914,249   Gross profit   $ 4,404,836     $ 2,075,807     $ -     $ 6,480,643     $ 12,928,607     $ 5,930,923     $ -     $ 18,859,530   Operating expenses                                                                 Sales, general, and administrative     3,182,509       912,387       1,032,183       5,127,079       9,494,634       3,437,565       2,826,134       15,758,333   Depreciation and amortization     90,630       159,251       -       249,881       161,833       484,157       52,279       698,269   Research and development     1,049,909       -       -       1,049,909       3,895,717       -       -       3,895,717   Operating income/(loss)   $ 81,788     $ 1,004,169     $ (1,032,183 )   $ 53,774     $ (623,577 )   $ 2,009,201     $ (2,878,413 )   $ (1,492,789 )                                                                   Other income/(expense)   $ (282,857 )   $ (7,281 )   $ (929,395 )   $ (1,219,533 )   $ (58,065 )   $ (68,707 )   $ (3,196,712 )   $ (3,323,484 )       Security     Industrial Services     Corporate     Consolidated     Security     Industrial Services     Corporate     Consolidated       Three months ended June 30, 2022     Nine months ended June 30, 2022       Security     Industrial Services     Corporate     Consolidated     Security     Industrial Services     Corporate     Consolidated   Revenues   $ 6,640,913     $ 5,467,991     $ -     $ 12,108,904     $ 17,740,445       15,527,871     $ -     $ 33,268,316   Cost of revenues     3,257,672       3,811,125       -       7,068,797       10,261,376       10,974,802       -       21,236,178   Gross profit   $ 3,383,241     $ 1,656,866     $ -     $ 5,040,107     $ 7,479,069     $ 4,553,069     $ -     $ 12,032,138   Operating expenses                                                                 Sales, general, and administrative     3,057,839       1,081,392       814,487       4,953,718       8,483,955       3,706,041       2,867,239       15,057,235   Depreciation and amortization     217,497       174,066       36,248       427,811       398,707       529,779       109,652       1,038,138   Research and development     1,189,875       -       -       1,189,875       3,660,883       -       -       3,660,883   Operating (loss)/income   $ (1,081,970 )   $ 401,408     $ (850,735 )   $ (1,531,297 )   $ (5,064,476 )   $ 317,249     $ (2,976,891 )   $ (7,724,118 )                                                                   Other income/(expense)   $ (83,355 )   $ (104,797 )   $ 1,578,107     $ 1,389,955     $ 741,330     $ (181,586 )   $ (864,616 )   $ (304,872 )       2023     2022       June 30,     September 30,       2023     2022   Identifiable Assets                 Security   $ 20,631,185     $ 15,257,235   Industrial Services     17,302,398       16,658,984   Corporate     3,810,093       9,869,716   Discontinued operations     -       3,971,693   Total Assets   $ 41,743,676     $ 45,757,628

v3.23.2

FAIR VALUE MEASUREMENTS (Tables)	9 Months Ended
	Jun. 30, 2023
Fair Value Disclosures [Abstract]
SCHEDULE OF FAIR VALUE OF ASSETS	The Company’s fair value assets at June 30, 2023, and September 30, 2022, are as follows.  SCHEDULE OF FAIR VALUE OF ASSETS     (Level 1)     (Level 2)     (Level 3)     2023       Quoted Prices     Significant               in Active     Other     Significant     Balance       Markets for     Observable     Unobservable     as of       Identical Assets     Inputs     Inputs     June 30,       (Level 1)     (Level 2)     (Level 3)     2023   Assets                                 Investment in marketable securities                                      (included in short-term investments)   $ 13,663     $ -     $ -     $ 13,663                                                                        Fair value assets   $ 13,663     $ -     $ -     $ 13,663         (Level 1)     (Level 2)     (Level 3)     2022       Quoted Prices     Significant               in Active     Other     Significant     Balance       Markets for     Observable     Unobservable     as of       Identical Assets     Inputs     Inputs     September 30,       (Level 1)     (Level 2)     (Level 3)     2022   Assets                                 Investment in marketable securities                                        (included in short-term investments)   $ 13,721     $ -     $ -     $ 13,721                                     Fair value assets    $ 13,721     $ -     $ -     $ 13,721

v3.23.2

TRADE RECEIVABLES, NET (Tables)	9 Months Ended
	Jun. 30, 2023
Receivables [Abstract]
SCHEDULE OF TRADE RECEIVABLES, NET	Trade receivables, net consist of the following:  SCHEDULE OF TRADE RECEIVABLES, NET     June 30,     September 30,       2023     2022   Trade receivables   $ 7,757,039     $ 5,648,655   Allowance for doubtful accounts     (249,284 )     (249,439 ) Accounts receivables, net, total   $ 7,507,755     $ 5,399,216

v3.23.2

INVENTORY, NET (Tables)	9 Months Ended
	Jun. 30, 2023
Inventory Disclosure [Abstract]
SCHEDULE OF INVENTORY, NET	Inventory, net, consist of the following:  SCHEDULE OF INVENTORY, NET     June 30,     September 30,       2023     2022   Raw materials   $ 1,130,327     $ 1,375,933   Work in progress     95,773       120,026   Finished goods     8,099,426       8,080,235   Inventory, gross     9,325,526       9,576,194   Less: Allowance for inventory obsolescence     (605,786 )     (1,088,377 ) Inventory –net of allowance for inventory obsolescence   $ 8,719,740     $ 8,487,817

