NMDC Ltd Auditor Reports

To,

The Members,

NMDC Limited

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the accompanying Standalone Financial Statements of NMDC Limited (hereinafter referred to as "the Company"), which comprise the Standalone Balance Sheet as at March 31, 2024, the Standalone Statement of Profit and Loss (including Other Comprehensive Income), the Standalone Statement of Changes in Equity and the Standalone Statement of Cash flows for the year then ended, and notes to the Standalone Financial Statements, including material accounting policy information and other explanatory information (hereinafter referred to as the "Standalone Financial Statements").

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Standalone Financial Statements give the information required by the Companies Act, 2013 ("the Act") in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, ("Ind AS") and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2024, its 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 ("ICAI") together with the ethical requirements that are relevant to our audit of the Standalone Financial Statements under the provisions of the Act and the Rules made thereunder, and we have fulfilled our other ethical responsibilities in accordance with the provisions of the Act and the ICAIs Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Standalone Financial Statements.

Key Audit Matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the Standalone Financial Statements of the current period. These matters were addressed in the context of our audit of the Standalone Financial Statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

For each Key audit matter below, description of how our audit addressed the Key audit matter is provided in that context. We have determined the following matters to be the Key audit matters to be communicated in our report:

Sl No	Key Audit Matter	Auditors Response
1.	Revenue from Operations and Related Royalty & Levies.	The audit procedures in relation to revenue recognised, royalty and other statutory dues payable included the following:
	A) Revenue from Operations:	• Assessing the appropriateness of the Companys revenue recognition accounting policies in line with Ind AS 115.
	• Revenue from operations constitute revenue from sale of iron ore and pellets. The Company deals with different sizes of iron ore. Amounts invoiced is adjusted with the price of Fe content in the product sold. This involves substantial effort in establishing accuracy of revenue recognised. Hence, this was identified as Key Audit Matter.	• Understanding and testing of design and operating effectiveness of Internal controls in place relating to recognition and measurement of revenue, royalty and other cess payable.
	• The sale price of Iron-ore is based on the presence of "Fe" content in the Iron-ore. The sale price in the e-auction (advance) as well as Long Term Agreement are fixed for standard "Fe" grade and revenue are recognized at standard "Fe" and adjustments for the revenue recognized are made (Bonus / Penalty) based on the certified actual "Fe" grade.	• Testing of relevant information technology general controls, automated controls, and the related information used in recording and disclosing revenue.
	B) Royalty & Levies	• Performed Cut off procedures as on year end with respect to revenue, royalty and other cess paid based on quantity dispatched.
	• Royalty and other statutory dues on sale of Iron-ore are required to be paid on the basis of Mines and Minerals (Development and Regulation) Act on advance basis to the respective statutory authorities. The Royalty and other statutory dues are computed on the basis of the "Fe" grade and rate published by Indian Bureau of Mines (IBM).	• Recomputed royalty and other cess payable for the current year as per IBM rates based on "Fe" quantities sold and reconciled the provision made.
	• We identified Royalty & other statutory dues as Key Audit Matter, considering the quantum of royalty and other statutory dues, inherent risk involved in accurately recognizing royalty and other statutory dues and complexities involved with respect to Fe grade, rates prescribed, timing of despatches.	• Performed analytical procedures on current year revenue, royalty and other cess and where appropriate, conducted further enquiries and testing.
	(Refer Note 2.18 and 2.34.14 to the Standalone Financial Statement)	• Substantive testing of revenue, royalty and other cess with the underlying documents on a sample basis.
		• Substantive testing of quantity despatched on sale with the sales recorded in books and substantive testing of royalty and other cess paid on quantity dispatched.
2.	Capital Work-in progress:	The audit procedures in relation to Capital Work in Progress included the following:
	Considering the nature, duration, estimated amount and amount incurred on projects carried out, Capital Work in Progress is determined as a key audit matter.	• Reviewed the accounting policies for CWIP.
	(Refer Note 2.2 to the Standalone Financial Statement)	• Understanding and testing of design and operating effectiveness of Internal controls in place relating to approval process for capitalisation.
		• Tested the control procedure for identification of cost incurred for specific projects.
		• Performed substantive procedures on sample basis for amounts capitalised and amounts added to CWIP during the year.
		• Examined the disclosures made in respect of CWIP in compliance with Ind AS-16 and Schedule III to the Companies Act 2013.
3.	Mine Closure Obligation (MCO):	The audit procedure performed in relation to Mine Closure Obligation included the following:
	The company provides for Mine closure obligation (MCO) based on the present cost of closure of mining project based on a representative mine. The rate of closure arrived at based on such cost is uniformly applied to other mines for arriving at the total MCO liability.	• Our Audit procedure comprise of identification and understanding of the reasonableness of the principal assumptions used by the management to the MCO which involves technical evaluation and data of production of ore.
	As the provision for mine closure involves estimate and Management judgement, the amount involved is significant, the same is considered as a Key Audit Matter.	• We have reviewed the methodology to quantify the liability for mine closure obligation at a rate per MT on the cumulative Run of Mine quantity for mine closure obligations.
	(Refer Note 2.14.4 to the Standalone Financial Statement)	• We have verified the arithmetical accuracy of the provision for mine closure obligation based on the recommendation of the Committee formed for this purpose.
4.	Contingent Liabilities	The audit procedures in relation to contingent liabilities included the following:
	The Company is involved in various taxes and other disputes for which final outcome cannot be predicted and which could potentially result in significant liabilities. The assessment of the risks associated with the litigations is based on complex assumptions, which require the use of judgements and such judgements relates, primarily, to the assessment of the uncertainties connected to the prediction of the outcome of the proceedings and to the adequacy of the disclosures in the financial statements. Because of the judgement required, the materiality of such litigations and the complexity of the assessment process, the area is a key matter for our audit.	• Understood and tested the design and operating effectiveness of controls as established by the management for obtaining all relevant information for pending litigation cases.
	(Refer Note 2.31 to the Standalone Financial Statement)	• Discussed with the management regarding any material developments thereto and latest status of legal matters.
		• Read various correspondences and related documents pertaining to litigation cases and relevant external legal opinions obtained by the management.
		• Examined managements judgements and assessments in respect of whether provisions are required and discussed with the management.
		• Reviewed the adequacy and completeness of disclosures.

