Railtel Corporation of India Auditors Report


To

The Members of

RailTel Corporation of India Limited

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the Standalone Financial Statements of RailTel Corporation of India Limited ("the Company"), which comprises the Standalone Balance Sheet as at 31st March 2023, 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 ended on that date, and notes to the financial statements, including a summary of the significant accounting policies and other explanatory information (hereinafter referred to as "the standalone Financial Statements").

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Standalone Financial Statements give the information required by the Companies Act 2013 ("the Act") in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies ( India Accounting Standards

) Rule 2015 as amended, ("Ind AS") and other accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March 2023 and its net 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 Companies Act, 2013. Our responsibilities under those Standards are further described in the Auditors Responsibilities for the Audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Companies Act, 2013 and the Rules there under, and we have fulfilled our 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 basis for our audit opinion.

Emphasis of Matter

We draw attention to the following matters in the notes to the Standalone Financial Statements:

Refer Note no. 42 of the accompanying Audited Standalone Financial Statements which states that during the year, the company has rationalized the estimates for calculation of Expected Credit Loss as permitted by Ind AS- 109. This has resulted into reduction of Expected credit loss provision by Rs. 4,498 lakhs and corresponding increase in profit before tax for the year.

Our Opinion is not modified in respect of the above matter.

Key Audit Matters

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

1. Recognition, measurement, estimation, presentation and disclosures in respect of "Revenue from contracts with Customers" under Ind AS 115

Our audit approach consisted testing of the design and operating effectiveness of internal controls and procedures as follows:
The application of this revenue accounting standard involves certain key judgments relating to identification of distinct • performance obligations, determination of transaction price of identified performance obligations, the appropriateness of the basis used to measure revenue recognized over a period, and disclosures including presentations of balances in the financial statements. Evaluated the effectiveness of controls over the preparation of information that are designed to ensure the completeness and accuracy.
Estimated efforts is a critical estimate to determine revenue, as it requires consideration of progress of the contract, efforts incurred till date, efforts required to complete the remaining performance obligation. (Refer Note No. 30 of the Standalone financial statements.) Selected a sample of existing continuing contracts and new contracts, and tested the operating effectiveness of the internal control, relating to identification of the distinct performance obligations and determination of transaction price.
Tested the relevant information, accounting systems and change relating to contracts and related information used in recording and disclosing revenue in accordance with Ind AS 115.
Reviewed a sample of contracts to identify possible delays in achieving milestones, which require change in estimated efforts to complete the remaining performance obligations.
Performed analytical procedures and test of details for reasonableness and other related material items.

2. Expected Credit Loss (ECL) for Trade Receivables

The company has applied simplified approach to measure ECL for trade receivables, which allows for lifetime expected credit losses to be recognized from initial recognition of the receivables. The company determines the expected credit losses on trade receivables by using a provision matrix that is based on historical credit loss experience, adjusted for forward looking factors to the debtors and the economic environment. Recognition and measurement of expected credit loss involves significant management judgement. These include:

We have applied the following audit procedures in this regard:

Identification of exposures where there is a significant increase in credit risk We have obtained an understanding of the companys credit policy along with the applications controls associated with the accuracy of the information included in the debtors ageing report.
• Completeness and timing of recognition of default, in accordance with the credit policy of the company We evaluated the companys process of ECL calculation. We assessed the reasonableness of the assumptions used in ECL calculation by comparing them with the historic data adjusted for current market condition and forward- looking information.
Estimation of Forward-Looking Adjustments We have also considered the disclosures made by the company under the head credit risk.
Based on the above procedure performed, the management estimations and judgement in ECL were found to be reasonable.
Due to significance of trade receivables and the complexity involved in the ECL calculation, this was considered as a key audit matter.
(Refer Note No. 11 and item no II (2A) of the Significant Accounting Policy to the Standalone financial statements.)

