Hindustan Petroleum Corporation Ltd Auditor Reports

TO THE MEMBERS OF

HINDUSTAN PETROLEUM CORPORATION LIMITED

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the accompanying standalone financial statements of Hindustan Petroleum Corporation Limited ("the Company"), which comprise the Standalone Balance Sheet as at March 31, 2025, the Standalone Statement of Profit 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 financial statements, including material accounting policy information and other explanatory information, which includes the standalone financial statements of the Visakh Refinery for the year ended on that date, audited by the branch auditor, located at Visakhapatnam (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 ("Ind AS") and accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2025 and its profit, total comprehensive income, changes in equity and its cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit of the standalone financial statements in accordance with the Standards on Auditing ("SAs") specified under section 143(10) of the Act. 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 ("ICAI") together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules made thereunder, and we have fulfilled 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 sufficient and appropriate to provide a basis for our opinion on the standalone financial statements.

Key Audit Matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined, taking into consideration audit report issued by the branch auditors, the matters described below to be the key audit matters to be communicated in our report:

Sr. No. Key Audit Matters	Auditors Response
1 Property, plant and equipment and capital work-in-progress	How the Key Audit matter was addressed
• The Company has, during the year, executed various projects and is also in the process of executing various projects like expansion of refinery, installation of bio- refinery and other new plants, depots, LPG bottling plants, terminals, pipelines, etc. Since these projects take a substantial period of time to get ready for intended use and considering the materiality of the amounts capitalized and included in Capital Work in Progress, in the context of the Balance Sheet of the Company, this is considered to be a key area having significant effect on the overall audit strategy and allocation of resources in planning and completion of our audit;	• We performed an understanding and evaluation of the system of internal control processes over the projects and those included in capital work in progress, with reference to identification and testing of key controls;
• With regard to above capital projects, management has identified specific expenditure including employee costs and other overheads relating to each of the assets in the above capital projects and has applied judgement to assess if the costs incurred in relation to these assets meet the recognition criteria of Property, Plant and Equipment in accordance with Ind AS 16.c	• We assessed whether the Companys accounting policy in relation to the capitalisation of expenditures are in sync and in compliance with Ind AS and found them to be consistent;
• There are areas where management judgements impact the carrying value of the property, plant and equipment, intangible assets and their respective depreciation/ amortization rates. These include the decision to capitalise or expense costs, the annual asset life review, the timeliness of the capitalisation of assets and the use of management assumptions and estimates for the determination or the measurement and recognition criteria for assets retired from active use.	• We have reviewed Board minutes relating to approvals of the projects and changes in estimates thereof;
This has been determined as a key audit matter due to the significance of the capital expenditure during the year as compared to the existing block of Property, Plant and Equipment, the risk that the elements of costs that are eligible for capitalisation are not appropriately capitalised in accordance with the recognition criteria provided in Ind AS 16, and the complex nature of the project. (Refer Note No. 3, 4,5 & 5A).	• We assessed the progress of the project and the intention and ability of the management to bring the asset to its state of intended use;
	• We understood, evaluated and tested the design and operating effectiveness of key controls relating to capitalisation of various costs incurred;
	• We tested, on sample basis, the direct and indirect costs capitalised, with the underlying supporting documents to ascertain nature of costs and basis for allocation, where applicable, and evaluated whether they meet the recognition criteria provided in the Indian Accounting Standard (Ind AS) 16, Property, Plant and Equipment;
	• We ensured adequacy of disclosures in the standalone financial statements;
	• We reviewed the judgements made by the management including the nature of underlying costs capitalized, determination of realizable value of the assets retired from active use, the appropriateness of useful lives applied in the calculation of depreciation/amortization, the useful lives of assets prescribed in Schedule II to the Act and the useful lives of certain assets as per the technical assessment of the management. We have found that the management has regularly reviewed aforesaid judgements and there are no material changes.