Emphasis of Matter

We draw attention to the following matters forming part of the Standalone Financial Statements

I. Note No. 2.34.4 regarding dues from NMDC Steel Limited ("NSL"), which includes an amount of INR 2,502.64 crores arising from demerger;

II. Note No.2.32.5 regarding advance of INR 639.61 crores paid by the Company to a subsidiary M/s Karnataka Vijayanagar Steel Limited (KVSL); and

III. Note No. 2.34.7 regarding demand of INR 1,623.44 Crores, shown as Contingent Liability relating to compensation based on common cause judgement, which is sub-judice.

The impact of the above on the Standalone Financial Statements is dependent on the outcome of the proceedings/ matters described in the said notes.

Our opinion is not modified in respect of these matters.

Information Other than the Standalone Financial Statements and Auditors Report Thereon

The Companys Management and Board of Directors are responsible for the preparation of the other information. The other information comprises the information included in the Management Discussion and Analysis, Boards Report including Annexures to Boards Report, Business Responsibility and Sustainability Report, Corporate Governance Report and Shareholder Information (collectively called as "Other Information") but does not include the Standalone Financial Statements and our auditors report thereon. The Other information as above is expected to be made available to us after the date of this Auditors report.

Our opinion on the Standalone Financial Statements does not cover the other information and we do not express any form of assurance/ conclusion on the other information.

In connection with our audit of the Standalone Financial Statements, our responsibility is to read the other information identified above when it becomes available and, in doing so, consider whether the other information is materially inconsistent with the Standalone Financial Statements, or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated.

When we read the other information, if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance and take appropriate actions, if required.

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

The Companys Management and Board of Directors are responsible for the matters specified in section 134(5) of the Act, with respect to the preparation and presentation of these Standalone Financial Statements that give a true and fair view of the standalone financial position, standalone financial performance, standalone other comprehensive income, standalone cash flows and standalone changes in equity of the Company in accordance with the Indian Accounting Standards (Ind- AS) specified under section 133 of the Act, read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, and other accounting principles generally accepted in India.

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 the design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Standalone Financial Statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the Standalone Financial Statements, the Board of Directors are responsible for assessing the Companys ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless Board of Directors either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

The Board of Directors are also responsible for overseeing the Companys financial reporting process.

Auditors Responsibilities for the Audit of the Standalone Financial Statements

Our objectives are to obtain reasonable assurance about whether the Standalone Financial Statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Standalone Financial Statements.

As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the Standalone Financial Statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal financial controls relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system with reference to 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.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the Standalone Financial Statements of the current period and are therefore the key audit matters. We describe these matters in our auditors report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Other Matters

1. We did not audit the financial statements of five branches included in the audited Standalone Financial Statements of the Company, whose financial statements reflects total assets of INR 13,867.36 Crores as at March 31, 2024; total revenues of INR 21,400.76 Crores, total net profit before tax of INR 7,194.68 Crores, for the year ended March 31, 2024 as considered in the respective audited financial statements of the Branches included in the Standalone Financial Statements of the Company. The financial statements of these branches have been audited by the respective branch auditors whose reports have been furnished to us, and our opinion in so far as it relates to the amounts and disclosures included in respect of these branches, is based solely on the report of such branch auditors and the procedures performed by us are as stated under Auditors Responsibilities for the Audit of the Standalone Financial Statements section above after considering the requirements of Standard on Auditing (SA 600) on "Using the work of Another Auditor" including materiality.

2. The Standalone Financial Statements includes the audited Standalone Financial Statements for the year ended March 31, 2023 which was audited by the predecessor auditor of the Company who had expressed an unmodified opinion on those audited Standalone Financial Statements vide their report dated May 23, 2023. We have audited the restatement adjustments, as disclosed in Note 2.34.13 to the Standalone Financial Statements, which have been made to the comparative Standalone Financial Statements presented for the years prior to year ended March 31, 2024 in accordance with the requirements of applicable Ind AS.