3. Contingent Liabilities

We have adopted the following audit procedures
The Company is subject to a number of legal, regulatory, arbitration and tax cases for which final outcome cannot be easily predicted and which could potentially result in significant liabilities. • Understoodandtestedthedesignandoperating effectiveness of controls as established by the management for obtaining all relevant information for pending litigation cases
The assessment of whether a liability is recognised as a provision or disclosed as a contingent liability in the standalone financial statements is inherently subjective and requires significant management judgement in determination of the cash outflows from the business, interpretation of applicable laws and regulations, and careful examination of pending assessments at various levels of regulatory authorities. Discussed with the management any material developments and latest status of legal matters at the corporate office.
We identified this as a key audit matter because the estimates on which these amounts are based involve a significant degree of management judgement in interpreting the cases and it may be subject to management bias. • Read various correspondences and related documents pertaining to litigation cases and performed substantive procedures on calculations supporting the disclosure of contingent liabilities Assessed the adequacy and completeness of disclosures.
(Refer item no. 23 of note no. 43 and Item No. 25 of the significant Accounting Policy to the Consolidated Financial Statements) Based on the above procedure performed, the estimations and disclosure of contingent liabilities are considered to be adequate and reasonable

Information other than the Standalone Financial Statements and Auditors Report thereon

The Companys Board of Directors is responsible for the preparation of the other information. The other information comprises the Corporate Governance Report, and the information included in the Directors Report including Annexures, Management Discussion and Analysis, Business Responsibility and Sustainability

Report and other company related information (but does not include the Standalone Financial Statements and our auditors report thereon), which are 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 and will not express any form of assurance conclusion thereon.

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

When we read such other information, as and when made available to us and 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 for the Standalone Financial Statements

The Companys management is responsible for the matters stated in section 134(5) of the Companies

Act, 2013 ("the Act") with respect to the preparation of the standalone financial statements that give a true and fair view of the financial position, financial performance, total comprehensive income, changes equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015 as amended. 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 implementation and maintenance of 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 the accounting records, relevant to the preparation and presentation of the financial statement that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the standalone financial statements, the Board of Directors is responsible for assessing the Companys ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management 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)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of managements use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the 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. And we have placed reliance on resolution plan submitted by company to its bankers. However, future events or conditions may cause the Company to cease to continue as a going concern.

Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

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

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 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 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

We have not audited the financial results / information of Eastern Region, Western Region and Southern Region included in these audited standalone financial results; whose financial results / information total revenues of Rs. 1,35,987 lakhs, total net profit after tax of Rs. 24,706 lakhs for the year ended March 31, 2023 and total assets of Rs.2,03,262 lakhs as on March 31, 2023. The same have been audited by other auditors appointed by the CAG. Our opinion in so far as it relates to the amounts and disclosures in respect of these regional offices is solely based on reports of other auditors a) The Standalone Financial Results include the results for the quarter ended 31 March 2023 being the balancing figure between the audited figures in respect of the full financial year ended 31 March and the published unaudited year to date figures up to the third quarter of the current financial which were subject to limited review by us. b) The Standalone financial results for the quarter and year ended 31st March, 2022 were reviewed / audited by the predecessor statutory auditor of the Company.

Our report is not modified in respect of above 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 in terms of Section 143(11) of the Act and on the basis of such checks of the books and records of the company as we considered appropriate and according to the information and explanations given to us, 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 Comptroller and Auditor General of India through directions/sub-directions issued under Section 143(5) of the Companies Act 2013, on the basis of written representation received from the management, we give our report on the matter specified in the"Annexure –B" attached.

3. 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. c. The Standalone Balance Sheet, the Standalone Statement of Profit and Loss (including Other Comprehensive Income), 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 prescribed under Section 133 of the Act read with the Companies (Indian Accounting