 

Sr. No. Key Audit Matters	Auditors Response
2 Evaluation of uncertain indirect tax positions	How the Key Audit matter was addressed
The Company has material uncertain indirect tax positions including matters under dispute which involves significant judgments and estimates to determine the possible outcome of these disputes. The Company has disputes pending at various levels of tax authorities over the past several years. (Refer Note No.- 53 and para (vii) (b) - Annexure I of this report). Because of the judgement required, the area determined to be a key audit matter.	• We have evaluated and tested the appropriateness of the design and the operating effectiveness of the managements controls over the tax litigation matters;
	• We reviewed the managements underlying assumptions in estimating the tax provision based on the possible outcome of the disputes, legal precedence and other rulings in evaluating managements position on these uncertain tax positions;
	• We relied upon the management judgements, industry level deliberations and estimates for possible outflow and opinion of internal experts of the Company in relation to such disputed tax positions;
	• We assessed the appropriateness of disclosures made as per Ind AS 37 "Provisions, Contingent Liabilities and Contingent Assets".

 

3 Computation of Expected Credit Loss (ECL)	How the Key Audit matter was addressed
Trade receivables constitute a significant component of the total current assets of the Company. At each reporting date, the Company recognizes lifetime expected credit losses on these Trade receivables wherein we relied on Managements estimates regarding probability of default rates linked to age-wise bucketing of the underlying assets. Given, the technical complexity in estimating the probability of default; this area is considered as a key audit matter. (Refer Note No. 13)	• We evaluated the methodology used for age-wise classification of trade receivables and assessed the key assumptions underlying the estimated probability of default. This evaluation includes verifying consistency with the Companys historical default trends.
	• We also assessed the appropriateness whether the managements estimates are in line with Ind AS 109.

 

4 Inventories	How the Key Audit matter was addressed
The verification and valuation of inventories, is a significant area that involves considerable management judgment in the application of accounting policies and estimation techniques. Since, these judgments have a significant impact on the amounts recognized in the Standalone Financial Statements, we have identified this area as a key audit matter. (Refer Note No. 11)	• We evaluated the inventory monitoring and control system and noted that the physical verification of inventories is done by the Management at reasonable intervals.
	• Our audit teams conducted physical verification of inventories on a sample basis at various locations.
	However, since physical verification at every location is not possible, in such cases we placed reliance on the physical verification procedures carried out by the Management.
	• For inventories held at third-party locations, we relied on the Companys system of record-keeping related to such inventories.
	• We also tested, on a sample basis, the values used for determining net realisable value and cost of inventories, and verified their consistency with the inventory valuation records and related accounting entries.
	• We assessed that the valuation of inventories is in compliance Ind AS 2.

Information Other than the Financial Statements and Auditors Report thereon

The Companys management and the Board of Directors is responsible for the preparation of the other information. The other information comprises the information included in the Directors Report including Annexures to the Directors Report, Corporate Governance Report, Management Discussion and Analysis Report and Business Responsibility and Sustainability Report, but does not include the standalone financial statements and our auditors report thereon. The other information as 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 will 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, if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance.

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

The Companys management and the Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance, 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. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding 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 and the Board of Directors are 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.

The 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 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.

• 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 believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion on 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

1. We did not audit the financial statements and other financial information of Visakh Refinery which is considered as a branch, and included in the standalone financial statements, whose financial statements reflect total assets of Rs. 47,607.28 Crore as at March 31, 2025, total revenues of Rs. 1,05,008.74 Crore, net profit after tax of Rs. 302.85 Crore and total comprehensive income of Rs. 285.32 Crore for year ended March 31, 2025. The financial statements of the Visakh Refinery of the Company have been audited by the Branch Auditor of the Company. The Branch Auditors report dated April 17, 2025, has been furnished to us and our opinion in so far as it relates to the amounts and disclosures included in respect of this branch, is based solely on the report of such branch auditor.