v3.23.2

PREPAID AND OTHER CURRENT ASSETS (Tables)	9 Months Ended
	Jun. 30, 2023
Prepaid And Other Current Assets
SUMMARY OF PREPAID AND OTHER CURRENT ASSETS	Prepaid and other current assets consisting of the following:  SUMMARY OF PREPAID AND OTHER CURRENT ASSETS     June 30, 2023     September 30, 2022                 Prepaid expenses   $ 344,300     $ 536,820   Prepaid inventory     1,427,013       220,553   Deferred costs     60,169       40,626   Prepaid income taxes     402,048       604,840   VAT & GST tax receivable     289,371       236,986   Contract assets     566,515       781,819   Prepaid expenses and other assets total   $ 3,089,416     $ 2,421,644

v3.23.2

PROPERTY AND EQUIPMENT (Tables)	9 Months Ended
	Jun. 30, 2023
Property, Plant and Equipment [Abstract]
SUMMARY OF PROPERTY AND EQUIPMENT	Property and equipment are summarized as follows:  SUMMARY OF PROPERTY AND EQUIPMENT     June 30,     September 30,       2023     2022   Land   $ 790,373     $ 790,373   Building and leasehold improvements     2,915,918       2,906,953   Furniture and office equipment     574,645       546,548   Computers and software     1,333,135       365,892   Machinery and equipment     10,725,259       11,242,709   Property and equipment, gross     16,339,330       15,852,475   Less: Accumulated depreciation     (10,158,559 )     (10,572,033 ) Property and equipment, net   $ 6,180,771     $ 5,280,442

v3.23.2

OTHER ASSETS (Tables)	9 Months Ended
	Jun. 30, 2023
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
SCHEDULE OF OTHER ASSETS	Other assets consist of the following:  SCHEDULE OF OTHER ASSETS     June 30, 2023     September 30, 2022   Rental deposits   $ 251,739     $ 204,388   Investment in Masterpiece VR     1,000,000       1,000,000   Other deposits     64,626       24,467   Demonstration equipment supplied to resellers     330,038       170,890   Other assets total   $ 1,646,403     $ 1,399,745

v3.23.2

LEASES (Tables)	9 Months Ended
	Jun. 30, 2023
Leases
SCHEDULE OF RECONCILIATION OF UNDISCOUNTED CASH FLOWS TO OPERATING LEASE LIABILITIES	A reconciliation of undiscounted cash flows to operating lease liabilities recognized in the condensed consolidated balance sheet at June 30, 2023, is set forth below:  SCHEDULE OF RECONCILIATION OF UNDISCOUNTED CASH FLOWS TO OPERATING LEASE LIABILITIES Years ending September 30,   Operating Leases   2023     211,721   2024     786,889   2025     764,530   2026     684,449   2027 & Thereafter     289,528   Undiscounted lease payments     2,737,117   Amount representing interest     (523,776 ) Discounted lease payments   $ 2,213,341
SCHEDULE OF LEASE COSTS	Lease costs for the three and nine months ended June 30, 2023, and 2022 are set forth below.:  SCHEDULE OF LEASE COSTS     2023     2022     2023     2022       For the three months ended     For the nine months ended       June 30,     June 30,       2023     2022     2023     2022   Operating lease costs     193,843       223,595       678,489       592,958   Total lease cost   $ 193,843     $ 223,595     $ 678,489     $ 592,958

