TO THE MEMBERS OF HOUSING AND URBAN DEVELOPMENT CORPORATION LIMITED Report on the Audit of the Standalone Financial Statements
1. Opinion:
W e 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, 2026, 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, 2026, 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 ‘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 Companies Act, 2013 and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion on the standalone financial statements.
3. Emphasis of Matter:
We draw attention towards the following matters in the Standalone Financial Statements:
1. As described in Para 3 of Note no. 41 to the Financial Statements, the company has recognized interest income on "No lien AGP Account" amounting to Rs.26.57 Crore for the year ended 31st March 2026 [Rs. 29.46 Crores for the previous year ended 31st March, 2025]. The balance outstanding at the end of the year is Rs. 685.64 Crore (debit) (Rs.626.52 Crore (debit) in the previous year ended 31st March 2025) in "No lien AGP Account". The Company is executing Andrews Ganj Project on behalf of the MoHUA and acting as an agent, therefore no provision for expected credit loss is created against the same. The company is in discussion with MoHUA for recovery/reimbursement of outstanding amount (including interest) as well as booking of expenses.
2. 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 December 31, 2022 and April 1, 2023 to March 31, 2026. Further, various Committees were constituted on 29th April, 2025, hence the Composition of Committees were not in compliance with Companies Act, 2013 and SEBI (LODR) Regulations, 2015, till 28th April 2025.
3. We draw attention to para 14 of Note 41 to the financial statements regarding certain requirements stipulated by the Reserve Bank of India (‘RBI) while granting the Certificate of Registration as NBFC-IFC on 23rd August 2024, requiring the Company to (i) achieve the Principal Business Criteria (PBC) in accordance with the RBI Scale Based Regulations, i.e. 75% exposure in Infrastructure Finances; and (ii) divest its investments in joint venture companies by March 31, 2026. As stated in the said note, the Company has not fully complied with the aforesaid conditions as at March 31, 2026 and has represented to RBI seeking extension of time vide letter dated May 04, 2026, which is pending consideration.
4. We draw attention to the Note no. 39(B) to the financial statements regarding non-recognition of Deferred Tax
Liability ("DTL") on Special Reserve created and maintained under Section 36(1)(viii) of the Income Tax Act, 1961 and derecognition of DTL recognised in earlier years on such reserve. As stated in the said note, the accounting treatment has been adopted by the Company based on the Board approved position regarding continued maintenance of such reserve, management assessment under Ind AS 12 – Income Taxes, expert opinions obtained by the Company and the practice followed by similarly placed institutions.
5. 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:
Key Audit Matters |
Our Audit Procedures Included: |
| 01. Ind AS 109 on Financial Instruments establishes a comprehensive framework for determining expected credit losses, accuracy of classification, recognition, 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 managements 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) | • T ested the relevant information 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. |
| • T ested the appropriate staging of 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 Companys 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). | • Obtained understanding of the Companys risk management policies for derivative transactions. |
| 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. | • Assessed the design and operating effectiveness of controls over classification and valuation of derivatives. |
| In view of the volume, nature, and valuation sensitivity of derivative contracts, as well as the of their impact on the financial results, this area was considered a key audit matter. | Verified the fair values obtained from counterparties and validated them using independent valuation techniques, wherever applicable. |
| (Refer Notes Note 38 to standalone financial statements) | • Reviewed accounting treatment including hedge documentation and compliance with recognition criteria under Ind AS 109. |
| • Assessed the completeness and accuracy of disclosures in the financial statements related to derivative instrument. |
5. Information Other than the Standalone Financial Statements and Auditors Report Thereon:
The Companys 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 Companys Annual Report, but does not include the standalone financial statements and our auditors report thereon. The Annual report for the year ending 31st March 2026 is expected to be made available to us after the date of this auditors report.
Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone financial statements, our responsibility is to read the other information identified above when it becomes available and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained 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 Companys Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013
("the Act") with respect to the preparation of these standalone financial statements that give a true and fair view of the 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 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 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 Companys financial reporting process.
