Energy Development Company Ltd Auditor Reports

THE MEMBERS OF ENERGY DEVELOPMENT COMPANY LIMITED

REPORT ON THE AUDIT OF THE STANDALONE FINANCIAL STATEMENTS

ADVERSE OPINION

We have audited the accompanying standalone fi nancial statements of Energy Development Company Limited (hereina er referred to as "the Company") which comprise the Standalone Balance Sheet as at 31st March, 2024, the Standalone Statement of Profi t and Loss (including Other Comprehensive Income), the Standalone Statement of Changes in Equity and the Standalone Statement of Cash Flows for the year then ended, and notes to the standalone fi nancial statements, including a summary of material accounting policies and other explanatory notes for the year ended on that date (hereina er referred to as the "standalone fi nancial statements").

In our opinion and to the best of our information and according to the explanations given to us, due to the signifi cance of the matters described in the Basis for Adverse Opinion section below, the aforesaid standalone fi nancial statements do not give the information required by the Companies Act, 2013 read with relevant rules issued thereunder from time to time (hereina er referred to as "the Act") in the manner so required and also does not give a true and fair view in conformity with the Indian Accounting Standards notifi ed under section 133 of the Act (hereina er referred to as "the Ind AS") and other accounting principles generally accepted in India, of the state of a airs of the Company as at 31st March, 2024, its losses (including other comprehensive income), changes in equity and its cash fl ows for the year ended on that date.

BASIS FOR ADVERSE OPINION

Attention is drawn to the following notes of the standalone fi nancial statements: a) Note 7.3(a), 7.3(b) and 7.3(c) regarding investments, loans and other receivables aggregating to 2,938.38 lakhs in Arunachal Pradesh and U arakhand Undertaking transferred pursuant to the agreement dated 9th November, 2015 and consideration of 4,994.52 lakhs recoverable in this respect. In view of the uncertainty and non-fulfi lment of the conditions precedent to the agreement, amount recoverable there against is doubtful of recovery and considering the progress of underlying projects, value of investments and loans in these companies have been signifi cantly impaired. Impact in this respect have not been ascertained by the management and recognized in the standalone fi nancial statements;

b) Note 16.3 regarding non-determination of terms and conditions of repayment and recoverable amount in respect of outstanding loans of 2,655.08 lakhs from wholly owned subsidiary companies. Impact in this respect have not been ascertained by the management and recognized in the standalone fi nancial statements; c) Note 7.5 regarding impairment in the value of investments aggregating to 5,701.00 lakhs in wholly owned subsidiaries of the Company. Impact in this respect have not been ascertained by the management and recognized in the standalone fi nancial statements; d) Note 13.4, 16.4 and 52(ii) regarding outstanding amount of 3,349.38 lakhs in respect of trade receivables, loan amounting to 313.50 lakhs (including interest accrued thereon) and security deposits/retention money, advances and balances with government authorities amounting to 255.51 lakhs given/recoverable to/from certain companies/statutory authorities which are doubtful of recovery and considering recoverability, etc., are prejudicial to the interest of the Company. In absence of the provision there against, the loss for the year is understated to that extent. Impact in this respect have not been ascertained by the management and recognized in the standalone fi nancial statements; e) Note 17.2 regarding payment of remuneration amounting to 40.20 lakhs to a director, being shown as recoverable as stated in the said note; f) Note 52(i) regarding non-reconciliation of certain debit and credit balances including loans, advances, creditors, etc., with confi rmation thereof, and g) Note 53 regarding receipt of demand notices aggregating to 18,817.47 lakhs pertaining to Income Tax Assessment Order for Assessment Years 2011-2012 to 2020-2021 and stay of demand pursuant to application fi led and payment of 1,235.03 lakhs (including 153.30 lakhs recovered from the bank accounts of the Company) made under protest being shown as recoverable by the Company. The Company has preferred necessary appeals before the Commissioner of Income Tax (Appeals). Impact in this respect is presently not ascertainable.

Overall impact with respect to above, except in case of (d) above, even though likely to be material, are not ascertainable and as such cannot be commented upon by us.