v3.23.2

LINES OF CREDIT AND LONG-TERM LIABILITIES (Tables)	9 Months Ended
	Jun. 30, 2023
Debt Disclosure [Abstract]
SCHEDULE OF LINES OF CREDIT AND LIABILITIES	The following table outlines the Company’s lines of credit and secured liabilities.  SCHEDULE OF LINES OF CREDIT AND LIABILITIES                 June 30,     September 30,       Interest Rate     Maturity     2023     2022   Fulton Bank line of credit $3,500,000 - The terms of this line of credit are subject to the bank’s review annually on February 1.   Secured Overnight Financing Rate (“SOFR”) plus 2.37% (7.46% as of June 30, 2023 and 5.35% as of September 30, 2022)       N/A     $ -     $ -                                   Fulton Bank loan $5,250,000 for the purchase of AIS $5,000,000 of the proceeds went to the direct purchase of AIS.   SOFR plus 2.37%(7.46% as of June 30, 2023 and 5.35% as of September 30, 2022)       12-15-2022       -       247,284                                   Fulton Bank loan $400,000 fund equipment for AIS.   SOFR plus 2.37% (7.46% as of June 30, 2023 and 5.35% as of September 30, 2022)       05-01-2023       -       63,280                                   Fulton Bank - $360,000 fund equipment for AIS. The Company was in compliance with loan covenants as of June 30, 2023. This loan is secured by certain assets of the Company.   SOFR plus 2.37% (7.46% as of June 30, 2023 and 5.35% as of September 30, 2022).       01-31-2025       128,086       183,839                                   Fulton Bank mortgage $2,476,000. The Company was in compliance with loan covenants as of June 30, 2023. This loan is secured by the underlying asset   SOFR plus 2.62% (7.71% as of June 30, 2023 and 5.6% as of September 30, 2022).       01-28-2040       2,195,515       2,245,664                                   Note payable - $439,774. For the purchase of VDI. Payable in two installments on October 26, 2021, and October 26, 2022.   5 %     10-26-2022       -       219,370                                   Note payable - $5,755,000 - Less original issue discount $750,000 and legal fees $5,000, net cash received $5,000,000 Unamortized original issue discount balance of $0 and $250,000, as of June 30, 2023 and September 30, 2022 respectively.   8 %     06-30-2024       4,899,908       4,943,929                                   Note payable - $9,205,000. Less original issue discount $1,200,000 and legal fees $5,000,net cash received $8,000,000. 28,572 shares of common stock valued at $700,400 recognized as additional original issue discount. Unamortized original issue discount balance of $105,578 and $1,064,778 as of June 30, 2023 and September 30, 2022 respectivly.   8 %     08-23-2023       10,491,283       9,738,632                                   Term Loan Agreement with NIL Funding Corporation (“NIL”) - $5,600,000 The Company was in compliance with loan covenants as of June 30, 2023.   11.50 %     12-31-2024       2,179,743       2,804,743                                   Paycheck Protection Program loan - $121,400 - The issuing bank determined that this loan qualifies for loan forgiveness; however the Company is awaiting final approval from the Small Business Administration.   1 %     05-05-2025       101,246       121,400                                   Software License Agreement - $1,125,000, for the purchase of software source code for use in our Security segment products   N/A       06-03-2024       900,000       -   Total lines of credit and secured liabilities                 $ 20,895,781     $ 20,568,141   Less: Current maturities                   (17,185,167 )     (16,894,743 ) Less: Unamortized original issue discount                   (105,578 )     (1,305,778 ) Lines of credit and secured liabilities, Long Term                 $ 3,605,036     $ 2,367,620

v3.23.2

ORGANIZATION AND PLAN OF OPERATIONS (Details Narrative) - USD ($)			3 Months Ended						9 Months Ended		12 Months Ended
	Jan. 25, 2023	Nov. 22, 2022	Jun. 30, 2023	Mar. 31, 2023	Dec. 31, 2022	Jun. 30, 2022	Mar. 31, 2022	Dec. 31, 2021	Jun. 30, 2023	Jun. 30, 2022	Sep. 30, 2022	Sep. 30, 2021	Jul. 29, 2022	Jan. 24, 2022
Reverse stock split	35:1 reverse stock split								35:1 reverse stock split
Net loss			$ (1,146,524)	$ (594,794)	$ (6,277,211)	$ (680,793)	$ (4,721,247)	$ (4,477,951)	$ (8,018,529)	$ (9,879,991)	$ 13,020,958	$ 7,807,995
Loss from continuing operations									4,835,914
Debt obligations			17,185,167						17,185,167
Working capital			$ 967,489						$ 967,489
Common Stock [Member]
Reverse stock split	35:1 reverse stock split
Minimum share bid price														$ 1.00
Common Stock [Member] | Minimum [Member]
Minimum share bid price														$ 1.00
Preferred Stock [Member]
Minimum share bid price													$ 1.00
Preferred Stock [Member] | Minimum [Member]
Minimum share bid price													$ 1.00
Cemtrex XR Inc [Member]
Consideration transferred		$ 895,000
Cash payable		$ 75,000
Royalty percentage		5.00%
Royalty description		the Business to be paid 90 days after the end of each calendar year for the next three years; and should the total sum of royalties due be less than $820,000 at the end of the three-year period, Purchaser shall be obligated to pay the difference between $820,000 and the royalties paid.
Royalties paid		$ 820,000
Cemtrex Advanced Technologies Inc [Member]
Cash payable		$ 10,000
Royalty percentage		5.00%
Royalty description		the Business to be paid 90 days after the end of each calendar year for the next 5 years
Common equity		$ 1,600,000
Common equity, description		subsequent fundraising or exit above $5M with a $10M cap.

v3.23.2

SUMMARY OF LOSS ON SALE (Details) - USD ($)	3 Months Ended			6 Months Ended	9 Months Ended
	Jun. 30, 2023	Dec. 31, 2022	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Sep. 30, 2022
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Purchase Price	$ 96,095			$ 96,095
Assets Sold
Accounts receivable, net						$ 561,470
Total Assets Sold						3,971,693
Liabilities Transferred
Short-term liabilities						805,219
Long-term liabilities						6,273
Total Liabilities Transferred						$ 811,492
Pretax loss on sale of Cemtrex Advanced Technologies, Inc, and Cemtrex XR, Inc.Companies				$ (2,455,341)
Discontinued Operations, Disposed of by Sale [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Purchase Price		$ 745,621
Less cash and cash equivalents transferred		(699,423)
Less liabilities assumed		(10,924)
Net purchase price		35,274
Assets Sold
Accounts receivable, net		625,638
Inventory, net		980,730
Prepaid expenses and other assets		502,577
Property and equipment, net		837,808
Goodwill		598,392
Total Assets Sold		3,545,145
Liabilities Transferred
Accounts payable		370,774
Short-term liabilities		364,775
Long-term liabilities		318,981
Total Liabilities Transferred		1,054,530
Net assets sold		2,490,615
Pretax loss on sale of Cemtrex Advanced Technologies, Inc, and Cemtrex XR, Inc.Companies		$ (2,455,341)

