Housing & Urban Development Corporation Ltd Auditor Reports

<dhhead>INDEPENDENT AUDITOR’S REPORT</dhhead>

TO THE MEMBERS OF HOUSING AND URBAN DEVELOPMENT CORPORATION LIMITED Report on the Audit of the Standalone Financial Statements

This revised Independent Auditor’s Reports is being issued in supersession of our earlier Independent Auditor’s Reports dated 7^th May, 2025. The Revised Report is being issued in view of the observation, pointed out by the C&AG of India on our earlier reports. Further, we confirm that there is no change in the opinion as expressed earlier and also none of the figures have undergone any change in the financial statements of the company as at 31st March, 2025.

1. Opinion:

We have audited the accompanying Standalone Financial Statements of Housing and Urban Development Corporation Limited ("the Company"), which comprise the Balance Sheet as at 31st March, 2025, the Statement of Profit and Loss (including other Comprehensive Income), the statement of changes in equity and the Statement of Cash Flow for the year then ended, and Notes to the Standalone financial statements including a summary of Material Accounting Policies and other explanatory information (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 other accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2025, its profit (including other comprehensive income), changes in equity and its cash flows for the year ended on that date.

2. 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 Companies Act, 2013. Our responsibilities under those Standards are further described in the ‘Auditor’s 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 relevanttoourauditofthestandalonefinancialstatements under the provisions of the Companies Act, 2013 and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is basis for our opinion on the standalone financial statements.

3. Emphasis of Matter:

We draw attention to the following matter in the Para 3 of Note 41 to the Standalone financial statements: 1. The company has recognized interest income on "No lien AGP Account" amounting to Rs. 29.46 Crore for the year ended 31st March 2025 [Rs. 29.01 Crores for the previous year ended 31st March, 2024].

2. The balance outstanding at the end of the year is Rs. 626.52 Crore (debit) (Rs. 592.65 Crore (debit) in the previous year ended 31st March 2024) in "No lien AGP Account". The company is in discussion with MoHUA for recover/ reimbursement of outstanding amount (including interest) as well as booking of expenses.

3. The Company has not complied with the provisions of regulation 17(1)(b) of SEBI (LODR) Regulations, 2015, regarding the requirement of the requisite number of Independent Directors for the period July 1, 2019 to Dec 31, 2022 and April 1, 2023 to March 31, 2025.

4. Our opinion is not modified in respect of these matters.

4. Key Audit Matters:

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

No. Key Audit Matter	Our Audit Procedures Included:
01. Ind AS 109 on Financial Instruments establishes a comprehensive framework for determining expected credit losses, accuracy of classification, de-recognition and measurement requirements for all the financial assets and liabilities.	Our procedures and audit approach consisted and included, but were not limited to testing of the design and operating effectiveness of the internal controls and substantive testing as follows:
The Company follows a Board approved methodology wherein assessment for allowance is carried out for impairment based on certain criterion/ framework classifying the assets into various stages depending upon credit risk and level of evidence of impairment.	Obtained an understanding of the systems, processes and controls implemented by management for recording and calculating Expected credit losses (ECL), recognition, de-recognition and measurement of Financial Assets and Financial Liabilities, for classifying financial assets portfolio into stages based on credit risk.
Impairment allowance is measured as product of the Probability of Default, Exposure at Default and Loss Given Default being the key parameters for assessing the impairment allowance.
	Discussed with appropriate senior management and evaluated management’s underlying key assumptions in estimating the expected credit losses and measuring Financial Assets and Financial Liabilities.
The key indicators underlying for assessment of impairment allowance are appraised on an ongoing basis by the management Considering the materiality of the amounts involved, the significant management judgment required in estimating the expected credit losses as well as measuring Financial Assets and Financial Liabilities and such estimates and judgments being inherently subjective, this matter has been identified as a key audit matter for the current year audit.
	Selected the sample and tested the operating effectiveness of the internal control, relating to recognition, measurement and de- recognition of, financial assets and financial liabilities and calculation of ECL. We carried out a combination of procedures involving enquiry and observation, performance and inspection of evidence in respect of operation of these controls.
(Refer Notes: 6, 7, 8, 9, 10, 11, 16, 17, 18, 19, 33,36, 37, 38, 40 and 41 to standalone financial statements)
	Tested the relevant information technology systems access and change management controls relating to contracts and related information used in recording financial assets/ liabilities and calculation of ECL in accordance with the said Ind AS.
	Tested the appropriate staging of assets basis, their days past due and other loss indicators on sample basis.

02. The Company uses derivative instruments, including currency and interest rate swaps, to hedge its exposure to market risks.	Our procedures and audit approach consisted and included, but were not limited to testing of the design and operating effectiveness of the internal controls and substantive testing as follows:
The Company enters into derivative contracts in accordance with RBI guidelines to mitigate its currency and interest rate risk in accordance with the Company’s board approved currency risk management policy. Derivative contracts are either categorised at Fair Value through P&L (FVTPL) or under cash flow hedge (Hedge Accounting). Mark to market gain/loss on derivatives categorised at FVTPL is recognised in Statement of Profit and Loss and that of cash flow hedge is recognised in the Other Comprehensive Income.
	Obtained understanding of the Company’s risk management policies for derivative transactions.
	Assessed the design and operating effectiveness of controls over classification and valuation of derivatives. • Verified the fair values obtained from counterparties and validated them using independent valuation techniques, wherever applicable.
In view of the volume, nature, and valuation sensitivity of derivative contracts, as well as the significance of their impact on the financial results, this area was considered a key audit matter.
	Reviewed accounting treatment including hedge documentation and compliance with recognition criteria under Ind AS 109.
(Refer Notes Note 38 to standalone financial statements)
	Assessed the completeness and accuracy of disclosures in the financial statements related to derivative instrument