We conducted our audit in accordance with the Standards on Auditing (hereina er referred to as "SAs") specifi ed under section 143(10) of the Act. Our responsibilities under those SAs 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 (hereina er referred to as "the ICAI") together with the ethical requirements that are relevant to our audit of the standalone fi nancial statements under the provisions of the Act and the Rules thereunder, and we have fulfi lled our other ethical responsibilities in accordance with these requirements and the ICAIs Code of Ethics. We believe that the audit evidence we have obtained is su cient and appropriate to provide a basis for our adverse opinion on the standalone fi nancial statements.

KEY AUDIT MATTERS

Key audit ma ers are those ma ers that, in our professional judgment, were of most signifi cance in our audit of the standalone fi nancial statements for the fi nancial year ended 31st March, 2024. These ma ers were addressed in the context of our audit of the standalone fi nancial statements as a whole and in forming our opinion thereon, and we do not provide a separate opinion on these ma ers. We have considered the ma ers described below to be the key audit ma ers for incorporation in our report.

We have fulfi lled the responsibilities described in the "Auditors Responsibilities for the Audit of the Standalone Financial Statements" section of our report, including in relation to these ma ers. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the standalone fi nancial statements. The result of our audit procedures, including the procedures performed to address the ma ers below, provide the basis for our opinion on the accompanying standalone fi nancial statements.

Key Audit Ma ers	Addressing the Key Audit Ma ers
Recognition of Deferred tax assets (Refer note no. 10 to the standalone fi nancial statements)	Our audit procedures based on which we arrived at the conclusion regarding reasonableness of the recognition of deferred tax assets include the following:
Deferred tax assets pertaining to unused tax credits and unabsorbed depreciation aggregating to 533.96 lakhs as on 31st March, 2024, as recognized in earlier years has been continued in the books of accounts in this year. Recognition of deferred tax assets is based on expected utilization and/ or reversal thereof considering the managements projection of future taxable income of the Company. This involves estimation of future operations and profi tability based on assumptions and anticipations which may be in variance with the actual happening.
	• Evaluation of the temporary differences and utilization/reversal of deferred tax assets based on internal forecasts by the management and resultant impact on future taxable income of the Company.
	• The above includes critical review of underlying assumptions for consistency and arriving at reasonable level of probability on the matters with due regard to the current and past results and performances, as required in terms of Ind AS 12 "Income Taxes" and principles in this regard.
	• Review of managements assumption with respect to profi t in future periods and taxability thereof and placing reliance on such assumptions and projections given the current scale of operations and prevailing conditions and situations.

INFORMATION OTHER THAN THE STANDALONE FINANCIAL STATEMENTS AND AUDITORS REPORT THEREON

The Companys Board of Directors is responsible for the preparation of other information. The other information comprises the information included in the Annual Report but does not include the standalone fi nancial statements, consolidated fi nancial statements and our auditors reports thereon. The other information as stated above is expected to be made available to us a er the date of this auditors report. Our opinion on the standalone fi nancial 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 fi nancial statements, our responsibility is to read the other information identifi ed above when it becomes available, and, in doing so, consider whether the other information is materially inconsistent with the standalone fi nancial 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 ma er to those charged with governance and describe necessary actions required as per applicable laws and regulations.

RESPONSIBILITIES OF MANAGEMENT AND THOSE CHARGED WITH GOVERNANCE FOR THE STANDALONE FINANCIAL STATEMENTS

The Companys Board of Directors is responsible for the ma ers stated in section 134(5) of the Act with respect to the preparation of these standalone fi nancial statements that give a true and fair view of the fi nancial position, fi nancial performance (including other comprehensive income), changes in equity and cash fl ows of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards notifi ed under section 133 of the Act read with relevant rules, as amended from time to time. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and the design, implementation and maintenance of adequate internal fi nancial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone fi nancial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the standalone fi nancial statements, the Board of Directors is responsible for assessing the Companys ability to continue as a going concern, disclosing, as applicable, ma ers related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

The Board of Directors are also responsible for overseeing the Companys fi nancial reporting process.

