tata steel ltd share price Auditors report


To the Members of Tata Steel Limited

Report on the Audit of the Standalone Financial Statements Opinion

1.We have audited the accompanying standalone financial statements of Tata Steel Limited (the "Company"), which comprise the Balance Sheet as at March 31, 2023, and the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the Statement of Cash Flows for the year then ended, and notes to the standalone financial statements, including a summary of significant accounting policies and other explanatory information.

2.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 accounting principles generally accepted in India, of the state of a airs of the Company as at March 31,2023 and total comprehensive income (comprising of profit and other comprehensive income), changes in equity and its cash flows for the year then ended.

Basis for Opinion

3.We conducted our audit in accordance with the Standards on Auditing (SAs) specified under Section 143(10) of the Act. Our responsibilities under those Standards are further described in the "Auditors Responsibilities for the Audit of the Standalone Financial Statements" section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules thereunder, and we have ful lled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is su cient and appropriate to provide a basis for our opinion.

Emphasis of Matter

4.We draw your attention to Note 6(iv) to the standalone financial statements which states that the ability of Tata Steel Europe (TSE), the step-down subsidiary of T Steel Holdings Pte. Ltd. (TSH), a subsidiary of the Company, to continue as a going concern is dependent on the outcome of measures taken as stated therein and the availability of future funding requirements, which may have a consequential impact on the carrying amount of investments of RS.19,684.89 crore in TSH as at March 31, 2023. Our Opinion is not modified in respect of the above matter.

Key audit matters

5.Key audit matters are those matters that, in our professional judgement, were of most signi cance 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.

Key audit matter How our audit addressed the key audit matter
Assessment of litigations and related disclosure of contingent liabilities Our audit procedures included the following:
[Refer to Note 2 (c) to the standalone financial statements– "Use of estimates and critical accounting judgements – Provisions and contingent liabilities", Note 35 (A) to the standalone financial statements "Contingencies" and Note 36 to the standalone financial statements – "Other significant litigations"] • We understood, assessed and tested the design and operating eFectiveness of key controls surrounding assessment of litigations relating to the relevant laws and regulations;
As at March 31, 2023, the Company has exposures towards litigations relating to various matters as set out in the aforesaid Notes. Significant management judgement is required to assess such matters to determine the probability of occurrence of material outflow of economic resources and whether a provision should be recognised or a disclosure should be made. The management judgement is also supported with legal advice in certain cases as considered appropriate. As the ultimate outcome of the matters are uncertain and the positions taken by the management are based on the application of their best judgement, related legal advice including those relating to interpretation of laws/ regulations, it is considered to be a Key Audit Matter. • We have reviewed the legal and other professional expenses and enquired with the management for recent developments and the status of the material litigations which were reviewed;
• We performed our assessment on a test basis on the underlying calculations supporting the contingent liabilities/other significant litigations disclosed in the standalone financial statements;
• We used auditors experts/specialists to gain an understanding and to evaluate the disputed tax matters;
• We considered external legal opinions, where relevant, obtained by management;
• We evaluated managements assessments by understanding precedents set in similar cases and assessed the reliability of the managements past estimates/judgements;
• We evaluated managements assessment around those matters that are not disclosed or not considered as contingent liability, as the probability of material outflow is considered to be remote by the management; and
• We assessed the adequacy of the Companys disclosures. Based on the above work performed, the assessment in respect of litigations and related disclosures relating to contingent liabilities/other significant litigations in the standalone financial statements is considered to be reasonable.
Key audit matter How our audit addressed the key audit matter
Assessment of carrying value of investments in Non- Convertible Redeemable Preference Shares and Equity Shares of Tata Steel Long Products Limited (TSLP) and Neelachal Ispat Nigam Limited (NINL), subsidiaries respectively Our audit procedures included the following
[Refer to Note 2(c) to the standalone financial statements – "Use of estimates and critical accounting judgements – Impairment", Note 2(m) to the standalone financial statements - "Investments in subsidiaries, associates and joint ventures" and Note 6 to the standalone financial statements – "Investments", Note 2(n)(I) to the standalone financial statements – "Financial assets", Note 6(v) to the standalone financial statements] : • We obtained an understanding from the management, assessed and tested the design and operating eFectiveness of the Companys key controls over the impairment assessment of investments.
The Companys investment in 0.01% non-convertible, non- cumulative redeemable preference shares (NCRPS) in its subsidiary Tata Steel Long Products Limited (TSLP) and equity investment in its step-down subsidiary Neelachal Ispat Nigam Limited (NINL) amounts to RS.13,983.08 crore and I396.69 crore respectively. • We evaluated the appropriateness of the Companys accounting policy in respect of impairment assessment of investments in subsidiaries.
The Company accounts for investment in NCRPS of Tata Steel Long Products Limited initially at fair value and subsequently at amortised cost. Contractual cash flows from the NCRPS represent the principal (RS.12,700 crore) plus accrued interest (RS.1,283.08 crore) aggregating to RS.13,983.08 crore as on March 31, 2023. These investments have been made in TSLP for acquisition of NINL at a consideration of RS.12,100 crore and for meeting the fund requirements/obligations of NINL. • We evaluated the Companys process regarding impairment assessment by involving auditors valuation experts, where considered necessary, to assist in assessing the appropriateness of the impairment assessment model, underlying assumptions relating to discount rate, terminal value etc.
The above equity investment in NINL is carried at cost.
Where an indication of impairment exists, the carrying value of investment is assessed for impairment and where applicable an impairment provision is recognised. • We evaluated the cash flow forecasts/ incremental cash flows by comparing them to the budgets and our understanding of the internal and external factors.
The impairment assessment for such investments have been carried out by the management in accordance with Ind AS 36 and Ind AS 109, as applicable. The key inputs and judgements involved in the impairment of unquoted investments include: • We checked the mathematical accuracy of the impairment model and agreed the relevant data with the latest budgets, actual past results and other supporting documents, as applicable.
• Cash flows forecast/incremental cash flows including assumptions on capacity expansion • We assessed the sensitivity analysis and evaluated whether any reasonably foreseeable change in assumptions could lead to impairment.
• Discount rates • We have discussed the key assumptions and sensitivities with those charged with governance.
• Terminal growth rate • We evaluated the appropriateness of the disclosures made in the standalone financial statements. Based on the above procedures performed, we did not identify any significant exceptions in the managements assessment in relation to the carrying value of investments in aforesaid subsidiaries.
• Economic and entity specific factors incorporated in the valuation.
The accounting for above investments is a Key Audit Matter as the determination of recoverable value for impairment assessment involves significant management judgement and estimates.