Standards) Rules, 2015 as amended. e. Being a Government Company pursuant to the Notification No. GSR 463(E) dated 5 June 2015 issued by the Ministry of Corporate Affairs, Government of India, provisions of sub-section (2) of Section 164 of the Companies Act 2013, are not applicable to the Company. f. With respect to the adequacy of the internal financial controls with reference to the Standalone Financial Statement of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure C". g. As per Notification No. GSR 463(E) dated 5 June 2015 issued by the Ministry of Corporate Affairs, Government of India, Section 197 of the Companies Act 2013, is not applicable to the Government Companies. Accordingly, reporting in accordance with requirement of provisions of section 197(16) of the Act is not applicable on the Company. h. With respect to the other matters to be included in the Auditors Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended, in our opinion and to the best of our information and according to the explanations given to us: i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements. - Refer item No. 23 of Note No. 43 to the Financial Statement. ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts. iii. During the year there is no requirement of any amount to be transferred of an unclaimed dividend to the Investor Education and Protection Fund under section 124(5) of the Companies Act, 2013

iv. (a) The Management has represented that, to the best of its knowledge and belief, as disclosed in Note No. 43 (Item No. 33) to the Standalone Financial Statements, no funds (which are material either individually or in the aggregate) have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entity ("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; (b) The Management has represented, that, to the best of its knowledge and belief, as disclosed in Note No. 43 (Item No. 33) to the Standalone Financial Statements, as that no funds have been received by the company from any person(s) or entity(ies), including foreign entities ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company shall, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

(c) Based on the audit procedures performed that have been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (d)(ii) of Rule 11(e) contain any material misstatement. v. (a) The final dividend proposed for the previous year, declared and paid by the Company during the year is in accordance with Section 123 of the Act, as applicable

(b) Interim dividend declared and paid by the Company during the year is in accordance with Section 123 of the Act. vi. 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.

For S R Goyal & Co. Chartered Accountants

FRN: 001537C

Sd/-

Place: New Delhi

A.K. Atolia

Date: 17.05.2023

(Partner)

UDIN: 23077201BGXMRT2947

M.No.: 077201

TO THE INDEPENDENT AUDITORS REPORT ON THE STANDALONE FINANCIAL STATEMENTS

(Referred to in paragraph 1 under ‘Report on Other Legal and Regulatory Requirements section of our Independent Auditors Report, of even date, to the Members of RailTel Corporation of India Limited on Standalone Financial Statements for the year ended 31st March 2023) i. In respect of the Companys Property, Plant and Equipment and Intangible Assets: -a. (A) The Company has maintained proper records showing full particulars with respect to most of its

Property, Plant and Equipment, and is in the process of updating the quantitative, identification marks and situation details with respect to certain Property, Plant and Equipment in the records maintained by the Company (B) The Company has generally maintained proper records showing full particulars of Intangible assets. b. The Company has a program of verification of Property, Plant and Equipment to cover all the items in a phased manner. Pursuant to the program, during the year, as part of the internal audit, the internal auditors have carried out the physical verification of Property, Plant and Equipment of the Company and no material discrepancies were noticed on such verification. c. According to the information and explanations given to us, we report that the title deeds of all the immovable properties which are included under the head property, plant and equipment (other than properties where the company is the lessee and the lease agreements are duly executed in favour of the lessee) are held in the name of the Company. d. The Company has not revalued its Property, Plant and Equipment (including Right of Use assets) and intangible assets during the year. Accordingly, the provision of clause 3(i)(d) is not applicable. e. According to the information and explanations given to us, there are no proceedings which have been initiated or are pending against the Company for holding benami property under the Benami

Transactions (Prohibition) Act, 1988 (as amended in 2016) and rules made thereunder. ii. As informed to us, the Inventory is located in the Western Region and verified by the respective Statutory Auditor. The following has been reported as follows:

(a) The Inventory of the Western Region has been physically verified by the management during the year. In our opinion, the frequency of verification is reasonable. The procedures of physical verification of inventory followed by the management are, in our opinion reasonable and adequate in relation to the size of the company and nature of its business. The WR is maintaining proper records of inventory. No material discrepancies were noticed on the last physical verification

(b) In our opinion and according to the information and explanations given to us, during the year, the Company has not been sanctioned working capital, hence this clause is not applicable. iii. According to the information and explanations given to us, the Company has not made any investment, provided guarantee, security and not granted loans and advances in the nature of loans, secured and unsecured, to Companies, Firms, Limited Liability Partnerships or any other parties. In view of this, subclause (a) (b) (c) (d) (e) and (f) of clause 3(iii) of the Order is not applicable on the Company. iv. According to the information and explanations given to us, the Company has not made any loans, investments, guarantees, and security in terms of Section 185 and 186 of Companies Act, 2013. Accordingly, clause 3(iv) of the Order is not applicable. v. In our opinion and according to the information and explanations given to us, the Company has not accepted deposits or amount which deemed to be deposits. 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.

