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DLF Ltd.

BSE: 532868 Sector: Infrastructure
NSE: DLF ISIN Code: INE271C01023
BSE 00:00 | 13 Jul 142.90 -4.75
(-3.22%)
OPEN

149.00

HIGH

149.00

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141.75

NSE 00:00 | 13 Jul 142.90 -4.85
(-3.28%)
OPEN

148.85

HIGH

149.20

LOW

141.65

OPEN 149.00
PREVIOUS CLOSE 147.65
VOLUME 784118
52-Week high 266.65
52-Week low 114.50
P/E 23.74
Mkt Cap.(Rs cr) 35,372
Buy Price 142.70
Buy Qty 200.00
Sell Price 142.90
Sell Qty 382.00
OPEN 149.00
CLOSE 147.65
VOLUME 784118
52-Week high 266.65
52-Week low 114.50
P/E 23.74
Mkt Cap.(Rs cr) 35,372
Buy Price 142.70
Buy Qty 200.00
Sell Price 142.90
Sell Qty 382.00

DLF Ltd. (DLF) - Auditors Report

Company auditors report

To the Members of DLF Limited

Report on the Audit of the Standalone Ind AS Financial Statements

Opinion

We have audited the accompanying standalone Ind AS financial statementsof DLF Limited ("the Company") which comprise the Balance sheet as at 31 March2019 the Statement of Profit and Loss including the statement of Other ComprehensiveIncome the Cash Flow Statement and the Statement of Changes in Equity for the year thenended and notes to the standalone Ind AS financial statements including a summary ofsignificant accounting policies and other explanatory information.

In our opinion and to the best of our information and according to theexplanations given to us the aforesaid standalone Ind AS financial statements give theinformation required by the Companies Act 2013 as amended ("the Act") in themanner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at 31March 2019 its profit including other comprehensive income its cash flows and the changesin equity for the year ended on that date.

Basis for Opinion

We conducted our audit of the standalone Ind AS financial statements inaccordance with the Standards on Auditing (SAs) as specified under section 143(10) of theAct. Our responsibilities under those Standards are further described in the‘Auditor's Responsibilities for the Audit of the Standalone Ind AS FinancialStatements' section of our report. We are independent of the Company in accordancewith the ‘Code of Ethics' issued by the Institute of Chartered Accountants ofIndia together with the ethical requirements that are relevant to our audit of thefinancial statements under the provisions of the Act and the Rules thereunder and we havefulfilled our other ethical responsibilities in accordance with these requirements and theCode of Ethics. We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the standalone Ind AS financialstatements.

Emphasis of Matters

We draw attention to Note no. 50 to the Standalone Ind AS financialstatements of the Company which describes the uncertainty relating to outcome of followinglawsuits filed against the Company:

a) In a complaint filed against the Company relating to imposing unfairconditions on buyers the Competition Commission of India has imposed a penalty of र63000 lakhs on the Company which was upheld by Competition Appellate Tribunal. TheCompany has filed an appeal which is currently pending with Hon'ble Supreme Court ofIndia and has deposited र 63000 lakhs as per direction of the Hon'ble SupremeCourt of India.

b) In a writ filed with Hon'ble High Court of Punjab and Haryanathe Company and one of its subsidiary and a joint venture Company have received judgmentscancelling the sale deeds of land /removal of structure relating to two IT SEZ/ IT ParkProjects in Gurugram. The Company and the subsidiary companies filed Special Leavepetitions (SLPs) challenging the orders which is currently pending with Hon'bleSupreme Court of India. The Hon'ble Supreme Court has admitted the matters and stayedthe operation of the impugned judgments till further orders in both the cases.

c) Securities and Exchange Board of India (SEBI) in a complaint filedagainst the Company imposed certain restrictions on the Company. The Company had receiveda favorable order against the appeal in said case from Securities Appellate Tribunal(SAT). SEBI subsequently has filed a statutory appeal which is currently pending beforeHon'ble Supreme Court. SEBI has also imposed penalties upon the Company some of itsdirectors officers its three subsidiaries and their directors which has been disposed ofby SAT with a direction that these appeals will stand automatically revived upon disposalof civil appeal filed by SEBI against aforementioned SAT judgement. Based on the advice ofthe external legal counsels no adjustment has been considered in these standalone Ind ASfinancial statements by the management in respect of above matters. Our report is notmodified in respect of these matters.

