To the Members of
Jindal Steel & Power Limited
Report on the Audit of the Standalone Financial Statements
Opinion
We have audited the accompanying standalone financial statements of Jindal Steel & Power Limited ("the Company"), which comprise the Balance Sheet as at 31st March 2024, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the Statement of Cash Flows for the year then ended, and notes to the financial statements, including material accounting policies and other explanatory information (hereinafter referred to as "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, 2024, its Profit (including Other comprehensive income), changes in equity and its cash flows for the year ended on that date.
Basis for Opinion
We conducted our audit in accordance with the Standards on Auditing (SAs) specified under Section 143(10) of the Act. Our responsibilities under those Standards are further described in the "Auditors Responsibilities for the Audit of the Standalone Financial Statements" section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules 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 audit opinion on the standalone financial statements.
Emphasis of matters (A) Attention is drawn to:
As stated in Note no. 49 of the Standalone Financial Statements, the Auditors of Jindal Steel & Power (Mauritius) Limited (JSPML) have drawn attention, without qualify, in the audit report on financial statements for the year ended 31st March 2024, on inherent uncertainty regarding "Going Concern Issue" basis and as stated in the said note as on 31st March 2024, the accumulated losses and negative net worth of wholly owned subsidiary, JSPML is of 2 3,466.69 crores and 2 2,068.70 crores respectively. Further, as explained in the said note of the standalone financial statements, balance outstanding amount of 2 5,523.32 crores in the account of JSPML (of loan/ outstanding amount net of written off/ provision made) has been considered good and realisable by the management and as stated no additional provision is required to be made at this stage.
Our opinion is not modified in respect of above matter.
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 for the financial year ended 31st March 2024. 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.
In addition to the matter described in the "Emphasis of Matters" section we have determined the matters described below to be the key audit matters to be communicated in our report:-
S. No. Description of Key Audit Matter | How our audit addressed the key audit matters |
1 Recognition and measurement of taxation and tax litigation | |
The Company has significant tax and other litigations against it. There is a high level of judgement required in estimating the level of provisioning required and appropriateness of disclosure of those litigations as Contingent Liabilities. | Our procedures included: |
We evaluated the design and tested the operating effectiveness of controls in place for the determination and recognition of current tax and deferred tax balances. We determined that we could rely on these controls for the purposes of our audit; | |
The recognition and measurement of taxation (current tax and deferred tax) requires management judgement, assumptions. The recognition of deferred tax assets involved managements estimation regarding likelihood of the realization of these assets, in particular whether there will be taxable profits in future periods that support recognition of these assets. | |
We tested the underlying data in support of tax calculations; | |
We made enquiries regarding the tax assessments as well as the results of previous claims/ demands, and changes to the tax environments. | |
Refer Note 39 and 40(a)(i)(b) to the Standalone Financial Statements | For legal, regulatory and tax matters our procedures included examining external opinions obtained by the management, examining relevant correspondences and discussing with Companys legal counsel, tax experts and tax head. |
We also involved our internal tax specialists to gain an understanding and to determine the level of exposure for tax litigation of the Company. | |
In assessing managements conclusions with respect to the tax provision, we evaluated the amount provided for of tax losses recognised in light of the future projected profitability. | |
We determined that the tax balances were supportable and provision for taxes, deferred tax are recorded and assessed the adequacy of disclosures in the standalone financial statements. | |
2. Revenue Recognition | |
Revenue from the sale of goods (hereinafter referred to as "Revenue") is recognized when the Company performs its obligation to its customers and the amount of revenue can be measured reliably and recovery of the consideration is probable. The timing of such recognition in case of sale of goods is when the control over the same is transferred to the customer, which is mainly upon delivery. | Our procedures included: |
Evaluating the integrity of the general information and technology control environment and testing the operating effectiveness of key IT application controls | |
Evaluating the design and implementation of Companys controls in respect of revenue recognition. | |
The timing of revenue recognition is relevant to the reported performance of the Company. The management considers revenue as a key measure for evaluation of performance. There is a risk of revenue being recorded before control is transferred. | Testing the effectiveness of such controls over revenue cut off at year-end |
Testing the supporting documentation for sales transactions recorded during the period closer to the year end and subsequent to the year end, including examination of credit notes to determine whether revenue was recognized in the correct period. | |
Refer Note no. 3.6 - Material Accounting Policies; and Note no. 31 - Revenue from Operations; of the Standalone Financial Statements | |
Performing analytical procedures on current year revenue based on monthly trends and where appropriate, conducting further enquiries and testing. | |
Assessing the appropriateness of the Companys revenue recognition accounting policies in line with IND AS 115 ("Revenue from Contracts with Customers") and testing thereof. |
Information Other than the Financial Statements and Auditors Report thereon
The Companys Board of Directors is responsible for the other information. The other information comprises the information included in the Annual report, but does not include the standalone financial statements and our auditors report thereon. The Annual Report 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 and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.