v3.23.2

SCHEDULE OF ASSETS AND LIABILITIES INCLUDED WITHIN DISCONTINUED OPERATIONS (Details) - USD ($)	3 Months Ended		6 Months Ended	9 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Sep. 30, 2022
Current assets
Cash and equivalents					$ 714,420
Trade receivables, net					561,470
Inventory –net of allowance for inventory obsolescence					1,043,865
Prepaid expenses and other assets					153,461
Total current assets					2,473,216
Property and equipment, net					825,850
Other					672,627
Total Assets Sold					3,971,693
Current liabilities
Accounts payable					205,622
Short-term liabilities					464,429
Deposits from customers					125,032
Accrued expenses					10,136
Total current liabilities					805,219
Deferred revenue					6,273
Total long-term liabilities					6,273
Total Liabilities Transferred					$ 811,492
Total net sales		$ 1,521,942	649,061	$ 3,763,234
Cost of sales		685,693	228,086	1,997,211
Operating, selling, general and administrative expenses	1,443	1,425,801	1,297,507	4,036,614
Other (income)/expenses		248,749	3,195	11,808
Income (loss) from discontinued operations	(1,443)	(838,301)	(879,727)	(2,282,399)
Amortization of discounted royalties	14,724		33,875
Loss on sale of discontinued operations			(2,455,341)
Adjustment of benefit obligation			89,085
Income tax provision
Discontinued operations, net of tax	$ 13,281	$ (838,301)	$ (3,212,108)	$ (2,282,399)

v3.23.2

DISCONTINUED OPERATIONS (Details Narrative) - USD ($)		9 Months Ended
	Nov. 22, 2022	Jun. 30, 2023
Discontinued operations funds received		$ 96,095
Discontinued operations consulting fees		7,010
Loss on discontinued operations		89,085
Smart Desk [Member] | Safe Agreement [Member]
Royalty expense	$ 0
Cemtrex XR Inc [Member]
Increase in royalty payment	820,000
Royalties paid	$ 820,000
Cemtrex XR Inc [Member] | Accounting Standards Update 2020-08 [Member]
Royalties paid		$ 691,611

v3.23.2

SCHEDULE OF COMPUTATION OF DILUTED NET LOSS PER COMMON SHARE AS ANTI-DILUTIVE EFFECT (Details) - shares	3 Months Ended		9 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Share-Based Payment Arrangement, Option [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Options	28,796	34,579	28,796	34,579

v3.23.2

SCHEDULE OF SEGMENT INFORMATION (Details) - USD ($)	3 Months Ended		9 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Sep. 30, 2022
Segment Reporting Information [Line Items]
Revenues	$ 14,730,140	$ 12,108,904	$ 42,773,779	$ 33,268,316
Cost of revenues	8,249,497	7,068,797	23,914,249	21,236,178
Gross profit	6,480,643	5,040,107	18,859,530	12,032,138
Operating expenses
Sales, general, and administrative	5,127,079	4,953,718	15,758,333	15,057,235
Depreciation and amortization	249,881	427,811	698,269	1,038,138
Research and development	1,049,909	1,189,875	3,895,717	3,660,883
Operating income/(loss)	53,774	(1,531,297)	(1,492,789)	(7,724,118)
Other income/(expense)	(1,219,533)	1,389,955	(3,323,484)	(304,872)
Total Assets	41,743,676		41,743,676		$ 45,757,628
Discontinued Operations [Member]
Operating expenses
Total Assets					3,971,693
Security [Member]
Segment Reporting Information [Line Items]
Revenues	9,015,279	6,640,913	25,933,921	17,740,445
Cost of revenues	4,610,443	3,257,672	13,005,314	10,261,376
Gross profit	4,404,836	3,383,241	12,928,607	7,479,069
Operating expenses
Sales, general, and administrative	3,182,509	3,057,839	9,494,634	8,483,955
Depreciation and amortization	90,630	217,497	161,833	398,707
Research and development	1,049,909	1,189,875	3,895,717	3,660,883
Operating income/(loss)	81,788	(1,081,970)	(623,577)	(5,064,476)
Other income/(expense)	(282,857)	(83,355)	(58,065)	741,330
Total Assets	20,631,185		20,631,185		15,257,235
Industrial Services [Member]
Segment Reporting Information [Line Items]
Revenues	5,714,861	5,467,991	16,839,858	15,527,871
Cost of revenues	3,639,054	3,811,125	10,908,935	10,974,802
Gross profit	2,075,807	1,656,866	5,930,923	4,553,069
Operating expenses
Sales, general, and administrative	912,387	1,081,392	3,437,565	3,706,041
Depreciation and amortization	159,251	174,066	484,157	529,779
Research and development
Operating income/(loss)	1,004,169	401,408	2,009,201	317,249
Other income/(expense)	(7,281)	(104,797)	(68,707)	(181,586)
Total Assets	17,302,398		17,302,398		16,658,984
Corporate Segment [Member]
Segment Reporting Information [Line Items]
Revenues
Cost of revenues
Gross profit
Operating expenses
Sales, general, and administrative	1,032,183	814,487	2,826,134	2,867,239
Depreciation and amortization		36,248	52,279	109,652
Research and development
Operating income/(loss)	(1,032,183)	(850,735)	(2,878,413)	(2,976,891)
Other income/(expense)	(929,395)	$ 1,578,107	(3,196,712)	$ (864,616)
Total Assets	$ 3,810,093		$ 3,810,093		$ 9,869,716