Key Audit Matters

Key audit matters are those matters that in our professional judgmentwere of most significance in our audit of the standalone Ind AS financial statements forthe financial year ended 31 March 2019. These matters were addressed in the context of ouraudit of the standalone Ind AS financial statements as a whole and in forming our opinionthereon and we do not provide a separate opinion on these matters. For each matter belowour description of how our audit addressed the matter is provided in that context. We havedetermined the matters described below to be the key audit matters to be communicated inour report. We have fulfilled the responsibilities described in the Auditor'sresponsibilities for the audit of the standalone Ind AS financial statements section ofour report including in relation to these matters. Accordingly our audit included theperformance of procedures designed to respond to our assessment of the risks of materialmisstatement of the standalone Ind AS financial statements. The results of our auditprocedures including the procedures performed to address the matters below provide thebasis for our audit opinion on the accompanying standalone Ind AS financial statements.

Key audit matters How our audit addressed the key audit matter
Revenue recognition for real estate projects (as described in note 61 to the standalone Ind AS financial statements)
The Company has adopted Ind AS 115 - Revenue from Contracts with Customers mandatory for reporting periods beginning on or after April 1 2018. Our audit procedures included:
The Company has applied the modified retrospective approach to contracts that were not completed as at April 01 2018 and has given impact of Ind AS 115 application by debit to retained earnings as at the said date by र 396399.66 lakhs (net of tax). We have read the Company's revenue recognition accounting policies and assessed compliance of the policies with Ind AS 115;
We tested the computation of the adjustment to retained earnings balance as at April 1 2018 in view of adoption of Ind AS 115 as per the modified retrospective method;
The application of Ind AS 115 has impacted the Company's accounting for recognition of revenue from real estate projects which is now being recognised at a point in time upon the Company satisfying its performance obligation and the customer obtaining control of the underlying asset. We obtained and understood revenue recognition process including identification of performance obligations and determination of transfer of control of the asset underlying the performance obligation to the customer;
Considering application of Ind AS 115 involves significant judgment in identifying performance obligations and determining when ‘control' of the asset underlying the performance obligation is transferred to the customer and the transition method to be applied the same has been considered as key audit matter. We have read the legal opinion obtained by the Company to determine the point in time at which the control is transferred in accordance with the underlying agreements;
We tested revenue related transactions with the underlying customer contracts sale deed and handover documents evidencing the transfer of control of the asset to the customer based on which revenue is recognized;
We assessed the revenue-related disclosures included in Note 61 to the financial statements.
Claims litigations and contingencies (as described in note 50 to the standalone Ind AS financial statements)
The Company is having various ongoing litigations court and other legal proceedings before tax and regularity authorities and courts which could have significant financial impact if the potential exposure were to materialize. Our audit procedures included:
We understood management's process relating to the identification and impact analysis of claims litigations and contingencies;
Management estimates the possible outflow of economic resources based on legal counsel opinion and available information on the legal status of the proceedings. We analyzed responses obtained from the legal advisors.
We have obtained confirmation letters from legal counsels;
Considering the determination by the management of whether and how much to provide and / or disclose for such contingencies involves significant judgement and estimation the same has been considered as key audit matter. We have read the minutes of meetings of the Audit Committee and the Board of Directors of the Company related to noting of status of material litigations;
We have assessed management's assumptions and estimates related to disclosures of contingent liabilities in the financial statements.