Our opinion is not modified in respect of these matters.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditors Report) Order, 2020 ("the Order") issued by the Central Government of India in terms of Section 143(11) of the Act, we give in "Annexure 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, based on our audit 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 except for the matters stated in the paragraph 2(j)(vi) below on reporting under Rule11(g) of the Companies (Audit and Auditors) Rules, 2014.

c) The reports on the accounts of the branch offices of the Company audited under Section 143(8) of the Act by branch auditors have been sent to us and have been properly dealt with by us in preparing this report.

d) The Standalone Balance Sheet, the Standalone Statement of Profit and Loss (including other comprehensive income), Standalone Statement of changes in equity and the Standalone Statement of Cash Flows dealt with by this Report are in agreement with the books of account.

e) In our opinion, the aforesaid Standalone Financial Statements comply with the Indian Accounting Standards (Ind AS) specified under Section 133 of the Act.

f) The provisions of Section 164(2) of the Act, in respect of disqualification of directors are not applicable to the company, being a Government company in terms of notification no: - G.S.R.463(E) dated 5th June 2015 issued by Ministry of Corporate Affairs, Government of India.

g) The modifications relating to the maintenance of accounts and other matters connected therewith are as stated in the paragraph 2(b) above on reporting under Section 143(3)(b) of the Act and paragraph 2(j)(vi) below on reporting under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014, as amended.

h) With respect to the adequacy of internal financial controls with reference to Standalone Financial Statements of the Company and operating effectiveness of such controls, refer to our separate Report in "Annexure -B", wherein we have expressed an unmodified opinion.

i) With respect to the other matters to be included in the auditors report in accordance with the requirements of Section 197(16) of the Act, as amended:

We are informed that the provisions of section 197 read with Schedule V of the Act, relating to managerial remuneration are not applicable to the company, being a Government Company, in terms of Ministry of Corporate Affairs notification no- G.S.R.463(E) 5th June 2015.

j) 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 2.31 to the Standalone Financial Statements.

ii. The company does not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.

iii. There has been delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the company as detailed below:

a. Unclaimed amount of dividend:

(INR in Crores)

Year	Amount involved	Due date of amount to be transferred to IEPF	Actual date of transfer
2015-16	0.15	26-Apr-2023	26-Jun-2023

b. Equity shares related to unclaimed dividend:

Year	No of shares	Due date of shares to be transferred to IEPF	Actual date of transfer
2015-16	3776	26-Apr-2023	07-Jun-2023 & 08-Jun-2023

iv.

a. The management has represented that, to the best of its knowledge and belief, as disclosed in Note 2.34.17 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 persons or entities, including foreign entities ("Intermediaries") with the understanding, whether recorded in writing or otherwise, that the Intermediary shall:

• 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 2.34.17 to the Standalone Financial Statements, 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:

• Directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party ("Ultimate Beneficiaries") or

• Provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and

c. Based on the audit procedures performed by us that have been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (iv)(a) and (v)(b) contain any material misstatement.

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

The final dividend paid by the Company during the financial year 2023-24 which was declared for the previous financial year 2022-23 and approved by the members at Annual General Meeting is in accordance with section 123 of the Act, to the extent it applies to payment of dividend.

As stated in note 2.34.24 to the Standalone Financial Statements, the Board of Directors of the Company has recommended Final dividend for the year which is subject to the approval of the members in ensuing Annual General Meeting. The dividend declared is in accordance with section 123 of the Act to the extent it applies to declaration of dividend.

vi. Based on our examination which included test checks and the report of the auditors of the five branches and according to the information and explanations given to us, the Company has used the accounting software for maintaining its books of account which has a feature of audit trail (edit log) facility and the same has operated throughout the year for all the relevant transactions recorded in such software except that:

The feature of recording audit trail (edit log) at the data base level to log any direct changes for the accounting software used for maintaining the books of account was not enabled.

During the course of our audit, we did not come across any instance of audit trail feature being tampered with for the period for which audit trail was enabled.

In the first year of applicability, the reporting on preservation of audit trail for record retention is not required as per "Implementation guide in Reporting on Audit Trail under Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 issued by ICAI.

3. We are enclosing our report in terms of section 143(5) of the Act, on the basis of such checks of books and records of the company as we consider appropriate and according to the information and explanations given to us, in "Annexure-C" on the directions issued by the Comptroller & Auditor General of India.

	For VARMA & VARMA
	Chartered Accountants
	FRN 004532S
	P R Prasanna Varma
Place: Hyderabad	Partner
Date: May 27, 2024	M No. 025854
	UDIN:24025854BKGPYV6233

ANNEXURE- A

TO THE INDEPENDENT AUDITORS REPORT

(Referred to in paragraph 1 under Report on Other Legal and Regulatory Requirements section of our report to the Members of NMDC Limited of even date on the Standalone Financial Statements for the year ended March 31, 2024)

i.

a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of Property, Plant & Equipment.

The Company is maintaining proper records showing full particulars of Intangible assets.

