coal india ltd Auditors report

To the Members of Coal India Limited

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the accompanying Standalone Financial Statements of Coal India Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2023, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the Statement of Cash Flows for the year then ended and notes to the Standalone Financial Statements, including a summary of significant accounting policies and Other Explanatory Notes for the year ended on that date (hereinafter referred to as the "Standalone Financial Statements").

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Standalone Financial Statements give the information required by the Companies Act, 2013 (the "Act") in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended from time to time, ("Ind AS") and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2023, and its profit and Other Comprehensive Income, Changes in Equity and its Cash Flows for the year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Companies Act, 2013. Our responsibilities under those Standards are further described in the Auditors Responsibilities for the Audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the Standalone Financial Statements under the provisions of the Companies Act, 2013 and the Rules thereunder and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Emphasis of Matter

We draw attention to the following notes / matters to the Standalone Financial Statements.

i) Note No. 11(4), regarding carrying forward of input tax credit on GST paid on input materials/services available for utilization against GST on output. GST liability on coal is 5% whereas the inputs are being taxed at 18% and GST Input tax credit getting accumulated amounting to Rs. 76.81 crore and outstanding as at March 31, 2023 (March 31, 2022: Rs. 59.79 crore) largely relate to such inverted duty structure.

The amount is not refundable in terms of notification issued in this respect and is therefore available only for utilization against duty on output. Consequential adjustments and impact thereof pending determination of amount as such cannot be commented upon by us; and

ii) The Regulation 17 read with Schedule II of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 dealing with mandatory requirement of an independent woman director is yet to be complied with by the company.

Our opinion is not modified in respect of the above matters.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Standalone Financial Statements of the current year. These matters were addressed in the context of our audit of the Standalone Financial Statements as a whole, and in forming our opinion thereon, we do not provide a separate opinion on these matters. We have determined the matters described below to be the Key Audit Matters for incorporation in our Report:

Key Audit Matters	Addressing the Key Audit Matters
Evaluation of provisions and Contingent Liabilities:	Our Audit procedures based on which we arrived at the conclusion regarding reasonableness of disclosure of contingent liability and recognition of provisions includes the following:
There are a number of litigations including direct and indirect taxes, various claims, etc. pending before various forums against the Company and the managements judgement is required for estimating the amount to be provided and/or disclosed as contingent liability.	• We have obtained an understanding of the Companys internal instructions and procedures in respect of estimation, assessment and disclosure of contingent liabilities;
We identified this as a key audit matter because the estimates and assessment with respect to these involve a significant degree of managements judgement, interpretations, and may therefore require adequate attention to arrive at the required conclusion.	• Understood and tested the design and operating effectiveness of controls as established by the management for obtaining all relevant information for pending litigation cases;
(Refer Note No. 38(1)(a) to the Standalone Financial Statements, read with the Significant Accounting Policy No. 2.21)	• Discussed with the management regarding any material developments thereto and latest status of legal matters;
	• Read various correspondences and related documents pertaining to litigations involved and relevant external legal opinions obtained by the management and performed substantive procedures on estimation supporting the disclosure of contingent liabilities;
	• Examined managements judgements and assessments in respect of whether provisions are required;
	• Reviewed the managements assessments of those matters which have not been provided for or disclosed as contingent liability since the probability of material outflow has been considered to be remote;
	• Reviewed the adequacy and completeness of disclosures; Based on the above procedures performed, the estimation of provision and disclosures for contingent liabilities have been considered to be adequate and reasonable.
Impairment of investment in subsidiaries:	Our Audit procedures based on which we arrived at the conclusion regarding reasonableness of Impairment includes the following:
As at March 31, 2023, the Company held investments with a carrying amount of Rs. 4,269.42 crore and Rs. 4,657.00 crore in Eastern Coalfields Limited (ECL) and Bharat Coking Coal Limited (BCCL) respectively, wholly owned subsidiaries. These investments are carried at cost in the Companys standalone financial statements. Consequent to accumulation of losses incurred by the subsidiaries in earlier years, net worth of these companies have been eroded to that extent. These are investments in wholly owned subsidiaries and are long term and strategic in nature and as such no impairment in value thereof has been recognised by the management.	• Pursuant to the outcome of the measures taken, the performance of the subsidiary companies after coming out of Board for Industrial and Financial Reconstruction (BIFR) have improved significantly. There had been a consistent positive trend in performance and gradual decrease in accumulated losses of these companies. The accumulated losses of BCCL and ECL have significantly decreased to Rs. 872.87 crore and Rs. 1,725.55 crore from Rs. 4,106.03 crore and Rs. 2,716.00 crore respectively;
We considered this as a key audit matter since the amount of investments are material and value of investment if eroded and lost need to be given effect to in the financial statements in terms of Indian Accounting Standard 36 "Impairment of Assets". The matter during the year ended March 31, 2022 has also been considered relevant for reporting under Emphasis of Matter paragraph by predecessor auditor.	• Sensitivity analysis and evaluation whether any reasonably foreseeable change in assumption could lead to impairment;
(Refer to Note No. 7(1) to the Standalone Financial Statements.)	• Further, in most recent time there has not been any significant events that have occurred or circumstances that have changed that may lead to the likelihood that the carrying amount of these companies would be less than current is remote;
	• Broad review of future performance, prospects for consistency based on our understanding of the internal and external factors largely placing the reliance on managements assumption with respect to expected volume of business and sustainability of the profit;
	• We have evaluated the adequacy of the disclosures made in the Standalone financial statement;
	• Placing reliance on the managements assumption for future prospects, expansion of current capacity, expected volume of business and sustainability of the profitability and cash flows therefrom.