AUDITORS RESPONSIBILITIES FOR THE AUDIT OF THE STANDALONE FINANCIAL STATEMENTS

Our objectives are to obtain reasonable assurance about whether the standalone fi nancial 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 infl uence the economic decisions of users taken on the basis of these standalone fi nancial 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 fi nancial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is su cient 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 controls;

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

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

• Conclude on the appropriateness of 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 signifi cant doubt on the Companys ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw a ention in our auditors report to the related disclosures in the standalone fi nancial 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 fi nancial statements, including the disclosures, and whether the standalone fi nancial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other ma ers, the planned scope and timing of the audit and signifi cant audit fi ndings, including any signifi cant defi ciencies 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 ma ers that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the ma ers communicated with those charged with governance, we determine those ma ers that were of most signifi cance in the audit of the standalone fi nancial statements of the current period and are therefore the key audit ma ers. We describe these ma ers in our auditors report unless law or regulation precludes public disclosure about the ma er or when, in extremely rare circumstances, we determine that a ma er should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefi ts of such communication.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

1. As required by the Companies (Auditors Report) Order, 2020 (hereina er referred to as "the Order"), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the "Annexure A" a statement on the ma ers specifi ed in paragraphs 3 and 4 of the Order, to the extent applicable.

2. 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, except for the effects/ possible effects of the ma ers described in the Basis for Adverse Opinion section above, obtained all the information and explanations which, to the best of our knowledge and belief, were necessary for the purposes of our audit of the aforesaid standalone fi nancial statements;

b) Except for the effects/ possible effects of the matters described in the Basis for Adverse Opinion section above and reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014, as amended from time to time as stated in paragraph 3(vi) below, in our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;

c) The Standalone Balance Sheet, the Standalone Statement of Profi t and Loss (including Other Comprehensive Income), the Standalone Statement of Changes in Equity and the Standalone Statement of Cash Flows dealt with by this Report are in agreement with the relevant books of account maintained for the purpose of preparation of the standalone fi nancial statements;

d) Due to the signifi cance of the matters described in the Basis for Adverse Opinion section above, in our opinion, the aforesaid standalone fi nancial statements do not comply with the requirement and provisions of Indian

Accounting Standards notifi ed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended from time to time;

e) The ma ers described in the Basis for Adverse Opinion section above especially those relating to non-provision of investments, loans, trade and other receivables as stated in paragraphs (a), (b), (c) and (d) and demand for income tax raised by Income Tax Authorities pending resolution thereof as stated in paragraph (g) of that section, in our opinion, may have an adverse effect on the functioning of the Company;

f) On the basis of the wri en representations received from the Directors as on 31st March, 2024, taken on record by the Board of Directors, none of the Directors are disqualifi ed as on 31st March, 2024 from being appointed as a Director in terms of section 164(2) of the Act;

g) The adverse remarks relating to the maintenance of accounts and other ma ers connected therewith are as stated in the Basis for Adverse Opinion section above and paragraph 2(b) above on reporting under section 143(3)(b) of the Act; and

h) With respect to the adequacy of the internal fi nancial controls with reference to the standalone fi nancial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure B". Our report expresses a qualifi ed opinion on the adequacy and operating effectiveness of the internal control with reference to the standalone fi nancial statements of the Company.

3. With respect to the other matters to be included in the Auditors Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014 (as amended from time to time), in our opinion and to the best of our information and according to the explanations given to us:

i. Pending litigations (other than those already recognized in the standalone fi nancial statements) having material impact on the fi nancial position of the Company have been disclosed in the standalone fi nancial statements as required in terms of accounting standards and provisions of the Act- refer note no. 40(A) to the standalone fi nancial statements;

ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;

iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company;

iv. a. The management has represented that, to the best of its knowledge and belief, as disclosed in note no. 54 to the standalone fi nancial 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, whether, directly or indirectly, lend or invest in other persons or entities identifi ed in any manner whatsoever by or on behalf of the Company ("Ultimate Benefi ciaries") or provide any guarantee, security or the like on behalf of the Ultimate Benefi ciaries;

b. The management has represented that, to the best of its knowledge and belief, as disclosed in note no. 54 to the standalone fi nancial 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, whether, directly or indirectly, lend or invest in other persons or entities identifi ed in any manner whatsoever by or on behalf of the Funding Parties ("Ultimate Benefi ciaries") or provide any guarantee, security or the like on behalf of the Ultimate Benefi ciaries; and

c. Based on the audit procedures that 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) of the Companies (Audit and Auditors) Rules, 2014, as amended from time to time, as provided under 3(iv)(a) and 3(iv)(b) above, contain any material misstatement; v. The Company has not declared or paid any dividend and has also not proposed any dividend during the year and as such, requirement for complying with the provisions of section 123 of the Act in this respect are not applicable to the Company; and

vi. Based on our examination which included test checks, the Company has used accounting so ware incorporating all the fi nancial and other transactions involving various operational areas and functions (except for records relating to payroll processing, property, plant and equipment and intangible assets which are being maintained manually) for maintaining its books of account which, except in respect of master data, have fi elds and tables where the feature of recording audit trail (edit log) for changes made in the transactions at application level are available and have been operated throughout the year for all relevant transactions recorded in the said so ware. However, records edited or modifi ed are replaced and trail of the old records have not been maintained.