When we read Annual Report, if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance.
Managements Responsibility 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 Act with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position/ state of affairs, financial performance, total 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 AS) specified under Section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the standalone financial statements, management is responsible for assessing the Companys ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those Board of Directors are also responsible for overseeing the Companys financial reporting process.
Auditors Responsibilities for the Audit of the Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under Section 143(3X0 of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such controls.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by 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 ability of the Company 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.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Materiality is the magnitude of misstatements in the standalone financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the financial statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the standalone financial statements.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditors Report) Order, 2020 ("the Order"), issued by the Central Government of India in terms of Section 143(11) of the Act, we give in the "Annexure A" a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.
2. 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) I n our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books, except for the matters stated in paragraph 2(h) (vi) below on reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 (as amended) ("the Rules").
c) The Balance Sheet, the Statement of Profit and Loss including other comprehensive income, the Statement of Changes in Equity and the Statement of Cash Flows dealt with by this Report are in agreement with the books of account.
d) In our opinion, the aforesaid standalone financial statements comply with the Indian Accounting Standards specified under Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014.
e) On the basis of the written representations received from the directors as on 31st March, 2024 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2024 from being appointed as a director in terms of Section 164 (2) of the Act.
f) With respect to the maintenance of accounts and other matters connected therewith, reference is made to our remarks in paragraph 2(h)(vi) below on reporting under Rule 11(g) of the Rules.
g) With respect to the adequacy of the internal financial controls with reference to standalone financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure B". Our report expresses unmodified opinion on the adequacy and operating effectiveness of the Companys internal financial controls with reference to standalone financial statements.
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 its financial position in its standalone financial statements - Refer Note No. 40(a) (i)(a) and (b) to the standalone financial statements;
ii. The Company has made provision, as required under the applicable law or Indian accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts;
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended 31st March, 2024.
iv. (a) The Management has represented that, to the best of its knowledge and belief, as disclosed in Note No. 64 to the standalone financial statements, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies) including foreign entities ("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(b) The Management has represented, that, to the best of its knowledge and belief, as disclosed in Note No. 64 to the standalone financial statements, no funds have been received by the Company from any person(s) or entity(ies), including foreign entities ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company shall, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(c) Based on the audit procedures performed that have been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has come to our notice that has caused us to believe that the representations under sub-clause (i) and (ii) of the Rule 11(e), as provided under (a) and (b) above, contain any material misstatement.
v. The dividend declared and paid by the Company during the year is in accordance with section 123 of the Act, as applicable. As stated in Note No. 20(h) to the standalone financial statements, the Board of Directors of the Company has proposed dividend for the year which is subject to the approval of the members at the ensuing Annual General meeting. The dividend proposed is in accordance with section 123 of the Act, as applicable.
vi. Based on our examination, the Company has used a widely used ERP as its accounting software for maintaining its books of account during the year ended March 31, 2024, which has a feature of recording the audit trail (edit log) facility, however, the audit trail (edit log) facility was not enabled at Database level including some tables of ERP throughout the year. The audit trail (edit log) facility which was enabled, as reported above, has been operated throughout the year for relevant transactions in the accounting software. Further, during the course of our examination, we did not come across any instance of the audit trail being tampered with, in respect of the accounting software for the period for which the audit trail feature was enabled and operating. Refer note 59 to the standalone financial statements.
As proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 is applicable from April 1, 2023, reporting under Rule 11(g) of the Companies (Audit and Auditors) Rule, 2014 on preservation of audit trail as per the statutory requirements for record retention is not applicable for the financial year ended March 31, 2024.
3. In our opinion and to the best of our information and according to the explanations given to us, the managerial remuneration for the year ended 31st March, 2024 has been paid/ provided for by the Company to its directors in accordance with the provisions of Section 197 read with Schedule V to the Act.
ANNEXURE "A" TO THE INDEPENDENT AUDITORS REPORT
(Referred to in paragraph 1 under Report on Other Legal and Regulatory Requirements section of our report of even date on the Standalone Financial Statements of JINDAL STEEL & POWER LIMITED for the year ended 31st March 2024)
(i). (a) (A) The Company is maintaining proper records showing full particulars including quantitative details and situation of Property, Plant & Equipment and relevant details of Right to Use Assets.
(B) The Company is maintaining proper recordsshowing full particulars of intangible assets.
(b) The Property, Plant & Equipment and Right to use Assets have been physically verified by the management as per the regular programme of periodical physical verification in a phased manner and same is reasonable in our opinion having regard to the size of the Company and nature of its assets. No material discrepancies have been noticed on such physical verification.
(c) According to the information and explanations given to us and on the basis of our examination of the property tax receipts and lease agreements and/or registered sale deed / transfer deed/ conveyance deed or document constituting evidence of a right, provided to us, we report that, the title deeds of the immovable properties disclosed (other than properties on lease where the Company is the lessee and the lease agreements are duly executed in favour of the lessee) in the financial statements and included in Property, Plant and Equipment are held in the name of the Company as at the Balance Sheet date, except for the following:-
Description of Property | Gross Carrying Value | Held in Name of | Whether promoter/ director or their relative or employee | Period held - indicate range, where appropriate | (Amount in T crores) Reason for not being held in the name of the Company |
Freehold land 22 Plots admeasuring 8454.62 sq. yards at Sonepat Global City, Sonepat (including held for sale of 10 plots admeasuring 3901.32 sq. yards amounting to T 5.03 crores) | 10.76 | Jindal Realty Limited, (Enterprises over which Key Management Personnel and their relatives exercise significant influence) | No | 30-09-2015 | Pending balance parcels of land / area fully developed, the stated plots has not been registered |
Leasehold land Admeasuring 734.58 acres in village Malibrahmani under Chhendipada Tahasil in the District of Angul | 50.00 | Monnet Power Company Limited | No | 23-11-2023 | JSP has acquired under IBC (the Insolvency and Bankruptcy Code, 2016) liquidation process JSP has acquired 2*525 MW Power plant Assets (under construction) at Angul, Odisha of Monnet Power Company Limited (MPCL) on slump sale basis including land (ACPP-II) and Registration in the name of the company is in process |
(d) The Company has not revalued its Property, Plant and Equipment (including Right of Use assets) or intangible assets or both during the year. Consequently, the question of our commenting on whether the revaluation is based on the valuation by a Registered Valuer, or specifying the amount of change, if the change is 10% or more in the aggregate of the net carrying value of each class of Property, Plant and Equipment (including Right of Use assets) or intangible assets does not arise.
(e) Based on the information and explanations furnished to us, no proceedings have been initiated or are pending against the Company for holding benami property under the Prohibition of Benami Property Transactions Act, 1988 (as amended in 2016) [formerly the Benami Transactions (Prohibition) Act, 1988 (45 of 1988)] and Rules made thereunder, and therefore the question of our commenting on whether the Company has appropriately disclosed the details in its financial statements does not arise.
(ii). (a) As per the physical verification program, the inventory of the Company (except for stock lying with the third parties and in transit, which have been verified based on confirmations and subsequent receipts) were physically verified during the year by the Management at reasonable intervals. In our opinion and according to the information and explanations given to us, the coverage and procedure of such verification by the Management is appropriate having regard to the size of the Company and the nature of its operations. No discrepancies of 10% or more in the aggregate for each class of inventory were noticed on such physical verification of inventory/ alternative procedures performed as applicable, when compared with the books of account.