No order has been passed with respect to Section 73 to 76, by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal. vi. We have broadly reviewed the accounts and records maintained by the Company for the year 2022- 23 pursuant to the Rules made by the Central Government for the maintenance of cost records under sub-section (1) of Section 148 of the Act read with Companies (Cost Records & Audit) Rules, 2014, as amended and we are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. 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, the Company is generally regular in depositing the undisputed statutory dues including goods and service tax, provident fund, income tax, service tax, duty of customs, duty of excise, value added tax, cess and any other statutory dues to the appropriate authorities. According to the information and explanations given to us, there are no undisputed statutory dues are outstanding arrears as on 31st March, 2023 for a period of more than six months from the date they became payable.

(b) According to records of the company and information and explanations given to us by the Company, the gross statutory dues of income tax or sale tax or service tax or duty of custom or duty of excise or value added tax or Cess or Goods and Service Tax and any other statutory dues of the Company which have not been deposited on account of dispute or deposited under protest and the forum where the dispute is pending are given below:

S. No

OU

Name of the Statute Nature of Dues Opening Amount (In Lacs)

Addi- tion (In Lacs)

Amount Adjusted (In Lacs) Closing Amount (In Lacs) Period to which the amount relates

Forums where dispute is pending

1 SR

Service Tax

Levy of service tax on consideration received for maintaining electricity and power at major railway stations, Non-payment of service tax on on service rendered to Associated enterprises, Non- reversal of CENVAT credit on common input services received for providing taxable as well as exempted services, Difference in reconciliation for the period 2011-14. Order no. 70 & 71/2015-16. 508.14 Nil Nil 508.14 2011-14 Tribunal Hyderabad
2 SR

Service Tax

Classification of Railway deposit works under works contract tax. Department contention is service tax payable on 13% service charge for the period 2008-2011. Stay order provided by CESTAT. 320.07 Nil Nil 320.07

2008- 2011

Tribunal, Hyderabad
3 SR GST Demand as per Notice DIN No. 20211255YK0000333C1F Dt. 28- Dec-2021 regarding Mismatch in liability declared against RCM and ITC availed under RCM in GSTR-3B for the period Apr-21 to Sep-21 11.67 Nil Nil 11.67 Apr-21 to Sep- 21 Andhra Pradesh
4 SR GST Demand for Recovery of for Sanjana Telecom vide Notice No. STO/NAN-BCP-C-003/ NED/Recovery/2021-22/ Nanded/B-1095/Demand No 31 Dt. 23-Mar-2022 for F.Y 2017-18. 1.87 Nil 1.87 0

Maharashtra (Nanded)

5 SR GST Demand vide Notice No. ZB3312211776351 Dt. 14-Dec- 2021 for F.Y 2018-19 regarding intimating discrepancies in the return after scrutiny. 510.98 Nil Nil 510.98

FY 2018- 19

Tamil Nadu
6 SR GST Demand vide Notice Ref. No. ZB3311211704579 Dt. 30-Nov- 2021 for F.Y 2019-20 regarding intimating discrepancies in the April 2019 return (GSTR-1 &GSTR-3B) after scrutiny and GST ASMT-10 Dated 04-12- 2020 6.68 Nil Nil 6.68

FY 2019- 20

Tamil Nadu
7 SR GST Demand vide Notice Dt. 01- Mar-2022 for F.Y 2018-19 regarding Return Scrutiny intimating discrepancies like Determination of Tax not paid, Short paid, Input wrongly availed. 535.15 Nil Nil 535.15