v3.23.2

RESTRICTED CASH (Details Narrative) - USD ($)	Jun. 30, 2023	Sep. 30, 2022
Cash and Cash Equivalents [Abstract]
Restricted cash	$ 805,237	$ 1,577,915

v3.23.2

SCHEDULE OF FAIR VALUE OF ASSETS (Details) - USD ($)	Jun. 30, 2023	Sep. 30, 2022
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value assets	$ 13,663	$ 13,721
Marketable Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value assets	13,663	13,721
Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value assets	13,663	13,721
Fair Value, Inputs, Level 1 [Member] | Marketable Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value assets	13,663	13,721
Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value assets
Fair Value, Inputs, Level 2 [Member] | Marketable Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value assets
Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value assets
Fair Value, Inputs, Level 3 [Member] | Marketable Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value assets

v3.23.2

SCHEDULE OF TRADE RECEIVABLES, NET (Details) - USD ($)	Jun. 30, 2023	Sep. 30, 2022
Receivables [Abstract]
Trade receivables	$ 7,757,039	$ 5,648,655
Allowance for doubtful accounts	(249,284)	(249,439)
Accounts receivables, net, total	$ 7,507,755	$ 5,399,216

v3.23.2

SCHEDULE OF INVENTORY, NET (Details) - USD ($)	Jun. 30, 2023	Sep. 30, 2022
Inventory Disclosure [Abstract]
Raw materials	$ 1,130,327	$ 1,375,933
Work in progress	95,773	120,026
Finished goods	8,099,426	8,080,235
Inventory, gross	9,325,526	9,576,194
Less: Allowance for inventory obsolescence	(605,786)	(1,088,377)
Inventory –net of allowance for inventory obsolescence	$ 8,719,740	$ 8,487,817

v3.23.2

SUMMARY OF PREPAID AND OTHER CURRENT ASSETS (Details) - USD ($)	Jun. 30, 2023	Sep. 30, 2022
Prepaid And Other Current Assets
Prepaid expenses	$ 344,300	$ 536,820
Prepaid inventory	1,427,013	220,553
Deferred costs	60,169	40,626
Prepaid income taxes	402,048	604,840
VAT & GST tax receivable	289,371	236,986
Contract assets	566,515	781,819
Prepaid expenses and other assets total	$ 3,089,416	$ 2,421,644

v3.23.2

SUMMARY OF PROPERTY AND EQUIPMENT (Details) - USD ($)	Jun. 30, 2023	Sep. 30, 2022
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 16,339,330	$ 15,852,475
Less: Accumulated depreciation	(10,158,559)	(10,572,033)
Property and equipment, net	6,180,771	5,280,442
Land [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	790,373	790,373
Building And Leasehold Improvements [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	2,915,918	2,906,953
Furniture and Fixtures [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	574,645	546,548
Computers And Software [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	1,333,135	365,892
Machinery and Equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 10,725,259	$ 11,242,709

v3.23.2

PROPERTY AND EQUIPMENT (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Property, Plant and Equipment [Member]
Impairment Effects on Earnings Per Share [Line Items]
Depreciation	$ 249,881	$ 427,811	$ 698,269	$ 1,038,138

v3.23.2

SCHEDULE OF OTHER ASSETS (Details) - USD ($)	Jun. 30, 2023	Sep. 30, 2022
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Rental deposits	$ 251,739	$ 204,388
Investment in Masterpiece VR	1,000,000	1,000,000
Other deposits	64,626	24,467
Demonstration equipment supplied to resellers	330,038	170,890
Other assets total	$ 1,646,403	$ 1,399,745

v3.23.2

OTHER ASSETS (Details Narrative) - USD ($)	3 Months Ended	9 Months Ended
	Jun. 30, 2023	Jun. 30, 2023	Jan. 19, 2022	Nov. 13, 2020
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Investment			$ 500,000	$ 500,000
Impairment expense	$ 0	$ 0