Other Information

6.The Companys Board of Directors is responsible for the other information. The other information comprises the information included in the Integrated Report, Boards Report along with its Annexures and Financial Highlights included in the Companys Annual report (titled as ‘Tata Steel Integrated Report & Annual Accounts 2022-23) but does not include the standalone financial statements and our auditors report thereon. Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of management and those charged with governance for the Standalone Financial Statements

7.The Companys Board of Directors is responsible for the matters stated in Section 134(5) of the Act with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance, changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating efectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

8.In preparing the standalone financial statements, management is responsible for assessing the Companys ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so. Those Board of Directors are also responsible for overseeing the Companys financial reporting process.

Auditors Responsibilities for the Audit of the Standalone Financial Statements

9.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 in uence the economic decisions of users taken on the basis of these standalone financial statements. 10. As part of an audit in accordance with SAs, we exercise professional judgement 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 su cient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

•Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under Section 143(3) (i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to standalone financial statements in place and the operating eFectiveness of such controls.

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

•Conclude on the appropriateness of managements use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Companys ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors report. However, future events or conditions may cause the Company to cease to continue as a going concern.

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

11. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit ndings, including any significant de ciencies in internal control that we identify during our audit. 12. 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. 13. From the matters communicated with those charged with governance, we determine those matters that were of most signi cance in the audit of the standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on other legal and regulatory requirements

14. As required by the Companies (Auditors Report) Order, 2020 ("the Order"), issued by the Central Government of India in terms of sub-section (11) of Section 143 of the Act, we give in the Annexure B a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

15. As required by Section 143(3) of the Act, we report that: (a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit. (b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books. (c) The Balance Sheet, the Statement of Profit and Loss (including other comprehensive income), the Statement of Changes in Equity and the Statement of cashflows dealt with by this Report are in agreement with the books of account.