7. 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 Companies Act, 2013, we are also responsible for expressing our opinion on whether the company has adequate internal financial controls with reference to Standalone Financial Statements in place and the operating effectiveness of such controls.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
• Conclude on the appropriateness of managements use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast 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 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 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 Financial
Statements.
W e 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
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.
8. Report on Other Legal and Regulatory Requirements:
A. As required by the Companies (Auditors Report) Order, 2020 ("the Order") issued by the Central Government of India in terms of Sub section (11) of Section 143 of the 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) W e 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 5th June 2015 issued by the Ministry of Corporate affairs; f) With respect of the adequacy of the Internal Financial Controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in Annexure- "C"; g) As per 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 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 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 except for a single instance mentioned below (Refer Para 16 of
Note no. 41 to the standalone financial statement).
Out of the interest in respect of Tax Free Bonds 2012 – Tranche II ( having due date 28/03/2018 ),
1,27,719 remained unclaimed till 28/03/2025. As per the applicable provisions relating to transfer of unclaimed amounts to the Investor Education and Protection Fund (IEPF), the said amount was required to be transferred to IEPF account within 30 days of expiry of 7 years i.e 27.04.2025. However, the transfer to IEPF was made on 29.04.2025, due to technical glitch in MCA portal resulting in a delay of 2 days in compliance with the prescribed timeline. iv. (a) The management has represented that, to the best of its knowledge and belief (Refer Para 37 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 37 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 28 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.
ANNEXURE "A" TO THE INDEPENDENT AUDITORS 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 31st, 2026).
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 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 & Equipment. B. The Company has maintained proper records showing full particulars of intangible assets. b) Based on information and explanation given to us, the companys 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 |
| Building | 1.91 | Government of Tamil Nadu | NO | Since 1989 | Sale deed of HUDCO office at 5th Floor, Thalamuthu Natarajan Building, Egmore, Chennai is yet to be issued by CMDA. CRO is constantly pursuing with CMDA. |
| CMDAispursuingwithRevenue, Disaster Management & Land Administration Department, Government of Tamil Nadu for transfer of ownership in the name of CMDA and only upon receipt of the same by CMDA, process for execution of sale deed in the name of HUDCO can be taken up. |
The company is having Leasehold Lands/ Flats/ building measuring 11371.73 square meters having cost of Rs.33.90 Crore, or which lease deeds are pending for execution in the name of the Company. Details are as follows:
Name of Regional Office Mt.) purchase of Patna |
Address of Property | AREA (Sq. | Cost of the property including applicable Stamp Duty & Reg. charges (Amount in Rs.) | Reason for non execution |
