nhpc ltd share price Auditors report

To the Members of NHPC Limited

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the accompanying Standalone Financial Statements of NHPC Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2023, 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 Standalone Financial Statements, including a summary of significant accounting policies and Other Explanatory Notes for the year ended on that date (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 the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2023, and total comprehensive income (comprising of profit and 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 opinion.

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 period. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have considered the matters described below to be the Key Audit Matters for incorporation in our Report.

Sl. No.	Key Audit Matters	Addressing the Key Audit Matters
1.	Regulatory Deferral Account Debit Balances and accruals of revenue pending tariff Notifications.	Our audit procedures based on which we arrived at the conclusion regarding reasonableness of the carrying value of Regulatory Deferral Account Debit Balances include the following:
	The operating activities of the Company are subject to cost of service regulations whereby tariff charged for electricity generated is based on allowable capital and other cost and expenses and stipulated return there against. The Company invoices its customers on the basis of pre-approved/ provisional tariff which is subject to truing up.	• Understanding and testing the design and operating effectiveness of controls as established by the management for accrual of income and determination of the amounts recoverable there against.
	The Company recognizes revenue as the amount invoiced to customers based on pre-approved/ provisional tariff rates agreed with the regulator. As the Company is entitled to a fixed return on equity, the difference between the revenue recognized and entitlement as per the regulations is recognized as regulatory assets / liabilities.	• Obtaining and understanding of the amount recoverable in terms of CERC Regulations and assessing, testing and evaluating the reasonableness thereof keeping in view the significant judgements applied by the management for such assessments.
	As at March 31, 2023, the Company has recognized Regulatory Deferral Account Debit balances of 6420.12 Crores ( 6948.11 Crores up to March 31, 2022) as given in Note 14.1 of the Standalone Financial Statements.	• The above includes the evaluation of the CERC guidelines and acceptance of the claim made by the Company in the past and the trend of disallowances on various count and adherences and compliances thereof by the management and rationale for assumptions taken under the given situation and business environment.
	This include accruals aggregating to 3470.59 Crores on account of interest cost and other attributable expenses pertaining to Subansiri Lower HE Project for the period from the date of interruption of work i.e. 16.12.2011 till 30.09.2019 as indicated in Note 34(22A) of Standalone Financial Statements.	• Evaluating the various assumptions considered by the management for arriving at the value of Cash Generating Unit, Note 34(18) of Standalone Financial Statements in case of Subansiri Lower HE Project and adequacy thereof with respect to the carrying value of the Project in Progress and balances pertaining to the said project under Regulatory Deferral Accounts.
	Regulatory Deferral Accounts Debit Balances are determined based on tariff regulations and past tariff orders and are subject to verification and approval by the regulators. The Regulatory Deferral Accounts Debit Balances are recognized on undiscounted basis based on the estimates and assumptions with respect to the probability that future economic benefit will flow to the entity as a result of actual or expected action of regulator under applicable regulatory framework and therefore recoverability thereof is dependent upon TariFF Regulations and related approvals and notifications.	• Assessing the application of provisions of Ind AS 114, Guidance Note on Accounting of Rate Regulated Activities issued by ICAI for recognition of regulatory deferral balances.
	The accruals made as above are vital and proprietary to the business in which the Company is operating. In absence of specific notification and rate fixation, these are based on the managements assumptions and estimates which are subject to finalization of tariff by CERC and commencement of operations of the Projects.	• Reviewing the adequacy and reasonableness of amounts recognised and measurement policies followed by the Company and adequacy of the disclosure made with respect to the same in the Standalone Financial Statements of the Company.
2.	Impairment Assessment of carrying amount of:	Our audit procedures based on which we arrived at the conclusion regarding reasonableness of the impairment assessment of carrying amount of PPE, CWIP & Investments in/ Loans to Subsidiaries/ Joint
	A. Property, Plant and Equipment (PPE) and Capital Work in Progress (CWIP)
	Each of the Power Station/ Project has been considered as Cash Generating Units (CGU) of the Company and impairment indicators and requirements thereof have been assessed with respect to the Property, Plant and Equipment (PPE) and Capital Work in Progress (CWIP) as given in Note 34(18) of the Standalone Financial Statements. This has been assessed that no significant change with an adverse e_ ect on the Company has taken place during the year or is expected to take place in the near future, in the technological, economic or legal environment in which the Company operates. Based on the assessment, the Company has concluded that there exists no significant impairment indicator or any impairment in respect of the CGUs of the Company tested for impairment during the year 2022-23. Based on the above assessment, no provision for impairment against PPE or CWIP has been considered necessary by the Company.	Ventures include the following:
		• Critical evaluation of internal and external factors impacting the entity and indicators of impairment (or reversal thereof) in line with Ind AS 36.
		• Review of impairment valuation models used in relation to CGU to determine the recoverable amount by analysing the key assumptions used by management in this respect including:
		– Consistency with respect to forecast for arriving at the valuation and assessing the potential impact of any variances;
		– Price assumptions used in the models;
		– Factoring of risk inherent to the CGUs in the Cash Flow projections or the discount rate.
		– The assumption/estimation for the weighted average cost of capital and rate of discount for arriving at the value in use.
	Impairment exercise undertaken which justifi es the carrying amount of certain assets as above include the regulatory deferral account balances pertaining to Subansiri Lower HE Project as dealt with under para 1 above, is significant and vital to the Companys operations.	• Reviewed the Government Policy and approval for setting up the Projects, decision of the Board of Directors and the e_ orts and steps being undertaken in this respect.
	Evaluation of the impairment involves assessment of value in use of the Cash Generating Units (CGUs) and requires significant judgements and assumptions about the future cash _ flow forecasts, forecast production, forecast volumes, prices and discount rate.	• Reliance has been placed on management projections for completion timeline, volume of generation and resultant revenue based on expected tariff there against.
		• Obtained and read the financial statements of the Subsidiaries and joint ventures to identify any disclosure for impairment of assets in their standalone financial statements.
		• Evaluation of adequacy and appropriateness of disclosures made in the Standalone Financial Statements.
	B. Companys investments in and loans to Subsidiaries and Joint Ventures
	The Company has investments in a subsidiary (Loktak Downstream Hydroelectric Corporation Limited) and a joint venture (National High Power Test Laboratory Private Limited) with a carrying value of 135.96 Crores. Further, the Company has also provided loan to the joint venture amounting to 18.40 Crore.
	The Company accounts for its investments in subsidiaries and joint ventures at cost (subject to impairment assessment). Management regularly reviews whether there are any indicators of impairment of investments with reference to Ind AS 36 ‘Impairment of Assets. If such indicators exist, impairment loss is determined and recognised in accordance with the accounting Policy of the Company.
	In case of the subsidiary, due to the delay in investment sanction (PIB & CCEA) and high projected tariff s, the Company has recognised impairment allowance of 105.56 Crores during the year ended March 31, 2023, in respect of the investment made in the subsidiary.
	The joint venture, on the other hand, has been incurring continuous losses, and accordingly, during the year ended March 31, 2023, the Company has recognised impairment allowance of 16.33 Crores, in respect of the investment made in the joint venture and 18.40 Crores in respect of loan provided to the joint venture. Refer Note 34(18) of Standalone Financial Statements.
	Further, the Company has not recognised interest income of 2.10 Crores during the current financial year ( 1.67 Crores during the year ended March 31, 2022) from its joint venture due to significant uncertainty in realization.
3.	Contingent Liabilities – against claim from Contractors (Note 34(1)(a)(i) of Standalone Financial Statements)	Our audit procedures based on which we arrived at the conclusion regarding reasonableness of the Contingent Liabilities include the following:
	Various claims lodged by the Contractors against Capital Works amount to 9971.13 Crores of which 1116.93 Crores have been provided for, 8556.95 Crores have been disclosed under Contingent Liabilities and in respect of the rest of the claims, possibility of any out flow in settlement is considered as remote. This includes matters under arbitration and/ or before the Court which have been decided against the Company. Further, amounts have been paid/deposited pursuant to the NITI Aayog directions or Court order in some cases as referred in Note 34 (1) (e) (i) & (ii) of the Standalone Financial Statements.	• Obtained the status of the cases from the legal department and their view on the matter;
	Claims made against the Company are significant. These are pending for decision before arbitration or other judicial forums and consequential and possible impact thereof. Provisions/disclosure required have been based on the managements assessment of the probability of the occurrence of the liability.	• Evaluated the contractual terms and conditions and managements rationale for the adequacy of the provision so far made and the amount remaining unprovided against the demands made against the Company;
		• Discussion with management and perusing/ reviewing the correspondences, Memos and Notes on related matters.
		• Reliance has been placed on the legal views and decisions on similar matters and probability of the liability arising therefrom and provision made by the Management pending _ nal judgement/ decisions;
		• Reviewed the appropriateness and adequacy of the disclosure and provision by the management as required in terms of the requirement of Ind AS 37 "Provisions, Contingent Liabilities and Contingent Assets".