Assessing the carrying value of Inventory (as described in note 12 to the standalone Ind AS financial statements)

The Company's inventory comprise of ongoing and completed real estate projects unlaunched projects and development rights. As at 31 March 2019 the carrying values of inventories amounts to ` 1135726.23 lakhs. Our audit procedures/ testing included among others:
We read and evaluated the accounting policies and disclosures made in the financial statements with respect to inventories;
The inventories are carried at the lower of the cost and net realizable value (‘NRV'). The determination of the NRV involves estimates based on prevailing market conditions current prices and expected date of commencement and completion of the project the estimated future selling price cost to complete projects and selling costs. We understood and reviewed the management's process and methodology of using key assumptions for determination of NRV of the inventories;
Considering significance of the amount of carrying value of inventories in the financial statements and the involvement of significant estimation and judgement in such assessment of NRV the same has been considered as key audit matter. We have tested the NRV of the inventories to its carrying value in books on sample basis.
Where the Company involved specialists to perform valuations
we also performed the following procedures:
We obtained and read the valuation report used by the management for determining the NRV;
We considered the independence competence and objectivity of the specialist involved in determination of valuation.
Involved experts to review the assumptions used by the management specialists.
Assessing impairment of Investments in subsidiary joint venture and associate entities (as described in note 6A to the standalone Ind AS financial statements)
The Company has significant investments in its subsidiaries joint ventures and associates. As at 31 March 2019 the carrying values of Company's investment in its subsidiaries joint ventures and associate entities amounts to र 953590.24 lakhs. Our procedures in assessing the management's judgement for the impairment assessment included among others the following:
We assessed the Company's valuation methodology applied in determining the recoverable amount of the investments;
Management reviews regularly whether there are any indicators of impairment of the investments by reference to the requirements under Ind AS 36 "Impairment of Assets". We obtained and read the valuation report used by the management for determining the fair value (‘recoverable amount') of its investments;
We considered the independence competence and objectivity of the management specialist involved in determination of valuation;
For investments where impairment indicators exist significant judgments are required to determine the key assumptions used in the discounted cash flow models such as revenue growth unit price and discount rates. We tested the fair value of the investment as mentioned in the valuation report to the carrying value in books;
Made inquiries with management to understand key drivers of the cash flow forecasts discount rates etc
Considering the impairment assessment involves significant assumptions and judgement the same has been considered as key audit matter. Involved experts to review the assumptions used by the management specialists. We reviewed the disclosures made in the financial statements regarding such investments.
Assessment of recoverability of deferred tax asset (as described in note 9 to the standalone Ind AS financial statements)
As at 31 March 2019 the Company has recognized deferred tax assets of र 367450.55 lakhs on deductible temporary differences and unused tax losses. Our audit procedures included amongst others:
Obtained an understanding of the process and tested the controls over recording of deferred tax and review of deferred tax at each reporting date;
We tested the computation of the amounts recognized as deferred tax assets;
Recognition of deferred tax assets to the extent that it is probable that taxable profit will be available against which the deductible temporary differences and the carry forward of unused tax credits and unused tax losses can be utilized involves significant management judgement and estimation given that it is based on assumptions such as the likely timing and level of future taxable profits which are affected by expected future market and economic conditions. We evaluated management's assumptions used to determine the probability that deferred tax assets recognized in the balance sheet will be recovered through taxable income in future years by comparing them against profit trends and future business plans;
Considering this involves significant judgement and estimates the same has been considered as key audit matter. We assessed the disclosures on deferred tax included in Note 9 to the financial statements.
Related party transactions (as described in note 45 to the standalone Ind AS financial statements)
The Company has undertaken transactions with its related parties in the ordinary course of business at arm's length. These include transactions in the nature of investments loans sales and purchases etc. as disclosed in note 45 to the standalone Ind AS financial statements. Our procedures/ testing included the following:
Obtained and read the Company's policies processes and procedures in respect of identifying related parties obtaining approval recording and disclosure of related party transactions;
Considering the significance of transactions with related parties and regulatory compliances thereon related party transactions and its disclosure as set out in respective notes to the financial statements has been identified as key audit matter. Read minutes of share holder meetings board meetings and minutes of meetings of those charged with governance in connection with Company's assessment of related party transactions being in the ordinary course of business at arm's length;
Tested related party transactions with the underlying contracts confirmation letters and other supporting documents; Agreed the related party information disclosed in the financial statements with the underlying supporting documents on a sample basis.

We have determined that there are no other key audit matters tocommunicate in our report.