Information Other than the Standalone Financial Statements and Auditors Report Thereon

The Companys Board of Directors is responsible for the other information. The other information comprises the information included in the Annual Report, but does not include the Standalone Financial Statements and our auditors report thereon. The other information as stated above is expected to be made available to us after the date of this auditors report.

Our opinion on the Standalone Financial Statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the Standalone Financial Statements, our responsibility is to read the other information identified above when it becomes available, and, in doing so, consider whether the other information is materially inconsistent with the Standalone Financial Statements, or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated.

When we read the other information as stated above and if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance and describe necessary actions required as per applicable laws and regulations.

Responsibilities of the Management and Those Charged with Governance for the Standalone Financial Statements

The Companys Board of Directors is responsible for the matters stated in section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these Standalone Financial Statements that give a true and fair view of the state of affairs (financial position), Profit or Loss (financial performance including other comprehensive income), changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Indian accounting Standards specified under section 133 of the Act read with relevant rules, as amended.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Standalone Financial Statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the Standalone Financial Statements, management is responsible for assessing the Companys ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those Board of Directors are also responsible for overseeing the Companys financial reporting process.

Auditors Responsibilities for the Audit of the Standalone Financial Statements

Our objectives are to obtain reasonable assurance about whether the Standalone Financial Statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Standalone Financial Statements.

As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the Standalone Financial Statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control;

• Obtain an understanding of internal financial control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such controls;

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the management;

• Conclude on the appropriateness of managements use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Companys ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors report to the related disclosures in the Standalone Financial Statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors report. However, future events or conditions may cause the Company to cease to continue as a going concern; and

• Evaluate the overall presentation, structure and content of the Standalone Financial Statements, including the disclosures, and whether the Standalone Financial Statements represent the underlying transactions and events in a manner that achieves fair presentation.

Materiality is the magnitude of misstatements in the Standalone Financial Statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the Standalone Financial Statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the Standalone Financial Statements.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the Standalone Financial Statements of the current period and are therefore the key audit matters. We describe these matters in our auditors report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Other Matters

The comparative financial information of the Company for the year ended 31^st March, 2022 included in these Ind AS Standalone Financial Statement, are based on the Standalone Financial Statements for the year ended 31^st March, 2022 audited by predecessor auditor, M/s. Ray and Ray, an independent firm of Chartered Accountants, whose report for the year ended 31^st March, 2022 dated 13^th July, 2022 expressed unmodified opinion on those Standalone Financial Statements. Reliance has been placed by us on the said Standalone Financial Statements and the report issued thereupon for the purpose of these Standalone Financial Statements and the report issued by us.

Our opinion is not modified in respect of the above matter.

Report on Other Legal and Regulatory Requirements

1) As required by the Companies (Auditors Report) Order, 2020 ("the Order"), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Companies Act, 2013, we give in the "Annexure – A", a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable;

2) As required under Section 143 (5) of the Companies Act, 2013, we give in the "Annexure – B", a statement on the Directions issued by the Comptroller and Auditor General of India after complying with their suggested methodology of audit, the action taken thereon and its impact on the accounts and Standalone Financial Statements of the Company;

3) Further to our comments in the annexure referred to in the paragraph above, as required by Section 143(3) of the Act, we report that:

a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;

b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;

c) The Balance Sheet, the Statement of Profit and Loss (including Other Comprehensive Income), Statement of Changes in Equity and Statement of Cash Flows dealt with by this Report are in agreement with the books of account;

d) In our opinion, the aforesaid Standalone Financial Statements comply with the Indian Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Indian Accounting Standards) Rules, 2015, as amended from time to time;

e) In terms of Notification no. G.S.R. 463 (E) dated 05^th June 2015 issued by the Ministry of Corporate Affairs, provisions of Section 164(2) of the Act regarding disqualifications of the Directors, are not applicable as it is a Government Company; and

f) With respect to the adequacy of the internal financial controls with reference to Standalone Financial Statements of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure C". Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Companys internal control with reference to standalone financial statements.