| Residential flat- Flat No. N-1302, Udaigiri Apartment, Budh Marg, Patna | 195 sqm. | 14,57,500 | HUDCO has purchased the Flat No N-1302 at Udaigiri Bhawan from Bihar State Housing Cooperative Federation Ltd. on resale which was one of the allottees of Vaishali Co-operative Housing Society Ltd. The allotment was transferred by Vaishali Co-operative Society vide letter dated 06.08.1997. Land for Vaishali Co-operative Housing Society Ltd. was purchased on lease hold basis. | |
| The Registration of lease deed for the land by the Society is pending. Due to non registration of lease deed, the Society is not in a position to execute individual lease deed with the allottees/ members. | ||||
| Execution of the lease deed can only be done after the management committee is elected for the Vaishali Co-operative Housing Society Limited by the District Cooperative Officer, Udaygiri Maintenance Committee. | ||||
Bhubaneshwar |
Flats: Flat No. A-503, Block-1 (Hira), Toshali Apartment Satyanagar, Bhubaneshwar Flat No. B-304, B-305 & B-306 | 123.65 sft. | 8,27,976 | |
Bhubaneshwar |
Block-IV (Rupa), Toshali Apartment Satyanagar, Bhubaneshwar Garage No. (4 Nos.) 76,77,78 & 79, | 223.8 sft | 17,25,900 | With regard to 4 flats & 4 parking lots, the file was in process in the Odisha State Housing Board. However, State Govt notification regarding retrospective applicability of RERA Act is under litigation (W.P.C No. 3328/25) in the Honble High Court Odisha. |
Bhubaneshwar |
Block-IV (Rupa), Toshali Apartment, Satyanagar, Bhubaneshwar Garage No. (1 No.), 15, HIRA Block | Part of flats | 5,57,920 | Last date of High Court hearing was 01.07.2025. As per Latest status, no update is shown on High Court Website. |
Bhubaneshwar |
No. 1, Toshali Apartment, Satya Nagar, Janpath, Bhubaneshwar | 15.05 sft. | 1,06,700 | |
Chandigarh |
Flats: Flat No. 1501(GF) HIG(U), Sector 43-B, Chandigarh | 92 sqm. | 2,46,184 | Documents have been submitted to Chandigarh Housing Board and lease deed is under process. |
Mumbai |
Staff Qtr., Flat No. 32, Bldg. No. 24 Anand Sagar, CHS Ltd., Bandra Reclamation, Bandra (West), Mumbai-400 050 | 60.3 sqm. | 5,69,449 | |
Mumbai |
Staff Qtr., Flat No. 32, Bldg. No. 18, Samundra Darshan CHS Ltd., Bandra Reclamation, Bandra (West), Mumbai-400 050 | 50.64 sqm. | 4,25,788 | |
Mumbai |
Staff Qtr., Flat No. 33, Bldg. No. 18, Samundra Darshan CHS Ltd., Bandra Reclamation, Bandra (West), Mumbai-400 050 | 50.64 sqm. | 3,88,740 | Letter of Allotment by MHADA and Share Certificate issued by Co- op. |
Mumbai |
Staff Qtr., Flat No. 51, Bldg. No. 5, Hira CHS Ltd., Bandra Reclamation, Bandra (West), Mumbai-400 050 | 44.64 sqm | 5,64,842 | Housing Society for the flats available with HUDCO-MRO except for flat no.24/32 at Anand Sagar CHS Ltd. Lease agreements for Flats allotted to HUDCO by MHADA are not available with RO. Letter dated 22/07/2025 has been forwarded to MHADA requesting for lease agreements of flats allotted by MHADA. The same is being followed up. |
Mumbai |
Staff Qtr., Flat No. 52, Bldg. No. 5, Hira CHS Ltd., Bandra Reclamation, Bandra (West), Mumbai-400 050 | 44.64 sqm | 5,64,842 | |
Mumbai |
Staff Qtr., Flat No. 61, Bldg. No. 5, Hira CHS Ltd., Bandra Reclamation, Bandra (West), Mumbai-400 050 | 44.64 sqm | 5,64,842 | |
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 sqm. | 21,10,483 | |
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 sqm. | 21,56,363 | |
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 sqm. | 22,94,004 | |
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 sqm. | 23,39,884 | |
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 sqm. | 23,85,764 | |
Delhi |
HUDCO Bhawan, IHC, Lodhi Road, New Delhi | 8600 sqm. | 28,84,67,754 | India Habitat Centre yet to execute sub lease deed with all allottees including HUDCO. |
Delhi |
Hudco House, Lodhi Road, New Delhi | 619.94 sqm. | 58,38,202 | 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 [-24 GF- 1378.87 sft FF-1407.34 sft (each)] | 776.54 sqm. | 2,53,97,247 | 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 Companys 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.