(Rs.) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act. (e) On the basis of the written representations received from the directors, taken on record by the Board of Directors, none of the directors is disquali ed as on March 31, 2023, from being appointed as a director in terms of Section 164(2) of the Act. (f) With respect to the adequacy of the internal financial controls with reference to standalone financial statements of the Company and the operating eFectiveness of such controls, refer to our separate Report in "Annexure A". (g) With respect to the other matters to be included in the Auditors Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014 (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 as on March 31, 2023 on its financial position in its standalone financial statements – Refer Note 35(A) and 36 to the standalone financial statements; ii. The Company was not required to recognise a provision as at March 31, 2023 under the applicable law or accounting standards, as it does not have any material foreseeable losses on long-term contracts (including derivative contracts).

iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended March 31, 2023 except for amount aggregating to I6.72 crore, which according to the information and explanations provided by the management is held in abeyance due to dispute/ pending legal cases. iv. (a) The management has represented that, to the best of its knowledge and belief, other than as disclosed in the Notes to the standalone financial statements, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities ("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company ("Ultimate Bene ciaries") or provide any guarantee, security or the like on behalf of the Ultimate Bene ciaries [Refer Notes 6(xi) and 7(iv) to the standalone financial statements]; (b) The management has represented that, to the best of its knowledge and belief, 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, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party ("Ultimate Bene ciaries") or provide any guarantee, security or the like on behalf of the Ultimate Bene ciaries [Refer Notes 6(xii) and 7(v) to the standalone financial statements]; and

(c) Based on such audit procedures that we 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 (a) and (b) contain any material misstatement. v. The dividend declared and paid during the year by the Company is in compliance with Section 123 of the Act, except for dividend amounting to I4.16 crore, which has been paid subsequently without depositing the amount to a separate bank account. [Also refer note C(i) to the standalone financial statements] vi. As proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 (as amended), which provides for books of account to have the feature of audit trail, edit log and related matters in the accounting software used by the Company, is applicable to the Company only with e ect from financial year beginning April 1, 2023, the reporting under clause (g) of Rule 11 of the Companies (Audit and Auditors) Rules, 2014 (as amended), is currently not applicable.

16. The Company has paid/ provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act.

For Price Waterhouse & Co Chartered Accountants LLP

Firm Registration Number: 304026E/E-300009

Subramanian Vivek

Partner Place: MumbaiMembership Number 100332 Date: May 2, 2023UDIN: 23100332BGYVTL5217

ANNEXURE A TO INDEPENDENT AUDITORS REPORT

Referred to in paragraph 15 (f) of the Independent Auditors Report of even date to the members of Tata Steel Limited on the standalone financial statements as of and for the year ended March 31, 2023.

Report on the Internal Financial Controls with reference to Standalone Financial Statements under clause (i) of sub-section 3 of Section 143 of the Act

1.We have audited the internal financial controls with reference to standalone financial statements of Tata Steel 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

2.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 ("the Guidance Note") issued by the Institute of Chartered Accountants of India ("ICAI"). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating efectively for ensuring the orderly and e cient conduct of its business, including adherence to companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.

Auditors Responsibility

3.Our responsibility is to express an opinion on the Companys internal financial controls with reference to standalone financial statements based on our audit. We conducted our audit in accordance with the Guidance Note and the Standards on Auditing deemed to be prescribed under Section 143(10) of the Act to the extent applicable to an audit of internal financial controls, both applicable to an audit of internal financial controls and both issued by the ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls with reference to standalone financial statements was established and maintained and if such controls operated efectively in all material respects.

4.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 eFectiveness. Our audit of internal financial controls with reference to standalone financial statements included obtaining an understanding of internal financial controls with reference to financial statements, assessing the risk that a material weakness exists, and testing and evaluating the design and operating eFectiveness of internal control based on the assessed risk. The procedures selected depend on the auditors judgement, including the assessment of the risks of material misstatement of the standalone financial statements, whether due to fraud or error.

5.We believe that the audit evidence we have obtained is su cient and appropriate to provide a basis for our audit opinion on the Companys internal financial controls system with reference to standalone financial statements.

Meaning of Internal Financial Controls with reference to financial statements

6.A companys internal financial controls with reference to 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 controls with reference to financial statements includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly re ect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the companys assets that could have a material e ect on the financial statements.