4) With respect to the other matters to be included in the Auditors Report in accordance with Rule 11 of the Companies (Audit and Auditors) Amendment Rules, 2021, in our opinion and to the best of our information and according to the explanations given to us:

a) The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements – Refer note 38(1)(a) of the Standalone Financial Statements;

b) The Company did not have any material foreseeable losses against long-term contracts, including derivative contracts and thereby requirement for making provision in this respect is not applicable to the company;

c) There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company;

d) (i) The Management has represented that, to the best of its knowledge and belief as disclosed in Note No. 38(7)(q) to the standalone financial statements, no funds have been advanced or loaned or invested (either from borrowed funds or securities premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities ("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company "Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

(ii) The Management has represented, that, to the best of its knowledge and belief as disclosed in Note No. 38(7)(q) to the standalone financial statements, no funds have been received by the Company from any person(s) or entity(ies), including foreign entities ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company shall, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Parties ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and

(iii) Based on such audit procedures we have been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (i) and (ii) of Rule 11(e), as provided under (a) and (b) above, contain any material misstatement.

5) The dividend declared or paid during the year by the Company is in compliance with Section 123 of the Act;

6) Proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 for maintaining books of account using accounting software which has a feature of recording audit trail (edit log) facility is applicable with effect from April 1, 2023 to the Company, which is the company incorporated in India, and accordingly, reporting under Rule 11(g) of Companies (Audit and Auditors) Rules, 2014 is not applicable for the financial year ended March 31, 2023; and

7) As per notification number G.S.R. 463 (E) dated 5^th June, 2015 issued by the Ministry of Corporate Affairs, section 197 of the Act as regards the managerial remuneration is not applicable to the Company, since it is a Government Company.

For Lodha & Co Chartered Accountants Firms ICAI Registration Number: 301051E

Sd/-

R. P. Singh

(Partner) Place: Kolkata

Membership No. 052438

Date: 7^th May, 2023

UDIN: 23052438BGXSBT1343

ANNEXURE "A" TO THE AUDITORS REPORT OF EVEN DATE:

The Statement referred to in paragraph 1 with the heading ‘Report on other legal and regulatory requirements of our Report of even date to the members of Coal India Limited on the Standalone Financial Statements of the Company for the year ended 31^st March 2023, we report that:

i) a) The Company has maintained proper records showing full particulars, including quantitative details and situation of Property, Plant and Equipment and Intangible Assets;

b) During the year, property, plant and equipment have been physically verified by the management according to a regular program of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. According to the information and explanations given to us, no material discrepancies were noticed on such verification;

c) According to the information and explanations given to us and on the basis of our examination of the title deeds of all the immovable properties disclosed in the Standalone Financial Statements, the same are held in the name of the Company as on the Balance Sheet date except for the following where the title deeds are not in the name of the Company:

Description of Property	Gross Carrying Value (Rs. in crore)	Title deed held in the name of	Whether title deed holder is a promoter, director or relative of promoter/director or employee of promoter/director	Property held since which date		Reason for not being held in the name of the Company
Zabadiya and Bhadramali Solar Project	13.43	Not Available	Not Available	31-03-2022		Title deed not received.
IICM Land	0.42	Not Available	No	25-07-2012		Allotment Letter in respect of the said land is given by the authorities in the name of Central Mine Planning and Design Institute Limited.
Dankuni Coal Complex	3.75	Details of Requisition and Acquisition of Land received. (unable to identify)	Not Available	01-04-1994		Allotment Letter in respect of the said property is given by the authorities
Scope Complex and Scope Minar at New Delhi	8.59	Title Deeds not available	Not Available	01-12- 2004 and 30-09-1989 respectively		Buildings are promoted by Standing Committee of Public Enterprises (SCOPE) and CIL has allotment letters only as proof of ownership.
Guest House at Kidwai Nagar, New Delhi	13.80	Title Deeds not available	Not Available	01-05-2019		Buildings are promoted by NBCC and CIL has allotment letter only as proof of ownership.
Office Building at Kidwai Nagar, New Delhi	60.69	Title Deeds not available	Not Available	23-03-2021		Buildings are promoted by NBCC and CIL has allotment letter only as proof of ownership.
Residential Flat at Pedder Road, Mumbai	0.03	Western Coalfields Limited	No	01-04-1978		The title deed is held in the name of subsidiary of the company and transfer of title is pending.
32.45 Ha. Freehold land at Simsang (Meghalaya)	0.23	Title deeds are not available	Not Available	04-01-1992		We understand that the Land is situated in the State of Meghalaya which is under Six Schedule of Indian Constitution, Title Deed is not being issued in favour of North Eastern Coalfields.
5.60 Ha. freehold lands at Tura Dakopgre (Meghalaya)	0.03	Title deeds are not available	Not Available	08-01-1994		We understand that the Land is situated in the State of Meghalaya which is under Six Schedule of Indian Constitution, Title Deed is not being issued in favour of North Eastern Coalfields.
11.47 Ha.Tipong Colliery (Tipongpani Natun Gaon)	0.01	Coal Mines Authority Limited	No	09-01-1975		The said colliery is in the name of Coal Mines Authority Limited (former name of the Company). This has not been updated in the title deed. The land is under the possession of North Eastern Coalfields, a unit of the Company.
10.97 Ha. freehold lands at Dilli- Jeypore Colliery	*	M/S Dilli Colliery	No	11-03-1997		The land is under the possession of North Eastern Coalfields, a unit of the Company.
105.34 Ha. free hold land at Margherita Town.	*	Assam Railways and Trading Company Limited	No	Since 1973		Lands were acquired or came in possession of the Company by virtue of Coal Mines Nationalization Act, 1973.
9.16 Ha. free hold land at Grant no.277(F) NLR, Namdang.	*	Assam Railways and Trading Company Limited	No	Since 1973		Lands were acquired or came in possession of the Company by virtue of Coal Mines Nationalization Act, 1973.
15.95 Ha. free hold land at W.L.Application No.11 (part/ north).	*	Assam Railways and Trading Company Limited	No	Since 1973		Lands were acquired or came in possession of the Company by virtue of Coal Mines Nationalization Act, 1973.
17.27 Ha. free	*	Assam Railways and	No	Since 1973		Lands were acquired or came
hold land at		Trading Company				in possession of the Company
W.L.Application		Limited				by virtue of Coal Mines
No.85/1923.24.						Nationalization Act, 1973.
3.61 Ha. free hold land at Grnat no.277(c) NLR, Namdang.	*	Assam Railways and Trading Company Limited	No	Since 1973		Lands were acquired or came in possession of the Company by virtue of Coal Mines Nationalization Act, 1973.
369.01 Ha. free hold land at Ledo-Tikak NLR Grant No.2.	*	Assam Railways and Trading Company Limited	No	Since 1973		Lands were acquired or came in possession of the Company by virtue of Coal Mines Nationalization Act, 1973.
4.43 Ha. free hold land at Namdang Bah Bari.	*	Assam Railways and Trading Company Limited	No	Since 1973		Lands were acquired or came in possession of the Company by virtue of Coal Mines Nationalization Act, 1973.
21.90 Ha. free hold land at W.L.Application No.20 of 1923- 24.	*	Assam Railways and Trading Company Limited	No	Since 1973		Lands were acquired or came in possession of the Company by virtue of Coal Mines Nationalization Act, 1973.
2.10 Ha. free hold land at Tipongpani station site.	*	Assam Railways and Trading Company Limited	No	Since 1973		Lands were acquired or came in possession of the Company by virtue of Coal Mines Nationalization Act, 1973.
58.64 Ha. free hold land at No.1 Baragolai Gaon.	*	Assam Railways and Trading Company Limited	No	Since 1973		Lands were acquired or came in possession by the Company by virtue of Coal Mines Nationalization Act, 1973.
3.85 Ha. free hold land at No.2 Baragolai Gaon.	*	Assam Railways and Trading Company Limited	No	Since 1973		Lands were acquired or came in possession of the Company by virtue of Coal Mines Nationalization Act, 1973.
61.77 Ha. free hold land at 11 no Grant Baragolai.	*	Assam Railways and Trading Company Limited	No	Since 1973		Lands were acquired or came in possession of the Company by virtue of Coal Mines Nationalization Act, 1973.
11.12 Ha. free hold land at Ledo Kol Para.	*	Assam Railways and Trading Company Limited	No	Since 1973		Lands were acquired or came in possession of the Company by virtue of Coal Mines Nationalization Act, 1973.
7.89 Ha. free hold land at 6 No. Grant Lekhapani.	*	Assam Railways and Trading Company Limited	No	Since 1973		Lands were acquired or came in possession of the Company by virtue of Coal Mines Nationalization Act, 1973.
145.46 Ha. free hold land at Ledo town.	*	Assam Railways and Trading Company Limited	No	Since 1973		Lands were acquired or came in possession of the Company by virtue of Coal Mines Nationalization Act, 1973.
13.85 Ha. free hold land at Lekhapani colliery line (Nepali Gaon).	*	Assam Railways and Trading Company Limited	No	Since 1973		Lands were acquired or came in possession of the Company by virtue of Coal Mines Nationalization Act, 1973.
11.38 Ha. free hold land at Tipongpani ward.	*	Assam Railways and Trading Company Limited	No	Since 1973		Lands were acquired or came in possession of the Company by virtue of Coal Mines Nationalization Act, 1973.
10.24 Ha. free hold land at Namdang Special patta.	*	Assam Railways and Trading Company Limited	No	Since 1973		Lands were acquired or came in possession of the Company by virtue of Coal Mines Nationalization Act, 1973.
0.92 Ha. freehold Lands at Tura Office, Meghalaya	*	Title deeds are not available	Not Available		Not Available	We understand that the Land is situated in the State of Meghalaya which is under Six Schedule of Indian Constitution, Title Deed is not being issued in favour of North Eastern Coalfields.
Diversion of	43.25	Title deeds are not	Not Available		Not	89.36 HA of Land have
98.59 Ha. of		available			Available	already allotted to the North
Forest Land for Tikak						Eastern Coalfields by the State Government vide letter no ECF202385/2022/134 dt 10.05.2022 and ECF No 202389/2022/22 dated 10.05.2022. However, title deed in the name of Coal India Limited is not yet issued as payment has not made to the State Government.