5. INFORMATION OTHER THAN THE STANDALONE FINANCIAL STATEMENTS AND AUDITOR’S REPORT THEREON:

The Company’s Board of Directors are responsible for the other information. The other information comprises the Directors’ report, Corporate Governance report, Business responsibility report and Management Discussion and Analysis etc. included in the Company’s Annual Report, but does not include the standalone financial statements and our auditor’s report thereon. The Annual report for the year ending 31st March 2025 is expected to be made available to us after the date of this auditor’s report. Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements, our responsibility is to read the other information identified above when it becomes available and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained in the 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 and take appropriate actions, if required.

6. Responsibilities of Management and Those Charged with Governance for the Standalone Financial Statements: The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these standalone financial financial position, financial performance including other Comprehensive income, Changes in Equity, and Cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Indian accounting Standards (Ind ASs) specified under Section 133 of the Act. This responsibility also includes, a. 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; b. selection and application of appropriate accounting policies; c. making judgments and estimates that are reasonable and prudent and d. 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, the Board of Directors is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless Board of Directors either intend to liquidate the company or to cease operations, or has no realistic alternative but to do so.

The Board of Directors is also responsible for overseeing the Company’s financial reporting process.

7. Auditor’s 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 auditor’s 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 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 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 Companies Act, 2013, we are also responsible for expressing our opinion on whether the company has adequate internal financial controls with reference to Standalone FinancialStatementsinplaceandtheoperatingeffectiveness . 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 management’s 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 as a going concern. If we conclude that a material uncertainty significant exists, we are required to draw attention in our auditor’s 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 auditor’s 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 thestandalonefinancialstatements represent the underlying transactions and events in a manner that achieves fair presentation.

Materiality is the magnitude of misstatement in the Standalone Financial Statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the Financial Statements may and qualitative factors in (i) Planning the scope of our audit work beinfluenced. and in evaluating the results of our work: and (ii) to evaluate the effect of any identified misstatements in the Financial

Statements.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing anysignificant duringoftheaudit and significant 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 Auditor’s 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.

8. Report on Other Legal and Regulatory Requirements:

A. As required by the Companies (Auditor’s Report) Order, 2020 ("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 matters specified in Paragraph 3 and 4 of the said Order, to the extent applicable.

B. The Comptroller and Auditor General of India has issued the directions indicating the areas to be examined in term of sub-section 5 of Section 143 of the Act, the compliance of which is set out in Annexure- "B".

C. 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 accounts as required by law have been kept by the company so far as it appears from our examination of those books. c) The Balance Sheet, the Statement of Profit and loss [including Other Comprehensive income], Statement of Changes in Equity and the Statement of Cash Flow dealt with by this Report are in agreement with the books of account; d) In our opinion, the aforesaid Standalone Financial Statements comply with the Ind AS specified under Section 133 of the Act read with Companies (Indian Accounting Standards) Rules, 2015 as amended; e) The provisions of section 164(2) of the Companies Act, 2013 in respect of disqualifications of directors are not applicable to the Company being Government Company in terms of notification no. G.S.R. 463(E) dated 5^th June 2015 issued by the Ministry of Corporate affairs; f) With respect of the adequacy of the Internal Financial Controls over financialreporting of the Company and the operating effectiveness of such controls, refer to our separate report inAnnexure- "C"; g) 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 Director is not applicable to the Company, since it is a Government Company and h) With respect to the other matters to be included in the Auditor’s 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 financial position on its Standalone financial statements; (Refer Para 2(a) of Note no. 41 to standalone financial statements) ii. The Company has made due provision as required under the applicable law or Indian Accounting Standards, for material foreseeable losses, if any, on long term contracts including derivatives contracts; (Refer Note no. 38 to 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; (Refer Para 17 of Note no. 41 to standalone financial statements) iv.

(a) The management has represented that, to the best of its knowledge and belief (Refer Para 39 of Note no. 41 to standalone financial statements) no funds (which are material either individually or in the aggregate) have been advanced or loaned invested (either from borrowed funds or securities premium or any other sources or kind of funds) by the Company to or in any persons or entities, including foreign entities (the 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 (the Ultimate Beneficiaries) or provide any guarantee, security or the like on behalf the Ultimate Beneficiaries; (b) The management has represented that, to the best of its knowledge and belief, (Refer Para 39 of Note no. 41 to standalone financial statements) no funds (which are material either individually or in the aggregate) have been received by the Company from any persons or entities, including foreign entities (the 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 audit procedures performed as considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under Sub-clauses (a) and (b) above contain any material misstatement.

v. As stated in Para 29 of Note no. 41 to the Standalone Financial Statements:

The final dividend proposed for the previous year, declared and paid by the company during the year is in compliance with section 123 of the companies Act,2013, as applicable;

The interim dividend declared and paid by the company during the year and until the date of this report is in compliance with section 123 of the companies Act, 2013 and

The Board of director of the company have proposed final dividend for the year which is subject to the approval of the member at the ensuing Annual General Meeting. The amount of the dividend proposed is in accordance with section 123 of the companies Act, 2013, as applicable. vi. Proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 with respect to using accounting software for maintaining its books of account which has certain features e.g. edit log etc. as enumerated in aforesaid proviso is applicable to the Company with effect from April 1, 2023.