Inherent Limitations of Internal Financial Controls with reference to financial statements

7.Because of the inherent limitations of internal financial controls with reference to financial statements, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls with reference to financial statements to future periods are subject to the risk that the internal financial controls with reference to financial statements may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

8.In our opinion, the Company has, in all material respects, an adequate internal financial controls system with reference to standalone financial statements and such internal financial controls with reference to standalone financial statements were operating effectively as at March 31, 2023, 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 issued by ICAI.

For Price Waterhouse & Co Chartered Accountants LLP

Firm Registration Number: 304026E/E-300009

Subramanian Vivek

Partner Place: MumbaiMembership Number 100332 Date: May 2, 2023UDIN: 23100332BGYVTL5217

ANNEXURE B TO INDEPENDENT AUDITORS REPORT

Referred to in paragraph 14 of the Independent Auditors Report of even date to the members of Tata Steel Limited on the standalone financial statements as of and for the year ended March 31, 2023.

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

(B) The Company is maintaining proper records showing full particulars of Intangible Assets.

(b) The Property, Plant and Equipment are physically verified by the Management according to a phased programme designed to cover all the items over a period of three years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, a portion of the Property, Plant and Equipment has been physically verified by the Management during the year and no material discrepancies have been noticed on such veri cation. (c) The title deeds of all the immovable properties (other than properties where the Company is the lessee and the lease agreements are duly executed in favour of the lessee), as disclosed in Note 3 on Property, plant and equipment and Note 4 on Right-of-use assets to the standalone financial statements, are held in the name of the Company, except for the following:

Description of property

Gross carrying value ( crore)

Held in the name of

Whether promoter, director or their relative or employee

Period held (i.e. dates of capitalisation provided in range)#

Reason for not being held in the name of the Company

Freehold Land

279.85

Not Applicable

No

March, 1928 to April, 2020

Title Deeds not available with the Company

Buildings

55.13

Not Applicable

No

March, 1974 to January, 1995

Title Deeds not available with the Company

Freehold Land 224.65 Tata Steel BSL Limited No April, 2020

Freehold Land

147.19

Bhushan Steel Limited (earlier name of Tata Steel BSL Limited)

No

April, 2020

Freehold Land

1.92

Bhushan Steel & Strips Limited (earlier name of Tata Steel BSL Limited)

No

April, 2020

Buildings 3.08 Indian Tube Company Limited No January, 1960

Buildings

24.70

Tata SSL Limited

No

January, 1989 to January, 2000

For certain properties

Right-of-use Land

523.65

Tata Steel BSL Limited

No

April, 2020

acquired through amalgamation/merger, the

Right-of-use Land

179.40

Bhushan Steel Limited (earlier name of Tata Steel BSL Limited)

No

April, 2020

name change in the name of the Company is pending

Right-of-use Land

139.93

Bhushan Steel & Strips Limited (earlier name of Tata Steel BSL Limited)

No

April, 2020

Right-of-use Land

3.28

Jawahar Metal Industries Private Limited (earlier name of Tata Steel BSL Limited)

No

April, 2020

Right-of-use 13.34 Tata Steel BSL Limited No April, 2020 to
Buildings October, 2021
Right-of-use 0.15 Not Applicable No Not Available Lease Deed not available
Land with the Company

# In case of immovable properties acquired from Tata Steel BSL Limited which got merged with the Company in the preceding year have been considered with e ect from the merger.

(Rs.) The Company has not revalued its Property, Plant and Equipment (including Right-of-use assets) or intangible assets during the year. Accordingly, the reporting under Clause 3(i)(Rs.) of the Order is not applicable to the Company.

(e) Based on the information and explanations furnished to us, no proceedings have been initiated on or are pending against the Company for holding benami property under the Prohibition of Benami Property Transactions Act, 1988 (as amended in 2016) (formerly the Benami Transactions (Prohibition) Act, 1988 (45 of 1988)) and Rules made thereunder, and therefore the question of our commenting on whether the Company has appropriately disclosed the details in its standalone financial statements does not arise. ii. (a) The physical veri cation of inventory (excluding stocks with third parties) has been conducted at reasonable intervals by the Management during the year and, in our opinion, the coverage and procedures of such veri cation by Management is appropriate. In respect of inventory lying with third parties, these have substantially been con rmed by them. In respect of inventories of stores and spares, the Management has a veri cation programme designed to cover the items over a period of three years. The discrepancies noticed on physical veri cation of inventory as compared to book records were not 10% or more in aggregate for each class of inventory.