Information Other than the Financial Statements and Auditor'sReport thereon

The Company's Board of Directors is responsible for the otherinformation. The other information comprises the Message from Chairman Directors'Report Management Discussion & Analysis report and Corporate Governance Report butdoes not include the standalone Ind AS financial statements and our auditor's reportthereon.

Our opinion on the standalone Ind AS financial statements does notcover the other information and we do not express any form of assurance conclusionthereon.

In connection with our audit of the standalone Ind AS financialstatements our responsibility is to read the other information and in doing so considerwhether such other information is materially inconsistent with the financial statements orour knowledge obtained in the audit or otherwise appears to be materially misstated. Ifbased on the work we have performed we conclude that there is a material misstatement ofthis other information we are required to report that fact. We have nothing to report inthis regard.

Responsibilities of Management and those Charged with Governance forthe Standalone Ind AS Financial Statements

The Company's Board of Directors is responsible for the mattersstated in section 134(5) of the Act with respect to the preparation of these standaloneInd AS financial statements that give a true and fair view of the financial positionfinancial performance including other comprehensive income cash flows and changes inequity of the Company in accordance with the accounting principles generally accepted inIndia including the Indian Accounting Standards (Ind AS) specified under section 133 ofthe Act read with the Companies (Indian Accounting Standards) Rules 2015 as amended.This responsibility also includes maintenance of adequate accounting records in accordancewith the provisions of the Act for safeguarding of the assets of the Company and forpreventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and the design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the standalone IndAS financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

In preparing the standalone Ind AS financial statements management isresponsible for assessing the Company's ability to continue as a going concerndisclosing as applicable matters related to going concern and using the going concernbasis of accounting unless management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so.

Those Board of Directors are also responsible for overseeing theCompany's financial reporting process.

Auditor's Responsibilities for the Audit of the Standalone Ind ASFinancial Statements

Our objectives are to obtain reasonable assurance about whether thestandalone Ind AS financial statements as a whole are free from material misstatementwhether due to fraud or error and to issue an auditor's report that includes ouropinion. Reasonable assurance is a high level of assurance but is not a guarantee that anaudit conducted in accordance with SAs will always detect a material misstatement when itexists. Misstatements can arise from fraud or error and are considered material ifindividually or in the aggregate they could reasonably be expected to influence theeconomic decisions of users taken on the basis of these standalone Ind AS financialstatements.

As part of an audit in accordance with SAs we exercise professionaljudgment and maintain professional skepticism throughout the audit. We also: Identify andassess the risks of material misstatement of the standalone Ind AS financial statementswhether due to fraud or error design and perform audit procedures responsive to thoserisks and obtain audit evidence that is sufficient and appropriate to provide a basis forour opinion. The risk of not detecting a material misstatement resulting from fraud ishigher than for one resulting from error as fraud may involve collusion forgeryintentional omissions misrepresentations or the override of internal control. Obtain anunderstanding of internal control relevant to the audit in order to design auditprocedures that are appropriate in the circumstances. Under section 143(3)(i) of the Actwe are also responsible for expressing our opinion on whether the Company has adequateinternal financial controls system in place and the operating effectiveness of suchcontrols. Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made by management. Conclude on theappropriateness of management's use of the going concern basis of accounting andbased on the audit evidence obtained whether a material uncertainty exists related toevents or conditions that may cast significant doubt on the Company's ability tocontinue as a going concern. If we conclude that a material uncertainty exists we arerequired to draw attention in our auditor's report to the related disclosures in thefinancial statements or if such disclosures are inadequate to modify our opinion. Ourconclusions are based on the audit evidence obtained up to the date of our auditor'sreport. However future events or conditions may cause the Company to cease to continue asa going concern. Evaluate the overall presentation structure and content of thestandalone Ind AS financial statements including the disclosures and whether thestandalone Ind AS financial statements represent the underlying transactions and events ina manner that achieves fair presentation. We communicate with those charged withgovernance regarding among other matters the planned scope and timing of the audit andsignificant audit findings including any significant deficiencies in internal controlthat we identify during our audit.

We also provide those charged with governance with a statement that wehave complied with relevant ethical requirements regarding independence and to communicatewith them all relationships and other matters that may reasonably be thought to bear onour independence and where applicable related safeguards.