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 a regular programme of physical verification of its Property, Plant and Equipment by which all the Property, Plant and Equipment are physically verified by the management in a phased manner. In our opinion the periodicity of the physical verification is reasonable having regard to the size of the company and the nature of Property, Plant and Equipment. In accordance with this program, certain Property, Plant and Equipment were verified during the year and no material discrepancies have been noticed on such verification.

c) According to the information and explanations given to us and on the basis of our examination of the records of the company, the title deeds of immovable properties (other than immovable properties where the Company is the lessee and the lease agreements are duly executed in favour of the lessee) disclosed in the financial statements are held in the name of the company, except as mentioned in Additional Note 2.1.1 of the Standalone Financial Statements and as given below:

Description of property	Gross carrying value INR (In Crores)	Held in name of	Whether promoter, director or their relative or employee	Period held -range.	Reason for not being held in name of company
			KIRANDUL
Land at Madadi Village	-	-	No	31-03-2006	Panchnama done by Railway, Revenue NMDC officials is available with the Project.
Railway Land			No	31-03-1986	Panchnama done by Railway Revenue authorities and NMDC officials is available with the Project.
Freehold Land	0.0023		No	31-03-1966	Sale Deed available with the management for total 19.09 Hectares. Appeal against the order issued by the Tahsildar, Bade Bacheli is being prepared by the advisor (Revenue) and same will be submitted before the SDM. Bade Bacheli. The title is not in the name of Company.
Revenue Land			No		File has been sent to Head Office for approval so that proper application can be submitted before district Administration for the allotment of Land. It is under Progress. The title is not in the name of Company.
			BACHELI
Forest Land for Uniflow Rly. Dispatch System	0.124	Forest Department	No	07-06-2002	This is Forest Land. (MOEF Letter No. 8B/007/2002/ FCW/1313 dated 07.06.2002)
Land for Shankhni pump House & pipeline hect 4.68	0.0103	Forest Department	No	14-03-2002	This is Forest Land (MOEF clearance Letter dated 14.03.2002).
Infrastructure Lond Lease of Deposit 10(FO)	13.92	Forest Department	No	10-07-2019	This is Forest Land (MOEF letter dated 10 July 2019).
			PALONCHA
SIU NMDC Ltd,	1.09	TSIIC	No	11.35 Acres	Provisional allotment order has been issued by TSIIC and not yet registered
SIU NMDC Ltd,	0.20	TSIIC	No	2.08 Acres	During the survey, 2.08 acres found shortage out of 13.43 acres which is pending confirmation from TSIIC.
			DONIMALAI
Bhujanganagar land for Township to the extent of 3.73 acres	-	-	No	17-03-1971	The Company is in the possession of Land allotment letter/ land sanction letter. Mutation of the same is pending.
Bhujanganagar land for Township to the extent of 11.23 acres	-	-	No	07-07-1972	The Company is in the possession of Land allotment letter/ land sanction letter. Mutation of the same is pending.
Bhujanganagar land for Township to the extent of 2.22 acres	-	-	No	17-03-1971	The Company is in the possession of Land allotment letter/ land sanction letter. Mutation of the same is pending.
Bhujanganagar land for Township to the extent of 6.94 acres	-	-	No	15-02-1971	The Company is in the possession of Land allotment letter/ land sanction letter. Mutation of the same is pending.
Ranajithpur land for Pellet plant to the extent of 8.31 acres	-	-	No	03-05-1976	The Company is in the possession of Land allotment letter/ land sanction letter. Mutation of the same is pending.
Narasingapura and Bhujanganagar for bore hole to the extent of 0.037 acres	-	-	No	NA	The Company is in the possession of Land allotment letter/ land sanction letter. Mutation of the same is pending.
			HEAD OFFICE
Hyderabad Corporate Office, NMDC Ltd., 10-3-311/A, Castle Hills, Masab Tank, Hyderabad-28	-	-	No	17-09-1981	Revenue Authority inspected the Building Premises & Documents. Mutation is pending.
NMDC Guest, House, Plot No.7 Road No.2, Banjara Hills, Hyderabad-33	-	-	No	15-02-1995	Revenue Authority inspected the Building Premises & Documents. Mutation is pending.
NMDC Guest, House, Plot No.16 Road No.2, Banjara Hills, Hyderabad-33	-	-	No	17-12-1994	Revenue Authority inspected the Building Premises & Documents. Mutation is pending.
NMDC Guest, House, Plot No.18 Road No.2, Banjara Hills, Hyderabad-33	-	-	No	17-12-1994	Revenue Authority inspected the Building Premises & Documents. Waiting for mutation papers
NMDC Guest, House, Plot No.19 Road No.2, Banjara Hills, Hyderabad-33	-	-	No	17-12-1994	Revenue Authority inspected the Building Premises & Documents. Mutation is pending.
NMDC Guest, House, Plot No.20 Road No.2, Banjara Hills, Hyderabad-33	-	-	No	17-12-1994	Revenue Authority inspected the Building Premises & Documents. Mutation is pending.
NMDC Guest, House, Plot No.21 Road No.2, Banjara Hills, Hyderabad-33	-	-	No	17-12-1994	Revenue Authority inspected the Building Premises & Documents. Mutation is pending.
NMDC Guest, House, Plot No.22 Road No.2, Banjara Hills, Hyderabad-33	-	-	No	17-12-1994	Revenue Authority inspected the Building Premises & Documents. Mutation is pending.
Transit Camp, Flat No.24, Kranthi Shikara Apartments, Panjagutta, Hyderabad-82 .	-	-	No	19-08-1992	Revenue Authority inspected the Building Premises & Documents. Mutation is pending.
Patancheru, Survey No.420 & 425 Hyderabad-502 032	-	-	No	18-07-2019	Mutation is pending.
Guest House Plot No.8 H.I.G Jubilee Hills	-	-	No	23-03-2022	Mutation is pending.
			R&D CENTRE
NPD LAB	-	-	No	10-08-1990	Mutation is pending.