Audit trail (edit log) with respect to the direct changes at database level have not been enabled.

In respect of the above so ware, other than the exceptions noted hereinabove, we have, however, not come across any instance of the same being tampered with.

As proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 is applicable from 1st April, 2023, reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014, as amended from time to time, on preservation of audit trail (edit log) as per the statutory requirements for record retention is not applicable for the fi nancial year ended 31st March, 2024.

4. With respect to the reporting under section 197(16) of the Act to be included in the Auditors Report, in our opinion and according to the information and explanations given to us, the remuneration (including si ing fees) paid by the Company to its directors during the current fi nancial year, is in accordance with the provisions of section 197 of the Act and is not in excess of the limit laid down therein.

For A L P S & Co.

Chartered Accountants

Firms Registration No.: 313132E

 

Sd/- A. K. KHETAWAT

Partner

Membership No.: 052751

UDIN : 24052751BKFDBE4561

 

Place : Kolkata

Dated : 29th May, 2024

"ANNEXURE – A" TO THE INDEPENDENT AUDITORS REPORT

(Referred to in paragraph 1 under "Report on Other Legal and Regulatory Requirements" sec on of our report of even date to the members of Energy Development Company Limited)

(i) In respect of the Companys property, plant and equipment and intangible assets:

(a) (A) The Company has maintained proper records showing full particulars, including quantitative details and situation of its property, plant and equipment; (B) The Company has maintained proper records showing full particulars of 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 based on our examination of the relevant records of the Company, the title deeds of all immovable properties (other than properties where the Company is lessee and lease agreements have duly been executed), as disclosed in note no. 5 to the standalone financial statements, are held in the name of the Company as on the balance sheet date;

(d) The Company has not revalued any of its property, plant and equipment (including right-of-use assets) and intangible assets during the year. Accordingly, reporting under clause (i)(d) of paragraph 3 of the Order is not applicable; and

(e) According to the information and explanations given to us and as represented by the management, no proceeding has been initiated during the year or are pending against the Company as at 31st March, 2024 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 clause (i)(e) of paragraph 3 of the Order is not applicable.

(ii) According to the information and explanations given to us and based on our examination of the books of account of the Company:

(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 the nature of its inventories. The discrepancies noticed on physical verification of inventories were not 10% or more in aggregate for each class of inventories and have been properly dealt with in the books of the account; and

(b) The Company has been sanctioned working capital limits in excess of five crore rupees, in aggregate, from bank on the basis of security of certain current assets in respect of which monthly statements (hereina er referred to as "Statements") have been filed with the banks. These Statements have been prepared in accordance with the books of account and there are no di erences at the quarter ends in this respect.

(iii) The Company has granted unsecured loan to its subsidiary during the year. Other than this, the Company has not made any investments or provided guarantee or security or granted advances in the nature of loans, secured or unsecured, to companies, firms, limited liability partnerships or any other parties during the year.

(a) In respect of loans granted as above, the aggregate amount during the year, and balances outstanding as at the balance sheet date are given below:

Particulars	Loans ( in lakhs)
Loan to subsidiary companies given during the year	42.00
Balances outstanding as at balance sheet date	2,634.25

The above amounts are included in note no. 16 on loans.

(b) According to the information and explanations given to us and based on the audit procedures conducted by us, no stipulation for repayment and related terms and conditions have been specified. The unsecured loans given to subsidiary companies are interest free. In absence of other terms and conditions as stated above, we are unable to o er our comment whether these are prejudicial to the interest of the Company;

(c) In respect of loans granted during the year by the Company and those outstanding from the beginning of the year, there were no stipulations with respect to repayment of principal and interest where applicable. As such, we are unable to make comment on the regularity of repayment of principal and payment of interest;

(d) As stated in clause (iii)(c) above, there are no stipulations with respect to repayment of principal and interest where applicable and as such amounts overdue for more than ninety days are not ascertainable;