4.	Expenditure incurred on Survey and Investigation Projects and those under preconstruction stage upto 31.03.2023	Our audit procedures based on which we arrived at the conclusion regarding the carrying amount of expenditure incurred on survey and Investigation Projects include the following:
	Expenditure of 1293.90 Crores as given in Note 2.2.3 of the Standalone Financial Statements has been incurred for conducting survey and investigation on projects. This includes Interest, administrative and other costs attributable to these projects. Out of this 964.21 Crores (including 2.19 Crores during the year) have been provided for, keeping in view uncertainty with respect to clearances, approvals for implementing the Projects, leaving 329.69 Crores which has been carried forward as Capital Work in Progress.	• Obtained the status of the Projects under Survey and Investigation stage as provided by the management and the reason thereof of keeping them in abeyance.
	Further, Capital Work in Progress also includes Projects where active construction activities are yet to be undertaken.	• Understanding and testing the design and operating effectiveness of controls as established by the management for accounting the expenses incurred (a) for survey and investigation projects and the Policy followed for making provisions/ write off for such expenses given the nature of business of the Company, (b) for project under pre-construction stage and allocation of Borrowing and other cost incurred and allocated there against.
	Interest, Administrative and other Costs are capitalized till the projects are abandoned, however, provisions are made as given herein above in cases where in view of the management there are uncertainties in implementing the projects undertaken.	• Evaluating the managements rationale with respect to continuing such projects under Capital Work in Progress in spite of there being uncertainties and delay in implementing the same and expected economic use of the same in future.
	In the event of related Projects not being undertaken, amounts spent on survey and investigation and those incurred/ allocated prior to construction thereof will no longer be eligible to be carried forward as Capital Work in Progress.	• Evaluating the tenure of pre and under construction stage of project and management contention of normal period required for the same given the location, size and nature in each case of the respective project.
		• The matter being technical and proprietary to the nature of business in which the Company is operating, reliance has been placed on the managements contention and representation on the matter.
5.	Recognition of MAT Credit and Regulatory Deferral (Credit) balances	Our audit procedures based on which we arrived at the conclusion regarding appropriateness of MAT Credit recognized and Regulatory Deferral (Credit) balances created there against include the following:
	During the current Financial Year, the Company has assessed the recoverability of unrecognised MAT Credit of 945.96 Crores available to it. Based on such assessment, the Company has recognized deferred tax asset relating to MAT credit entitlement of 417.31 Crores ( 1478.62 Crores upto March 31, 2022) as the amount of MAT Credit which shall be available for utilization by the Company in future years by way of lower outflow of Income Tax in future years. Out of the MAT Credit recognised, 328.94 Crores has been utilized during the current Financial Year.c	• Understanding and testing the operating effectiveness of the Companys control relating to taxation and assessment of carrying amount of deferred tax assets/ liabilities.
	Correspondingly, in respect of ibid deferred tax asset relating to MAT credit entitlement, Regulatory Deferral (Credit) Balance of 923.20 Crores ( 1313.27 Crores upto March 31, 2022) has been recognized, being the amount, which shall be passed on to the beneficiaries in future as per CERC Tariff Regulations.	• Review of the Companys accounting Policy in respect of deferred tax assets on unutilized MAT credit and current year developments, if any, requiring change in such Policy and management contention on the same.
	The recoverability of this deferred tax asset relating to MAT credit entitlement is dependent upon the generation of sufficient future taxable profits to utilize such entitlement within the stipulated period prescribed under the Income Tax Act, 1961.	• Evaluation of tax credit entitlement as legally available to the Company based on internal forecasts prepared by the Company and probability of future taxable income.
	The recognition of MAT Credit and Regulatory Deferral (Credit) balance there against is important to the intended users of the Standalone Financial Statements in view of its materiality and requirement of judgement in forecasting future taxable pro_ ts for recognition of MAT credit entitlement considering the recoverability of such tax credits within allowed time frame as per the provisions of the Income Tax Act, 1961.	• Review of underlying assumptions for consistency and uncertainty involved and principle of prudence for arriving at a reasonable degree of probability of utilisation of MAT Credit recognized.
	Relevant disclosures in this regard have been provided at Notes 14.2, 18, 30.1, 31, 34(22)(E) read with Significant Accounting Policy No. 20.0(b) of the Standalone Financial Statements.	• Review of implication pertaining to regulatory regime under which the Company operates and estimations prepared by the Company regarding MAT Credit arising out of generation activity to be passed on to beneficiaries and impact thereof on the Standalone Financial Statements under the given current Regulatory provisions and period of applicability thereof.
		• Evaluation of adequacy and appropriateness of disclosures made in the Standalone Financial Statements.