(b) During the year, the Company has been sanctioned working capital limits in excess of I5 crore, in aggregate, from banks on the basis of security of current assets. The Company has led quarterly returns or statements with such banks, which are in agreement with the books of account other than those as set out below.

Name of the Bank

Aggregate working capital limits sanctioned ( crore)

Nature of Current Asset offered as Security

Quarter ended

Amount disclosed as per quarterly return/ statement ( crore)

Amount as per books of account ( crore)

Diference ( crore)

Reasons for Diference

State Bank of India and consortium of banks

2,000.00

Refer Note below

December 31, 2022

12,594.47

12,572.90

21.57

Incorrect amount of Creditors for Goods under Non-LC & others

Note: Pari-passu charge on the Companys entire current assets namely stock of raw materials, finished goods, stocks-in-process, consumables stores and spares and book debts at its plant sites or anywhere else, in favour of the Bank, by way of hypothecation.

The Company has led the revised quarterly return/ statement with such banks for the above instance, in March, 2023, with the correct amounts, which are in agreement with the books of account.

Also refer Note 18(iv) to the standalone financial statements. iii. (a) The Company has, during the year, made investments in eight companies and sixteen mutual fund schemes, granted unsecured loans to four companies and eight hundred and forty-six employees and stood guarantee for five companies. The aggregate amount during the year, and balance outstanding at the balance sheet date with respect to such loans and guarantees to subsidiaries and to parties other than subsidiaries, joint ventures and associates are as per the table given below:

Particulars

Guarantees ( crore)

Loans ( crore)

Aggregate amount granted/ provided during the year
Subsidiaries 478.80 3,674.60
Others - 3.86
Balance outstanding (gross) as at balance sheet date in respect of the above cases
Subsidiaries 349.05 3,436.75
Others - 3.14

The above amounts are included in Note 7 on Loans and Note 35(B) on Commitments to the standalone financial statements.

(b) In respect of the aforesaid investments, guarantees and loans, the terms and conditions under which such investments were made, guarantees provided and loans were granted are not prejudicial to the Companys interest, based on the information and explanations provided by the Company. (c) In respect of the loans outstanding as on the balance sheet date, the schedule of repayment of principal and payment of interest has been stipulated by the Company except for one loan aggregating I2.00 crore (fully provided in books) where no schedule of repayment of principal and payment of interest has been stipulated. Except for the aforesaid instance (where in the absence of stipulation of repayment/payment terms, we are unable to comment on the regularity of repayment of principal and payment of interest) and the following instance, the parties are repaying the principal amounts, as stipulated, and are also regular in payment of interest as applicable.

Name of the entity

Amount ( crore)

Due Date

Extent of delay (provided in range)

Remarks

Tayo Rolls Limited

81.30

Multiple Dates

1,826 days - 2,421 days

The amounts pertain to principal and interest, which are overdue as at March 31, 2023. The company is under corporate insolvency resolution process. The Company has led its claim as financial creditor. The amounts are fully provided in books.

(Rs.) In respect of the following loan, the total amount overdue for more than ninety days as at March 31, 2023 is I81.30 crore.

Based on the information and explanations given to us, the entity is under corporate insolvency resolution process and accordingly, the Company is not taking any further steps for the recovery of the principal and interest amounts, other than those mentioned in clause (iii)(c) above against Tayo Rolls Limited.

No. of cases

Principal Amount Overdue ( crore)

Interest Overdue ( crore)

Total Overdue ( crore)

Remarks

One

67.00

14.30

81.30

The amounts are fully provided in books

(e) Following loans were granted to same parties, which has fallen due during the year and were renewed/extended. Further, no fresh loans were granted to same parties to settle the existing overdue loans.

Name of the parties

Aggregate amount of dues renewed or extended ( crore)

Percentage of the aggregate to the total loans granted during the year

Tata Steel Downstream Products Limited 150.00 3.92%
Tata Steel Mining Limited 790.00 20.66%
Tata Steel Holdings Pte. Ltd. 1,643.45 42.97%

The above amounts are included in Note 7 on Loans to the standalone financial statements.