No. of cases |
Principal Amount Overdue | Interest Overdue | Total Overdue | Remarks (if any) |
| 675 | 1670.24 | 17412.58 | 19082.82 | - |
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. 1st 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, 2026 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 2026 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:
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 based on procedures performed by us and on the overall examination of the financial statements of the company, the funds raised on short term basis have, prima facie have not been used during the year for long term purpose by the company on overall basis. 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. We have been informed and based on our audit procedures, we are of the opinion that money raised by the company by way of debt instruments were applied for the purposes for which it was raised. 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. T o 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: a. No fraud by the Company or on the Company has been noticed during the year. b. 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. c. As represented to us by the management, there are 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 (Auditors 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). 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) W e 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 23rd August 2024 vide Registration number N-14.03626. The said registration prescribes certain condition including achievement of prescribed principal business criteria relating to infrastructure financing company and divestment from joint venture companies by March 31, 2026. According to the information and explanations given to us, the Company has not complied with the said conditions as at March 31, 2026 and has applied to RBI seeking extension of time, which is pending consideration as on the date of this report.
(b) According to the information and explanations given to us, the company has not conducted any non-banking financial or housing finance activities 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 of the financial ratios, 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. The Clause 3(xxi) of the order is not applicable to the Standalone Financial Statements hence no comment is given.
ANNEXURE "B" TO THE INDEPENDENT AUDITORS 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 31st March, 2026)
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 Assess the fair valuation of all the investments, both quoted and unquoted, made directly by the Company or through Trusts, for Post-retirement benefits of the employees. This includes verifying valuation methodologies, ensuring consistency with Ind AS and reviewing supporting documentation. | Based on the actuarial valuation reports, supporting investment records, confirmations obtained and explanations provided by the management, we have examined the valuation methodology and accounting treatment adopted in respect of the funded post- retirement benefit plans of the Company, comprising Provident Fund managed through HUDCO Employees PF Trust and Gratuity Fund managed through LIC. |
| The auditor shall provide a brief note on the valuation approach, its reasonability, and compliance with applicable regulations, reporting any material deviations or misstatements. | Our audit procedures included review of actuarial reports, verification assessment of valuation methodologies, of supporting records relating to plan assets and evaluation of consistency of the valuation approach with the requirements of Ind AS 19. |
| Based on the audit procedures performed, the valuation of plan assets for both the funded schemes has been carried out in accordance with the applicable principles of Ind AS 19. In respect of the Gratuity Fund managed through LIC, confirmation regarding fair valuation of plan assets has been obtained from LIC. However, detailed investment-wise valuation workings of the underlying investments were not available for independent verification, being maintained by LIC as an external agency. | |
| Accordingly, based on the records and information made available for audit, the valuation approach adopted for funded post-retirement benefit plan assets appears reasonable and broadly consistent with the applicable accounting framework. No material deviation or misstatement requiring separate reporting was observed in this regard. | |
| 02 Whether the Company has a system in place to process all the accounting transactions through IT system? If yes, whether review of this system and controls that are significant to the Companies financial reporting process as well as cyber security has been done by Information Security Auditing Organizations empaneled by Cert-In at a minimum frequency of once in a year and material discrepancies found, if any, have been suitably reported? | The Company has a system in place to process accounting transactions through integrated IT systems, comprising ERP (iGL), Loan Management System (LMS), Treasury, HRMS and other supporting applications forming part of the overall financial reporting framework. These systems collectively capture, record, process and report transactions relevant to the financial statements. |
| The implications of processing of accounting transactions outside IT system on the integrity of the accounts along with the financial implications may also be reported. | Based on our understanding of the Companys information system and related business processes, and audit procedures performed in accordance with the Standards on Auditing, it is observed that the majority of accounting transactions are processed through the IT systems. However, certain accounting transactions are processed through manual interventions within the ERP environment, as detailed below: |