From the matters communicated with those charged with governance wedetermine those matters that were of most significance in the audit of the standalone IndAS financial statements for the financial year ended 31 March 2019 and are therefore thekey audit matters. We describe these matters in our auditor's report unless law orregulation precludes public disclosure about the matter or when in extremely rarecircumstances we determine that a matter should not be communicated in our report becausethe adverse consequences of doing so would reasonably be expected to outweigh the publicinterest benefits of such communication.

Other Matters

We did not audit the financial statements and other financialinformation as regards Company's share of loss of partnership firm (post tax)amounting to र 211.73 lakhs for the year ended 31 March 2019 included in theaccompanying standalone Ind AS financial statements of the Company whose financialstatements and other financial information have been audited by the other auditors whosereports have been furnished to us and our opinion in so far as it relates toCompany's share of loss included in respect of the partnership firm investments isbased solely on the report of such other auditor. The accompanying standalone Ind ASfinancial statements include unaudited financial statements and other unaudited financialinformation as regards Company's share in loss of partnership firm (post tax) र267.26 lakhs for the year ended 31 March 2019. These unaudited financial statements andother unaudited financial information has been furnished to us by the management. Ouropinion in so far as it relates to Company's share of loss in so far as it relatesto Company's share of loss included in respect of the partnership firm investmentsis based solely on the on such unaudited financial statements and other unauditedfinancial information. In our opinion and according to the information and explanationsgiven to us by the Management these financial statements and other financial informationare not material to the Company.

Our opinion above on the standalone Ind AS financial statements and ourreport on Other Legal and Regulatory Requirements below is not modified in respect of theabove matters with respect to our reliance on the work done and the reports of the otherauditor and the financial statements and other financial information certified by theManagement.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order 2016("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 1" a statement on thematters specified in paragraphs 3 and 4 of the Order.

2. As required by Section 143(3) of the Act we report that:

(a) We have sought and obtained all the information and explanationswhich to the best of our knowledge and belief were necessary for the purposes of ouraudit;

(b) In our opinion proper books of account as required by law havebeen 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 theStatement of Other Comprehensive Income the Cash Flow Statement and Statement of Changesin Equity dealt with by this Report are in agreement with the books of account;

(d) In our opinion the aforesaid standalone Ind AS financialstatements comply with the Accounting Standards specified under Section 133 of the Actread with Companies (Indian Accounting Standards) Rules 2015 as amended;

(e) The matter described in ‘Emphasis of Matters' paragraphabove in our opinion may have an adverse effect on the functioning of the Company;

(f) On the basis of the written representations received from thedirectors as on 31 March 2019 taken on record by the Board of Directors none of thedirectors is disqualified as on 31 March 2019 from being appointed as a director in termsof Section 164 (2) of the Act;

(g) With respect to the adequacy of the internal financial controlsover financial reporting of the Company with reference to these standalone Ind ASfinancial statements and the operating effectiveness of such controls refer to ourseparate Report in "Annexure 2" to this report;

(h) In our opinion the managerial remuneration for the year ended 31March 2019 has been paid/ provided by the Company to its directors in accordance with theprovisions of section 197 read with Schedule V to the Act;

(i) With respect to the other matters to be included in theAuditor's 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 tothe explanations given to us:

i. The Company has disclosed the impact of pending litigations on itsfinancial position in its standalone Ind AS financial statements - Refer Note 50 to thestandalone Ind AS financial statements;

ii. The Company has made provision as required under the applicablelaw or accounting standards for material foreseeable losses if any on long-termcontracts including derivative contracts;

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

for S.R. Batliboi & CO. LLP
Chartered Accountants
ICAI Firm Registration Number: 301003E/ E300005
per Manoj Kumar Gupta
New Delhi Partner
21 May 2019 Membership No.: 083906

Annexure I referred to in paragraph 1 under "Report on Other Legaland Regulatory Requirements" section of our report of even date

Re: DLF Limited ("the Company")

(i) (a) The Company has maintained proper records showing fullparticulars including quantitative details and situation of the fixed assets comprisingof property plant and equipment and investment properties. (i) (b) All fixed assetscomprising of property plant and equipment and investment properties have not beenphysically verified by the management during the year but there is a regular programme ofverification which in our opinion is reasonable having regard to the size of the Companyand the nature of its assets. No material discrepancies were noticed on such verification.