Based on our examination which included test checks, the company has used an 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. Additionally, the audit trail has been preserved by the company as per the statutory requirements for record retention.

9. NHB/RBI Directions:

The Company is complying with National Housing Bank’s (NHB)/Reserve Bank of India’s (RBI) credit concentration norms in respect of loans to private sector agencies. However, in case of loans to State Governments/State Government Agencies/Central Government Agencies, the said norms have been relaxed by the NHB/RBI vide its circular number DOR.CRE.70/21.01.003/2023-24 dated January 15, 2024 (Refer Para no.19 of Note No.41).

In reference to the above, all exposures except, exposures which are secured by Central Government/State Governments guarantees and direct borrowings by the government have been considered for computing the exposure for purposes of credit concentration norms.

ANNEXURE "A" TO THE INDEPENDENT AUDITOR’S REPORT ON THE AUDIT OF STANDALONE FINANCIAL STATEMENTS

(Referred to in Paragraph 8 (A) under ‘Report on Other Legal and Regulatory Requirements’ section of our report of even date to the members of Housing and Urban Development Corporation Limited on the Standalone Financial Statements for the year ended March 31^st, 2025).

To the best of our information and according to the 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 Company’s 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 & Equipment. B. The Company has maintained proper records showing full particulars of intangible assets. b) Based on information and explanation given to us, the company’s management carries out the physical verification of all its Property, Plant & Equipment once every year at the end of the Financial Year which, in our opinion, is reasonable having regard to the size of the company and the nature of its Property, Plant & Equipment. Pursuant to the program, Property, Plant& Equipment were physically verified by the management at the end of the Financial Year. In our opinion and as per the information given by the management, the discrepancies observed, were not material and have been appropriately accounted for in the books. c) The title deeds of all the immovable properties (including investment properties) held by the company (other than properties where the company is the lessee and the lease agreements are duly executed in favor of the lessee) disclosed in the Standalone financial statements are held in the name of the Company, except for the following properties:

Description of property	Gross carrying value (In Crore)	Held in name of	Whether promoter, director or their relative or employee	Period held	Reason for not held in name of the company
		NIL

The company is having Leasehold Lands/ Flats/ building measuring 11521.52 square meters having cost of Rs.33.99 Crore and Freehold land/flats/ building measuring 4844.66 square meters for which lease deeds are pending for execution in the name of the Company. Details are as follows:

Name of Regional Office

Address of Property

AREA

Nature of Ownership

Cost of the purchase of property including applicable Stamp Duty & Reg. charges (Amount in Rs.)

Status of Lease Deed/status of construction of plot

Reason for non execution

Patna

Residential flat- Flat No. N-1302, Udaigiri Apartment, Budh Marg, Patna

195 Sq. Mt.

Lease hold

14,57,500

Not Executed

The land for construction of this society flat was provided by the State Govt to State Housing Board. However Govt. is yet to decide the rate for land. Pending a decision about the land rate and payment of dues by other allottes, the lease deed has not been executed.

Bhubaneshwar

Flat No. A-503, Block-1 (Hira), Toshali Apartment Satyanagar, Bhubaneshwar

1331 Sq. Ft.

Lease hold

8,27,976

Not Executed

State Govt yet to transfer the land title to Orrisa Housing Board (OSHB). As such lease deed cannot be executed by OSHB in favor of HUDCO

Bhubaneshwar

Flat No. B-304,B-305 & B-306 Block-IV (Rupa), Toshali Apartment Satyanagar, Bhubaneshwar

803 Sq. Ft.

Lease hold

17,25,900

Not Executed

Bhubaneshwar

Garage No. (4 Nos.) 76,77,78 & 79, Block- IV (Rupa), Toshali Apartment, Satyanagar, Bhubaneshwar

Part of flats

Lease hold

5,57,920

Not Executed

State Govt yet to transfer the land title to Orrisa Housing Board (OSHB). As such lease deed cannot be executed by OSHB in favor of HUDCO

Bhubaneshwar

Garage No. (1 No.), 15, HIRA Block No. 1, Toshali Apartment, Satya Nagar, Janpath, Bhubaneshwar

162 Sq. Ft.

Lease hold

1,06,700

Not Executed

Chennai

Regional Office: 5th floor, CMDA Tower-I, Gandhi Irwin Road, Egmore, Chennai-600 008

2388 Sq. Mt.

Freehold

1,91,24,731

Not Executed

Guideline value are yet to be finalised by Revenue Dept. of State Govt., pending which the deed can’t be executed.

Chandigarh

Plot: Plot No. 3, Part-II, Sector-25., Panchkula, Chandigarh

2456.66 Sq. Mt.

Freehold

1,32,45,767

Not Executed

HSVP and Chandigarh Housing Board has yet to approve execution of lease deed

Chandigarh

Flats: Flat No. 1501(GF) HIG(U), Sector 43-B, Chandigarh

92 Sq. Mt.

Lease hold

2,46,184

Not Executed

HSVP and Chandigarh Housing Board has yet to approve execution of lease deed

Chandigarh

Flat No. 3067(GF)

49.93

Lease hold

2,86,184

Not Executed

HIG(L), Sector 44-D

Sq. Mt.