| (i) transactions pertaining to Retail Finance business, which is presently outside the scope of the existing ERP modules; and | |
| (ii) rectification, adjustment and reconciliation entries recorded in the ERP (iGL) module to ensure compliance with applicable accounting principles and financial reporting requirements. | |
| These transactions are subsequently recorded in the ERP system through controlled journal entry mechanisms supported by defined approval workflows and underlying documentation. | |
| Based on our audit procedures, such instances of manual intervention do not involve maintenance of parallel books of account or systematic processing of transactions outside the IT system. Further, these are not considered to have any material impact on the integrity of the accounting records or the financial statements of the Company. | |
| The Companys IT systems and controls that are significant to financial reporting have been reviewed during the year through independent Information Security Audits conducted by CERT-In empanelled auditors. Based on the audit reports made available to us and our evaluation thereof, the identified vulnerabilities, including critical and high-risk observations, have been remediated by the management and subsequently validated by the auditors. Accordingly, no material weakness in IT systems and controls has been observed which may result in a material misstatement of the financial statements. | |
| Further, the Company has undertaken cyber security reviews during the year covering key systems and infrastructure. Based on the reports and information made available to us, no material discrepancies have been reported which could have a material impact on financial reporting. | |
| Accordingly, based on the audit procedures performed and information and explanations provided to us, the Companys | |
| IT systems, including controls relevant to financial reporting and cyber security framework, are considered adequate and effectively, operating except for the limited instances of manual interventions as stated above, which do not have any material impact on the integrity of the accounts or financial statements. | |
| 03 Whether funds (grants/ subsidy etc.) received/ receivable for specific schemes from Central/ State Government or its agencies were properly accounted for as per: the applicable accounting standards- or norms and whether the received funds were utilized as per its terms and conditions? | Based on the audit procedures performed, records examined and explanations provided by the management, it is observed that the Company has neither received nor recognised any grant/subsidy from Central/State Government or their agencies during the year under audit, and no such grant/subsidy was receivable as at the year-end date. |
| Whether accounting of interest earned on grants received has been done as per terms and conditions of the Grant. List the cases of deviation. | We have also examined the accounting treatment of interest earned, wherever applicable, in respect of grants pertaining to earlier years with reference to the relevant terms and conditions of the respective schemes/grants. |
| Based on the audit procedures performed and records made available for audit, no material deviation requiring separate reporting under this direction has been observed. | |
| 04 Whether the Company has identified the key Risk areas? If yes, whether the Company has formulated any Risk Management Policy to mitigate these risks? If yes, (a) whether the Risk Management Policy has been formulated considering global best practices? (b) whether the Company has identified its data assets and whether it has been valued appropriately? | Based on the information and explanations provided by the management and records made available for audit, including the Board-approved Risk Management Policy, Risk-Based Internal Audit (RBIA) framework, internal audit reports, Risk Management Committee minutes and related disclosures in the financial statements, it is observed that the Company has identified the key risk areas relevant to its operations as an NBFC–IFC and has established a risk management framework and governance mechanism for mitigation and monitoring of such risks. The risk management framework is supported by periodic risk assessment, risk-based internal audit covering Head Office and Regional Offices, and oversight by designated committees. The Policies and processes are broadly aligned with applicable regulatory requirements and recognised risk management practices. Key risk areas and related risk management practices are also disclosed in the Notes to Accounts in accordance with applicable regulatory requirements. Further, as informed by the management, no data assets requiring separate valuation/recognition in the financial statements were identified during the year and accordingly no specific audit procedures in this regard were considered necessary. |
| Accordingly, based on the audit procedures performed and verification subject to of underlying records, nothing has come to our attention which causes us to believe that the Company has not complied, in all material respects, with the requirements of the C&AG audit direction. | |
| 05 Whether the Company is complying with the Securities and Exchange Board of India (SEBI) (Listing Obligation and Disclosure Requirements) Regulations, 2015, and other applicable rules and regulations of SEBI, Department of Investment and Public Asset Management, Ministry of Corporate Affairs, Department of Public Enterprises, Reserve Bank of India, Telecom Regulatory Authority of India; CERT-IN, Ministry of Electronics and Information Technology and National Payments Corporation of India wherever applicable? If not, the cases of deviation may be highlighted. | Based on the information and explanations provided by the management and records made available to us, the Company has generally complied, in all material respects, with the applicable provisions of SEBI (LODR) Regulations, 2015, RBI directions/guidelines, Companies Act, 2013 and other applicable rules, regulations and guidelines issued by DPE, DIPAM, CERT- In, MeitY and other regulatory authorities, wherever applicable, during the year. |