2. We refer to Note No. 50 in respect of 17 unincorporated Joint Operations involved in exploration activities, of which majority are under relinquishment. The standalone financial statements include Companys proportionate share in Assets and Liabilities amounting to Rs. 3.09 Crore and Rs. 1.64 Crore respectively, as on March 31, 2025, and Income and Expenditure amounting to Rs. 2.73 Crore and Rs. 2.04 Crore for the year ended March 31, 2025, which have been included based on unaudited financial information. Our opinion in respect thereof is solely based on the management certified information. We have placed reliance on technical/commercial evaluation by the management in respect of categorisation of wells, allocation of cost incurred on them, liability for decommissioning costs, liability for NELP and nominated blocks for under performance against agreed Minimum Work Programme.

3. The standalone financial statements of the Company for the year ended March 31, 2024, were audited by the previous joint auditors, one of which is predecessor audit firm and have expressed an unmodified opinion on such standalone financial statements.

Our opinion is not modified in respect of these matters.

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 Section 143(11) of the Act, we give in "Annexure I" 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 Act, based on our audit as aforesaid, we give in the Annexure II, a report on the directions including additional directions issued by the Comptroller and Auditor General of India, action taken thereon and its impact on the accounts and standalone financial statements of the Company.

3. 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 and proper returns adequate for the purposes of our audit have been received from branch not visited by us;

c) The report dated April 17, 2025, on the accounts of the Visakh Refinery of the Company, issued under section 143(8) of the Act by the Branch Auditors upon their audit of the books of account of Visakh Refinery has been forwarded to us and have been properly dealt with by us in preparing our report in the manner considered necessary by us;

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

e) In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements comply with the Indian Accounting Standards specified under section 133 of the Act read with Companies (Indian Accounting Standard) Rules, 2015 as amended;

f) As per notification no. G.S.R 463(E) dated June 5, 2015, the Government Companies are exempted from the provisions of section 164(2) of the Act, accordingly, we are not required to report whether any of the directors of the Company is disqualified in terms of provisions contained in the said section;

g) 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 III";

h) With respect to the other matters to be included in the Auditors Report in accordance with the requirements of section 197(16) of the Act, as amended we report that: As per Notification number G.S.R. 463 (E) dated June 5, 2015 issued by Ministry of Corporate Affairs, section 197 of the Act regarding remuneration to directors is not applicable to the Government Company; and hence we are not required to report as to whether the remuneration paid by the Company to its directors during the year is in accordance with the provisions of section 197 of the Act;

i) 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, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements (Refer Note No.53 of the standalone financial statements);

ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts (Refer Note No. 54 to the standalone financial statements);

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, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person or entity, including foreign entity ("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

(b) The Management has represented, that, to the best of its knowledge and belief, no funds have been received by the Company from any person or entity, including foreign entity ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and

(c) Based on such audit procedures 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), as provided under (a) and (b) above, contain any material misstatement.

v. (a) The final dividend paid by the Company during the year, in respect of the previous year, is in accordance with section 123 of the Act to the extent it applies to payment of dividend;

(b) As stated in note no. 48 to the standalone financial statements, the Board of Directors of the Company have proposed final dividend for the year which is subject to the approval of the members at the ensuing Annual General Meeting. The dividend declared is in accordance with section 123 of the Act to the extent it applies to declaration of dividend.

vi. Based on our examination which included test checks, the Company has used accounting software for maintaining its books of account which has a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software. Further, during the course of our audit we did not come across any instance of audit trail feature being tampered with and the same has been preserved as per statutory requirements of record retention.

For J Singh & Associates	For S K Patodia & Associates LLP
Chartered Accountants	Chartered Accountants
Firms Registration No: 110266W	Firms Registration No: 112723W/W100962
sd/-	sd/-
J Singh	Dhiraj Lalpuria
Partner	Partner
Membership No.: 042023	Membership No.: 146268
UDIN: 25042023BMLIQV3740	UDIN: 25146268BMIXID5795
Place: Mumbai	Place: Mumbai
Date: May 6, 2025	Date: May 6, 2025

Annexure I to the Independent Auditors Report

(Referred to in paragraph 1 under "Report on Other Legal and Regulatory Requirements" of our report of even date to the Members of Hindustan Petroleum Corporation Limited (the "Company"))