(i) (c) According to the information and explanations given by themanagement the title deeds of immovable properties included in property plant andequipment and investment properties are held in the name of the Company except: fiveimmovable properties having gross block of ` 1338.18 lakhs and net block of ` 1338.18lakhs title deed for which is in the name of one of the group company and the Company isin process of getting them registered in their name. The Company has constructed buildingon such land having net block of ` 17389.98 lakhs.

• one immovable properties which includes land aggregating `148.75 lakhs as at 31 March 2019 for which title deed is not in the name of the companyand the company is in the process of getting the same registered in their name.

• the title deeds of immovable properties included in investmentproperty amounting to र 45653 lakhs which according to the information andexplanations given by the management are pledged with the banks against borrowings takenby subsidiary company and are not available with the Company. The same has not beenindependently confirmed by the bank and hence we are unable to comment on the same. TheCompany has constructed building on such land having net block of ` 145517 lakhs.

(ii) In our opinion the management has conducted physical verificationof inventory at reasonable intervals during the year except for inventory represented bydevelopment rights. Inventories represented by development rights have been confirmed asat 31 March 2019 on the basis of custodian certificates obtained by the management. Nomaterial discrepancies were noticed on such physical verification/ confirmations.

(iii) (a) The Company has granted unsecured loans to companies firmsor other parties covered in the register maintained under section 189 of the CompaniesAct 2013. In our opinion and according to the information and explanations given to usthe terms and conditions of the grant of such loans are not prejudicial to theCompany's interest.

(iii) (b) The Company has granted loans that are re-payable on demandto companies firms or other parties covered in the register maintained under section 189of the Companies Act 2013. We are informed that the company has not demanded repayment ofany such loan during the year and thus there has been no default on the part of theparties to whom the money has been lent. The payment of interest has been regular.

(iii) (c) There are no amounts of loans granted to companies firms orother parties listed in the register maintained under section 189 of the Companies Act2013 which are overdue for more than ninety days.

(iv) In our opinion and according to the information and explanationsgiven to us provisions of section 185 and 186 of the Companies Act 2013 in respect ofloans to directors including entities in which they are interested and in respect of loansand advances given investments made and guarantees and securities given have beencomplied with by the Company.

(v) The Company has not accepted any deposits within the meaning ofSections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules 2014 (asamended). Accordingly the provisions of clause 3(v) of the Order are not applicable.

(vi) We have broadly reviewed the books of account maintained by theCompany pursuant to the rules made by the Central Government for the maintenance of costrecords under section 148(1) of the Companies Act 2013 in relation to constructionindustry and are of the opinion that prima facie the specified accounts and records havebeen made and maintained. We have not however made a detailed examination of the same.

(vii) (a) Undisputed statutory dues including provident fundemployees' state insurance income-tax sales-tax service tax duty of custom dutyvalue added tax goods and service tax cess and other statutory dues have generally beenregularly deposited with the appropriate authorities though there has been a slight delayin a few cases. The provisions relating to duty of excise are not applicable to theCompany.

(vii) (b) According to the information and explanations given to us noundisputed amounts payable in respect of provident fund employees' state insuranceincome-tax service tax sales-tax duty of custom value added tax goods and servicetax cess and other statutory dues were outstanding at the year end for a period of morethan six months from the date they became payable. The provisions relating to duty ofexcise are not applicable to the Company.