(b) According to the information and explanations given to us, the Company has been sanctioned working capital limits in excess of T 5 crores, in aggregate, at points of time during the year, from banks on the basis of security of current assets. In our opinion and according to the information and explanations given to us, the quarterly returns / statements filed by the Company with such banks are generally in agreement with the unaudited books of account of the Company.
(iii). The Company has made investments in, provided guarantee or security, granted loans secured or unsecured to Companies and any other parties and has not provided any advances in the nature of loans to Companies, firms, limited liability partnerships and any other parties during the year.
(a) The Company has during the year, provided loans, guarantees and security to companies or any other parties, as per details below:
Loans | Guarantees | Security | |
A. Aggregate amount granted / provided during the year: | |||
- Subsidiaries | 50.00 | 3,354.43 {Refer Note No. 48A(c)} | 2,854.43 {Refer Note No. 48A(d)} |
- Others | 4.15 | ||
B. Balance outstanding as at 31st March 2024 in respect of above case: | |||
- Subsidiaries | - | 478.43 {Refer Note No. 48A(c)}* | 478.43 {Refer Note No. 48A(d)} |
- Others | 3.07 |
[* to the extent facility drawn]
(b) According to the information and explanations given to us and based on the records as made available to us, in our opinion, (i) the investments made, during the year; (ii) guarantees provided; and (iii) security give and the terms and conditions of the grant of all the above- mentioned loans and guarantees provided, during the year are, in our opinion, prima facie, not prejudicial to the Companys interest.
(c) I n respect of certain loans granted by the Company, the schedule of repayment of principal and payment of interest has been stipulated and the repayments of principal amounts and receipts of interest are regular as per stipulation {read with our comments to para 3 (e) below & note no. 49 of the standalone financial statements}.
Further, the Company has also granted certain loans that are repayable on demand. During the year the Company has not demanded such loans. Having regard to the
fact that the repayment of principal or the payment of interest has not been demanded by the Company, in our opinion the repayments of principal amounts and receipts of interest are regular {read with our comments to para 3(f) below}.
(d) According to the information and explanations given to us and based on the audit procedures performed, in respect of loans granted by the Company, there is no overdue amount remaining outstanding in respect of loan amount and interest as at the balance sheet date which are overdue for more than ninety days {read with our comments to para 3 (e) & 3(f) below}.
(e) The Company had granted loan to a company which had fallen due during the year and the Company had renewed the said loan during the year. The aggregate amount of such dues renewed and the percentage of the aggregate to the total loans or advances in the nature of loans granted during the year are as follows:
Name of Parties* | Aggregate amount of overdues of existing loans renewed or extended or settled by fresh loans | Percentage of the aggregate to the total loans or advances in the nature of loans granted during the year |
Style Buildhome Private Limited | 4.30 | 7.94% |
Virtual Mercantile Private Limited | 3.34 | 6.17% |
Akshara Mercantile Private Limited | 3.22 | 5.94% |
Weldon Buildwell Private Limited | 2.95 | 5.45% |
Amtek Mercantile Private Limited | 2.49 | 4.60% |
United Buildhome Private Limited | 2.37 | 4.38% |
Compact Buildwell Private Limited | 2.28 | 4.21% |
Vision Buildhome Private Limited | 1.51 | 2.79% |
Citizen Buildwell Private Limited | 1.34 | 2.48% |
Aim Buildwell Private Limited | 1.01 | 1.87% |
Orchid Buildhome Private Limited | 0.81 | 1.50% |
Sudarshan Infratech Private Limited | 0.42 | 0.78% |
(f) The Company has granted Loans which are repayable on demand or without specifying any terms or period of repayment details of which are given below:
(Amount in ^ crores)
All Parties | Promoters | Related Parties | |
Aggregate of loans/advances in nature of loans | |||
- Repayable on demand (A) | 26.08 | - | 0.02 |
- Agreement does not specify any terms or period of repayment (B) | |||
Total (A+B) | 26.08 | - | 0.02 |
Percentage of loans/advances in nature of loans to the total loans | 0.43% | - | 0.0003% |
(iv) . According to the information, explanations and representations provided by the management and based on the audit procedures performed, we are of the opinion that in respect of loans granted, investments made and guarantees and securities provided, the Company has complied with the provisions of the Section 185 and 186 of the Companies Act, 2013.