According to the information and explanations provided to us by the Company and the books of account and records examined by us in the normal course of audit, we state that:

(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 Property, Plant and Equipment;

(B) The Company has maintained proper records showing full particulars of intangible assets;

(b) The Company has a program of physical verification of Property, Plant and Equipment other than LPG cylinders and pressure regulators with customers, so to cover all the assets once in every three years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its business. Pursuant to the program, certain Property, Plant and Equipment were due for verification during the year and were physically verified by the Management during the year and no material discrepancies were noticed on such verification and have been properly dealt with in the books of account;

(c) Based on our examination, we report that title deeds of all immovable properties (other than properties where the company is the lessee and the lease agreements are duly executed in favour of the lessee), disclosed in the financial statements included under Property, Plant and Equipment are held in the name of the Company as at the balance sheet date other than as disclosed in Note No. 3(13) of the standalone financial statements. For the purpose of above reporting, registered sale deed/transfer deed/conveyance deed and other substantive evidences such as allotment letters, Court orders, noting in municipal / revenue records, property tax receipts etc. conveying title to the Company over the property has been taken into consideration by the management and relied upon by us.

Further there are certain leasehold immovable properties under the continuous possession, control and use of the company, the lease agreements of which have expired. These have not been recognised as right of use assets;

(d) The Company has not revalued its Property, Plant and Equipment (including right-of-use assets) or intangible assets or both during the year;

(e) As disclosed in Note No.72.5 of the standalone financial statements, the Company does not have any proceedings initiated or pending for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 and rules made thereunder;

(ii) (a) The management has conducted physical verification of inventory except goods-in-transit and stock lying with third parties at reasonable intervals. In our opinion, considering the size of the Company, the coverage and procedure of such verification by the management is appropriate. As per information and explanations given to us, no discrepancies of 10% or more in the aggregate for each class of inventory were noticed on the said physical verification carried out by the Management.

(b) As disclosed in Note No. 72.1 of the standalone financial statements and based on our examination of the relevant documents, the Company has been sanctioned working capital limits in excess of Rs. 5 Crore, in aggregate, from banks or financial institutions on the basis of security of current assets; and the quarterly returns / statements filed by the Company with such banks or financial institutions are in agreement with the books of account of the Company, except in respect of quarter ended March 31, 2025 where such quarterly return / statement is yet to be filed; (iii) During the year, if the Company has made investments in, provided any guarantee or security or granted any loans or advances in the nature of loans, secured or unsecured, to companies, firms, Limited Liability Partnerships, or any other parties, accordingly, we have to report as under:

(a) The Company has provided loans to entities including employees of the Company, during the year, the details of which are as under:

	(Rs. in Crore)
Particulars	Loans
Aggregate amount of loan granted /
provided during the year
Subsidiaries, Joint Ventures and Associates	3,825.00
Others	268.95
Balance outstanding as at the Balance
Sheet date in respect of above cases
Subsidiaries, Joint Ventures and Associates	3,825.00
Others	258.35

(b) In our opinion, the investments made and the terms and conditions of the grant of loans during the year are, prima facie, not prejudicial to the Companys interest;

(c) In respect of loans granted by the Company except for loans granted under Pradhan Mantri Ujjwala Yojana (PMUY) scheme and loan given to a joint venture amounting to Rs. 3,825.00 Crore for which terms are stipulated in Note No. 69, the schedule of repayment of principal and payment of interest has been stipulated and the repayments of principal amounts and receipts of interest have generally been regular as per stipulation;

(d) In respect of loans granted by the Company except PMUY loans (refer Note No. 61), there is no overdue amount for more than ninety days as at the balance sheet date;

(e) There are no loans falling due within year has been renewed or extended or fresh loans granted to settle the overdues of existing loans given to the same parties;

(f) During the year, 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 except loan given to a joint venture amounting to Rs. 3,825 Crore for which terms are stipulated in Note No. 69;

(iv) The Company has complied with the provisions of section 185 and 186 of the Act, with respect to the loans, investments, guarantees and security to the extent applicable;

(v) The Company has not accepted any deposits from the public, within the meaning of sections 73 to 76 of the Act and the rules framed there under. We are informed by the Management that no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other tribunal in this regard;

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

(vii) (a) On the basis of our examination of records and according to the information and explanations given to us, the Company has generally been regular in depositing undisputed statutory dues, including Goods and Services tax, Provident Fund, Employees State Insurance, Income Tax, Sales Tax, Service Tax, duty of Custom, duty of Excise, Value Added Tax, Cess and any other statutory dues applicable to it with the appropriate authorities.