(vii) (c) According to the records of the Company the dues ofincome-tax sales-tax service tax duty of custom value added tax goods and service taxand cess on account of any dispute are as follows:

Nature of Statute Nature of dues Amount Amount paid under protest Period to which the amount relates Forum where dispute is pending
(` in lakhs) (` in lakhs)
Income Tax Act 1961 Tax demands on account of various disallowances during tax assessment 10072.92 - 2016-17 Commissioner of Income Tax (Appeals)
Income Tax Act 1961 Tax demands on account of various disallowances during tax assessment 349044.30 13089.11 2006-07 to 2015-16 Income Tax Appellate Tribunal
Income Tax Act 1961 Tax demands on account of various disallowances during tax assessment 31979.26 - 1992-93 to 2007-08 and 2011-12 Hon'ble High Court of Delhi
Odisha Entry Tax Act 1999 Entry tax demand on purchase of goods in the state of Odisha 0.76 - 2014-15 to 2015-16 Additional Commissioner (Appeals)
West Bengal Entry Tax Entry tax demand on purchase of goods 5.14 - 2012-13 Hon'ble High Court of
Act 2012 in the state of West Bengal Kolkata
Odisha Value Added Tax Act 1999 Demand of VAT on leased transaction 263.69 - 2009-10 to 2013-14 Hon'ble High Court of Odisha
Odisha Value Added Tax Act 1999 Demand of VAT on leased transaction 676.56 - 2014-15 to 2015-16 Additional Commissioner (Appeals)
Uttar Pradesh Value Added Tax Act 2008 Demand of VAT on account of taxable turnover 21.65 11.85 2011-12 to 2015-16 Additional Commissioner (Appeals) Noida
Haryana General Sales Tax Act 1973 Disallowance of refund 145.01 145.01 1997-98 to 999- 2000 Hon'ble High Court Punjab & Haryana
The Finance Act 2004 and Service tax rules Denial of Cenvat credit on rent paid and service tax demand on other matters 299.84 280.19 2009-10 to 2012-13 CESTAT Chandigarh
The Finance Act 2004 and Service tax rules Interest on wrong availment of inadmissible Cenvat Credit 221.62 - 2011-12 Commissioner Service Tax
The Finance Act 2004 and Service tax rules Demand of service tax on transfer of development rights 4991.45 850.00 2012-13 to 2015-16 Additional Director General DGCEI New Delhi
The Finance Act 2004 and Service tax rules Service tax liability in respect of registration charges recovered by the assesse from their customers 1697.00 - 2015-16 Commissioner CGST Gurugram
Custom Act 1962 Classification & Assessment of Goods - Deformed Steel Bars 714.86 - 2008 Commisioner (Appeals) Kandla

(viii) In our opinion and according to the information and explanationsgiven by the management the Company has not defaulted in repayment of loans or borrowingsto a financial institution bank or dues to debenture holders. The Company did not haveany outstanding loans or borrowings due to government.

(ix) According to the information and explanations given by themanagement the Company has utilized the money raised by way of term loans for the purposefor which they were raised. According to the information and explanations given by themanagement the Company has not raised any money way of initial public offer/ furtherpublic offer (including debt instruments).

(x) Based upon the audit procedures performed for the purpose ofreporting the true and fair view of the financial statements and according to theinformation and explanations given by the management we report that no fraud by thecompany or no fraud on the Company by the officers and employees of the Company has beennoticed or reported during the year.

(xi) According to the information and explanations given by themanagement the managerial remuneration has been paid/ provided in accordance with therequisite approvals mandated by the provisions of section 197 read with Schedule V to theCompanies Act 2013.

(xii) In our opinion the Company is not a Nidhi Company. Thereforethe provisions of clause 3(xii) of the order are not applicable to the Company and hencenot commented upon.

(xiii) According to the information and explanations given by themanagement transactions with the related parties are in compliance with section 177 and188 of Companies Act 2013 where applicable and the details have been disclosed in thenotes to the financial statements as required by the applicable accounting standards.

(xiv) According to the information and explanations given by themanagement the Company has complied with provisions of section 42 of the Companies Act2013 in respect of the shares issued through Qualified Institutional Placement during theyear. According to the information and explanations given by the management we reportthat the amounts raised were not required for immediate utilization hence investedpartially in fixed deposits and balance remains in current account. Further as perinformation and explanations given by management the Company has converted part of itscompulsorily convertible debentures into equity shares during the year for which moneywas raised in previous financial year.

(xv) According to the information and explanations given by themanagement the Company has not entered into any non-cash transactions with directors orpersons connected with him as referred to in section 192 of Companies Act 2013.