(v) . In our opinion and according to the information and explanations given to us, the Company has not accepted deposits or amounts which are deemed to be deposits within the meaning of section 73 to 76 of the Act or any other relevant provisions of the Act and the rules framed there under (to the extent applicable). We have been informed that no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or other Tribunal in this regard.
(vi) . We have broadly reviewed the books of account maintained
by the company pursuant to the rules made by the Central Government for the maintenance of cost records under section 148(1) of the Act in respect of the companys products to which the said rules are made applicable and are of the opinion that prima facie, the prescribed records have been made and maintained. We have, however, not made a detailed examination of the said records with a view to determine whether they are accurate or complete.
(vii). According to the records of the company and information and explanations given to us, in respect of statutory dues:
(a) According to the records of the Company, the Company is generally been regular in depositing undisputed statutory dues including goods and services tax, provident fund, employees state insurance, income tax, sales tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues with the appropriate authorities to the extent applicable.
There were no undisputed statutory dues payable in respect of Goods and Service tax, Provident Fund, Employees State Insurance, Income-tax, Sales Tax, Service Tax, duty of Custom, duty of Excise, Value Added Tax, cess and other material statutory dues in arrears as at March 31, 2024 for a period of more than six months from the date they become payable.
(b) Details of statutory dues referred to in sub-clause (a) above which have not been deposited as on March 31, 2024 on account of disputes are given below: -
(Amount in ^ crores)
Sr. No | Nature of Statute | Nature of Statutory Dues | Net of Predeposit as on 31.03.2024 | Period to which amount relates | Closing forum where dispute is pending |
1 | Central Excise Act, 1944 | 165.35 | FY 2010-11 to FY 2014-15 & FY 2016-17 to Jun2017 | CESTAT, Delhi | |
2 | 656.45 | Jan-2010 to Nov - 2013 | High Court of Cuttack (Odisha) | ||
3 | Excise Duty | 173.42 | April-2010 to June-2017 | CESTAT, Kolkata | |
4 | 1.21 | Jul-17 | Commissioner (Appeals), Bhubaneswar | ||
5 | 1.72 | Feb 2015 to Jun2017 | High Court of Cuttack (Odisha) | ||
6 | 285.37 | March 2016 to November 2016 | High Court of Bilaspur (Chhattisgarh) | ||
7 | 1.37 | FY 2012-14 | Additional Commissioner of Commercial Tax, Cuttack | ||
8 | Central Sales Tax Act, 1956 | Central Sales Tax | 0.09 | 2005-06 | High Court of Cuttack (Odisha) |
9 | 14.99 | FY 2015-16 | Assessing Officer, Commercial Tax, Angul | ||
10 | 0.03 | FY 2013-14 | Addl. Commissioner, CTC, Bhopal | ||
11 | 4.54 | FY 2002-03 & April-2014 to Nov 2015 | CESTAT - Mumbai | ||
12 | 0.04 | Jan-2004 to Mar 2014 | Commissioner(Appeals) Nhava sheva, Maharashtra | ||
13 | 8.67 | FY 2020-21 | Deputy Commissioner, Custom Division, Paradip Port | ||
14 | Custom Act, 1962 | Customs Duty | 0.62 | Jun-22 | Addl. Commissioner (Appeals), CGST& Central Excise, Bhubaneswar, Odisha. |
15 | 9.51 | FY 2020-21 | Assistant Commissioner of custom, Custom House, Visakhapatnam | ||
16 | 19.36 | FY 2009-10 to Oct13 | CESTAT - Kolkata | ||
17 | 2.14 | FY 2011-12 | DCC - Paradeep | ||
18 | 7.61 | FY 2013-14 to FY 2014-15 | CESTAT - Hyderabad | ||
19 | Chhattisgarh Upkar Adhiniyam 1981 | Energy Development Cess | 619.51 | FY 2004-05 to FY 2023-24 | Supreme Court |