(e) As stated in clause (iii)(c) above, it is not possible to ascertain and comment on whether any amount outstanding has fallen due for payment. Accordingly, reporting required under clause (iii)(e) of paragraph 3 of the Order has not been given; and

(f) The details of loan given during the year and those outstanding from the beginning of the year and as required under clause (iii)(f) of paragraph 3 of the Order are as follows:

Aggregate amount of loan outstanding ( in lakhs)	Percentage thereof to total loans granted	Aggregate amount of loan granted to promoter, related parties as defi ned in clause (76) of section 2 of Companies Act, 2013 ( in lakhs)
2747.52 lakhs	75.28%	2747.52 lakhs - subsidiary companies
588.72 lakhs	16.13%	588.72 lakhs - associate company
313.50 lakhs	8.59%	Not applicable

(iv) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of section 185 of the Act in respect of loans granted. The Company has complied with the provisions of section 186 of the Act, to the extent applicable to the Company.

(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 neither accepted any deposits or 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 clause (v) of paragraph 3 of the Order is not applicable.

(vi) We have broadly reviewed the cost records and accounts prescribed by the Central Government under section 148(1) of the Act and are of the opinion that prima-facie, such records have been made and maintained by the Company. However, we have not carried out any detailed examination of such accounts and records.

(vii) According to the information and explanations given to us and based on our examination of the books of accounts: (a) During the year, undisputed statutory dues including goods and services tax, provident fund, employees state insurance, income tax, sales tax, service tax, duty of customs, duty of excise, value added tax, cess and any other statutory dues, as applicable to the Company have generally been regularly deposited by the Company with the appropriate authorities though there has been slight delay in a few cases. There are no undisputed amounts in respect of goods and services tax, provident fund, employees state insurance, income tax, sales tax, service tax, duty of customs, duty of excise, value added tax, cess and any other material statutory dues, in arrears as at 31st March, 2024 for a period of more than six months from the date they became payable except in respect of following cases:

Name of the Statute	Nature of Dues	Amount ( in lakhs)	Period to which the amount relates	Due date	Date of payment
Income Tax	Tax deducted at source	6.46	March2014	30th April, 2014	Unpaid
Income Tax	Tax deducted at source	3.43	March2015	30th April, 2015	Unpaid
Income Tax	Tax deducted at source	2.56	March2023	30th April, 2023	Unpaid

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

Name of the Statute	Nature of Dues	Amount (Rs. in lakhs)	Period to which the amount relates	Forum where dispute is pending
The Income Tax Act, 1961	Income Tax	20,925.84	FY 2010-2011 to FY 2019-2020	CIT (Appeals)
The Finance Act, 1994	Service Tax	15.41	FY 2007-2008	CESTAT

(viii) In our opinion and on the basis of information and explanations given to us and as represented by the management with respect to income tax proceedings as stated in note no. 53 pending against the Company or even otherwise, 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 clause (viii) of paragraph 3 of the Order is not applicable.

(ix) In our opinion and on the basis of information and explanations given to us and based on our examination of the books of account of the Company:

(a) In respect of unsecured borrowings taken during the year and those obtained in earlier years which were outstanding as at 31st March, 2024, there were no stipulations with respect to repayment of principal and interest. As such, we are unable to make comment on the regularity of repayment of principal and payment of interest;

(b) The Company has not been declared willful defaulter by any bank or financial institution or any other lenders;

(c) In respect of unsecured borrowings taken during the year as stated above, terms of repayment thereof and utilization of the funds obtained have not been stipulated. Other than this, no term loan has been availed by the Company and accordingly, the reporting required under clause (ix)(c) of paragraph 3 of the Order as such cannot be made;

(d) According to the information and explanations given to us, and the procedures performed by us, and on an overall examination of the standalone financial statements of the Company, we report that no funds raised on short term basis have been used for long term purposes by the Company;

(e) The Company has not taken any funds from any entity or person on account of or to meet obligation of its subsidiaries or its associate. The Company does not have any joint ventures. Accordingly, reporting under clause (ix)(e) of paragraph 3 of the Order is not applicable; and

(f) The Company has not raised loans during the year on the pledge of securities held in its subsidiaries or its associate. The Company does not have any joint ventures. Accordingly, reporting under clause (ix)(f) of paragraph 3 of the Order is not applicable.