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 are pending against the Company for holding any benami property under The Benami Transactions (Prohibition) Act, 1988 and rules made thereunder.

ii.

a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, physical verification of inventory has been conducted at reasonable intervals by the management and in our opinion, the coverage and procedure of such verification by the management is appropriate and there are no discrepancies of 10% or more in aggregate for each class of inventory.

b) In our opinion and 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 sanctioned working capital limits in excess of INR 5 Crores, in aggregate, from the bank or financial institutions on the basis of security of current assets as per terms of sanction. Hence, reporting under paragraph 3(ii)(b) of the order is not applicable.

iii.

a. 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 made investments in, provided guarantee or security or granted loans or advances in the nature of loans, secured or unsecured to, companies, or any other parties and the details are given below:

A. The aggregate amount during the year and balance outstanding at the balance sheet date with respect to such loans or advances and guarantees or security to subsidiaries, joint ventures and associates (Refer note 2.32.5 of the Standalone Financial Statements):

(INR in Crores)

S. No	Particulars	Guarantees	Security	Investments	Loans	Advances in the nature of loans
1	Aggregate amount granted/provided during the Year:
	Subsidiaries	0.34	-	104.94	-	1.68
	Joint ventures	-	-	-	-	0.01
	Associates	-	-	-	-	-
2	Balance outstanding as at balance sheet date in respect of above cases:
	Subsidiaries	0.34	-	357.45	-	668.51
	Joint ventures	504.23	-	251.03	-	55.81
	Associates	-	-	418.98	-	-

B. The aggregate amount during the year, and balance outstanding at the balance sheet date with respect to such loans or advances and guarantees or security to any other entity:

(INR in Crores)

Sl No	Particulars	Guarantees	Security	Investments	Loans	Advances
1	Aggregate amount granted/provided during the Year
	Entity under common control (Refer Note 2.32.5)	-	-	-	-	250.04
	Employee Loans (including interest accrued during the year)	-	-	-	56.14	-
2	Balance outstanding as at balance sheet date in respect of above cases
	Entity under common control (Refer Note 2.32.5)	-	-	-	-	2,588.72
	Employee Loans (including interest accrued as at the year- end)				92.69

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 investments made, guarantees provided, and the terms and conditions of the loans and advances in the nature of loans and guarantees provided during the year 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, schedule of repayment of principal has not been stipulated in respect of loans and advances in the nature of loans granted by the Company to subsidiaries, joint ventures & commonly controlled entities. There is schedule of repayment of principal and payment of interest prescribed in respect of loans granted by the Company to employees and the repayments are generally regular.

d) According to the information and explanations given to us and on the basis of our examination of the records of the Company, no loan or advances in the nature of loan granted by the Company for which schedule of repayment has been stipulated is overdue.

e) According to the information and explanation given to us and on the basis of our examination of the records of the Company, there are no loan and advances given falling due during the year, which has been renewed or extended or fresh loan granted to settle the over dues of existing loans given to the same party.

f) According to the information and explanation given to us and on the basis of our examination of the records of the Company, the Company has granted loans or advances in the nature of loans without specifying any terms or period of repayment, to wholly owned Subsidiaries, Joint ventures, Associate companies and entity under common control, without specifying any terms or period as stated in note 2.32.5 of the Standalone Financial Statements and the details of which are given below. There was no loan given to such parties which was repayable on demand,

Particulars	Related Parties	Promoters
Aggregate amount of loans/advances in nature of loans	-	-
A). Repayable on demand	-	-
B). Agreement does not specify any terms or period of repayment	3,313.04	-
Total (A+B)	3,313.04	-
Percentage of loans /advances in the nature of loans to the total loans	97.28%	-

iv. According to the information and explanation given to us and on the basis of our examination of the records, the Company has complied with the provisions of Section 185 and 186 of the Act, in respect of loans granted, investments made, guarantees and securities provided, as applicable.

v. In our opinion and according to information and explanations given to us, the Company has not accepted any deposits or amounts which are deemed to be deposits from the public. As such, the directives issued by the Reserve Bank of India, the provisions of Sections 73 to 76 or any other relevant provisions of the Act and the rules framed thereunder are not applicable to the Company. Accordingly, clause 3(v) of the order is not applicable.

vi. According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Central Government has prescribed the maintenance of cost records under section 148(1) of the Act, for the business activities carried out by the Company. We are of the opinion that prima facie the Company is generally maintaining these cost records. We have not, however, made detailed examination of the records with a view to determine whether they are accurate and complete

vii.

a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company is generally regular in depositing undisputed statutory dues including Goods and Services Tax, provident fund, employees state insurance, income tax, service tax, duty of customs, duty of excise, value added tax, cess, royalty and any other statutory dues where applicable to it with the appropriate authorities during the year.