(f) The loans granted during the year, including to related parties had stipulated the scheduled repayment of principal and payment of interest and the same were not repayable on demand. No loans were granted during the year to promoters. iv. In our opinion, and according to the information and explanations given to us, the Company has complied with the provisions of Sections 185 and 186 of the Companies Act, 2013 in respect of the loans and investments made, and guarantees and security provided by it, as applicable. v. The Company has not accepted any deposits or amounts which are deemed to be deposits within the meaning of Sections 73, 74, 75 and 76 of the Act and the Rules framed there under to the extent noti ed. vi. Pursuant to the rules made by the Central Government of India, the Company is required to maintain cost records as specified under Section 148(1) of the Act in respect of its products. We have broadly reviewed the same and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete. vii. (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, except for dues in respect of royalty, the Company is regular in depositing undisputed statutory dues, including provident fund, employees state insurance, sales tax, income tax, service tax, duty of customs, duty of excise, value added tax, cess, goods and services tax and other material statutory dues, as applicable, with the appropriate authorities. We are informed that the Company has applied for exemption from operations of Employees State Insurance Act at some locations. We are also informed that actions taken by the authorities at some locations to bring the employees of the Company under the Employees State Insurance Scheme has been contested by the Company and payment has not been made of the contribution demanded. The extent of the arrears of statutory dues outstanding as at March 31, 2023, for a period of more than six months from the date they became payable are as follows:

Name of the statute

Nature of dues

Amount ( crore)

Period to which the amount relates

Due date

Date of Payment

The Mines and Minerals (Development and Regulation) Amendment Act, 2021

Royalty

2,025.44

March, 2021 to September, 2022

Various dates till September 30, 2022

Not yet paid

(b) According to the information and explanations given to us and the records of the Company examined by us, the particulars of statutory dues referred to in sub-clause (a) as at March 31, 2023, which have not been deposited on account of a dispute, are as follows:

Name of the statute

Nature of dues

Amount (net of payments) ( crore)

Amount paid ( crore)

Period to which the amount relates (FY)

Forum where the dispute is pending

Income-tax Act, 1961

Income Tax

2,061.05 197.47

1,131.51 124.12

1998-1999, 2006-2014, 2015-2017, 2018-2019 2013-2016, 2017-2018

Tribunal Commissioner (Appeals)

Customs Act, 1962

Customs Duty

2.44 153.89 15.17 6.59

- 53.43 1.91 3.77

2017-2018 2005-2008, 2010-2016, 2017-2019 1993-1994, 2002-2003, 2017-2021 2005-2009, 2013-2014

Commissioner Tribunal High Court Supreme Court

Central Excise Act, 1944

Excise Duty

10.54 61.90 1.88 565.62 33.12

0.92 5.87 1.07 37.21 0.10

2017-2018 1988-1989, 1994-1997, 2013-2018 2016-2017 2002-2005, 2006-2018 1989-1990, 2003-2009

Additional Commissioner Commissioner Joint Commissioner Tribunal High Court

Goods & Services Tax Act, 2017

Goods & Services Tax

15.83 0.75 0.16 0.05

- 0.04 - -

2017-2018 2018-2020 2018-2019 2017-2018

Additional Commissioner Assistant Commissioner Deputy Commissioner Commissioner

Name of the statute

Nature of dues

Amount (net of payments) ( crore)

Amount paid ( crore)

Period to which the amount relates (FY)

Forum where the dispute is pending

Sales Tax Laws

Sales Tax

0.41

0.19

1983-1984, 1988-1989, 1990-1991, 1992-1993, 1994-1996

Sales Tax Officer

362.04

2.36

1983-1984, 2002-2003, 2012-2013, 2016-2018

Additional Commissioner

6.30

3.63

1973-1974, 1980-1992, 1994-1997, 2004-2005, 2016-2018

Assistant Commissioner

15.02

2.94

1975-1976, 1983-1988, 1994-1995, 1997-2002, 2007-2012, 2013-2014, 2016-2019

Deputy Commissioner

215.40

4.56

1988-1990, 1991-1992, 1993-1995, 2001-2004, 2013-2014

Commissioner

66.25 0.50 2011-2013, 2014-2018 Joint Commissioner

46.67

8.14

1977-1978, 1980-1981, 1983-1985, 1987-1988, 1989-1999, 2000-2002, 2003-2010, 2013-2016

Tribunal

32.13

12.13

1977-1979, 1983-1984, 1991-1993, 1995-1997, 2000-2004, 2008-2009

High Court

Sales Tax Laws

Sales Tax (VAT)