| However, during the course of audit, the following procedural/ compliance related observations were noticed, which, in our opinion, are not material having regard to the size and nature of operations of the Company and do not have any material impact on the financial statements of the Company. The same have been communicated to the management for necessary corrective actions: | |
| 1. Delay was observed in depositing the amount pertaining to Investor Education and Protection Fund (IEPF) during the month of April 2025, as referred in Para 8.C.h(iii) above. | |
| 2. Shop and Establishment Registration for the Head Office was not obtained during FY 2025-26. | |
| 3. The Company did not possess FIU-IND registration certificate under the Prevention of Money Laundering Act, 2002 during FY 2025-26. | |
| 4. As per RBI directions dated th November 2025, NBFCs 28 are required to report changes in directors on a quarterly basis within 15 days from the end of the quarter. However, the requisite return for the quarter ended December 2025, due on 15th January 2026, was not filed by the Company within the prescribed timeline. | |
| 5. The required number of Independent Directors was not in place during part of the year and consequently the |
composition of the Board was not fully in compliance with the applicable provisions of SEBI (LODR) Regulations, 2015. Further, certain Committees were constituted on 29th April 2025 and accordingly the composition of such Committees was not in compliance with the applicable provisions of the Companies Act, 2013 and SEBI (LODR) Regulations, 2015 up to 28th April 2025. Except for the matters stated above, no material non-compliance requiring reporting under the aforesaid directions came to our notice during the course of audit.
This reporting is based on the records, information and explanations made available to us and has been considered in the context of materiality with reference to the financial statements of the Company.
ANNEXURE "C" TO THE INDEPENDENT AUDITORS 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 31st March, 2026)
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")
We have audited the internal financial controls with reference to the Standalone financial statements of HOUSING AND URBAN DEVELOPMENT CORPORATION LIMITED ("the Company") as of March 31, 2026 in conjunction with our audit of the Standalone Financial Statements of the Company for the year ended on that date.
01. Managements Responsibility for Internal Financial Controls
The Companys management 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 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 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 Companies Act, 2013.
02. Auditors Responsibility
Our responsibility is to express an opinion on the Companys 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 reasonable assurance about whether adequate internal financial controls 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 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 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 sufficient and appropriate to provide a basis for our audit opinion on the Companys internal financial controls system over financial reporting.
03. 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 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 companys 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. Opinion
In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as of March 31, 2026, based 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 issued by the Institute of Chartered Accountants of India.
Non-Banking Financial Companies Auditors Report for the year ended 31st March 2026
To,
The Members
Housing and Urban Development Corporation Limited Core 7A, HUDCO Bhawan, India Habitat Centre, Lodhi Road, New Delhi 110 003
1. This report is issued in accordance with the "Non-Banking Financial Companies Auditors Report (Reserve Bank)
Directions, 2016" issued by Reserve Bank of India (RBI) vide notification no. DNBS. PPD.03/66.15.001/2016-17 dated 29th September 2016 on the matters specified in para 3(A) and 3(C) of Chapter-II of the said Directions to the extent applicable to the company.
2. We have audited the accompanying standalone financial statements of Housing and Urban Development Corporation
Limited ("the Company"), which comprise the Standalone Balance Sheet as at 31st March 2026, the Standalone
Statement of Profit and Loss and the Standalone Statement of Cash Flows and the Standalone Statement of changes in equity for the year ended on that date, and a summary of the material accounting policies and other explanatory information (hereinafter referred to as "the standalone financial statements").
Managements Responsibility for the Standalone Financial Statements
3. The Companys Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013
(the Act) with respect to the preparation of these Standalone financial statements to give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under Section 133 of the
Act, read with Companies (Indian Accounting Standards Rules), 2015, as amended. This responsibility also includes maintenance of adequate and design records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
4. The Management is also responsible for compliance with the Reserve Bank of India (hereinafter RBI or Bank) Act, 1934 and other relevant RBI circulars and guidelines applicable to Non-Banking Financial Companies, as amended from time to time, and for providing all the required information to RBI.