There are no undisputed material amounts of above statutory dues payable which were in arrears as at 31^st March 2024 for a period of more than six months from the date they became payable.

b) According to the information and explanations given to us, there are no statutory dues referred in clause 3 (vii) (a) above which have not been deposited by the Company on account of disputes, except for the following:

Name of statute	Nature of Dues	Period	Forum where Dispute is Pending	Amount (net of deposit) (INR. In Crore)
		HEAD OFFICE
Income Tax Act, 1961	Income Tax & Interest thereon	FY 2014-15 & FY 2015-16	Principal Commissioner of Income Tax	30.26
Goods & Services Tax	Goods & Services Tax & penalty	FY 2017-18	Joint Commissioner (Appeals)	1.34
Income Tax Act, 1961	Withholding tax	FY 2023-24 & earlier years	Demand in TRACES portal. Company is in the process of filing rectification after reconciling liability with books	1.65
		KIRANDUL
Nagar palika, Kirandul	Export Tax	1995-96 to 202324	Honble High Court of Bilaspur	6.04
Nagar palika, Kirandul	Interest on Export Tax	1995-96 to 202224	Honble High Court of Bilaspur	16.37
Nagar palika, Kirandul	Conservancy Tax	1997-98 to 202021	Honble High Court of Bilaspur	1.83
Nagar palika, Kirandul	Property Tax	2013-14 to 202021	Honble High Court of Bilaspur	204.21
Service Tax	Service tax on Railway freight refund	July 2012	Service Tax Appellate Tribunal	8.81
Service Tax	Interest on Service tax Railway freight Refund	July, 2012 to March, 2024	Service Tax Appellate Tribunal	13.93
GST Authority	Differential GST underRCM on Royalty charges (Including DMF & NMET) in respect of licensing services for right to use minerals including exploration and evaluation.	July, 2017 to December, 2018	Honbe High Court of Bilaspur	90.02
District Collector Dantewada	Common Cause Notice (net of amount paid under protest of INR. 174 Cr)	FY 2018-19	Honbe High Court of Bilaspur	317.47
Central Goods & Service Tax & Central Excise	GST Demand	FY 2017-18 to FY 2019-20	Appellate authority of Central Goods & Service Tax & Central Excise	151.56
Central Goods & Service Tax & Central Excise	GST Demand	FY 2017-18 to July, 21	Principal Commissioner of Central Goods & Service Tax & Central Excise	19.04
		DONIMALAI
Karnataka Forest Act 1963	Forest Development Tax (* Net of amounts paid under protest INR. 139.77 Cr)	FY 2008-09 to FY 2010-11	Honble Supreme Court of India	383.46*
Central Excise, Customs and Service Tax	Service tax	FY 2012-13 to FY 2017-18	Commissioner of Central Excise (Appeals)	0.27
Central Excise, Customs and Service Tax	Service Tax	FY 2013-14 to FY 2017-18	CESTAT	1.30
Mines & Minerals Development and Regulations Act	Interest on Royalty	FY 2009-10 to FY 2011-12	Honorable High court of Karnataka	12.25
Goods & Services Tax	Goods & Service Tax	FY 2017-18	Commissioner of Central tax (Appeal)	2.57
Goods & Services Tax	Goods & Service Tax	FY 2017-18	Commissioner of Central tax (Appeal)	0.68
Goods & Services Tax	Goods & Service Tax	FY 2017-18	Commissioner of Central tax (Appeal)	0.54
Goods & Services Tax	Goods & Service Tax	FY 2017-18	Honorable High court of Karnataka	83.58
Goods & Services Tax	Goods & Service Tax	FY 2017-18, FY 2018-19, FY 2019-20	Honorable High court of Karnataka	88.23
		PANNA
Commercial Tax	Sales & Entry tax	2014-15	DCIT, Sagar	0.048
Commercial Tax	Sales & Entry tax	2013-14	DCIT, Sagar	0.23
		BACHELI
Nagarpalika, Bacheli	Export tax	March2010 to March2024	Honble High Court of Bilaspur	1.59
Nagar Palika, Bacheli	Property Tax on residential Building Area, Mining land area, Consolidated tax etc.	FY 2015-16	Honble High Court, Bilaspur	26.12
Service tax	Service tax on security services	July 2012 to June 2017	CESTAT, New Delhi	2.22
Service tax	Service tax on Railway freight refund	July 2012	Service tax appellate tribunal	33.57
Service tax	Interest on service tax on Railway Freight refund	July 2012 to March 2024	Service tax appellate tribunal	50.88
Goods & Service Tax	Interest on GST for DMF and NMET	01.07.2017 to 28.02.2020	GST Authority	9.30
Goods & Service Tax	Service tax on providing rent a cab operator service for the period from October 2014 to June 2017	October, 2014 to June, 2017	Principal Commissioner of Central Goods & Service Tax & Central Excise	0.165
Goods & Service Tax	GST under RCM against payment made towards Infrastructure cess and Environmental cess for the period from July 2017 to June 2021	July 2017 to July 2021	Principal Commissioner of Central Goods & Service Tax & Central Excise	18.24
Goods & Service Tax	Differential GST under RCM on Royalty charges (Including DMF & NMET)	July, 2017 to December, 2018	Honble High Court of Bilaspur	130.96
Goods & Service Tax	GST on CAMPA fund, and other GST matters	2017 -2019	Principal Commissioner of Central Goods & Service Tax & Central Excise	5.62
Nagar palika, Bacheli	Interest on Export Tax	March 2010 to March 2024	Honble High Court of Bilaspur	2.02
District Collector, Dantewada	Common cause notice (* Net of amount paid under protest of INR. 426 Cr)	FY 2018-19	Honble high court of Bilaspur	705.97*
		RO VIZAG
Service Tax Authority	Demand cum show cause Notice for service Tax on Screening of ore 2007-08 to 2011-12	FY 2007-08 to FY 2011-12	Customs, Excise and Service tax appellate tribunal	3.75
Service Tax Authority	Service Tax	FY 2017-18	Customs, Excise and Service tax appellate tribunal	3.54
Commissioner of Customs	Custom Duty	FY 2021-22	The case is heard by Appellate Authority and the company is in the process of filing with CESTAT Hyderabad	2.13
Directorate of Revenue Intelligence	DRI cases	FY 2012-13	Customs, Excise and Service tax appellate tribunal	2.59
Directorate of Revenue Intelligence	DRI cases	FY 2011-12	AP High Court.	4.67