69.28

0.46

2005-2006, 2012-2017

Additional Commissioner

0.68

0.12

2005-2007, 2016-2018

Assistant Commissioner

140.57

1.78

2004-2007, 2009-2018

Deputy Commissioner

10.99 0.08 2006-2011, 2014-2015 Commissioner
31.33 2.00 2011-2013, 2014-2017 Joint Commissioner

6.72

2.90

2005-2010, 2012-2015, 2016-2017

Tribunal

252.84

1.07

2001-2002, 2003-2004, 2007-2008, 2012-2016

High Court

Service Tax Laws

Service tax

0.74

0.03

2013-2018

Assistant Commissioner

2.75 0.10 2004-2008, 2012-2017 Commissioner
3.18 0.12 2016-2018 Joint Commissioner
372.91 14.14 2007-2018 Tribunal
0.30 - 2010-2011 High Court

Bihar Electricity Duty Act, 1948

Electricity Duty

0.59

-

2006-2011

Commercial Tax Officer

3.82

-

2012-2013, 2014-2016

Deputy Commissioner

7.18 0.03 2002-2003, 2008-2012 State Tax Officer
0.31 - 1976-1980, 2004-2008 Tribunal

Employee State Insurance Act, 1948

Employee State Insurance

21.37

-

1996-1997

High Court

Name of the statute

Nature of dues

Amount (net of payments) ( crore)

Amount paid ( crore)

Period to which the amount relates (FY)

Forum where the dispute is pending

Entry Tax Laws

Entry Tax

6.02

-

2008-2009, 2011-2012, 2014-2015

Assessing Officer

0.35

0.29

2007-2011, 2014-2015

Additional Commissioner

0.37

4.86

2009-2021

Assistant Commissioner

0.95

0.56

2001-2002, 2005-2007

Deputy Commissioner

0.11 0.24 2008-2012 Joint Commissioner
1.19 1.21 2007-2011 Tribunal
318.65 14.35 1999-2003, 2005-2018 High Court

Mines and Mineral (Development and Regulation) Act, 1957

Excess Mining / Common Cause

2,140.30

-

2000-2017

Revisional Authority, Ministry of Mines

132.91

-

1998-2011

Additional Chief Secretary, Steel & Mines

2,994.49 573.83 2011-2015 High Court

Jharkhand Mineral Area Development Authority

Mineral Area Development Fee

58.51

18.00

2005-2007, 2008-2010, 2011-2014, 2016-2017

High Court

Act, 2000 8.23 - 1992-1995, 2005-2006 Supreme Court

Employees Provident Fund & Miscellaneous Provisions Act, 1952

Provident Fund

-

1.02

1997-1998

High Court

Mineral Concession Rules, Royalty on Minerals 408.48 2.60 2009-2015 Mines Tribunal

1960

1,366.78

1,211.92

2000-2008

Supreme Court

Indian Stamp Act, 1899 Stamp Duty 5,165.00 414.00 2013-2014 High Court
State Water Tax Laws Water Tax 1,361.75 511.48 1980-1994, 1995-2023 High Court

The following matter has been decided in favour of the Company although the department has preferred appeal at higher levels:

Name of the statute

Nature of dues

Amount (net of payments) ( crore)

Period to which the amount relates (FY)

Forum where the dispute is pending

Customs Act, 1962 Customs Duty 248.24 2006-2009 Supreme Court
Central Excise Act, 1944 Excise Duty 235.48 2004-2005 Supreme Court
16.34 2009-2010 Tribunal

viii. According to the information and explanations given to us and the records of the Company examined by us, there are no transactions in the books of account that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961, that has not been recorded in the books of account. ix. (a) According to the records of the Company examined by us and the information and explanations given to us, the Company has not defaulted in repayment of loans or other borrowings or in the payment of interest to any lender during the year. Also refer Note 18(ii) on Borrowings to the standalone financial statements.

(b) According to the information and explanations given to us and on the basis of our audit procedures, we report that the Company has not been declared Wilful Defaulter by any bank or financial institution or government or any government authority. (c) In our opinion, and according to the information and explanations given to us, the term loans have been applied, on an overall basis, for the purposes for which they were obtained. (Rs.) According to the information and explanations given to us, and the procedures performed by us, and on an overall examination of the standalone financial statements of the Company, we report that no funds raised on short-term basis have been used for long-term purposes by the Company.