20 | Chattisgarh Electricity Duty Act, 1949 | Electricity Duty | 1,271.11 | FY 2010-11 to FY 2023-24 | High Court of Bilaspur (Chhattisgarh) |
21 | MP Entry Tax Act, 1976 | Entry tax | 0.08 | FY2013-14 | Addl. Commissioner, CTC, Bhopal |
22 | 0.03 | 2007-08 | Sales Tax Tribunal, Cuttack, Odisha | ||
23 | 60.62 | FY 2007-08 to FY 2010-11 | Sales Tax Tribunal, Cuttack, Odisha | ||
24 | 8.53 | Nov-2010 to July-2011 | High Court of Cuttack (Odisha) | ||
25 | Odisha Entry Tax Act, 1999 | Entry Tax | 20.41 | FY 2006-07, FY 2011-12, FY 2014-15 | Addl. Commissioner of GST & Commercial Taxes, Angul, Odisha |
26 | 1.89 | FY 2015-16 to June 2017 | Commissioner of GST & Commercial Taxes, Cuttack, Odisha | ||
27 | 29.79 | FY 2012-14 | Assessing Officer, Commercial Tax, Angul, Odisha | ||
28 | 46.18 | FY 2009-10 to June 2017 | CESTAT, Kolkata | ||
29 | The Finance Act, 1994 | Service Tax | 7.56 | FY 2016-17 | In process to file Appeal with CESTAT, Kolkata |
30 | 27.20 | FY 2010-11 to FY 2012-13 & FY 2016-17 to Jun2017 | CESTAT, Delhi | ||
31 | The Income Tax Act, 1961 | 515.12 | AY 2008-09, AY 2011-12 to AY 2012-13 and AY 2015-16 | ITAT, New Delhi | |
32 | Income Tax | 126.24 | AY 2005-06 And AY 2013-14 to AY 2018-19 | CIT (A) | |
33 | 255.93 | AY 2009-10 to AY 2010-11 | Punjab & Haryana High Court, Chandigarh | ||
34 | MP VAT Tax, 2002 | Value-Added Tax | 0.001 | FY2013-14 | Addl. Commissioner, CTC, Bhopal |
35 | TNVAT Act, 2006 | Value-Added Tax | 0.72 | FY 2008-09 to FY 2009-10 | Appellate Deputy Commissioner-III, Chennai |
36 | 0.13 | FY 2007-08 | Deputy Commissioner, Rourkela | ||
37 | The Odisha Value Added Tax Act, 2004 | 0.01 | FY 2006-07 | Deputy Commissioner, Angul | |
38 | Value-Added Tax | 11.38 | FY2012-14 | Honble Odisha High Court | |
39 | 0.53 | FY 2015-16 (Oct15 to Mar16) | Addl. Commissioner, Angul | ||
40 | Chhattisgarh (Adhosanrachna | Infrastructure Development Cess | 4.52 | FY 2011-12 to FY 2014-15 | High Court of Bilaspur (Chhattisgarh) |
41 | Vikas Evam Paryavaran) Upkar Adhiniyam, 2005 | Environment Cess | 4.52 | FY 2011-12 to FY 2014-15 | |
42 | Madhya Pradesh Municipal Corporation Act, 1956 | Terminal Tax | 3.83 | FY 2013-14 | High Court of Bilaspur (Chhattisgarh) |
43 | 1.08 | July17 to March 2018 | Deputy Commissioner (Appeal), Mumbai | ||
44 | 20.15 | July2017 to FY 2020-21 | High Court of Chhattisgarh | ||
45 | Central Goods & Service Tax Act, 2017 | 1.21 | July17 to March 2018 | Joint Commissioner Appeal, Kolkata, West Bengal | |
46 | GST | 1.04 | Jul-17 | Commissioner (Appeals), Tikapura, Raipur | |
47 | 19.41 | July 2017 to March 2018 | Commissioner (Appeals), CGST, Central Excise & Customs, BBSR, Odisha | ||
48 | 1.95 | July 2021 to Feb 2022 | Additional Commissioner (Appeal), CGST & Central Excise, BBSR, Odisha | ||
49 | Tamil Nadu Goods & Service Act, 2017 | GST | 0.14 | FY 2023-24 | Commissioner Appeal, Coimbatore |
50 | Odisha Goods and Services Tax Act, 2017 | GST | 0.72 | Jul-17 to Mar-18 | Commissioner (Appeals), CGST, Central Excise & Customs, BBSR, Odisha |
51 | Royalty | 9.86 | FY 2008-09 | Supreme Court | |
52 | Royalty & Mining Premium | 442.65 | Nov21 to Feb22 | High Court of Odisha | |
53 | Mines and Minerals (Development and Regulation) Act, 1957 | Royalty | 26.69 | FY 2016-17 to 2021-22 | Secretary, Govt of India. Dept of Mines, Ministry of Mines, New Delhi |
54 | Royalty & Mining Premium | 297.06 | Apr22 to May23 | Revision Authority, Ministry of Mines | |
55 | Royalty | 4.42 | FY 2008-09, FY 2000-01 to 2010-11 | ||
Royalty | 3.02 | FY 2011-12 to FY 2014-15 | High Court of Bilaspur (Chhattisgarh) | ||
Mines and Minerals Act, 1957 | Royalty | 31.66 | FY 2012-13 to FY 2014-15 |