FY 2018- 19

Tamil Nadu
8 SR GST Demand vide Notice No. ZD361121015643W Dt. 13- Nov-2021 for F.Y 2017-18, Show Cause Notice under section 73 10.47 Nil 10.47 0

FY 2017- 18

Telangana
9 SR GST Demand vide Notice No.ZD3611210157004 Dt. 13- Nov-2021 for F.Y 2018-19, Show Cause Notice under section 73 58.29 Nil 4.54 53.75

FY 2018- 19

Telangana
10 SR GST Demand vide Notice No. ZD3611210157301 Dt. 13-Nov- 2021 for F.Y 2019-20, Show Cause Notice under section 73 97.63 Nil Nil 97.63

FY 2019- 20

Telangana
11 SR GST Demand vide Notice No.ZD360222013737M Dt. 17- Feb-2022 for F.Y 2020-21, Show Cause Notice under section 73 64.12 Nil Nil 64.12

FY 2020- 21

Telangana
12 ER GST demand on ground that excess ITC Claimed in GSTR-3B w.r.t. ITC auto populated in GSTR-2A. 33.71 Nil Nil 33.71

FY 2018- 19

GST-BIHAR
13 ER GST demand on ground that excess ITC Claimed in GSTR-3B w.r.t. ITC auto populated in GSTR-2A. 17.40 Nil 17.4 0

FY 2019- 20

GST-BIHAR
14 ER GST Excess ITC Claimed 222.19 Nil 222.19 0

FY 2018- 19

GST - CHHATISGARH
15 NR

RVAT Act

Levy of entry Tax and demand raised under the act. 5.41 Nil Nil 5.41 2015-16 RVAT Department
16 NR

RVAT Act

Levy of entry Tax and demand raised under the act. 12.46 Nil Nil 12.46 2016-17 RVAT Department
17 NR

RVAT Act

Demand as per Notice u/s 49, 50 of RVAT Act-2003, u/s 9(3) of CST Act-1956 & u/s 174 of RGST Act-2017 of F.Y 2017-18 dt. 01-Oct-2019. 13.40 Nil Nil 13.4 2017-18 RVAT Department
18 NR

UP VAT Act

Demand raised on assessment. 56.23 Nil 56.23 0

FY 2014- 15

UPVAT Department
19 NR

HVAT Act

Demand raised on assessment. 7.74 Nil Nil 7.74

FY 2015- 16

HVAT Department
20 NR DVAT Demand Raised due to Mismatch of ITC Nil 52.58 47.16 5.42

FY 2015- 16

DVAT
21 NR DVAT Demand Raised due to Mismatch of ITC Nil 1360.68 Nil 1360.68

FY 2016- 17

DVAT
22 NR DVAT Demand Raised due to Mismatch of ITC Nil 511.54 Nil 511.54

FY 2017- 18

DVAT
23 WR MVAT

Demand raised on assessment for FY 2013-14

2.03 Nil 2.03 0

FY 2013- 14

MVAT Department
24 NR

Income Tax Act 1961

TDS demand due to short deduction of TDS. 0.27 Nil Nil 0.27 2010-11 to 2012- 13 TDS (Commissioner)
25 CO

Income Tax Act 1961

Appeal filed against AOs order for AY 2016-17 for making additions on account of disallowance for "Exp booked in FY 2016-17 and claimed in FY 15-16 for avoiding prior period expenses in FY 2016-17" & Rs. 10 Lakh u/s 14A rwr 8D, an amount equal to 1% of Annual Avg. of Investment in REL 144.09 Nil Nil 144.09

AY 2016- 17

CIT-(A), New Delhi

26 CO

Income Tax Act 1961

Appeal filed against AOs order for AY 2017-18 for making additions on account of disallowance for "Balance Amount (i.e., Actuarial gain/ loss) debited in Other Comprehensive Income which was paid on 06-09-2017 vide DD No. 19906" & Rs. 10 Lakh u/s 14A rwr 8D, an amount equal to 1% of Annual Avg. of Investment in REL 117.94 Nil 117.94 0