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 other information as stated above is expected to be made available to us after the date of this auditors report.

Our opinion on the Standalone Financial Statements does not cover the other information and we 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 during the course of our audit or otherwise appears to be materially misstated.

When we read the other information as stated above and if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance and describe necessary actions required as per applicable laws and regulations.

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

The Companys Board of Directors is responsible for the 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 state of affairs (financial position), Profit or Loss (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 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 Standard on Auditing (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 scepticism throughout the audit. We also: Identify and assess the risks of material misstatement of the Standalone Financial Statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control; Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system 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; and Evaluate the overall presentation, structure and content of the Standalone Financial Statements, including the disclosures, and whether the Standalone Financial Statements represent the underlying transactions and events in a manner that achieves fair presentation.

Materiality is the magnitude of misstatements in the Standalone Financial Statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the Standalone Financial Statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the Standalone Financial Statements.

We 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.

Report on Other Legal and Regulatory Requirements

i. 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 paragraphs 3 and 4 of the Order, to the extent applicable. ii. Based on the verification of books of account of the Company and according to information and explanations given to us, we give below a report on the Directions issued by the Comptroller and Auditor General of India in terms of Section 143 (5) of the Act:

Sl. No.	Directions	Reply
1	Whether the Company has system in place to process all the accounting transactions through IT system? If yes, the implications of processing of accounting transactions outside IT system on the integrity of the accounts along with the financial implications, if any, may be stated.	According to the information and explanations given to us and based on our audit, all accounting transactions are routed through ERP system implemented by the Company. Period end Standalone Financial Statements are compiled offine based on balances and transactions generated from ERP system.
		We have neither been informed nor have we come across during the course of our audit any accounting transactions having impact on the integrity of the accounts along with the financial implications which have been processed outside the IT system.
2	Whether there is any restructuring of an existing loan or cases of waiver/write offof debts/loans/ interest etc. made by a lender to the Company due to the Companys inability to repay the loan? If yes, the financial impact may be stated. Whether such cases are properly accounted for? (In case, lender is a government company, then this direction is also applicable for statutory auditor of lender company)	According to information and explanations given to us and based on our audit, there is no case of restructuring of an existing loan or cases of waiver/write offof debts / loans / interest etc. made by lender to the Company.
		Further, in respect of loan given by the Company to National High Power Test Laboratory Private Limited (Joint Venture) where interest was receivable in half yearly instalments starting from 30.04.2021 and principal was repayable in 20 equal half yearly instalments starting from 31.10.2022, interest accrued for the FY 2021-22 amounting to 1.67 Crore and for the FY 2022-23 amounting to 2.10 Crores respectively have not been accounted for in view of significant uncertainty of realization due to cash losses incurred by the Joint Venture.
3	Whether funds (grants/ subsidy etc.) received/ receivable for specific schemes from Central/ State Government or its agencies were properly accounted for/utilized as per its terms and conditions? List the cases of deviation.	According to information and explanations given to us and based on our audit, the Company has accounted for and utilized the funds received for specific schemes from Central/State agencies as per the terms and conditions of the schemes.

iii. Further to our comments in the annexure referred to in the paragraph above, as required by Section 143(3) of the Act, we report that:

a) we have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.

b) in our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.

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 Act.

e) in terms of Notification no. G.S.R. 463 (E) dated 05^th June 2015 issued by the Ministry of Corporate Affairs, provisions of Section 164(2) of the Act regarding disqualifications of the Directors, are not applicable as it is a Government Company.

f) 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 an unmodified opinion on the adequacy and operating effectiveness of the Companys internal control; and

g) 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 and Companies (Audit and Auditors) Amendment Rules, 2021 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 34(1) to the Standalone Financial Statements.

ii. The Company did not have any material foreseeable losses against long-term contracts including derivative contracts and thereby requirement for making provision in this respect is not applicable to the Company.

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

iv. As per notification number G.S.R. 463 (E) dated 5^th June, 2015 issued by Ministry of Corporate Affairs, section 197 of the Act as regards the managerial remuneration is not applicable to the Company, since it is a Government Company.

v. a. The management has represented that, to the best of its knowledge and belief, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other persons or entities, 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 to or on behalf of the Ultimate Beneficiaries.

b. The management has represented, that, to the best of its knowledge and belief, no funds have been received by the Company from any persons or entities, including foreign entities ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company shall: whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party ("Ultimate Beneficiaries") or provide any guarantee, security or the like from or on behalf of the Ultimate Beneficiaries; and c. Based on such audit procedures 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 clause (v) (a) and (v) (b) contain any material mis-statement.

vi. The dividend declared or paid during the year by the Company is in compliance with Section 123 of the Act.

vii. The Proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 for maintaining books of account using accounting software which has a feature of recording audit trail (edit log) facility is applicable to the Company with effect from April 1, 2023, and accordingly, reporting under Rule 11(g) of Companies (Audit and Auditors) Rules, 2014 is not applicable for the financial year ended March 31, 2023.

ANNEXURE "A" TO THE INDEPENDENT AUDITORS REPORT

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

(a) (A) The Company has maintained proper records showing full particulars, including quantitative details and situation of Property, Plant and Equipment.

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

(b) As per the information and explanations given to us and on the basis of our examination of the records of the Company, the Property, Plant and Equipment except Land in certain Units, have been physically verified by the management/ outside agencies, in a phased manner, which in our opinion is reasonable, having regard to the size of Company and nature of its business. The reconciliation of physically verified assets with the book records in certain cases is in progress. Discrepancies noticed on the physical verification and consequential adjustments are carried out on completion of reconciliation. According to information and explanations given by the management and in our opinion, the same are not material.