v3.23.2

RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($)					9 Months Ended
	Apr. 27, 2023	Jul. 31, 2022	Feb. 26, 2021	Aug. 31, 2019	Jun. 30, 2023	Sep. 30, 2022
Related Party Transaction [Line Items]
Costs to related party					$ 131,922
Proceeds from royalties received					691,611
Griffin Filters LLC [Member]
Related Party Transaction [Line Items]
Related party transaction description		Company negotiated a payment agreement surrounding the sale of Griffin Filters, LLC and other liabilities due to Cemtrex, Inc
Related Party [Member] | Service [Member]
Related Party Transaction [Line Items]
Other receivables, current					446,466
Related Party [Member] | Trade Accounts Receivable [Member]
Related Party Transaction [Line Items]
Other receivables, current					578,388
Asset Purchase Agreement [Member] | Ducon Technologies Inc [Member] | Griffin Filters LLC [Member]
Related Party Transaction [Line Items]
Due to related parties, current					3,372	$ 19,133
Asset Purchase Agreement [Member] | Ducon Technologies Inc [Member] | Griffin Filters LLC [Member] | Chief Financial Officer [Member]
Related Party Transaction [Line Items]
Total consideration				$ 550,000
Asset Purchase Agreement [Member] | Ducon to Cemtrix Technology [Member] | Griffin Filters LLC [Member]
Related Party Transaction [Line Items]
Related party, Interest rate		5.00%
Debt maturity date		Jul. 31, 2024
Other receivables, current					$ 708,512
Asset Purchase Agreement [Member] | Ducon to Cemtrix Technology [Member] | Related Party [Member]
Related Party Transaction [Line Items]
Due to related parties, current		$ 761,585
Settlement Agreement [Member] | Chief Financial Officer [Member] | Secured Promissory Note [Member]
Related Party Transaction [Line Items]
Debt maturity date	Feb. 28, 2024		Feb. 26, 2023
Debt instrument, principal amount			$ 1,533,280
Debt interest rate			9.00%

v3.23.2

SCHEDULE OF RECONCILIATION OF UNDISCOUNTED CASH FLOWS TO OPERATING LEASE LIABILITIES (Details) - USD ($)	Jun. 30, 2023	Sep. 30, 2022
Leases
2023	$ 211,721
2024	786,889
2025	764,530
2026	684,449
2027 & Thereafter	289,528
Undiscounted lease payments	2,737,117
Amount representing interest	(523,776)
Discounted lease payments	$ 2,213,341	$ 2,576,963

v3.23.2

SCHEDULE OF LEASE COSTS (Details) - USD ($)	3 Months Ended		9 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Leases
Operating lease costs	$ 193,843	$ 223,595	$ 678,489	$ 592,958
Total lease cost	$ 193,843	$ 223,595	$ 678,489	$ 592,958

v3.23.2

LEASES (Details Narrative)	9 Months Ended
	Jun. 30, 2023 USD ($) ft²	Sep. 30, 2022 USD ($)	Jun. 30, 2022
Leases
Operating lease term	3 years		3 years
Lease liabilities	$ 2,213,341	$ 2,576,963
Lease liabilities - short term	$ 716,896	$ 754,495
Weighted average discount rate lease	5.64%		5.66%
Area of Land | ft²	100
Payments for rent	$ 600

v3.23.2

SCHEDULE OF LINES OF CREDIT AND LIABILITIES (Details) (Parenthetical) - USD ($)	3 Months Ended	9 Months Ended
	Mar. 31, 2022	Jun. 30, 2023	Jun. 30, 2022	Sep. 30, 2022
Line of Credit Facility [Line Items]
Notes payable - discount		$ 1,200,200	$ 908,333
Proceeds from notes payable			$ 8,000,000
Notes payable - Unamortized discount		$ 105,578		$ 1,305,778
Common stock, value	$ 695,400
Notes Payable [Member]
Line of Credit Facility [Line Items]
Interest rate		5.00%
Notes payable		$ 439,774
Notes Payable One [Member]
Line of Credit Facility [Line Items]
Interest rate		8.00%
Notes payable		$ 5,755,000
Notes payable - discount		750,000
Notes payable - leagal fees		5,000
Proceeds from notes payable		5,000,000
Notes payable - Unamortized discount		$ 0		250,000
Notes Payable Two [Member]
Line of Credit Facility [Line Items]
Interest rate		8.00%
Notes payable		$ 9,205,000
Notes payable - discount		1,200,000
Notes payable - leagal fees		5,000
Proceeds from notes payable		8,000,000
Notes payable - Unamortized discount		$ 105,578		$ 1,064,778
Common stock, shares		28,572
Common stock, value		$ 700,400
Term Loans [Member]
Line of Credit Facility [Line Items]
Interest rate		11.50%
Loans payable		$ 5,600,000
P P P Loans [Member]
Line of Credit Facility [Line Items]
Interest rate		1.00%
Loans payable		$ 121,400
Software License Agreement [Member]
Line of Credit Facility [Line Items]
Loans payable		1,125,000
Fulton Bank [Member]
Line of Credit Facility [Line Items]
Loans payable to bank		$ 3,500,000
Interest rate basis spread		2.37%
Interest rate		7.46%		5.35%
Fulton Bank One [Member]
Line of Credit Facility [Line Items]
Loans payable to bank		$ 5,250,000
Interest rate basis spread		2.37%
Interest rate		7.46%		5.35%
Proceeds from debt		$ 5,000,000
Fulton Bank Two [Member]
Line of Credit Facility [Line Items]
Loans payable to bank		$ 400,000
Interest rate basis spread		2.37%
Interest rate		7.46%		5.35%
Fulton Bank Three [Member]
Line of Credit Facility [Line Items]
Loans payable to bank		$ 360,000
Interest rate basis spread		237.00%
Interest rate		7.46%		5.35%
Fulton Bank Mortgage Payable [Member]
Line of Credit Facility [Line Items]
Loans payable to bank		$ 2,476,000
Interest rate basis spread		2.62%
Interest rate		7.71%		5.60%