Chandigarh

Chandigarh

Flat No. 3067/1(GF) HIG(L), Sector 44-D Chandigarh

49.93 Sq. Mt.

Lease hold

6,25,906

Not Executed

Chandigarh Housing Board has yet to approve execution of lease deed

Chandigarh

Flat No. 3067/2(GF) HIG(L), Sector 44-D Chandigarh

49.93 Sq. Mt.

Lease hold

Not Executed

Mumbai

Staff Qtr., Flat No. 32, Bldg. No. 24 Anand Sagar, CHS Ltd., Bandra Reclamation, Bandra (West), Mumbai-400 050

60.3 Sq. Mt.

Lease Hold

5,69,449

Not Executed

Mumbai

Staff Qtr., Flat No. 32, Bldg. No. 18, Samundra Darshan CHS Ltd., Bandra Reclamation, Bandra (West), Mumbai-400 050

50.64 Sq. Mt.

Lease hold

4,25,788

Not Executed

Mumbai

Staff Qtr., Flat No. 33, Bldg. No. 18, Samundra Darshan CHS Ltd., Bandra Reclamation, Bandra (West), Mumbai-400 050

50.64 Sq. Mt.

Lease Hold

3,88,740

Not Executed

These flats, located in societies were purchased from MHADA and there is no practice of execution of lease deed by MHADA in favour of individual purchaser.

Mumbai

Staff Qtr., Flat No. 51, Bldg. No. 5, Hira CHS Ltd., Bandra Reclamation, Bandra (West), Mumbai- 400 050

44.64 Sq. Mt.

Lease Hold

5,64,842

Not Executed

MHADA only issues allotment letter and possession letter which forms the proof of ownership of property. MHADA will only execute the conveyance deed in respect of the entire property in favour of the Society.

Mumbai

Staff Qtr., Flat No. 52, Bldg. No. 5, Hira CHS Ltd., Bandra Reclamation, Bandra (West), Mumbai- 400 050

44.64 Sq. Mt.

Lease Hold

5,64,842

Not Executed

As such, there is no lease deed documents executed between HUDCO and MHADA.

Mumbai

Staff Qtr., Flat No. 61, Bldg. No. 5, Hira CHS Ltd., Bandra Reclamation, Bandra (West), Mumbai- 400 050

44.64 Sq. Mt.

Lease Hold

5,64,842

Not Executed

Mumbai

Staff Qtr., Flat No. 104, Bldg. No. 21, Oshiwara Gulmohar CHS Ltd., Plot H-56, MHADA, Oshiwara, Andheri (West), Mumbai- 400 053

86.05 Sq. Mt.

Lease Hold

21,10,483

Not Executed

Mumbai

Staff Qtr., Flat No. 204, Bldg. No. 21, Oshiwara Gulmohar CHS Ltd., Plot H-56, MHADA, Oshiwara, Andheri (West), Mumbai-400 053

86.05 Sq. Mt.

Lease Hold

21,56,363

Not Executed

Mumbai

Staff Qtr., Flat No. 501, Bldg. No. 21, Oshiwara Gulmohar CHS Ltd., Plot H-56, MHADA, Oshiwara, Andheri (West), Mumbai-400 053

86.05 Sq. Mt.

Lease Hold

22,94,004

Not Executed

These flats at Mumbai, located in societies were purchased from MHADA and there is no practice of execution of lease deed by MHADA in favour of individual pruchaser. MHADA only issues allotment letter and possession letter which forms the proof of

Mumbai

Staff Qtr., Flat No. 604, Bldg. No. 21, Oshiwara Gulmohar CHS Ltd., Plot H-56, MHADA, Oshiwara, Andhra, (West), Mumbai-400 053

86.05 Sq. Mt.

Lease Hold

23,39,884

Not Executed

ownership of property. MHADA will only execute the conveyance deed in respect of the entire property in favour of the Society. As such, there is no leasedeed documents executed between HUDCO and MHADA

Mumbai

Staff Qtr., Flat No. 704, Bldg. No. 21, Oshiwara Gulmohar CHS Ltd., Plot H-56, MHADA, Oshiwara, Andheri (West), Mumbai-400 053

86.05 Sq. Mt.

Lease Hold

23,85,764

Not Executed

Delhi Delhi

HUDCO Bhawan, IHC, Lodhi Road, New Delhi Hudco House, Lodhi Road, New Delhi

8600 Sq. Mt. 619.94 Sq. Mt.

Lease Hold Lease Hold

28,84,67,754 58,38,202

Not Executed Not Executed

India Habitat Centre yet to execute sub lease deed with all allottees including HUDCO. BHEL is the prime allottee who has yet to execute Lease Deed with L&DO

Delhi

C-24, C-25, C-26 (6 Flats), Jangpura Extn. New Delhi

C-24 GF- 1378.87 sft FF- 1407.34 sft (each)

Lease Hold

2,53,97,247

Not Executed

HPL is prime allottee of land and is yet to sign lease deed with L&DO. Therefore, sale deed of flats is pending with L&DO/HPL for Jangpura flats

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) According to information and explanations given by the management, no proceedings have been initiated or are pending against the company for holding any benami property under the Benami Transactions (Prohibition) Act,1988 (45 of 1988) and rules made there under. ii. (a) The Company does not have any inventory and hence reporting under clause 3(ii)(a) of the Order is not applicable.