(x) According to the information and explanations given to us and based on our examination of the books of account of the Company:

(a) The Company has not raised any money by way of initial public o er or further public o er (including debt instruments) during the year and accordingly, reporting under clause (x)(a) of paragraph 3 of the Order is not applicable; and

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

(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 explanations given to us, we have neither come across any instance of fraud by or on the Company noticed or reported during the year, nor have we been informed of any such cases by the management; b. According to the information and explanations given to us and based on our examination of the books and records of the Company, no report under sub-section (12) of section 143 of the Act, in Form ADT-4, as prescribed under Rule 13 of Companies (Audit and Auditors) Rules, 2014 (as amended from time to time) has been filed with the Central Government. Accordingly, reporting under clause (xi)(b) of paragraph 3 of the Order is not applicable; and

c. According to the information and explanations given to us and as far as ascertained from examination of the books and records in accordance with generally accepted auditing practices in India, no whistle blower complaints have been received during the year.

(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 clauses (xii)(a), (xii)(b) and (xii)(c) of paragraph 3 of the Order is not applicable.

(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, except as stated in paragraph (e) of Basis for Adverse Opinion section above, are in compliance with provisions of sections 177 and 188 of the Act where applicable and details of such transactions have been disclosed in the standalone financial statements as required by the applicable accounting standards.

(xiv) a. 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; and

b. 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 nature, timing and extent of our audit procedures in accordance with the guidance provided in SA 610 "Using the work of Internal Auditors".

(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 them and accordingly, reporting under clause (xv) of paragraph 3 of the Order is not applicable.

(xvi) According to the information and explanations given to us and based on our examination of the books and records of the Company:

(a) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act 1934;

(b) The Company has not conducted any non-banking financial or housing finance activities during the year;

(c) The Company is not a Core Investment Company as defined in the Core Investment Companies (Reserve Bank) Directions, 2016, as amended from time to time, issued by the Reserve Bank of India and accordingly, reporting under clause (xvi)(c) of paragraph 3 of the Order is not applicable; and

(d) In our opinion and based on the representation received 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 (xvi)(d) of paragraph 3 of the Order is not applicable.

(xvii) Based on the examination of the books of accounts, we report that the Company has not incurred cash losses in the current financial year covered by our audit or in the immediately preceding financial year.

(xviii) There has been no resignation of statutory auditors during the year and accordingly, reporting under clause (xviii) of paragraph 3 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. 51 to the standalone financial statements), ageing and expected dates of realization of financial assets and payment of financial liabilities, other information accompanying standalone financial statements, our knowledge of the

Board of Directors and management plans and based on our examination of the evidences supporting the assumptions, nothing has come to our a ention, 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 given 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.

(xx) According to the information and explanations given to us and based on our examination of the books of account, the requirement for making expenditure towards corporate social responsibility activities is not applicable as per the criteria specified under section 135 of the Act read with relevant rules issued thereunder from time to time and accordingly, reporting under clauses (xx)(a) and (xx)(b) of paragraph 3 of the Order is not applicable.

(xxi) The reporting under clause (xxi) of paragraph 3 of the Order is not applicable in respect of audit of standalone financial statements.

For A L P S & Co.

Chartered Accountants

Firms Registration No.: 313132E

 

Sd/- A. K. KHETAWAT

Partner

Membership No.: 052751

UDIN : 24052751BKFDBE4561

 

Place : Kolkata

Dated : 29th May, 2024

"ANNEXURE – B" TO THE INDEPENDENT AUDITORS REPORT

(Referred to in point (h) of paragraph 2 under "Report on Other Legal and Regulatory Requirements" sec on of our report of even date to the members of Energy Development Company Limited)

Report on the Internal Financial Controls with reference to the standalone fi nancial statements under clause (i) of sub-section 3 of section 143 of the Companies Act, 2013 (hereina er referred to as "the Act")

We have audited the internal fi nancial controls with reference to the standalone fi nancial statements of Energy Development Company Limited (hereina er referred to as "the Company") as at 31st March, 2024 in conjunction with our audit of the standalone fi nancial statements of the Company for the year ended on that date.

MANAGEMENTS RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE STANDALONE FINANCIAL STATEMENTS

The Board of Directors of the Company is responsible for establishing and maintaining internal fi nancial controls based on the internal control with reference to the standalone fi nancial 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 (hereina er referred to as "the Guidance Note") issued by the Institute of Chartered Accountants of India (hereina er referred to as "the ICAI"). These responsibilities include the design, implementation and maintenance of adequate internal fi nancial controls that were operating effectively for ensuring the orderly and e cient 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 fi nancial information, as required under the Act.