There were no undisputed amounts payable in respect of Goods and Service tax, Provident Fund, Employees State Insurance, Income Tax, Sales Tax, Service Tax, duty of Custom, duty of Excise, Value Added Tax, Cess and any other statutory dues in arrears as at March 31, 2025 for a period of more than six months from the date they became payable;

(b) On the basis of our examination of records and according to the information and explanations given to us, the particulars of statutory dues that have not been deposited on account of any dispute as under:

						(Rs. in Crore)
Name of the Statute	Dues Nature of	Amount (in dispute)(1)	Amount* deposited (2)	Net Amount (1-2=3)	amount relates Period to which	Forum where dispute is pending
Central Excise Act,	Excise Duty	0.10	-	0.10	2000-2004	Appellate Authority
1944		3,297.24	28.76	3,268.48	1994-2021	Customs, Excise and Service Tax Appellate Tribunal
		21.22	0.15	21.07	2003-2015	High Court
Sales Tax/VAT/GST Legislations	Sales Tax/ Entry Tax/	481.60	55.79	425.81	1990-2023	Appellate Authority/ Assessing Authority
	CST/VAT/ GST	1,638.49	93.06	1,545.43	1994-2018	Sales Tax Appellate Tribunal
		2,794.12	18.72	2,775.40	1981-2023	High Court
		1,425.83	-	1,425.83	2002-2011	Supreme Court
Finance Act, 1994 (Service Tax)	Service Tax	27.73	0.40	27.33	2005-2017	Customs, Excise and Service Tax Appellate Tribunal
		18.19	-	18.19	2004-2012	Supreme Court
Customs Act, 1962	Customs Duty	6.66	0.03	6.63	2005-2020	Customs, Excise and Service Tax Appellate Tribunal
		0.78	-	0.78	1996-1997	High Court
Income Tax	Income Tax	116.67	23.33	93.34	2020-2021	Commissioner of Income
Act, 1961		1.83	-	1.83	2021-2022	Tax (Appeals)

* Amount deposited under protest: Rs. Nil Crore.

(viii) As disclosed in Note No. 72.10 of the standalone financial statements, there are no transactions which are not recorded in the books of account and have been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961;

(ix) On the basis of our examination of records and according to the information and explanations given to us:

(a) The Company has not defaulted in repayment of loans or other borrowings or in the payment of interest thereon to any lender;

(b) As disclosed in Note No.72.6 of the standalone financial statements, the Company is not declared willful defaulter by any bank or financial institution or other lender;

(c) On an examination of records of the Company, we report that the funds of term loans have been utilised for the purpose for which loans were obtained;

(d) On an overall examination of the financial statements of the Company, funds raised on short- term basis have, prima facie, not been used during the year 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 the obligations of its subsidiaries, associates or joint ventures.

(f) The Company has not raised loans during the year on the pledge of securities held in its subsidiaries, joint ventures or associate companies;

(x) (a) The Company has not raised money by way of initial public offer or further public offer (including debt instruments) during the year and hence reporting under clause 3(x)(a) of the Order is not applicable to the Company;

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

(xi) (a) According to the information and explanations given to us and as represented by the Management and based on our examination of the books and records of the Company and in accordance with generally accepted auditing practices in India, no material case of frauds by the Company or on the Company has been noticed or reported during the year.