viii. In our opinion and 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 surrendered or disclosed as income, any transaction not recorded in the books of account, during the year in the tax assessments under the Income tax Act, 1961. Accordingly, the reporting under clause 3(viii) of the Order is not applicable.

ix.

a) In our opinion and according to the information and explanations give to us and on the basis of our examination of the records of the Company, the Company has not defaulted in repayment of loans or other borrowings or in the payment of interest thereon to any lender during the year.

b) According to the information and explanations give to us and on the basis of our examination of the records of the Company, the Company has not been declared a wilful defaulter by any bank or financial institution or other lender.

c) The Company has not taken any term loan during the year and there are no outstanding term loans at the beginning of the year and hence, reporting under Clause 3(ix)(c) of the Order is not applicable.

d) According to the information and explanations given to us and the procedures performed by us and on an overall examination of the financial statements of the Company, funds raised on short term basis have not been utilized during the year for long term purposes.

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 obligation of its subsidiaries, associates or joint ventures as defined under the Act. 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, associates or joint ventures as defined under the Companies Act, 2013. Accordingly, clause 3(ix)(f) of the order is not applicable.

x.

a) According to the information and explanations given to us and the procedures performed by us, we report that the Company has not raised any moneys 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 on the basis of our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or convertible debentures (fully, partially or optionally convertible) during the year. Accordingly, Clause 3(x)(b) of the order is not applicable.

xi.

a) According to the information and explanations given to us and on the basis of our examination of the books and records of the Company and in accordance with generally accepted audit practices, we report that no fraud by the Company or on the Company has been noticed or reported during the year.

b) As per the information and explanations given to us and as per the verifications carried out by us, there was no reporting under sub-section (12) of section 143 of the Company Act, 2013 in Form ADT -4 as prescribed under Rule 13 of Companies (Audit and Auditors) Rules, 2014 with the Central Government.

c) As per the information and explanations given to us, there are no whistle blower complaints received by the Company during the year. Accordingly, clause 3(xi)(c) of the order is not applicable.

xii. The Company is not a Nidhi Company. Accordingly, Clause 3(xii)(a) to Clause 3(xii)(c) of the order is not applicable.

xiii. In our opinion and according to the information and explanations given to us, the transactions with related parties are in compliance with section 177 and 188 of the Act, wherever applicable and the requisite details have been disclosed in the Standalone Financial Statements, as required by the applicable Indian Accounting Standards.

xiv.

a) In our opinion and based on our examination, the Company has an internal audit system commensurate with the size and nature of its business.

b) We have considered the reports of Internal Auditors for the year under audit, issued to the Company during the year and till date.

xv. In our opinion and according to the information and explanations given us, the Company has not entered into any non-cash transactions with its directors or persons or persons connected to its directors covered under section 192 of the Act. Accordingly, clause 3(xv) of the Order are not applicable.

xvi.

a. In our opinion and according to the information and explanations given to us, the Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, Clause 3(xvi)(a) of the order is not applicable.

b. According to the information and explanations provided to us, the Company has not conducted any Non-Banking Financial or Housing Finance activities, therefore the Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, clause 3(xvi)

(b) of the Order is not applicable.

c. The Company is not a Core Investment Company (CIC) as defined in the regulations made by the Reserve Bank of India. Accordingly, clause 3(xvi)

(c) of the order is not applicable.

d. In our opinion, there is no core investment company within the Group (as defined in the Core Investment Companies (Reserve Bank) Directions, 2016. Accordingly, clause 3(xvi)(d) of the order is not applicable.

xvii. Based on our examination of the books and records of the Company, the Company has not incurred cash losses in the current financial year and in the immediately preceding financial year. Accordingly, clause 3(xvii) of the order is not applicable.

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 date of realisation of financial assets and payments 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 the Company is not capable of meeting its liabilities existing at the date of balance sheet date. We however, state that this is not an assurance as to the future viability of the Company. We further state that our reporting is based on the facts up to the date of the audit report and we neither give any guarantee nor any assurance that all liabilities falling due within a period of one year from the balance sheet date will get discharged by the Company as and when they fall due.

xx.

a. In our opinion and according to the information and explanations given to us, in respect of other than ongoing projects, there has been no unspent amount which are required to be transferred to a Fund specified in Schedule VII of the Act pursuant to second proviso to sub-section (5) of section 135 of the Act. Accordingly, clause 3(xx)(a) of the order is not applicable.

b. In our opinion and according to the information and explanations given to us, in respect of ongoing projects, the Company has transferred unspent amount to a special account within thirty days from the end of the financial year in compliance with the provisions of sub-section 6 of section 135 of the said Act.