v3.23.2

SCHEDULE OF LINES OF CREDIT AND LIABILITIES (Details) - USD ($)	9 Months Ended
	Jun. 30, 2023	Sep. 30, 2022
Line of Credit Facility [Line Items]
Total Notes payable	$ 20,895,781	$ 20,568,141
Current maturities	(17,185,167)	(16,894,743)
Unamortized original issue discount	(105,578)	(1,305,778)
Notes Payable, Long Term	3,605,036	2,367,620
Software License Agreement [Member]
Line of Credit Facility [Line Items]
Total Notes payable	$ 900,000
Maturity date	Jun. 03, 2024
Fulton Bank [Member]
Line of Credit Facility [Line Items]
Total Notes payable
Fulton Bank One [Member]
Line of Credit Facility [Line Items]
Total Notes payable		247,284
Maturity date	Dec. 15, 2022
Fulton Bank Two [Member]
Line of Credit Facility [Line Items]
Total Notes payable		63,280
Maturity date	May 01, 2023
Fulton Bank Three [Member]
Line of Credit Facility [Line Items]
Total Notes payable	$ 128,086	183,839
Maturity date	Jan. 31, 2025
Fulton Bank Mortgage Payable [Member]
Line of Credit Facility [Line Items]
Total Notes payable	$ 2,195,515	2,245,664
Maturity date	Jan. 28, 2040
Notes Payable [Member]
Line of Credit Facility [Line Items]
Total Notes payable		219,370
Maturity date	Oct. 26, 2022
Notes Payable One [Member]
Line of Credit Facility [Line Items]
Total Notes payable	$ 4,899,908	4,943,929
Maturity date	Jun. 30, 2024
Notes Payable Two [Member]
Line of Credit Facility [Line Items]
Total Notes payable	$ 10,491,283	9,738,632
Maturity date	Aug. 23, 2023
Term Loans [Member]
Line of Credit Facility [Line Items]
Total Notes payable	$ 2,179,743	2,804,743
Maturity date	Dec. 31, 2024
P P P Loans [Member]
Line of Credit Facility [Line Items]
Total Notes payable	$ 101,246	$ 121,400
Maturity date	May 05, 2025

v3.23.2

LINES OF CREDIT AND LONG-TERM LIABILITIES (Details Narrative) - USD ($)							9 Months Ended
	Mar. 29, 2024	May 03, 2023	Apr. 03, 2023	Mar. 29, 2023	Mar. 03, 2023	Jan. 12, 2023	Jun. 30, 2023	Sep. 30, 2022
Line of Credit Facility [Line Items]
Long term debt							$ 20,895,781	$ 20,568,141
NIL Funding [Member]
Line of Credit Facility [Line Items]
Maturity date					Dec. 31, 2024
Exchange Fee					11.50%
Fees				$ 10,000
Additional principal payment				$ 100,000
NIL Funding [Member] | Forecast [Member]
Line of Credit Facility [Line Items]
Additional principal payment	$ 100,000
Software License Agreement [Member]
Line of Credit Facility [Line Items]
Maturity date							Jun. 03, 2024
Additional principal payment			$ 1,125,000
Debt instrument periodic payment			$ 75,000
Long term debt							$ 900,000
Streeterville Capital LLC [Member]
Line of Credit Facility [Line Items]
Original amount		$ 5,755,000
Increase in original amount		$ 252,912
Interest expense						$ 451,422
Exchange Fee		5.00%
Streeterville Capital LLC [Member] | September Thirty Two Thousand Twenty One Note [Member]
Line of Credit Facility [Line Items]
Original amount						5,755,000
Increase in original amount						148,000
Streeterville Capital LLC [Member] | February Twenty Two Two Thousand Twenty Two Note [Member]
Line of Credit Facility [Line Items]
Original amount						9,205,000
Increase in original amount						$ 303,422