(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 with the Central Government, during the year and up to the date of this report;

(c) We have taken into consideration the whistle blower complaints received by the Company during the year (and up to the date of this report), while determining the nature, timing and extent of our audit procedures;

(xii) The Company is not a Nidhi Company and hence reporting under clause 3(xii)(a), (b) and (c) of the Order is not applicable to the Company;

(xiii) As per notification no. G.S.R 463(E) dated June 5, 2015, the Government Companies are exempted from the provisions of section 188 of the Act in respect of contracts or arrangements entered into between the Government Companies. In our opinion, the Company is in compliance with Section 177 and 188 of the Act, with respect to applicable transactions with the related parties and the details of related party transactions have been disclosed in the standalone financial statements as required by the applicable accounting standards;

(xiv) (a) In our opinion the Company has an adequate internal audit system commensurate with the size and the nature of its business;

(b) We have considered, internal audit reports for the year under audit, issued to the Company during the year and till date, in determining the nature, timing and extent of our audit procedures;

(xv) The Company has not entered into any non-cash transactions with its Directors or persons connected with directors and hence provisions of section 192 of the Act are 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), (b) and (c) of the Order is not applicable to the Company;

(b) In our opinion, 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 to the Company;

(xvii) The Company has not incurred cash losses during the current financial year and in the immediately preceding financial year.

(xviii) There has been no resignation of the statutory auditors of the Company during the year;

(xix) On the basis of the financial ratios, ageing and expected dates of realisation of financial assets and payment of financial liabilities, other information accompanying the financial statements and 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 indicating 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;

(xx) (a) There are no unspent amounts towards Corporate Social Responsibility (CSR) other than ongoing projects, requiring a transfer to a Fund specified in Schedule VII to the Companies Act within a period of six months of the expiry of the financial year in compliance with second proviso to sub-section (5) of Section 135 of the said Act. Accordingly, reporting under clause 3(xx)(a) of the Order is not applicable for the year;

(b) There are no remaining unspent amount under subsection (5) of Section 135 of the Companies Act in respect of ongoing projects which is required to be transferred to a Special Account within a period of 30 days from the end of the financial year in compliance with the provision sub-section (6) of Section 135 of the said Act. Accordingly, reporting under clause 3(xx) (b) of the Order is not applicable for the year.

For J Singh & Associates	For S K Patodia & Associates LLP
Chartered Accountants	Chartered Accountants
Firms Registration No: 110266W	Firms Registration No: 112723W/W100962
sd/-	sd/-
J Singh	Dhiraj Lalpuria
Partner	Partner
Membership No.: 042023	Membership No.: 146268
UDIN: 25042023BMLIQV3740	UDIN: 25146268BMIXID5795
Place: Mumbai	Place: Mumbai
Date: May 6, 2025	Date: May 6, 2025

(Referred to in paragraph 2 under "Report on Other Legal and Regulatory Requirements" of our report of even date)

Based on the verification of records of Hindustan Petroleum Corporation Limited (the "Company") and based on information and explanations given to us, we give below a report on the directions including additional directions issued by the Comptroller and Auditor General of India (C&AG") in terms of the section 143(5) of the Act:

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 an adequate system i.e. System Applications and Products in Data Processing (SAP) in place to process all the accounting transactions through its implemented IT system. As such, we have not come across any accounting transactions processed outside IT systems which would have an impact on the integrity of the accounts or any financial implications.

Further, we have also relied on the exercise conducted by the management to check the design of internal controls, and its operating effectiveness including the IT systems and control; Further management has conducted the system audit through an external agency which has not reported any significant gaps; Apart from above there are few other accounting processes being undertaken through work sheets like inventory valuation, PMUY provisioning and computation of Expected Credit Loss, wherein sufficient controls for data integrity have been observed in our review of general IT controls. There is however a need of automation of such processes to ensure complete data integrity.

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 load? 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)

There are no such instances during the financial year 2024-25.

3. Whether funds (grants/subsidy etc.) received/ receivable for specific schemes from Central/State Government of its agencies were properly accounted for/utilized as per its term and conditions? List the cases of deviation.