	For VARMA & VARMA
	Chartered Accountants
	FRN 004532S
	P R Prasanna Varma
Place: Hyderabad	Partner
Date: May 27, 2024	M No. 025854
	UDIN: 24025854BKGPYV6233

ANNEXURE B

TO THE INDEPENDENT AUDITORS REPORT

(Referred to in paragraph 2(h) under Report on Other Legal and Regulatory Requirements section of our report to the Members of NMDC Limited of even date on the Standalone Financial Statements for the year ended March 31, 2024)

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 NMDC Limited ("the Company") as of March 31, 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 and Board of Directors 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 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 the 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 Act.

Auditors Responsibilities for the audit of Internal Financial Controls with reference to Standalone Financial Statements

Our responsibility is to express an opinion on the internal financial controls with reference to Standalone Financial Statements of the Company based on our audit. We conducted our audit in accordance with the Guidance Note 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 Act, to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls with reference to Standalone Financial Statements were established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls 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 judgment, including the assessment of the risks of material misstatement of the Standalone Financial Statements, whether due to fraud or error.

We believe that the audit evidence we have obtained, and the audit evidence obtained by branch auditor in terms of their reports referred to in the "Other Matters" paragraph below 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 standalone financial reporting and the preparation of Standalone 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 authorizations of management and directors of the company; and

3. Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the companys assets that could have a material effect on the 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 system with reference to Standalone Financial Statements and such internal financial controls with reference to Standalone Financial Statements were operating effectively as at March 31, 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.

Other Matters

Our aforesaid report under Section 143(3)(i) of the Act on the adequacy and operating effectiveness of the Internal financial controls with reference to Standalone Financial Statements of the Company, in so far as it relates to 5 Branches, is based on the corresponding reports of the branch auditors of the Company.

Our report is not modified in respect of the above matters.

	For VARMA & VARMA
	Chartered Accountants
	FRN 004532S
	P R Prasanna Varma
Place: Hyderabad	Partner
Date: May 27, 2024	M No. 025854
	UDIN:24025854BKGPYV6233

ANNEXURE C

TO THE INDEPENDENT AUDITORS REPORT

(Referred to in paragraph 3 under Report on Other Legal and Regulatory Requirements section of our report to the Members of NMDC Limited of even date on the Standalone Financial Statements for the year ended March 31, 2024)

Report on the Directions of the Comptroller and Auditor General of India required under sub section 5 of Section 143 of the Companies Act, 2013 ("the Act") based on the audit carried out by us and considering the report of the 5 Branch Auditors.

Sl. no	Directions u/s 143(5) of the Companies Act, 2013	Auditors reply on action taken on directions
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 on the basis of our examination, all the accounting transactions are processed through IT system, except for process such as inventory valuation and costing that is carried out manually with checks and controls in place.
		Based on audit procedures performed, there are no financial implications identified in respect carrying value of inventory recognized in the books of account as at the year end. Accordingly, there are no implications on the integrity of the accounts.
2.	Whether there is any restructuring of an existing loan or cases of waiver /write off of debts / loans / interest etc. made by a lender to the company due to the companys inability to repay the 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).	Based on the audit procedures carried out and as per the information and explanations given to us, there was no restructuring of existing loans or cases of waiver/write off of debts/ loans/ interest etc. made by the lender to the company due to the companys inability to repay the loan.
		As per the information and explanations furnished to us and a per the verification carried out by us, there was no restructuring of an existing loan or case of waiver/ writeoff of loan given by the Company.
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 term and conditions? List the cases of deviation.	According to the information, explanations given to us and examination of books of accounts, the company has not received any grants / subsidy from Central or State Government or its agencies.
4.	The accounting treatment of Statutory dues amounting to INR 144.62 crores paid under protest may be examined and if some discrepancy is found, the same may be commented upon suitably. [Additional Direction specific to NMDC Limited (Standalone) vide communication DGCA/A/C Desk/2023-24/3.13 dated 7th May 2024]	According to the information furnished to us, the company has paid an amount of INR 144.62 Crores under protest against the demand raised by the Government of Chattisgarh towards Forest Transit Fee, which has been disputed by the Company before Honble High Court of Chattisgarh, on the ground of retrospective levy which is not valid under the law and also that transit passes were not issued. Further, in terms of the agreement with customers, the transit fee is to be borne by the customer.
		In view of the above and based on a legal opinion obtained by the company, the Company did not recognize it in its accounts as an expense and the corresponding liability, but has disclosed in the Notes to the Standalone Financial Statements as a "Claim not acknowledged as debt" under Contingent Liabilities (to the extent not provided for), in accordance with the requirements of Schedule III to the Companies Act 2013 and the applicable Ind AS.
		Accordingly, in our opinion, there is no discrepancy in the accounting treatment.

 

	For VARMA & VARMA
	Chartered Accountants
	FRN 004532S
	P R Prasanna Varma
Place: Hyderabad	Partner
Date: May 27, 2024	M No. 025854
	UDIN:24025854BKGPYV6233