*Separate and distinct gross carrying value is not available

d) The company has not revalued any of its Property, Plant and Equipment and Intangible Assets during the year. Accordingly, reporting under paragraph 3 (i)(d) of the Order is not applicable to the Company; and

e) According to the information and explanations given to us and as represented by the management, no proceedings have been initiated during the year or are pending against the Company as at March 31, 2023 for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder, as amended from time to time. Accordingly, reporting under paragraph 3 (i)(e) of the Order is not applicable to the Company.

ii) a) The inventories of the Company have been physically verified by the management during the year at reasonable intervals and in our opinion coverage and procedure of such verification by the management is appropriate having regard to the size of the Company and nature of its inventory. The discrepancies noticed on physical verification of inventories were not more than 10% or more in aggregate for each class of inventory and have been properly dealt with in the books of account; and

b) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has been sanctioned working capital limits amounting to Rs. 430 crore from consortium of banks during the year on the basis of the security of current assets. No working capital loan against such sanction has been availed and utilised during the year and thereby, the quarterly returns or statements filed by the Company with such banks do not include the details of trade receivable, inventories and other current assets and accordingly the reporting requirement under clause 3(ii)(b) of the Order is not applicable to the company.

iii) The Company has made investments in mutual fund and shares of Joint Ventures during the year. Other than this, according to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has not made any investments, granted any secured and unsecured loan, provided any guarantee or security or granted any advances in the nature of loans, secured or unsecured, to companies, firms, limited liability partnership or any other parties during the year.

a) As stated above , the Company has not granted any secured or unsecured loan or provided any guarantee or security or granted any advances in the nature of loans, secured or unsecured, to companies, firms, limited liability partnership or any other parties during the year and hence reporting under paragraph 3 (iii)(a) of the Order is not applicable;

b) In respect of investments made in Joint Venture during the year, same being long term strategic in nature, terms and conditions thereof as such are prima facie not prejudicial to the Companys interest ;

c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, in respect of the loan given during the earlier year and advances in the nature of loans granted to employees, the terms and conditions for repayment of principal and interest have been stipulated and repayment thereof have generally been made regularly as per the stipulations;

d) According to the information and explanations given to us and on the basis of our examination of the records of the Company, having regards to the terms and conditions of the loans or advances in the nature of loan there is no overdue amount for more than ninety days in respect of loans given including interest thereon;

e) According to the information and explanations given to us and on the basis of our examination of the records of the Company, there was no loan or advance in the nature of loans granted falling due during the year, which has been renewed or extended or fresh loans granted to settle the overdue of existing loans or advances in the nature of loans given to same parties; and

f) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has not granted any loans or advances in the nature of loans either repayable on demand or without specifying any terms or period of repayment.

iv) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of section 185 and 186 of the Act, in respect of grant of loans, making investments and providing guarantees and securities, as applicable;

v) According to the information and explanation given to us and based on our examination of the books and records of the Company, the Company has not accepted any deposits or any amount deemed to be deposits from public covered under Sections 73 to 76 or any other relevant provisions of the Act and rules framed thereunder. Accordingly reporting under paragraph 3(v) of the Order is not applicable to the Company;

vi) We have broadly reviewed the books of account maintained by the Company pursuant to the Rules made by the Central Government for the maintenance of cost records under Section 148 (1) of the Act in respect of the Companys products to which the said rules are made applicable and are of the opinion that prima facie, the prescribed records have been maintained. We have, however, not made a detailed examination of the said records with a view to determine whether they are accurate or complete;

vii) According to the information and explanations given to us and based on our examination of the books of accounts:

a) During the year, the Company has generally been regular in depositing with the appropriate authorities undisputed statutory dues including Goods and Service Tax, Provident Fund, Income Tax, Sales Tax, Service Tax, Duty of Custom, Duty of Excise, Value Added Tax, Cess and any other statutory dues as applicable to it. According to the information and explanations given to us, there is no undisputed amounts payable in respect of these which were in arrears as on March 31, 2023 for a period of more than six months from the date they become payable.