As per the information and explanations furnished to us, the funds received /receivable by the Company for specific schemes from Central/State agencies to the extent these are recorded in the books of account and records produced before us, were properly accounted. We are informed that in the case of schemes of Central Government i.e. PMUY, DBTL, other subsidies etc. claims for reimbursements duly certified by Chartered Accountants are filed with Petroleum Planning and Analysis Cell ("PPAC") for reimbursement and hence these are not considered as Grants and no utilisation certificates are filed. In case of Central Governments FAME India Scheme (Phase-II), Ministry of Heavy Industries (MHI) has sanctioned grant for the installation and commissioning of EV charging stations, whereby completion timelines were within current financial year. Further, towards timeline extension, MHI vide their letter dated April 17, 2025 has conveyed that the proposal is being put up to the relevant authorities for consideration.

In the case of certain state specific schemes, utilization certificates are furnished by the Company separately to the respective agencies. During the course of our test checks of the records available at Head Office of the Company in respect of such claims for reimbursement recorded in the books which are approved by PPAC, nothing has come to our notice that causes us to believe that there has been any violation of terms and conditions in relation to these claims. The separate audit of these claims filed with PPAC is carried out by separate firms of Chartered Accountants.

For J Singh & Associates	For S K Patodia & Associates LLP
Chartered Accountants	Chartered Accountants
Firms Registration No: 110266W	Firms Registration No: 112723W/W100962
sd/-	sd/-
J Singh	Dhiraj Lalpuria
Partner	Partner
Membership No.: 042023	Membership No.: 146268
UDIN: 25042023BMLIQV3740	UDIN: 25146268BMIXID5795
Place: Mumbai	Place: Mumbai
Date: May 6, 2025	Date: May 6, 2025

Annexure III to the Independent Auditors Report

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

Report on the Internal Financial Controls with reference to Standalone Financial Statements under clause (i) of sub-section 3 of section 143 of the Companies Act, 2013 ("the Act")

We have audited the internal financial controls with reference to standalone financial statements of Hindustan Petroleum Corporation Limited ("the Company") as of March 31, 2025 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 Board of Directors of the Company is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting 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 ("the ICAI"). These responsibilities include the design, implementation and maintenance of adequate internal financial controls with reference to standalone financial statements of the Company 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 of the Company based on our audit. We conducted our audit in accordance with the Guidance Note issued by the ICAI and the Standards on Auditing prescribed under Section 143(10) of the Act, to the extent applicable to an audit of internal financial controls. 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 controls 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 internal financial controls over financial reporting, 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 opinion on the Companys internal financial controls with reference to standalone financial statements.

Meaning of Internal Financial Controls over Financial Reporting

A companys internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A companys internal financial control over financial reporting 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 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 financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, 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 over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, to the best of our information and according to the explanations given to us, the Company has, in all material respects, an adequate internal financial controls with reference to standalone financial statements and such internal financial controls with reference to standalone financial statements were operating effectively as at March 31, 2025, based on the criteria for internal financial control over financial reporting established by the Company considering the essential components of internal control stated in the Guidance Note.

Other Matter

Our aforesaid report under section 143(3)(i) of the Act on the adequacy and operating effectiveness of the Internal Financial Controls with reference to Financial Statements in so far as it relates to branch office of the Company viz. Visakh Refinery audited by the branch auditor, appointed under section 143(8) of the Act is based on the report dated April 17, 2025 of the branch auditor which has been sent to us and has been properly dealt with in preparing this report in the manner considered necessary by us. Our opinion is not modified in respect of this matter.

For J Singh & Associates	For S K Patodia & Associates LLP
Chartered Accountants	Chartered Accountants
Firms Registration No: 110266W	Firms Registration No: 112723W/W100962
sd/-	sd/-
J Singh	Dhiraj Lalpuria
Partner	Partner
Membership No.: 042023	Membership No.: 146268
UDIN: 25042023BMLIQV3740	UDIN: 25146268BMIXID5795
Place: Mumbai	Place: Mumbai
Date: May 6, 2025	Date: May 6, 2025