AY 2017- 18

CIT-(A), New Delhi

27 CO

Income Tax Act 1961

Appeal filed against AOs order for AY 2018-19 for additions made u/s 143(3) 1,013.78 Nil 682.592 331.1914

AY 2018- 19

CIT-(A), New Delhi

28 CO

Income Tax Act 1961

Appeal filed against AOs Penalty Order under section 270A of the Income Tax Act, 1961 Nil 5.03 Nil 5.03

AY 2020- 21

CIT-(A), New Delhi

29 CO

Income Tax Act 1961

TDS demand due to short deduction of TDS. 0.09 Nil Nil 0.09 2010- 11,11- 2,19-20 Traces
30 CO

Service Tax

Appeal Filed against Penalty Order u/s 78 in case of Service Tax Audit of Corporate Office for the period 2014-15 to Jun- 2017 17.02 Nil 1.70 15.32

FY 2014- 15 to Jun-2017

CESTAT, Chandigarh
(Order No. 04/Adj./DC/DIV- EAST-II/2021-22)
Total 3,788.83 1929.83 1164.12 4554.54

viii. In our opinion and according to the information and explanations given to us, the Company has not surrendered or disclosed as income, any transaction not recorded in the books of account, during the year in the income tax assessments under the Income Tax Act, 1961 (43 of 1961). Accordingly, the provisions of clause 3(viii) of the Order are not applicable. ix. According to the information and explanations given to us, the Company has not taken any loan or other borrowings. Hence, sub-clauses (a) (b) (c) (d) (e) and (f) of clause 3(ix) of the Order is not applicable the Company.

x. According to the information and explanations given to us, the Company has not raised any money by way of initial offer or further public offer (including debt instruments) during the year. Hence, sub clause (a) and (b) of clause 3(x) are not applicable. xi. (a) According to the information and explanations given to us and as represented by the management and Based on examination of the books and records of the Company, no case of material fraud by the Company or on the Company has been noticed or reported during the year.

(b) We have not submitted any report under sub section (12) of Section 143 of the Companies Act, 2013 in Form ADT-4 as prescribed under Rule 13 of Companies (Audit and Auditors) Rules, 2014 with the Central Government, during the year and up to the date of this audit report.

(c) As represented to us by the management, there are no whistle blower complaints received by the company during the year, accordingly, provisions of clause 3(xi)(c) of the order are not applicable.

xii. The Company is not a Nidhi Company. Accordingly, provisions of clause 3(xii) of the Order are not applicable.

xiii. In our opinion and according to the information and explanations given to us, all transactions with related parties are in compliance with section 177 and 188 of Act, where 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 the Internal Auditors issued to the Company during the year in determining the nature, timing and extent of our audit procedures.

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

(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, provisions of clause 3(xvi)(b) of the Order are 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, provisions of clause 3(xvi)(c) of the Order are 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, provisions of clause 3(xvi) (d) of the Order are not applicable. xvii. Based on our examination of the books and records of the Company, the Company has not incurred any cash losses in the financial year and the immediately preceding financial year. Accordingly, paragraph 3(xvii) of the Order is not applicable.

xviii. There has been no resignation of the statutory auditors during the year. Accordingly, provisions of clause 3(xviii) of the Order are 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 realization of financial assets and payment of financial liabilities, 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 indicating that Company is not capable of meeting its liabilities existing at the date of balance sheet as and when they fall due within a period of one year from the balance sheet date. We, however, state that this is not an assurance as to the future viability of the Company. We further state that our reporting is based on the facts up to the date of the audit report and we neither give any guarantee nor any assurance that all liabilities falling due within a period of one year from the balance sheet, 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, there is no such case in respect of other than ongoing projects. Therefore, the second proviso to sub-section (5) of section 135 of the said Act is not applicable.

(b) In our opinion and according to the information and explanations given to us, the company has incurred expenditure under Corporate Social Responsibility as required by the provisions of Section

135 of the Act and the unspent amount of Rs. 210 Lakhs, as required has been transferred to the respective CSR bank account as per the guidelines.