(b) According to information and explanations given by the management, the company has been sanctioned unsecured working capital limits in excess of five Crore rupees during the year, in aggregate, from Banks. Since, the limits have been sanctioned as unsecured, reporting under clause 3(ii) (b) of the Order is not applicable. iii. During the year the Company has made investments in, provided guarantees and granted loans/advances in the nature of loans, secured/unsecured to companies, firms, Limited Liability Partnerships or any other parties., In this regard we report hereunder a) The company is a registered NBFC with Reserve Bank of India with principal business of giving loans hence clause 3(iii)(a) of the Order is not applicable. b) In our opinion, the investments made, guarantees provided and the terms and conditions of the grant of all loans and advances in the nature of loans and guarantees provided, during the year are, prima facie, not prejudicial to the Company’s interest. c) Being a registered Non-Banking Financial Company (NBFC), the company grants its loans on stipulated terms and conditions for repayment of principal and interest. In respect of Loan assets except credit impaired assets, the repayments of principal amounts and receipts of interest are generally regular as per stipulation. d) In respect of loans and advances in the nature of loans, the total amount overdue for more than ninety days are as under. The Company takes steps for recovery of the principal and interest as per its defined procedures, which in our opinion are reasonable.

( in Crores)

No. of cases	Principal Amount Overdue	Interest Overdue	Total Overdue	Remarks (if any)
702	2,090.84	15,302.99	17,393.83	-

e) Reporting under clause 3(iii)(e) of the Order is not applicable, since the principal business of the company is to give loans f) As per the information and explanation provided to us, 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 during the year under audit. Hence, reporting under clause 3(iii) (f) is not applicable iv. In our opinion and according to the information and explanation given to us, the Company has not granted any loans or provided any guarantees or security to the parties covered under Section 185 of the Act. Further, in our opinion and according to information & explanations given to us, the Company, being a NBFC, is exempt from the provisions of Section 186 of the Act and the relevant rules in respect of loans and guarantees. In respect of the investments, the Company has complied with the provisions of section 186 (1) of the Act. v. The company has not accepted any deposits from public within the meaning of Sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended) during the year under review. According to the information and explanation given to us, the company had discontinued accepting/ renewing Public Deposit under the Public Deposit Scheme w.e.f.1 July 2019. However, the company has complied with directions issued by National Housing Bank / Reserve Bank of India; and the provisions of section 73 to 76 and other applicable relevant provisions of the Companies Act 2013 and the rules framed hereunder with regard to deposits outstanding during the year. vi. According to the information and explanations given to us, the Central Government has not prescribed the maintenance of cost records under subsection (1) of Section 148 of the Companies Act, 2013, in respect of the business of the Company. Accordingly, the provisions of clause 3(vi) of the Order are not applicable to the Company. vii.

(a) According to the information and explanation given to us and on the basis of our examination of the books of account, and records, the company has generally been regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Income-Tax, Goods & Service Tax, Service Tax, Duty of Customs, Duty of Excise, Value added Tax, Cess and any other statutory dues applicable to it with the appropriate authorities. According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, employees’ state insurance, income tax, goods and services tax, duty of custom, duty of excise, value added tax, sales tax, service tax, cess and other material statutory dues were outstanding, as on 31st March, 2025 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, and on the basis of our examination of the books of account, the dues as at 31st March 2025 of income tax, goods and services tax, duty of custom, duty of excise, value added tax and cess which have not been deposited on account of any dispute, are as follow:

( in Crores)

Name of Statute	Nature of Dues	Amount Disputed	Amount paid / refund adjusted (Under Protest)	Net Amount unpaid	Period of Dispute	Forum where dispute is pending
Income Tax Act 1961	Disputed Income tax Demand	0.01	0.01	-	AY 1995-96	AO
Income Tax Act 1961	Disputed Income tax Demand	19.44	19.44	-	AY 1996-97	Add. CIT and High Court
Income Tax Act 1961	Disputed Income tax Demand	12.59	12.59	-	AY 1997-98	CBDT and Add. CIT
Income Tax Act 1961	Disputed Income tax Demand	0.79	-	0.79	AY 1997-98	CBDT and Add. CIT
Income Tax Act 1961	Disputed Income tax Demand	0.86	0.86	-	AY 1998-99	Add. CIT and High Court

Name of Statute	Nature of Dues	Amount Disputed	Amount paid / refund adjusted (Under Protest)	Net Amount unpaid	Period of Dispute	Forum where dispute is pending
Income Tax Act 1961	Disputed Income tax Demand	9.41	9.41	-	AY 1998-99	Add.CIT
Income Tax Act 1961	Disputed Income tax Demand	4.72	4.72	-	AY 1999-00	Add.CIT
Income Tax Act 1961	Disputed Income tax Demand	23.24	23.24	-	AY 2000-01	Add.CIT
Income Tax Act 1961	Disputed Income tax Demand	0.13	0.13	-	AY 2000-01	Add.CIT
Income Tax Act 1961	Disputed Income tax Demand	3.16	3.17	- 0.01	AY 2000-01	Add.CIT
Income Tax Act 1961	Disputed Income tax Demand	2.79	-	2.79	AY 2000-01	Add.CIT
Income Tax Act 1961	Disputed Income tax Demand	19.86	19.86	-	AY 2001-02	Add.CIT
Income Tax Act 1961	Disputed Income tax Demand	1.70	1.70	-	AY 2001-02	Add.CIT
Income Tax Act 1961	Disputed Income tax Demand	15.86	15.86	-	AY 2002-03	Add.CIT
Income Tax Act 1961	Disputed Income tax Demand	0.27	0.27	-	AY 2002-03	Add.CIT
Income Tax Act 1961	Disputed Income tax Demand	0.66	0.66	-	AY 2003-04	Add.CIT
Income Tax Act 1961	Disputed Income tax Demand	3.33	3.33	-	AY 2003-04	Add.CIT
Income Tax Act 1961	Disputed Income tax Demand	18.61	18.61	-	AY 2004-05	AO
Income Tax Act 1961	Disputed Income tax Demand	19.82	19.82	-	AY 2005-06	Add. CIT, ITAT and supreme court
Income Tax Act 1961	Disputed Income tax Demand	6.14	6.14	-	AY 2006-07	Add. CIT, ITAT and supreme court
Income Tax Act 1961	Disputed Income tax Demand	27.35	27.35	-	AY 2007-08	Add. CIT, ITAT and supreme court