(c) According to the information and explanations given to us, the records examined by us and based on the title deeds provided to us, we report that, the title deeds, comprising all the immovable properties (including leased assets where the Company is a lessee) of land and building, are held in the name of the Company as on the balance sheet date except for the following where the title deeds are not in the name of the Company:

Relevant line item in the Balance sheet	Description of Item of Property	Gross Carrying Value ( in Crore)	Title Deeds held in the name of	Whether title deed holder is a promoter, director or relative of promoter/ director or employee of promoter/ director	Property held since which date	Reason for not being held in the name of the Company
Property, Plant and Equipment	Land (1458.45 Hectare)	6.52	Hind Sarkar (Govt. of India)	No	Since 1987	In respect of Salal Power Station. Documents are yet to be executed in favour of Company.
Property, Plant and Equipment	Land (7.0844 Hectare)	36.08	Various Parties	No	27.09.2021	The land is under possession of Parbati- II HEP. Documents are yet to be executed in favour of Company.
Property, Plant and Equipment	Land (4.69 Hectare)	6.33	Various Parties	No	10.04.2008	In respect of Teesta-V Power Station. Documents are yet to be executed in favour of Company.
Property, Plant and Equipment	Land (0.09 Hectare)	0.01	Prem Tshering Lepcha	No	31.03.2000	In respect of Rangit Power Station. Present owner of the property has passed away. Execution of Title Deed is pending.
Property, Plant and Equipment	Land (0.10 Hectare)	0.0004	Various Parties	No	Since 1987	In respect of Salal Power Station. Documents are yet to be executed in favour of Company.
Property, Plant and Equipment	Land (74.95 Hectare)	0.00	Govt of India 74.08 Hectare and pvt land 0.87 Hectare	No	Since January 1978	In respect of Bairasiul Power Station. Documents are yet to be executed in favour of Company.
Right of Use Assets	Land (122.93 Hectare)	140.86	Govt. of J&K under occupancy of NHPC	No	24.03.2011	The Land in respect of Kishanganga Power Station. Documents are yet to be executed in favour of Company.
Right of Use Assets	Land (28.13 Hectare)	18.53	Govt. land	No	2006-21	The Land in respect of Uri-II Power Station. Documents are yet to be executed in favour of Company.
Right of Use Assets	Land (219.56 Hectare)	6.15	Govt. land	No	Since 1984	In respect of Dulhasti Power Station. Documents are yet to be executed in favour of Company.
Right of Use Assets	Land (70.98 Hectare)	3.37	Govt. land	No	24.05.2021	In respect of Solar Project Ganjam. Lease agreement is under process
Right of Use Assets	Land (3.99 Hectare)	0.27	Jammu & Kashmir State Power Development Corporation Limited (JKSPDC)	No	31.07.2003	In respect of Chutak Power Station. Documents are yet to be executed in favour of Company.
Right of Use Assets	Land (7.72 Hectare)	0.19	JKSPDC & SDM,Bani (J&K)	No	Since 2000	In respect of Sewa-II Power Station. Matter is under regular correspondence with JKSPDC & SDM, Bani (J&K) for issuance of No Objection certificate. NOC is still awaited from concerned state department.
Right of Use Assets	Land (11.32 Hectare)	0.15	Private Land 7.87 Hectare and Govt. Land 3.45 Hectare	No	1991-92	In respect of Uri-I Power Station. Case is pending at court/State revenue authority.
Right of Use Assets	Land (0.22 Hectare)	0.05	Govt. land	No	30.09.2010	In respect of Nimoo Bazgo Power Station. The draft of lease deed has been provided to Tehsildar, Leh for the execution of title deed in favour of Company.
Right of Use Assets	Land (1.56 Hectare)	0.02	Govt. land	No	1984	In respect of Chamera-I Power Station. Matter is pending before court.

(d) According to the information and explanations given to us and on the basis of our examination of the records of the Company, 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 the information and explanations given to us and on the basis of our examination of the records of the Company, there are no proceedings initiated or pending against the Company for holding any benami property under the Prohibition of Benami Property Transactions Act, 1988 and rules made thereunder.

(ii) (a) As informed, the inventories of the Company except for inventories in transit, have been physically verified by the management/ outside agencies during the year. In our opinion and according to the information and explanations given to us, the frequency of such verification is reasonable and procedures and coverage as followed by management were appropriate. No discrepancies were noticed on verification between the physical stocks and the book records that were 10% or more in the aggregate for each class of inventory. Minor discrepancies noticed during physical verification were properly dealt within the books of account.

(b) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has been sanctioned working capital limits in excess of five crore rupees, in aggregate, from banks on the basis of security of current assets. In our opinion, the quarterly returns or statements filed by the Company with such banks are in agreement with the books of account of the Company.

(iii) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has granted loans and made investments in subsidiaries and joint ventures and provided guarantees to banks in respect of loans taken by subsidiary companies.