(viii) . As per the information, explanations and records provided,
there were no transactions relating to previously unrecorded income that were surrendered or disclosed as income in the tax assessments under the Income Tax Act, 1961 (43 of 1961) during the year.
(ix) . (a) As per the information and records provided, in our opinion, the Company has not defaulted in the repayment of loans or other borrowings or in the payment of interest thereon to any lender during the year.
(b) As per the information and explanations provided to us, during the year the Company has not been declared wilful defaulter by any bank or financial institution or government or any government authority.
(c) To the best of our knowledge and belief, in our opinion, term loans availed by the Company were, applied by the Company during the year for the purposes for which the loans were obtained.
(d) On an overall examination of the financial statements of the Company, funds raised on short-term basis have, prima facie, not been used, during the year for long-term purposes by the Company.
(e) On an overall examination of the financial statements of the Company and based on the representations of the Company, we report that the Company has neither taken any funds from any entity or person during the year nor it had unutilised any funds as at the beginning of the year, of the funds raised through issue of shares or borrowings in the previous year on account of or to meet the obligations of its subsidiaries, associates or joint ventures and hence, reporting under clause (ix)(e) of the Order is not applicable.
(f) According to the information and explanations given to us and procedures performed by us, we report that the Company has not raised loans during the year on the pledge of securities held in its Subsidiaries or joint ventures or associate companies.
(x). (a) The Company has not raised moneys by way of initial public offer or further public offer (including debt instruments) during the year and hence reporting under clause 3(x)(a) of the Order is not applicable.
(b) During the year the Company has not made any preferential allotment or private placement of shares or convertible debentures (fully or partly or optionally) and hence reporting under clause 3(x)(b) of the Order is not applicable to the Company.
(xi) . (a) Based on the audit procedures performed and on the basis of information and explanations provided by the management, no fraud by the Company and no material fraud on the Company has been noticed or reported during the year.
(b) To the best of our knowledge, no report under subsection (12) of section 143 of the Companies Act has been filed in Form ADT-4 as prescribed under rule 13 of Companies (Audit and Auditors) Rules, 2014 with the Central Government, during the year and upto the date of this report.
(c) We have taken into consideration the whistle blower complaints received by the Company during the year while determining the nature, timing and extent of audit procedures.
(xii) . In our opinion and according to the information and explanations given to us, the Company is not a nidhi company and hence reporting under clause 3(xii) of the Order is not applicable.
(xiii) . According to the information and explanations and records made available by the management of the Company and audit procedures performed, the Company is in compliance with Sections 177 and 188 of the Companies Act, 2013 where applicable, for all transactions with the related parties and the details of related party transactions have been disclosed in the standalone financial statements as required by the applicable Indian accounting standards.