(e) According to the information and explanations given to us and on an overall examination of the standalone financial statements of the Company, we report that the Company has not taken any funds from any entity or person on account of or to meet the obligations of its subsidiaries, associates or joint ventures.

(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, joint ventures or associate companies. x. (a) The Company has not raised any money by way of initial public offer or further public offer (including debt instruments) during the year. In our opinion, and according to the information and explanations given to us, the monies raised by way of further public offer in an earlier year have been applied, on an overall basis, for the purposes for which they were obtained.

(b) The Company has not made any preferential allotment or private placement of shares or fully or partially or optionally convertible debentures during the year. Accordingly, the reporting under clause 3(x) (b) of the Order is not applicable to the Company. xi. (a) During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of material fraud by the Company or on the Company, noticed or reported during the year, nor have we been informed of any such case by the Management.

(b) During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, a report under Section 143(12) of the Act, in Form ADT-4, as prescribed under rule 13 of Companies (Audit and Auditors) Rules, 2014 was not required to be led with the Central Government. Accordingly, the reporting under clause 3(xi)(b) of the Order is not applicable to the Company.

(c) During the course of our examination of the books and records of the Company carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, the Company has received whistle-blower complaints during the year, which have been considered by us for any bearing on our audit and reporting under this clause. As explained by the management, there were certain complaints in respect of which investigations are ongoing as on the date of our report and hence, the impact on our audit report in respect of those complaints cannot be determined at this stage. xii. As the Company is not a Nidhi Company and the Nidhi Rules, 2014 are not applicable to it, the reporting under clause 3(xii) of the Order is not applicable to the Company. xiii. The Company has entered into transactions with related parties in compliance with the provisions of Sections 177 and 188 of the Act. The details of such related party transactions have been disclosed in the standalone financial statements as required under Indian Accounting Standard 24 "Related Party Disclosures" specified under Section 133 of the Act.

xiv. (a) In our opinion and according to the information and explanation given to us, the Company has an internal audit system commensurate with the size and nature of its business.

(b) The reports of the Internal Auditor for the period under audit have been considered by us. xv. The Company has not entered into any non-cash transactions with its directors or persons connected with him. Accordingly, the reporting on compliance with the provisions of Section 192 of the Act under clause 3(xv) of the Order is not applicable to the Company. xvi. (a) The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, the reporting under clause 3(xvi)(a) of the Order is not applicable to the Company.

(b) The Company has not conducted non-banking financial / housing nance activities during the year. Accordingly, the reporting under clause 3(xvi)(b) of the Order is not applicable to the Company.

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

(Rs.) Based on the information and explanations provided by the management of the Company, the Group has seven CICs as part of the Group. We have not, however, separately evaluated whether the information provided by the management is accurate and complete. xvii. The Company has not incurred any cash losses in the financial year or in the immediately preceding financial year.

xviii. There has been no resignation of the statutory auditors during the year and accordingly the reporting under clause 3(xviii) of the Order is not applicable to the Company. xix. According to the information and explanations given to us and on the basis of the financial ratios (also refer Note 42 to the standalone financial statements), ageing and expected dates of realisation of financial assets and payment of financial liabilities, other information accompanying the standalone financial statements, our knowledge of the Board of Directors and management plans and based on our examination of the evidence supporting the assumptions, nothing has come to our attention, which causes us to believe that any material uncertainty exists as on the date of the audit report that the Company is not capable of meeting its liabilities existing at the date of balance sheet as and when they fall due within a period of one year from the balance sheet date. We, however, state that this is not an assurance as to the future viability of the Company. We further state that our reporting is based on the facts up to the date of the audit report and we neither give any guarantee nor any assurance that all liabilities falling due within a period of one year from the balance sheet date will get discharged by the Company as and when they fall due. xx. The Company has during the year spent the amount of Corporate Social Responsibility as required under subsection (5) of Section 135 of the Act. Accordingly, reporting under clause 3(xx) of the Order is not applicable to the Company. xxi. The reporting under clause 3(xxi) of the Order is not applicable in respect of audit of standalone financial statements. Accordingly, no comment in respect of the said clause has been included in this report.

For Price Waterhouse & Co Chartered Accountants LLP
Firm Registration Number: 304026E/E-300009
Subramanian Vivek
Partner
Place: Mumbai Membership Number 100332
Date: May 2, 2023 UDIN: 23100332BGYVTL5217