As informed to us, Employees State Insurance is not applicable to the Company;

b) The details of statutory dues referred to in sub clause (vii) (a) above, which have not been deposited on account of any dispute are as follows:

(Rs, in crore)

Name of the Statute	Nature of Dues	Gross Amount Under dispute	Period to which the amount relates	Forum where the dispute is pending	Amount deposited under protest	Amount not deposited
Income Tax Act	Income Tax	78.07	AY 2011-12	ITAT	20.00	58.07
		81.58	AY 2012-13	ITAT	0.00	81.58
		90.30	AY 2013-14	ITAT	0.00	90.30
		29.09	AY 2018-19	CIT (A)	0.00	29.09
Total		279.04			20.00	259.04
Central Excise Act,1944	Central excise	4.45	FY 2010-11 to FY 2014-15	CESTAT	0.17	4.28

viii) In our opinion and on the basis of information and explanations given to us and as represented by the management, we have neither come across nor have been informed of transactions which were previously not recorded in books of account and that have been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 and accordingly reporting under paragraph 3 (viii) of the Order is not applicable; ix) In our opinion and on the basis of information and explanations given to us by the management, the Company has not taken any loan from Banks, Financial Institutions or any other lender and accordingly, clause 3 (ix) of the order is not applicable to the Company;

x) According to the information and explanations given to us and based on our examination of books of account of the Company: a) The Company has not raised monies by way of initial public offer or further public offer (including debt instruments) or term loans and hence reporting under paragraph 3(x)(a) of the Order is not applicable to the Company; and

b) The Company has not made any preferential allotment or private placement of shares or convertible debentures (partly, fully, or optionally) during the year and accordingly, reporting under paragraph 3(x)(b) of the Order is not applicable to the Company.

xi) a) During the course of our examination of books and records of the Company carried out in accordance with generally accepted auditing practices in India, and according to the information and explanation given to us, we have neither come across any instance of fraud by the Company or on the Company noticed or reported during the year, nor have been informed of any such cases by the management;

b) No report under sub-section (12) of section 143 of the Act has been filed in Form ADT-4 as prescribed under Rule 13 of Companies (Audit and Auditors) Rules, 2014 (as amended from time to time) with the Central Government, during the year and up to the date of this report; and

c) According to the information and explanation given to us and based on the examination of the books of accounts of the company, no whistle blower complaints have been received during the year by the company. Accordingly, reporting under paragraph 3(xi) (c) of the Order is not applicable.

xii) In our opinion and according to the information and explanations given to us, the Company is not a Nidhi company and accordingly the Nidhi Rules, 2014 is not applicable to it, hence reporting under paragraph 3(xii) (a, b and c) of the Order is not applicable to the Company;

xiii) According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with provisions of Section 177 and 188 of the Act wherever applicable and details of such transactions have been disclosed in the Standalone Financial Statements as required by the applicable accounting standards;

xiv) The Company has appointed a firm of Chartered Accountants to carry out the internal audit of the Company. In our opinion and according to the information and explanations given to us, the internal audit system is commensurate with the size and nature of its business. We have considered, during the course of our audit, the reports of the internal auditor for the period under audit issued to the Company during the year and till date in determining the nature, timing and extent of our audit procedures in accordance with the guidance provided in SA 610 "Using the work of Internal Auditors". In case of Mumbai Regional Sales office, where volume of operations are not as such material, no internal audit report has been made available to us;

xv) According to the information and explanations given to us and as represented to us by the management and based on our examination of the records of the Company, the Company has not entered into non-cash transactions with directors or persons connected with him. Accordingly, paragraph 3(xv) of the Order is not applicable;

xvi) a) In our opinion, the Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934. Hence, reporting under clause 3(xvi)(a) of the Order is not applicable;

b) The Company has not conducted any Non-Banking Financial or Housing Finance Activities without a valid certificate of registration as required under Reserve Bank of India Act, 1934. Hence, reporting under clause 3(xvi)(b) of the Order is not applicable;

c) The Company is not a Core Investment Company (CIC) as defined in the regulations made by the Reserve Bank of India. Hence, reporting under clause 3(xvi)? of the Order is not applicable; and

d) In our opinion and based on the representation received by us from the management, there is no core investment company within the Group (as defined in the Core Investment Companies (Reserve Bank) Directions, 2016) and accordingly reporting under clause 3(xvi)(d) of the Order is not applicable.