(xiv) . (a) I n our opinion the Company has an adequate internal audit system commensurate with the size and the nature of its business.
(b) We have considered, the internal audit reports issued to the Company during the year and till date, in determining nature, timing and extent of our audit procedures.
(xv) . On the basis of records made available to us and according to information and explanations given to us, the Company has not entered into non-cash transactions with the directors or persons connected with its directors and hence provisions of section 192 of the Companies Act, 2013 are not applicable to the Company.
(xvi) . (a) The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, the reporting under clause 3(xvi)(a), (b) and (c) of the Order is not applicable.
(b) Based on the information and explanations provided by the management of the Company, the Group has more than one CIC as part of the group. There are 8 CIC within the group (as defined in Core Investment Companies (Reserve Bank) Directions, 2016). However, we have not separately evaluated whether the information provided by the management is accurate and complete
(xvii) . The Company has not incurred cash losses during the financial year covered by our audit and the immediately preceding financial year.
(xviii) . There has been no resignation of the statutory auditors of the Company during the year.
(xix) . According to the information and explanations given to us and on the basis of the financial ratios (also refer note no. 65 to the standalone financial statements), ageing and expected dates of realisation 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, however, state that this is not an assurance as to the future viability of the Company. We further state that our reporting is based on the facts up to the date of the audit report and we neither give any guarantee nor any assurance that all liabilities falling due within a period of one year from the balance sheet date, will get discharged by the Company as and when they fall due.
(xx) . As at balance sheet date, the Company has fully spent the required amount towards Corporate Social Responsibility (CSR) and does not have any amount remaining unspent under Section 135(5) of the Act. Further, no amount for the year requiring a transfer to a Fund specified in Schedule VII to the Companies Act or special account in compliance with the provision of sub-section (6) of section 135 of the said Act.
(xxi) . The reporting under clauses 3(xxi) of the Order is not applicable in respect of audit of standalone financial statements. Accordingly, no comment in respect of the said clause has been included in this report.
ANNEXURE "B" TO THE INDEPENDENT AUDITORS REPORT
(Referred to in paragraph 2(g) under Report on Other Legal and Regulatory Requirements section of our report of even date)
Report on the Internal Financial Controls with reference to standalone financial statements under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act")
We have audited the internal financial controls with reference to standalone financial statements of JINDAL STEEL & POWER LIMITED ("the Company") as of 31st March 2024 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.
Managements Responsibilities for Internal Financial Controls
The Companys Management are responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting ("the Guidance Note") issued by the Institute of Chartered Accountants of India ("ICAI"). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to respective 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.
Auditors Responsibility
Our responsibility is to express an opinion on the Companys internal financial controls with reference to standalone financial statements based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the "Guidance Note") issued by the Institute of Chartered Accountants of India and the Standards on Auditing prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls with reference to standalone financial statements. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls with reference to standalone financial statements was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system with reference to standalone financial statements and their operating effectiveness. Our audit of internal financial controls with reference to standalone financial statements included obtaining an understanding of internal financial controls with reference to standalone financial statements, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditors judgement, including the assessment of the risks of material misstatement of the standalone financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Companys internal financial controls system with reference to standalone financial statements.
Meaning of Internal Financial Controls with reference to standalone financial statements
A companys internal financial control with reference to standalone financial statements is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A companys internal financial control with reference to standalone financial statements includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the companys assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls with reference to standalone financial statements
Because of the inherent limitations of internal financial controls with reference to standalone financial statements, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls with reference to financial statements to future periods are subject to the risk that the internal financial control over with reference to financial statements may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
opinion
In our opinion, the Company has, in all material respects, an adequate internal financial controls system with reference to standalone financial statements and such internal financial controls with reference to standalone financial statements were operating effectively as at 31st March, 2024, 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 (the "Guidance Note").
For Lodha & Co LLP Chartered Accountants |
Firm Registration No. 301051E/E300284 |
Gaurav Lodha Partner |
Membership No. 507462 |
Place: New Delhi |
Dated: 13th May, 2024 |
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