For S R Goyal & Co. Chartered Accountants

FRN: 001537C

Sd/-

Place: New Delhi

A.K. Atolia Date: 17.05.2023

(Partner)

UDIN: 23077201BGXMRT2947

M. No.: 077201

ANNEXURE "B"

TO THE INDEPENDENT AUDITORS REPORT ON THE STANDALONE FINANCIAL STATEMENTS

(Referred to in paragraph 2 under ‘Report on Other Legal and Regulatory Requirements section of our Independent Auditors Report, of even date of RailTel Corporation of India Limited on standalone Financial Statements for the year ended 31st March 2023) As required by section 143(5) of the Act and in pursuance of directions issued by the Office of the and Auditor General of India for the year ended 31st March 2023, we report that:

S. No.

Directions / Sub-Directions Issued by Comptroller and Auditor General of India

Auditors reply on action taken on the directions

Impact on financial Statement

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.

Yes, as per the explanation and information provided to us that the company has implemented Oracle-ERP system which is processing all the accounting transactions. Since no transactions are processed outside IT system, the Company is not prone to any such risk and hence, there is no financial implication of it.

Nil

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?

The company has not availed any loan from any bank or financial institution.

Nil

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.

The company is in receipt of subsidy in respect of the following project: A. Rural Wi-Fi Project-The Company is in receipt of subsidy from Universal Service Obligation Fund (USOF) to the tune of Rs 1,437 lakhs till 31.03.2023 for Rural Wi-Fi Project. The said subsidy has been properly accounted for and utilized as per its terms and conditions and for the project for which it has been received. No deviation observed.

Nil

S. No.

Directions / Sub-Directions Issued by Comptroller and Auditor General of India

Auditors reply on action taken on the directions

Impact on financial Statement

B. NE -1 & NE -2 Project The Company has received subsidy of Rs. 3,146 lakhs From USOF till 31.03.2023 against execution of the project. The said subsidy has been properly accounted for and utilized as per its terms and conditions and for the project for which it has been received. No deviation observed.

For S R Goyal & Co.

Chartered Accountants

FRN: 001537C

Sd/-

Place: New Delhi

A.K. Atolia

Date: 17.05.2023

(Partner)

UDIN: 23077201BGXMRT2947

M. No.: 077201

ANNEXURE "C"

TO THE INDEPENDENT AUDITORS REPORT ON THE STANDALONE FINANCIAL STATEMENTS

(Referred to in paragraph 3 (f) under ‘Report on Other Legal and Regulatory Requirements section of our Independent Auditors Report, of even date, to the members of RailTel Corporation of India Limited on Standalone Financial Statements for the year ended 31st March 2023)

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act")

We have audited the internal financial controls with reference to the Standalone Financial Statements of RailTel Corporation of India Limited ("the Company") as of 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 over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India. These 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 respective companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditors Responsibility

Our responsibility is to express an opinion on the internal financial controls over financial reporting of 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 Companies Act, 2013, 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 over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls with reference to the Standalone Financial Statements and their operating effectiveness. Our audit of internal financial controls with reference to the Standalone Financial Statements included obtaining an understanding of internal financial controls with reference to the Standalone Financial Statements, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditors judgement, including the assessment of the risks of material misstatement of the 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 our audit opinion on the Companys internal financial controls with reference to the Standalone Financial

Statements.

Meaning of Internal Financial Controls over Financial Reporting

A companys internal financial control with reference to the Standalone Financial Statements is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A companys internal financial control with reference to the 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 financial statements

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls with reference to the 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 the Standalone Financial Statements to future periods are subject to the risk that the internal financial control with reference to the 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 the Standalone Financial Statements in place and such internal financial controls with reference to the Standalone Financial Statements were operating effectively as at 31 March 2023, based on the internal controls over financial reporting criteria established by the Company considering the components of internal controls stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the ICAI.

For S R Goyal & Co.

Chartered Accountants

FRN: 001537C

Sd/-Place: New Delhi

A.K. Atolia Date: 17.05.2023

(Partner)

UDIN: 23077201BGXMRT2947

M. No.: 077201