Name of Statute	Nature of Dues	Amount Disputed	Amount paid / refund adjusted (Under Protest)	Net Amount unpaid	Period of Dispute	Forum where dispute is pending
Income Tax Act 1961	Disputed Income tax Demand	1.99	1.99	-	AY 2007-08	Add. CIT, ITAT and supreme court
Income Tax Act 1961	Disputed Income tax Demand	0.73	0.73	-	AY 2007-08	Add. CIT, ITAT and supreme court
Income Tax Act 1961	Disputed Income tax Demand	8.69	8.69	-	AY 2008-09	Add. CIT, ITAT and supreme court
Income Tax Act 1961	Disputed Income tax Demand	13.33	13.33	-	AY 2009-10	Add. CIT, ITAT and supreme court
Income Tax Act 1961	Disputed Income tax Demand	6.38	6.37	0.01	AY 2010-11	AO
Income Tax Act 1961	Disputed Income tax Demand	8.25	8.25	-	AY 2011-12	AO
Income Tax Act 1961	Disputed Income tax Demand	13.92	13.92	-	AY 2012-13	ITAT
Income Tax Act 1961	Disputed Income tax Demand	26.70	26.70	-	AY 2013-14	CIT (A)
Income Tax Act 1961	Disputed Income tax Demand	12.11	12.11	-	AY 2014-15	ITAT
Income Tax Act 1961	Disputed Income tax Demand	2.05	1.42	0.63	AY 2015-16	ITAT
Income Tax Act 1961	Disputed Income tax Demand	5.63	5.63	-	AY 2016-17	CIT (A)
Income Tax Act 1961	Disputed Income tax Demand	5.37	5.37	-	AY 2017-18	CIT (A)
Income Tax Act 1961	Disputed Income tax Demand	2.59	0.79	1.80	AY 2018-19	CIT (A)
Income Tax Act 1961	Disputed Income tax Demand	8.86	8.85	0.01	AY 2019-20	AO
Income Tax Act 1961	Disputed Income tax Demand	0.39	0.38	0.01	AY 2020-21	AO
Income Tax Act 1961	Disputed Income tax Demand	0.18	-	0.18	AY 2021-22	AO

Name of Statute	Nature of Dues	Amount Disputed	Amount paid / refund adjusted (Under Protest)	Net Amount unpaid	Period of Dispute	Forum where dispute is pending
Wealth Tax Act, 1957	Wealth Tax	0.01	0.01	-	AY 1995-96	Addl CIT
TRACES De- mand	TDS	0.04	-	0.04	FY 2007-08 Onwards	AO
Service Tax- Finance Act 1994	Disputed Service tax Demand	0.07	-	0.07	FY 2005-06 to FY 2008-09	CESTAT KOLKOTA
Service Tax- Finance Act 1994	Disputed Service tax Demand	0.01	-	0.01	October 2008 to September 2010	Dy. Commissioner
Service Tax- Finance Act 1994	Disputed Service tax Demand	1.48	0.15	1.33	FY 2016-17	Dy. Commissioner & Commissioner of Central Tax
Service Tax- Finance Act 1994	Disputed Service tax Demand	2.16	0.90	1.26	FY 2018-19	AO
Goods & Service Tax	Disputed Tax & Interest	0.87	0.04	0.82	FY 2019-20	DY COMM/ ASST.COMM
Goods & Service Tax	Disputed Tax & Interest	0.00	0.00	0.00	FY 2017-18	DY COMM/ ASST.COMM
Goods & Service Tax	Disputed Tax & Interest	0.02	0.00	0.02	FY 2020-21	DY COMM/ ASST.COMM
Goods & Service Tax	Disputed Tax & Interest	0.46	0.02	0.43	FY 2019-2020	DY COMM/ ASST.COMM
Goods & Service Tax	Disputed Tax & Interest	54.95	2.97	51.98	FY 2020-2021	DY COMM/ ASST.COMM
Goods & Service Tax	Disputed Tax & Interest	0.13	0.01	0.12	FY 2019-2020	DY COMM/ ASST.COMM

viii. According to the information and explanations given to us and on the basis of our examination of the records of the Company, there are no transactions which have been surrendered or disclosed as income in tax assessments under the Income Tax Act, 1961 (43 of 1961). In view of this, there are no transactions of previously unrecorded income in terms of clause 3 (viii) of the Order. ix. a. According to the information and explanations given to us and based upon the audit procedures performed, the company has not defaulted in repayment of loans or other borrowings or in the payment of interest thereon to any lender. b. According to the information and explanations given to us, the company has not been declared willful defaulter by any bank or financial institution or other lender. c. According to the information and explanations given to us, term loans were applied for the purpose for which the loans were obtained. d. According to the information and explanations given to us and on the basis of our examination of the records, no funds raised on short term basis have been used for long term purposes by the company other than temporary usage pending receipts from long term sources. e. According to the information and explanations given to us, 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. According to the information and explanations given to us, 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) According to the information and explanations given to us, the Company has not raised money by way of Initial public offer or further public offer (including debt instruments) during the year. b) According to the information and explanations given to us, the company has not made any preferential allotment or private placement of shares or convertible debentures but has made private placement of non-convertible debentures during the year. Provisions of Section 42 and section 62 of the Act have been complied with and the funds raised have been used for the purposes for which the funds were raised. xi. i. Based upon the audit procedure performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations provided by the management, except for the four frauds on the company mentioned below, no other fraud by the company or on the company has been noticed or reported during the year.