Auditors Responsibility
5. Pursuant to the requirements of Non-Banking Financial Companies Auditors Report (Reserve Bank) directions, 2016 as consolidated in RBI master circular (the "Directions") it is our responsibility to examine the audited book and records of the Company for the year ended 31st March 2026 and our report on the matter specified in the directions to the extent applicable to the Company.
6. We conducted our examination in accordance with the Guidance Note on Reports or Certificates for Special Purpose (Revised 2016) issued by the Institute of Chartered Accountants of India (ICAI) and the Standard on Auditing specified under section 143(10) of the Companies Act, 2013, in so far as applicable for the purpose of this certificate. This
Guidance Note requires that we comply with the ethical requirements of the Code of Ethics issued by the ICAI.
Opinion
7. Based on our examination of the audited books and records of the Company for the year ended 31st March 2026 as produced for our examination and the information and explanations given to us, we report that –a. The Company had been granted registration under section 45-IA of the Reserve Bank of India Act, 1934 on 23rd August 2024 vide Certificate of Registration (COR) No. N-14.03626. RBI issued this Certificate along with direction for fulfilment of the condition as specified in the Annexure-I to the registration certificate.
As per the communication issued by RBI at the time of grant of COR, the Company was required to achieve the prescribed principal business Criteria applicable to NBFC-IFCs and divest from specified non-operative group companies by March 31, 2026.The Company has not fully complied with the aforesaid requirements as at March 31, 2026 and has submitted a representation/application to RBI seeking extension of time till 31st March 2027. b. The company is entitled to continue to hold such registration in terms of its asset/income pattern as st Marchon 31 2026. c. The Company is meeting the requirement of net owned funds applicable to an Infrastructure Finance Company as laid down in Master Direction – Reserve Bank of India (Non-Banking Financial Company – Scale Based Regulation) Directions, 2023 dated 19th October 2023. d. The Board of Directors of the Company, in its meetingthheld August 2018, has passed resolution for non- on 6 acceptance of any public deposits, and the company has not accepted any new public deposit since 1st July 2019. e. The Company has not accepted any public deposits during the financial year 2025-26. f. The financial statements of the Company for the year 2025-26 have been prepared in accordance with recognition and measurement principles of Ind AS prescribed under section 133 of the Companies Act 2013 read with relevant rules issued thereunder. Accordingly, the company is following Board Approved methodology for computation of impairment allowance towards provisioning for its loan assets and classification thereof. In view of regulatory compliance of Companies Act 2013 for adoption of a mechanism for preparation of financial statements the Company does not follow the Prudential norms relating to income recognition, asset classification and provisioning
(IRACP norms) for Bad and Doubtful debts in terms of the master directions 2023. Nevertheless, the company
Notification is complying with the directions of the RBI vide No. DOR (NBFC),CC.PD.No.109/22.10.106/2019-20 dated 13th March 2020 with respect to adherence to difference in provisioning between IRACP norms and ECL methodology of the company. g. 1) In our opinion, the Capital Adequacy ratio as disclosed in the Return submitted to RBI in Form NBS-7 (DNBS03) has been correctly arrived on the basis of provisional financial statements and such ratio is in compliance with minimum CRAR prescribed by RBI.
2) As per information and explanation given to us, the annual statement of capital funds, risk assets/ exposure and risk asset ratio (DNBS03 return) as on 31st March 2026 has been filed by company dated 21st April 2026 on the basis of the provisional financial results.
| For S A R C & Associates, | |
| Chartered Accountants | |
| FRN 006085N | |
| Sd/- | |
| (Kamal Aggarwal) | |
| Partner | |
Place : New Delhi |
(Membership No. 090129) |
Date : 14th May, 2026 |
UDIN: 26090129IZKIKF7667 |
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