(a) (A) Based on the audit procedures carried out by us and as per the information and explanations given to us, the aggregate amount during the year, and balance outstanding at the balance sheet date with respect to such loans and guarantees to subsidiaries and joint ventures are as per the table given below:

Particulars	Guarantees	Loans
	( in Crores)	( in Crores)
Aggregate amount granted/ provided during the year
- Subsidiaries	863.00	315.00
- Joint Ventures	-	-
Balance outstanding as at balance sheet date in respect of the above cases
- Subsidiaries	833.58*	60.00
- Joint Ventures	-	-

* Includes interest accrued.

(B) Based on the audit procedures carried out by us and as per the information and explanations given to us, during the year, the Company has not provided loans or provided advances in the nature of loans, or stood guarantee, or provided security to parties other than subsidiaries and joint ventures.

(b) According to the information and explanations given to us and based on the audit procedures conducted by us, we are of the opinion that the terms and conditions under which such investments were made, guarantees provided and loans were granted are, prima facie, not prejudicial to the interest of the Company.

(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, in the case of loans given, the repayment of principal and payment of interest has been stipulated and the repayments or receipts have been regular except in case of Loan given to National High Power Test Laboratory (P) Limited (Joint Venture) where interest was receivable in half yearly installments starting from 30.04.2021 and principal was repayable in 20 equal half yearly instalments starting from 31.10.2022. The interest accrued for the FY 2021-22 amounting to 1.67 Crore and for the FY 2022-23 amounting to 2.10 Crores respectively have not been accounted for in view of significant uncertainty of realization due to cash losses incurred by the Joint Venture. Further, impairment allowance of 18.82 Crore including interest already accrued for previous periods aggregating to 0.42 Crores has been created considering it to be doubtful. The same has been disclosed in Note 34(8) of the Standalone Financial Statements. (d)

No. of cases	Principal Amount Overdue ( in Crores)	Interest overdue ( in Crores)	Total Overdue ( in Crores)	Remarks
1	0.92	0.42*	1.34	Reasonable steps have been taken by the Company for recovery of overdue interest and principal.

* Excluding unrecognized interest income of 3.77 Crores.

(e) According to the information and explanations given to us and on the basis of our examination of the records of the Company, there is no loan granted which has fallen due during the year, has been renewed or extended or fresh loans granted to settle the overdue of existing loans given to the same parties.

(f) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has not granted any loans either repayable on demand or without specifying any terms or period of repayment.

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

(v) The Company has not accepted any deposits or amounts which are deemed to be deposits from the public within the meaning of sections 73 to 76 or any other relevant provisions of the Act. In respect of overdue earnest money deposits and security deposits, Management is of the view that overdue earnest money deposits and security deposits of suppliers/contractors appearing in the books are in the nature of retention money for performance of contracts for supply of goods and services and accordingly, not to be treated as deemed deposits by virtue of amendment in rule 2, sub rule (1), clause (c) of the Companies (Acceptance of Deposits) Amendment Rules 2016.

(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 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) (a) According to the information and explanations given to us, during the year, the Company has generally been regular in depositing with appropriate authorities undisputed statutory dues including Goods and Services Tax, Provident Fund, Employees State Insurance, Income Tax, Sales Tax, Service tax, Custom Duty, Excise Duty, Value Added Tax, Cess and other material statutory dues as applicable to it. There were no undisputed amounts payable in respect of Goods and Services Tax, Provident Fund, Employees State Insurance, Income Tax, Sales Tax, Service tax, Custom Duty, Excise Duty, Value Added Tax, Cess and other material statutory dues in arrear as at March 31, 2023 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, the details of disputed dues of Goods and Services Tax, Provident Fund, Employees State Insurance, Income-Tax, Sales-Tax, Service Tax, Custom Duty, Excise Duty, Value Added Tax, Cess and any other statutory dues, if any, as at March 31, 2023, are as follows:

Name of the Statute	Nature of dues	Period to which it pertains	Forum at which case is pending	Gross Disputed Amount (in Crore)	Amount Deposited under Protest (in Crore)
Building and Other Construction Workers Welfare Cess Act, 1996	Building and Other Construction Workers Welfare Cess	2009-10	Labour officer cum cess assessment officer, Chamba	9.24	9.24
Uttarakhand Water Tax on Electricity Generation Act, 2012	Water Cess	2015-16 to 2022-23	High Court of Uttarakhand Nainital	106.00	-
	Water Cess	2015-16 to 2022-23	High Court of Uttarakhand Nainital	118.42	-
Uttarakhand Green Energy Cess Act, 2014	Green Energy Cess	2015-16 to 2022-23	High Court of Uttarakhand Nainital	71.57	-
	Green Energy Cess	2015-16 to 20222-23	High Court of Uttarakhand Nainital	32.68	-
J&K Urban Immovable Property Tax Act, 1962	Property Tax	01.04.1991 to 31.03.1997	State Sales Tax Appellate Tribunal, Jammu	0.05	0.01
	Property Tax	01.04.1997 to 31.03.2002	State Sales Tax Appellate Tribunal, Jammu	0.15	0.01
Central Sales Tax and VAT Acts of Various States	Sales Tax/ VAT	2014-15	State Tax Department, Uttarakhand, Joint Commissioner (Appeals)	0.02	0.01
	Sales Tax/ VAT	1994-95	J&K State sales tax appellate tribunal Srinagar	234.61	-
	Sales Tax/ VAT	2004-05	West Bengal Taxation Tribunal, Kolkata	0.17	0.17
	Sales Tax/ VAT	2005-06	West Bengal Taxation Tribunal, Kolkata	1.44	1.44
	Sales Tax/ VAT	2006-07	West Bengal Taxation Tribunal, Kolkata	4.99	4.85
	Sales Tax/ VAT	2007-08	West Bengal Taxation Tribunal, Kolkata	3.48	2.73
	Sales Tax/ VAT	2008-09	West Bengal Taxation Tribunal, Kolkata	1.67	1.24
	Sales Tax/ VAT	2009-10	West Bengal Taxation Tribunal, Kolkata	1.59	1.52
	Sales Tax/ VAT	2010-11	West Bengal Taxation Tribunal, Kolkata	1.21	1.21
	Sales Tax/ VAT	2011-12	West Bengal Taxation Tribunal, Kolkata	2.14	2.14
	Sales Tax/ VAT	2012-13	West Bengal Taxation Tribunal, Kolkata	2.74	-
	Sales Tax/ VAT	2012-13	J&K Sales Tax Appellate Tribunal Srinagar	16.41	4.64
	Sales Tax/ VAT	2013-14	J&K Sales Tax Appellate Tribunal Srinagar	8.56	2.41
	Sales Tax/ VAT	2014-15	J&K Sales Tax Appellate Tribunal Srinagar	25.56	8.01
	Sales Tax/ VAT	2015-16	J&K Sales Tax Appellate Tribunal Srinagar	37.15	16.26
	Sales Tax/ VAT	2016-17	J&K Sales Tax Appellate Tribunal Srinagar	7.98	4.48
	Sales Tax/ VAT	2017-18	J&K Sales Tax Appellate Tribunal Srinagar	3.14	1.69
Finance Act, 1994	Service Tax	2004-2009	CESTAT, Chandigarh	19.65	1.70
	Service Tax	2008-09 to June 2017	CESTAT Kolkata	28.67	28.67
	Service Tax	2013-14 to 2017-18	Central Excise and Service Tax Appellate Tribunal, Chandigarh	101.00	-
Custom Act,1962	Custom Duty	2019-20	CESTAT Kolkata	25.15	-
Income Tax Act,1961	Income Tax	2016-17	CIT (Appeal), faceless centre	4.30	0.86
	Income Tax	2020-21	CIT (Appeal), faceless centre	5.74	-
Employees Provident Funds Act, 1952	EPF (Incl. Admin Charges & damage Charges)	01.04.1989 to 31.12.2004	Honble High Court	0.00*	-
	EPF (Incl. Admin Charges & damage Charges)	01.11.1995 to 31.12.2004	Honble High Court	0.00*	-
	TOTAL			875.50	93.27

* Less than 0.01 Crores.

(viii) According to the information and explanations given to us and on the basis of our examination of the records of the Company, there were no transactions relating to previously unrecorded income that have been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (43 of 1961).

(ix) (a) In our opinion and on the basis of information and explanations given to us by the management, we are of the opinion that 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 and on the basis of our examination of the records of the Company, the Company has not been declared a willful defaulter by any bank or financial institution or other lender.

(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, term loans were applied for the purpose for which the loans were obtained.

(d) According to the information and explanations given to us and on the basis of our examination of the records 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) According to the information and explanations given to us and on an overall examination of the financial statements of the Company, we report that the Company has not taken any funds from any entity or person on account of or to meet the obligations of its subsidiaries or joint ventures. Accordingly, clause 3(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. Accordingly, clause 3(ix) (f) of the Order is not applicable.

(x) (a) In our opinion and according to the information and explanations given to us, the Company has not raised any money by way of initial public offer or further public offer (including debt instruments) during the year. Accordingly, clause 3(x) (a) of the Order is not applicable.

(b) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly or optionally convertible debentures during the year. Accordingly, clause 3 (x)(b) of the Order is not applicable to the Company.

(xi) (a) Based on examination of the books and records of the Company and according to the information and explanations given to us, considering the principles of materiality outlined in Standards on Auditing, we report that no fraud by the Company or on the Company has been noticed or reported during the course of the audit.

(b) According to the information and explanations given to us, no report under sub-section (12) of Section 143 of the Act has been filed by the auditors in Form ADT-4 as prescribed under Rule 13 of Companies (Audit and Auditors) Rules, 2014 with the Central Government.