NATURE OF FRAUD	AMOUNT INVOLVED
Criminal Breach of Trust - Unauthorized sale of mortgaged property during pending litigation	Rs. 1.64 Lacs
Dual Mortgage Fraud - Unauthorized encumbrance on mortgaged property	Rs. 10.00 Lacs
Misappropriation & Criminal Breach of Trust - Property alienation post-default	Rs. 1.95 Lacs
Criminal Breach of Trust - Fraudulent property transfer	Rs.1.64 Lacs

ii. Based upon the audit procedure performed for the purpose of reporting the true and fair view of the financial statements, no report under sub-section (12) of section 143 of the Companies Act has been filed by any of the auditors of the company 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. iii. According to the information and explanations given to us, no whistle-blower complaints were received during the year by the company. xii. According to information and explanation given to us, the Company is not a Nidhi Company. Hence the Nidhi Rules, 2014 are not applicable to the Company. Accordingly, clause 3(xii) of the Companies (Auditor’s Report) Order 2020 is not applicable to the Company. xiii. According to the information and explanations given to us and on the basis of our examination of the records of the Company, transactions with the related parties are in compliance with section 177 and 188 of the Act where applicable and the necessary disclosures have been made in the standalone Ind AS financial statements etc., as required by the applicable accounting standards. The details have been disclosed in the Standalone Financial Statements, as required by the applicable Indian accounting standards (Ind AS) (Refer Note para 35 to No. 41) xiv. (a) In our opinion and according to the information and explanations provided by the management, the company gets its Internal Audit done on quarterly basis and have an internal audit system commensurate with the size and nature of its business.

(b) We have considered the 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. According to the information and explanations given to us, in our opinion during the year the Company has not entered into any non-cash transactions with its directors or persons connected with its directors and hence provisions of Section 192 of the Companies Act, 2013 are not applicable. xvi. (a) The Company has received registration as a non-banking finance company, Infrastructure Finance Company (NBFC-IFC) under section 45-IA of the Reserve Bank of India Act, 1934. The registration number issued to the company on 23^rd August 2024 vide Registration number N-14.03626.

(b) According to the information and explanations given to us, the company has not conducted any non-banking financial or housing financeactivities without a valid certificate of registration from the Reserve Bank of India as per Reserve Bank of India Act, 1934.

(c) According to the information and explanations given to us, the Company is not a core investment company (CIC) as defined in the regulations made by the Reserve Bank of India, hence reporting under clause 3 (xvi) (c) of the order is not applicable.

(d) 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. xvii. Based upon the audit procedures performed and according to the information and explanations provided by the management, the company has not incurred cash losses in the Financial Year and in the immediately preceding Financial Year. xviii. There has been no resignation of the statutory auditors during the year. Accordingly, the provisions of clause 3(xviii) of the Order are not applicable to the Company. xix. On the basis ofthefinancialratios, ageing and expected dates of realization of financial assets and payment of financial liabilities, other information accompanying the Financial Statements, our knowledge of the Board of Directors and management plans and based on our examination of the evidence supporting the assumptions, nothing has come to our attention, which causes us to believe that any material uncertainty exists as on the date of the audit report that Company is not capable of meeting its liabilities existing at the date of balance sheet as and when they fall due within a period of one year from the balance sheet date. We 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) According to the information and explanations given to us, there are no unspent amounts towards Corporate Social Responsibility (CSR) on other than ongoing projects requiring a transfer to a Fund specified in Schedule VII to the Companies Act 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) According to the information and explanations given to us, in respect of ongoing projects, the Company has transferred unspent Corporate Social Responsibility (CSR) amount as at the Balance Sheet date to a special account ‘Unspent CSR account’ opened with a Scheduled bank, within a period of thirty days from the end of the Financial Year in compliance with Section 135(6) of the Companies Act 2013. xxi. According to the information and explanations given to us, the company also prepares Consolidated Financial Statements consolidating the Associates and Joint Ventures in accordance with Ind AS requirements and there have been no qualifications or adverse remarks by the respective auditors in the Companies (Auditor’s Report) Order (CARO) reports of the companies (wherever applicable) included in the Consolidated Financial Statements.

ANNEXURE "B" TO THE INDEPENDENT AUDITOR’S REPORT ON THE AUDIT OF STANDALONE FINANCIAL STATEMENTS

(Annexure referred to in paragraph 8 (B) under ‘Report on Other Legal and Regulatory Requirements’ section of our report of even date to the members of Housing and Urban Development Corporation Limited on the Standalone Financial Statements for the year ended 31^st March, 2025)

As required under Section 143(5) of the Companies Act 2013 with respect to the directions issued by The Comptroller & Auditor General of India, we report that:

Sr.No. DIRECTIONS	REPLIES
01 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.	According to the information and explanation given to us and based on our audit the Company has the system in place to process all the accounting transactions through IT systems. It has been observed that basic calculations like Interest Payable on bonds and Borrowings, etc. are parallelly calculated outside IT systems i.e. through excel sheets for cross checking. During the course of verification on a test check basis, we have not come across any major calculation mistake. During the year the company has implemented ERP system and major of the modules have been operationalized during the Year.
02 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 company’s inability to repay the loan? If yes, the financialimpact may be stated. Whether such cases are property accounted for. (In case lender is a government company, then these directions also applicable for statutory auditor of lender company)	The company is using Integrated General Ledger (IGL) Customized ERP Software ( Since 1.04.2024) in which accounting entries/ vouchers are routed through. Till 31.03.24 all accounting transaction are maintained in system "Holfin" whichis now alegacy
	During the Financial Year 2024-25, no case of restructuring of an existing loan or case of waiver/write- off of debts/loans/ Interest etc. made by a lender to the company due to the company’s inability to repay the loan has been observed.
	However the company being a lender, it has implemented certain restructuring/ resolutions plan during the year.
	The details are as under:
	1. One NPA account namely M/s. Coastal Energen Pvt Ltd was restructured as per NCLT order in the Financial Year 2023-24 which was implemented during current year 2024-25 with Principal writeoff of Rs. 35.17 Crores.
	2. Total Interest to the tune of Rs.17674/- was waived in case of 7(Seven) Standard account wherein the penal interest had been waived in normal course of business.
	3. There was interest waiver of Rs. 1913.50 Crores in 7(Seven) old NPA accounts (Viz. A P Housing Board, (APHB), Centre for Science & Technology for Rural Development, Coastal Energen Pvt Ltd, Maniraja Construction Pvt. Ltd (DRAT order), Mizoram Urban Co-op Development Bank Ltd, Naya Raipur Development Authority (NRDA), and Zoram Industrial Development Corporation which had already been derecognized and hence were waived off in the memorandum accounts.

Sr.No. DIRECTIONS	REPLIES
	4. Apart from the above-mentioned cases, OTS for 2 Govt. Agencies A P Housing Board, (APHB) and Naya Raipur Development Authority (NRDA) was approved by the board during the Financial Year 2024-25. APHB has paid 25% of OTS amount and 1 out 8 installments for 75%. Further, NRDA has paid 25% of the OTS amount. The OTS will be fully implemented as and when the agencies pay the full OTS amount.
03 Whether funds (Grants/subsidy etc.) received/ receivable for specific schemes from Central/State Government or its agencies were properly accounted for/ utilized as per its terms and conditions? List the cases of deviation.	On the basis of selective audit procedures, we have observed that the company has not received any grant/ subsidy from Central/State Govt. agencies for their own utilization. The company acts as a channelizing agency for different Govt. of India’s Programs. The funds received/ receivable for specific schemes from Central/ State agencies in this regard were properly accounted for/ utilized as per its terms and conditions.

ANNEXURE "C" TO THE INDEPENDENT AUDITOR’S REPORT ON THE AUDIT OF STANDALONE FINANCIAL STATEMENTS

(Annexure referred to in paragraph 8 (C) (f) under ‘Report on Other Legal and Regulatory Requirements’ section of our report of even date to the members of Housing and Urban Development Corporation Limited on the Standalone Financial Statements for the year ended 31^st March, 2025)

Report on the adequacy of Internal Financial Controls over financial reporting of the Company and the operating effectiveness of such controls, under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the

Act") to the Standalone financial statements ofWehaveauditedtheinternalfinancial HOUSING AND URBAN DEVELOPMENT 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.

01. Management’s Responsibility for Internal Financial Controls

The Company’s management is responsible for establishing and maintaining internal financial controls based on 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 issued by the Institute of Chartered Accountants of India". These include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company’s 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 Companies Act, 2013.

02. Auditor’s Responsibility

Our responsibility is to express an opinion on the Company’s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the "Guidance Note") and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section143 (10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonableassuranceaboutwhetheradequateinternalfinancialcontrols over financial reporting 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 financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial 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 auditor’s judgment, 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 sufficientand on the Company’s internal financial controls system over financial reporting.

03. Meaning of Internal Financial Controls over Financial Reporting

A Company’s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of accordance with generally accepted accounting principles. A company’s internal financial control over financial includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of standalone financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with 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 company’s assets that could have a material effect on the standalone financial statements.

04. 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.

05. Qualified Opinion

According to the information and explanations given to us and based on our audit, the following deficiencies have been identified during the course of our audit for the year 2025: ended on March 31,

1. Few deficiencies were noted in the design and operating effectiveness of controls over core Loan Management System (LMS), including manual interventions in key reports, which needs to be strengthened.

2. In respect of entity-level controls and financial closure processes, there is an opportunity to enhance the effectiveness of certain procedures, particularly those related to cut-off, and the supervision and monitoring of information flow between regional offices, outsourced agencies, and the corporate office. Strengthening these areas would support more robust and timely financial reporting.

In our opinion, considering the nature of business, size of operation and organizational structure of the entity, except for the effects/possible effects of the deficiencies described above on the achievement of the objectives of the control criteria, the Company has maintained, in all material respects, adequate internal financial controls over financial reporting and such internal financial controlsoverfinancialreportingwereoperatingeffectivelyas of March 31 st, 2025, based the internal control reporting criteria established by the Company considering the essential components of internal control stated over financial 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 deficiencies identifiedand reported above in determining the nature, timing, and extent of audit tests applied in our audit of the March 31st, 2025 standalone financial statements of the Company, and these deficiencies does not affect our opinion on the standalone financial statements of the Company.

For S A R C & Associates,

Chartered Accountants

FRN – 006085N

Sd/-

(Kamal Aggarwal)

Partner

(M. No. 090129

UDIN: 25090129BMFMGU9247

Place : New Delhi

Date : 25th June, 2025