xvii) Based on the examination of the books of accounts, we report that the Company has neither incurred cash losses in current financial year covered by our audit nor has incurred cash losses in the immediately preceding financial year;

xviii) There has been no resignation of the statutory auditors of the Company during the year and hence reporting under paragraph 3(xviii) of the Order is not applicable;

xix) According to the information and explanations given to us and based on the financial ratios (refer note no. 38(7)(m) to the standalone financial statements), ageing and expected dates of realization of financial assets and payment of financial liabilities, other information accompanying the standalone financial statements, our knowledge of the Board of Directors and management plans and based on our examination of the evidence supporting the assumptions, nothing has come to our attention, which causes us to believe that any material uncertainty exists as on the date of the audit report that Company is not capable of meeting its liabilities existing at the date of balance sheet as and when they fall due within a period of one year from the balance sheet date. We, however, state that this is not an assurance as to the future viability of the Company. We further state that our reporting is based on the facts up to the date of the audit report and we neither give any guarantee nor any assurance that all liabilities falling due within a period of one year from the balance sheet date, will get discharged by the Company as and when they fall due; and

xx) According to the information and explanations given to us and as represented to us by the management and based on our examination of the records of the Company, there was no unspent amount on account of Corporate Social Responsibility (CSR) on other than ongoing projects envisaged under Section 135 of the Act and hence, reporting under paragraph 3(xx)(a) and (b) of the Order are not applicable to the Company; xxi) The reporting under paragraph 3(xxi) of the Order is not applicable in respect of audit of Standalone Financial Statements.

For Lodha & Co Chartered Accountants Firms ICAI Registration Number: 301051E

Sd/-

R. P. Singh

(Partner) Place: Kolkata Membership No. 052438 Date: 7^th May, 2023 UDIN: 23052438BGXSBT1343

"ANNEXURE-B" TO THE INDEPENDENT AUDITORS REPORT

(Referred to in Paragraph 2 of "Report on Other Legal and Regulatory requirements" section of our Audit Report)

Part I - Directions

S. No. Directions	Auditors Reply on the action taken on the directions
1. Whether the Company has system in place to process all the accounting transactions through IT System? If yes, the implications of processing of accounting transactions outside IT system on the integrity of the accounts along with the financial implications, if any, may be stated.	The Company has implemented a new ERP Software (SAP) with effect from April 01, 2021 in case of Head Office Kolkata, Delhi Office, Mumbai and Chennai Regional Sales Office (RSO) and with effect from August 01, 2021 in case of North Eastern Coalfield. All the information has been migrated from old accounting software Coalnet to SAP on the implementation dates. Post implementation of SAP, accounting of all the transactions is being processed through the SAP except hospital inventory and valuation of closing stock of coal at North Eastern Coalfield which are maintained manually. Further, various informations including ageing analysis which are required to be disclosed in the financials as per the Act, are also prepared manually by the management.
	As per information and explanations given to us, post completion of stabilization phase on 31" March 2022, the system is under AMC phase.
	No system audit and migration audit covering the implications of processing of such transactions, any consequential effect on the integrity of the accounts, along with related financial implications, etc. have been carried out.
2. Whether there is any restructuring of an existing loan or cases of waiver/ write off of debts/loans/interest etc. made by a lender to the company due to the companys inability to repay the loan? If yes, the financial impact may be stated. Whether such cases are properly accounted for? (In case, lender is a Government company, then this direction is also applicable for statutory auditor of Lender company).	As per the information and explanations given by the management, there is no loan taken from any lender by the Company.
3. Whether funds (grants/subsidy etc.) received / receivable for specific schemes from Central / State Government or agencies were properly accounted for / utilized as per its terms and conditions?	According to the information and explanations given to us and on the basis of our examination of the records of the Company, no grants/funds were received/accounted for during the year.
List the cases of deviation.	Further, grant for railway siding amounting to H 1.72 crore received by North Eastern Coalfield from Central Government in the FY 2019-20 was properly accounted for as per the terms and conditions.

Part II - Additional Directions:

S. No.	Sub-direction	Auditors Reply on the action taken on the directions
1.	Whether coal stock measurement was done	According to the information and explanations given to us and on the basis
	based on Yellow Book? Whether physical stock measurement reports are accompanied by contour map in all cases? Whether approval of the competent authority was obtained for new heap, if any, created during the year.	of our examination of the records of the Company, coal stock measurement is done keeping in view the Yellow Book. Physical stock measurement report of coal stock as on March 31, 2023 at North Eastern Coalfields has been accompanied by contour maps. No new heaps were created in any of the mines of North Eastern Coalfields during the financial year.
2.	Whether the company has conducted physical verification exercise of assets and properties at the time of merger/ split/restructure of an area. If so, whether the concerned subsidiary followed the requisite procedure.	As per the information and explanations given by the management, there is no such merger/split/restructure of any area during the year.