AUDITORS RESPONSIBILITY

Our responsibility is to express an opinion on the Companys internal fi nancial controls with reference to the standalone fi nancial statements based on our audit. We conducted our audit in accordance with the Guidance Note issued by the ICAI and the Standards on Auditing specifi ed under section 143(10) of the Act, to the extent applicable to an audit of internal fi nancial controls. Those Standards on Auditing 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 fi nancial controls with reference to the standalone fi nancial statements was 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 fi nancial controls system with reference to the standalone fi nancial statements and their operating effectiveness. Our audit of internal fi nancial controls with reference to the standalone fi nancial statements included obtaining an understanding of internal fi nancial controls with reference to the standalone fi nancial 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 fi nancial 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 fi nancial controls system with reference to the standalone fi nancial statements.

MEANING OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE STANDALONE FINANCIAL STATEMENTS

A companys internal fi nancial control with reference to the standalone fi nancial statements is a process designed to provide reasonable assurance regarding the reliability of fi nancial reporting and the preparation of the standalone fi nancial statements for external purposes in accordance with generally accepted accounting principles. A companys internal fi nancial control with reference to the standalone fi nancial statements includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly refl ect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of the standalone fi nancial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the companys assets that could have a material effect on the standalone fi nancial statements.

INHERENT LIMITATIONS OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE STANDALONE FINANCIAL STATEMENTS

Because of the inherent limitations of internal fi nancial controls with reference to the standalone fi nancial 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 fi nancial controls with reference to the standalone fi nancial statements to future periods are subject to the risk that the internal fi nancial control with reference to the standalone fi nancial statements may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

BASIS FOR QUALIFIED OPINION

According to the information and explanations given to us and based on our audit, the following material weaknesses have been identifi ed in the Companys internal fi nancial controls with reference to the standalone fi nancial statements as at 31st March, 2024:

• The Company did not have an appropriate internal control system in relation to granting of loans to subsidiary and associate and/ or other companies and making recoveries against the trade and other receivables, including ascertaining economic substance and business rationale of the transactions, establishing segregation of duties and determining credentials of the counter parties (refer note no. 13, 16 and 17 to the standalone fi nancial statements);

• With respect to inter corporate deposits, the Company did not have appropriate system to evaluate the credit worthiness of the parties and recoverability of monies given including interest thereon and related party transactions especially with respect to remuneration paid to one of the director of the Company (refer note no. 17.2) and also ensuring the compliances with respect to provisions of the Act so that these are not considered to be prejudicial to the interest of the Company, and

• Non-availability of confi rmation and reconciliation thereof of certain debit and credit balances including loans, advances, creditors, etc. (refer note no. 52(i) to the standalone fi nancial statements).

A ‘material weakness is a defi ciency, or a combination of defi ciencies, in internal fi nancial controls with reference to standalone fi nancial statements, such that there is a reasonable possibility that a material misstatement of the Companys annual or interim fi nancial statements will not be prevented or detected on a timely basis.

QUALIFIED OPINION

In our opinion, to the best of our information and according to the explanations given to us, except for the effects/ possible effects of the material weaknesses described in Basis for Qualifi ed Opinion section above on the achievement of the objectives of the control criteria, the Company has maintained, in all material respects, an adequate internal fi nancial controls with reference to the standalone fi nancial statements and such internal fi nancial controls with reference to the standalone fi nancial statements were operating effectively as at 31st March, 2024, based on the internal control with reference to the standalone fi nancial 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 issued by the Institute of Chartered Accountants of India.

We have considered the material weaknesses identifi ed and reported above in determining the nature, timing and extent of audit tests applied in our audit of the standalone fi nancial statements of the Company for the year ended 31st March, 2024, and these material weaknesses have a ected our opinion on the said standalone fi nancial statements of the Company and we have issued an adverse opinion on the standalone fi nancial statements of the Company.

For A L P S & Co.

Chartered Accountants

Firms Registration No.: 313132E

 

Sd/- A. K. KHETAWAT

Partner

Membership No.: 052751

UDIN : 24052751BKFDBE4561

 

Place	: Kolkata
Dated : 29th May, 2024