(c) According to the information and explanations given to us, no whistle blower complaints have been received by the Company during the year.

(xii) The Company is not a Nidhi Company. Hence, reporting under clauses 3(xii) (a), (b) and (c) of the Order is not applicable to the Company.

(xiii) According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with Section 177 and 188 of the Act where applicable and details of such transactions have been disclosed in the Note No.34 (8) of Standalone Financial Statements as required by the applicable accounting standards.

(xiv) (a) The Company is having Internal Audit Department responsible for carrying out the internal audit of various sections at corporate office, power stations/ projects, project offices and other offices at periodical intervals as per the approved audit plan. The internal audit system adopted by the internal audit department is commensurate with the size and nature of the business of the Company.

(b) We have considered the internal audit reports for the year under audit, submitted by Internal Audit Department 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 and as represented to us by the management and based on our examination of the records of the Company, the Company has not entered into non-cash transactions with directors or persons connected with him. Accordingly, clauses 3(xv) of the Order is not applicable.

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

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

b) The company has not conducted any Non- Banking Financial or Housing Finance activities during the year.

c) The Company is not a Core Investment Company (CIC) as defined in the regulations made by the Reserve Bank of India.

d) The Group does not have any CIC.

Accordingly, clauses 3(xvi) (a), (b), (c) and (d) of the Order are not applicable.

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

(xviii) There has been no resignation of the statutory auditors during the year. Accordingly, clause 3(xviii) of the Order is not applicable.

(xix) According to the information and explanations given to us and on the basis of the financial ratios, ageing and expected dates of realisation of financial assets and payment of financial liabilities, other information accompanying the Standalone 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 the 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) In our opinion and according to the information and explanations given to us, there is no unspent amount under sub-section (5) of Section 135 of the Act pursuant to any project. Accordingly, clauses 3(xx)(a) and 3(xx)(b) of the Order are not applicable.

(xxi) The reporting under clause 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.

For K G Somani & Co LLP	For Chaturvedi & Co.	For P C Bindal and Co.
Chartered Accountants	Chartered Accountants	Chartered Accountants
FRN: 006591N/N500377	FRN: 302137E	FRN: 003824N
(Bhuvnesh Maheshwari)	(S C Chaturvedi )	(Manushree Bindal)
Partner	Partner	Partner
M. No.088155	M. No. 012705	M. No. 517316
UDIN: 23088155BGYWED5558	UDIN: 23012705BGWLYC7299	UDIN: 23517316BGYPFX8650

Place: New Delhi

Date: May 29, 2023

ANNEXURE "B" TO THE INDEPENDENT AUDITORS REPORT

(Referred to in paragraph (iii) (f) under ‘Report on Other Legal and Regulatory Requirements of our report of even date) Report on the Internal Financial Controls with reference to Standalone Financial Statements under Clause (i) of Sub-section 3 of Section 143 of the Act

We have audited the internal financial controls with reference to Standalone Financial Statements of NHPC Limited ("the Company") as at March 31, 2023 in conjunction with our audit of the Standalone Financial Statements of the Company for the year ended on that date.

Managements Responsibility for Internal Financial Controls

The Companys management is responsible for establishing and maintaining internal financial controls based on the internal control with reference to Standalone Financial Statements criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the "Guidance Note") issued by the Institute of Chartered Accountants of India (the "ICAI"). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to Companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.

Auditors Responsibility

Our responsibility is to express an opinion on the Companys internal financial controls with reference to financial statements based on our audit. We conducted our audit in accordance with the Guidance Note and the Standards on Auditing, both, issued by ICAI, and deemed to be prescribed under section 143(10) of the Act, to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial control 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 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 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 Standalone Financial Statements for external purposes in accordance with generally accepted accounting principles including the Indian Accounting Standards (Ind AS). 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 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 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 Standalone 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 Standalone Financial Statements to future periods are subject to the risk that the internal financial control with reference to Standalone 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, to the best of our information and according to the explanations given to us, the Company has, in all material respects, an adequate internal financial controls with reference to Standalone Financial Statements and such internal financial controls with reference to Standalone Financial Statements were operating effectively as at March 31, 2023, based on the internal control with reference to Standalone Financial Statements criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by ICAI.

For K G Somani & Co LLP	For Chaturvedi & Co.	For P C Bindal and Co.
Chartered Accountants	Chartered Accountants	Chartered Accountants
FRN: 006591N/N500377	FRN: 302137E	FRN: 003824N
(Bhuvnesh Maheshwari)	(S C Chaturvedi )	(Manushree Bindal)
Partner	Partner	Partner
M. No.088155	M. No. 012705	M. No. 517316
UDIN: 23088155BGYWED5558	UDIN: 23012705BGWLYC7299	UDIN: 23517316BGYPFX8650

Place: New Delhi

Date: May 29, 2023