 

S. No. Sub-direction	Auditors Reply on the action taken on the directions
3. Whether separate Escrow Accounts for each mine has been maintained in CIL and its subsidiaries. Also examine the utilization of the fund of the account.	Separate escrow account for each mine (Tikak extension, Lekhapani OCP, Tipong, Ledo OCP, Tikak OCP and Tirap OCP) of North East Coalfields (NEC), the production unit of Coal India Limited, has been maintained. No such fund as explained by the management has been withdrawn during the year.
4. Whether the impact of penalty for illegal mining as imposed by the Honble Supreme Court/ National Green Tribunal/ State Pollution Control Board has been duly considered and accounted for?	According to the information and explanations given to us, no penalty for illegal mining has been imposed by the Honble Supreme Court/ National Green Tribunal/ State Pollution Control Board during the year on the Company.
5. Whether any independent Assessment/ Certification in respect of migration process of data from Coalnet portal to SAP has been done.	No Independent Assessment/Certification in respect of migration process of data from Coalnet portal to SAP has been carried out during the year.

For Lodha & Co Chartered Accountants Firms ICAI Registration Number: 301051E

Sd/-

R. P. Singh

(Partner) Place: Kolkata

Membership No. 052438

Date: 7^th May, 2023

UDIN: 23052438BGXSBT1343

ANNEXURE "C" TO THE INDEPENDENT AUDITORS REPORT

(Referred to in paragraph 3 (f) under ‘Report on Other Legal and Regulatory Requirements of our report of even date)

We have audited the internal financial controls with reference to the Standalone Financial Statements of Coal India Limited (hereinafter referred to as ‘the Company) as of March 31, 2023 in conjunction with our audit of the Standalone Financial Statements of the Company for the year ended on that date.

Managements Responsibility for Internal Financial Controls

The Companys management is responsible for establishing and maintaining internal financial controls based on the internal control with reference to the financial statements criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the ‘Guidance Note") issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to Companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.

Auditors Responsibility

Our responsibility is to express an opinion on the Companys Internal Financial Controls with reference to Standalone Financial Statements based on our audit. We conducted our audit in accordance with the Guidance Note issued by the Institute of Chartered Accountants of India and the Standards on Auditing prescribed under Section 143(10) of the Act, to the extent applicable to an audit of Internal Financial Controls with reference to the Financial Statements. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial control with reference to Standalone Financial Statements were established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls with reference to Standalone financial statements and their operating effectiveness. Our audit of internal financial controls with reference to Standalone financial statements included obtaining an understanding of such internal financial controls with reference to Standalone financial statements, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditors judgement, including the assessment of the risks of material misstatement of the Standalone financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Companys internal financial controls with reference to Standalone financial statements.

Meaning of Internal Financial Controls with reference to Standalone Financial Statements

A Companys internal financial control with reference to Standalone Financial Statements is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of Standalone Financial Statements for external purposes in accordance with generally accepted accounting principles. A Companys internal financial control with reference to Standalone Financial Statements includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of Standalone Financial Statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorisations of management and directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the Companys assets that could have a material effect on the Standalone Financial Statements.

Inherent Limitations of Internal Financial Controls with reference to Standalone Financial Statements

Because of the inherent limitations of internal financial controls with reference to the financial statements, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls with reference to the financial statements to future periods are subject to the risk that the internal financial control with reference to the financial statements may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

According to the information and explanations given to us and based on our audit, in our opinion, the Company has generally maintained, in all material respects, adequate internal financial controls with reference to the financial statements and such internal financial controls with reference to the financial statements were generally operating effectively as of March 31, 2023 based on the internal control with reference to the financial statements criteria established by the Company considering the essential components of internal controls stated in the "Guidance Note on Audit of Internal Financial Controls over Financial Reporting" issued by the Institute of Chartered Accountants of India.

However further improvement are required in respect of the following:

i) The documentation of Internal Financial Controls of the Company in respect of its risk assessment process, risk analysis of different functional areas and incorporating the process flows at departmental levels including risk mitigations; and

ii) Note No. 38(7)(j) regarding certain debit/credit balances including trade receivables, other current and non-current assets, trade payables, other financial liabilities and other current and non-current liabilities in the company are pending independent confirmation and consequential reconciliation thereof.

Our opinion is not modified in respect of the above matters.

For Lodha & Co Chartered Accountants Firms ICAI Registration Number: 301051E

Sd/-

R. P. Singh

(Partner) Place: Kolkata

Membership No. 052438

Date: 7^th May, 2023

UDIN: 23052438BGXSBT1343