(xvi) According to the information and explanations given to us theprovisions of section 45-IA of the Reserve Bank of India Act 1934 are not applicable tothe Company.

for S.R. Batliboi & CO. LLP
Chartered Accountants
ICAI Firm Registration Number: 301003E/E300005
per Manoj Kumar Gupta
New Delhi Partner
21 May 2019 Membership No.: 083906

ANNEXURE II TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ONTHE STANDALONE IND AS FINANCIAL STATEMENTS OF DLF LIMITED

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

We have audited the internal financial controls over financialreporting of DLF Limited ("the Company") as of 31 March 2019 in conjunction withour audit of the standalone Ind AS financial statements of the Company for the year endedon that date.

Management's Responsibility for Internal Financial Controls

The Company's Management is responsible for establishing andmaintaining internal financial controls based on the internal control over financialreporting criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting issued by the Institute of Chartered Accountants of India. Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to the Company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation of reliablefinancial information as required under the Companies Act 2013.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company'sinternal financial controls over financial reporting with reference to these standaloneInd AS financial statements based on our audit. We conducted our audit in accordance withthe Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the"Guidance Note") and the Standards on Auditing as specified under section143(10) of the Companies Act 2013 to the extent applicable to an audit of internalfinancial controls and both issued by the Institute of Chartered Accountants of India.Those Standards and the Guidance Note require that we comply with ethical requirements andplan and perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls over financial reporting with reference to these standalone Ind ASfinancial statements was established and maintained and if such controls operatedeffectively in all material respects.

Our audit involves performing procedures to obtain audit evidence aboutthe adequacy of the internal financial controls over financial reporting with reference tothese standalone Ind AS financial statements and their operating effectiveness. Our auditof internal financial controls over financial reporting included obtaining anunderstanding of internal financial controls over financial reporting with reference tothese standalone Ind AS financial statements assessing the risk that a material weaknessexists and testing and evaluating the design and operating effectiveness of internalcontrol based on the assessed risk. The procedures selected depend on the auditor'sjudgement including the assessment of the risks of material misstatement of the financialstatements whether due to fraud or error. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our audit opinion on theinternal financial controls over financial reporting with reference to these standaloneInd AS financial statements.

Meaning of Internal Financial Controls Over Financial Reporting WithReference to these Financial Statements

A company's internal financial control over financial reportingwith reference to these standalone Ind AS financial statements is a process designed toprovide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal financial control over financialreporting with reference to these standalone Ind AS financial statements includes thosepolicies and procedures that (1) pertain to the maintenance of records that in reasonabledetail accurately and fairly reflect the transactions and dispositions of the assets ofthe company; (2) provide reasonable assurance that transactions are recorded as necessaryto permit preparation of financial statements in accordance with generally acceptedaccounting principles and that receipts and expenditures of the company are being madeonly in accordance with authorizations of management and Directors of the company; and (3)provide reasonable assurance regarding prevention or timely detection of unauthorizedacquisition use or disposition of the company's assets that could have a materialeffect on the financial statements.

Inherent Limitations of Internal Financial Controls Over FinancialReporting With Reference to these Standalone Ind AS Financial Statements

Because of the inherent limitations of internal financial controls overfinancial reporting with reference to these standalone Ind AS financial statementsincluding the possibility of collusion or improper management override of controlsmaterial misstatements due to error or fraud may occur and not be detected. Alsoprojections of any evaluation of the internal financial controls over financial reportingwith reference to these standalone Ind AS financial statements to future periods aresubject to the risk that the internal financial control over financial reporting withreference to these standalone Ind AS financial statements may become inadequate because ofchanges in conditions or that the degree of compliance with the policies or procedures maydeteriorate.

Opinion

In our opinion the Company has in all material respects adequateinternal financial controls over financial reporting with reference to these standaloneInd AS financial statements and such internal financial controls over financial reportingwith reference to these standalone Ind AS financial statements were operating effectivelyas at 31 March 2019 based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls Over Financial Reportingissued by the Institute of Chartered Accountants of India.

for S.R. Batliboi & CO. LLP
Chartered Accountants
ICAI Firm Registration Number: 301003E/E300005
per Manoj Kumar Gupta
New Delhi Partner
21 May 2019 Membership No.: 083906