v3.23.2

STOCKHOLDERS’ EQUITY (Details Narrative) - USD ($)			3 Months Ended		9 Months Ended
	Feb. 02, 2023	Jan. 25, 2023	Jun. 30, 2023	Mar. 31, 2023	Jun. 30, 2023	Sep. 30, 2022
Class of Stock [Line Items]
Preferred stock, shares authorized			10,000,000		10,000,000	10,000,000
Preferred stock, par value			$ 0.001		$ 0.001	$ 0.001
Preferred stock, shares issued			2,343,016		2,343,016	2,129,122
Preferred stock, shares outstanding			2,278,916		2,278,916	2,065,022
Common stock, shares authorized			50,000,000		50,000,000	50,000,000
Common stock, par value			$ 0.001		$ 0.001	$ 0.001
Common stock, shares issued			957,760		957,760	754,711
Common stock, shares outstanding			957,760		957,760	754,711
Stockholders equity reverse stock split, descriptions		35:1 reverse stock split			35:1 reverse stock split
Stock issued, shares	19,314
Common stock shares, issued for service					22,017
Common stock value, issued for service			$ 39,372	$ 102,500	$ 141,872
Notes Payable to Banks [Member]
Class of Stock [Line Items]
Notes payable amount			487,716		487,716
Accrued interest			$ 662,284		662,284
Stock issued, value					$ 276,151
Common Stock [Member]
Class of Stock [Line Items]
Stockholders equity reverse stock split, descriptions		35:1 reverse stock split
Stock issued, shares					161,718
Common stock shares, issued for service			6,488	15,529
Common stock value, issued for service			$ 7	$ 15
Series 1 Preferred Stock [Member]
Class of Stock [Line Items]
Preferred stock, shares authorized			3,000,000		3,000,000	3,000,000
Preferred stock, shares issued			2,293,016		2,293,016	2,079,122
Preferred stock, shares outstanding			2,228,916		2,228,916	2,015,022
Preferred stock dividends shares					213,894
Series C Preferred Stock [Member]
Class of Stock [Line Items]
Preferred stock, shares authorized			100,000		100,000	100,000
Preferred stock, shares issued			50,000		50,000	50,000
Preferred stock, shares outstanding			50,000		50,000	50,000

v3.23.2

SHARE-BASED COMPENSATION (Details Narrative) - USD ($)	9 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Share-Based Payment Arrangement [Abstract]
Share-based compensation expense	$ 93,313	$ 111,402
Unrecognized compensation cost	$ 76,831
Options to purchase	2,931
Exercise price	$ 13.65
Options to forfeited	2,858
Exercise price cancelled	$ 40.95

v3.23.2

COMMITMENTS AND CONTINGENCIES (Details Narrative) - 9 months ended Jun. 30, 2023	USD ($) ft²	INR (₨) ft²	GBP (£) ft²
Product Liability Contingency [Line Items]
Area of land	100	100	100
Monthly rent | $	$ 600
Industrial Services Segment [Member] | Manchester [Member]
Product Liability Contingency [Line Items]
Area of land	25,000	25,000	25,000
Industrial Services Segment [Member] | York [Member]
Product Liability Contingency [Line Items]
Area of land	43,000	43,000	43,000
Industrial Services Segment [Member] | Emigsville [Member]
Product Liability Contingency [Line Items]
Area of land	15,500	15,500	15,500
Monthly rent | $	$ 4,555
Lease expiration date1	Aug. 31, 2025	Aug. 31, 2025	Aug. 31, 2025
Security Segment [Member] | Pune [Member]
Product Liability Contingency [Line Items]
Area of land	6,700	6,700	6,700
Monthly rent	$ 6,453	₨ 456,972
Lease expiration date1	Feb. 28, 2024	Feb. 28, 2024	Feb. 28, 2024
Security Segment [Member] | Hauppauge [Member]
Product Liability Contingency [Line Items]
Area of land	30,000	30,000	30,000
Monthly rent | $	$ 28,719
Lease expiration date1	Mar. 31, 2027	Mar. 31, 2027	Mar. 31, 2027
Security Segment [Member] | Hampshire [Member]
Product Liability Contingency [Line Items]
Area of land	9,400	9,400	9,400
Monthly rent	$ 7,329		£ 5,771
Lease expiration date1	Mar. 24, 2031	Mar. 24, 2031	Mar. 24, 2031
Lessee operating lease, description	terminate in 2026	terminate in 2026	terminate in 2026
Security Segment [Member] | Clovis CA [Member]
Product Liability Contingency [Line Items]
Area of land	280	280	280
Monthly rent | $	$ 1,504

v3.23.2

SUBSEQUENT EVENTS (Details Narrative) - USD ($)					3 Months Ended			9 Months Ended
	Aug. 04, 2023	Jul. 31, 2023	Jul. 06, 2023	Jul. 01, 2023	Jun. 30, 2023	Mar. 31, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Subsequent Event [Line Items]
Common stock, shares issued								22,017
Interest expense					$ 1,254,185		$ 925,545	$ 3,717,557	$ 3,641,432
Common stock, share value					$ 39,372	$ 102,500		$ 141,872
Subsequent Event [Member]
Subsequent Event [Line Items]
Acquisition consideration				$ 2,400,000
Acquisition consideration, cash				2,160,000
Acquisition consideration, seller's note				240,000
Business combination consideration transferred liabilities incurred				2,160,000
Acquisition costs				25,000
Real estate to be purchased				$ 1,500,000
Subsequent Event [Member] | Notes Payable And Accrued Interest [Member]
Subsequent Event [Line Items]
Common stock, shares issued	6,400	32,488	1,686
Repayments of notes payable		$ 200,000
Interest expense		$ 25,792
Common stock, share value	$ 45,625		$ 7,500

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