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DLF Ltd.

BSE: 532868 Sector: Infrastructure
NSE: DLF ISIN Code: INE271C01023
BSE 00:00 | 27 Jul 336.95 2.95
(0.88%)
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339.50

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344.50

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328.65

NSE 00:00 | 27 Jul 337.00 3.05
(0.91%)
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338.00

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344.55

LOW

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OPEN 339.50
PREVIOUS CLOSE 334.00
VOLUME 1573612
52-Week high 344.50
52-Week low 134.60
P/E 58.60
Mkt Cap.(Rs cr) 83,405
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 339.50
CLOSE 334.00
VOLUME 1573612
52-Week high 344.50
52-Week low 134.60
P/E 58.60
Mkt Cap.(Rs cr) 83,405
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

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 statements of DLF Limited("the Company") which comprise the Balance sheet as at March 31 2020 theStatement of Profit and Loss including the statement of Other Comprehensive Income theCash Flow Statement and the Statement of Changes in Equity for the year then ended andnotes to the standalone Ind AS financial statements including a summary of significantaccounting policies and other explanatory information.

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone Ind AS financial statements give the informationrequired by the Companies Act 2013 as amended ("the Act") in the manner sorequired and give a true and fair view in conformity with the accounting principlesgenerally accepted in India of the state of affairs of the Company as at March 31 2020its profit including other comprehensive income its cash flows and the changes in equityfor the year ended on that date.

Basis for Opinion

We conducted our audit of the standalone Ind AS financial statements in accordance withthe Standards on Auditing (SAs) as specified under section 143(10) of the Act. Ourresponsibilities under those Standards are further described in the ‘Auditor'sResponsibilities for the Audit of the Standalone Ind AS Financial Statements' sectionof our report. We are independent of the Company in accordance with the ‘Code ofEthics' issued by the Institute of Chartered Accountants of India together with theethical requirements that are relevant to our audit of the standalone financial statementsunder the provisions of the Act and the Rules thereunder and we have fulfilled our otherethical responsibilities in accordance with these requirements and the Code of Ethics. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our audit opinion on the standalone Ind AS financial statements.

Emphasis of Matters

1. We draw attention to Note no 50 to the standalone financial statements of theCompany which describes the uncertainty relating to outcome of following lawsuits filedagainst the Company:

a) In a complaint led against the Company relating to imposing unfair conditions onbuyers the Competition Commission of India has imposed a penalty of Rs.63000 lakhs onthe Company which was upheld by Competition

Appellate Tribunal. The Company has led an appeal which is currently pending withHon'ble Supreme Court of India and has deposited Rs.63000 lakhs as per direction of theHon'ble Supreme Court of India.

b) In a writ led with Hon'ble High Court of Punjab and

Haryana the Company and one of its subsidiary and a joint venture Company havereceived judgments cancelling the sale deeds of land /removal of structure relating to twoIT SEZ/ IT Park Projects in Gurgaon. The Company and the subsidiary companies led Special

Leave petitions (SLPs) challenging the orders which is currently pending with Hon'bleSupreme Court of India. The Hon'ble Supreme Court has admitted the matters and stayed theoperation of the impugned judgments till further orders in both the cases.

c) Securities and Exchange Board of India (SEBI) in a complaint led against theCompany imposed certain restrictions on the Company. The Company had received a favorableorder against the appeal in said case from Securities Appellate Tribunal (SAT). SEBIsubsequently has led a statutory appeal which is currently pending before Hon'ble SupremeCourt. SEBI has also imposed penalties upon the Company some of its directors of cersits three subsidiaries and their directors which has been disposed of by SAT with adirection that these appeals will stand automatically revived upon disposal of civilappeal filed by SEBI against aforementioned SAT judgement.

Based on the advice of the external legal counsels no adjustment has been consideredin these standalone Ind AS financial statements by the management in respect of abovematters.

2. We draw attention to Note no 62 to the standalone financial statements whichdescribes the uncertainties and the management's assessment of the financial impact due tolockdown and other restrictions and conditions related to Covid-19 pandemic situationfor which a definitive assessment of the impact in subsequent period is highly dependenton future economic developments and circumstances as they evolve. Our report is notmodified in respect of this matter.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the standalone Ind AS financial statements for the financialyear ended March 31 2020. These matters were addressed in the context of our audit of thestandalone Ind AS financial statements as a whole and in forming our opinion thereon andwe do not provide a separate opinion on these matters. For each matter below ourdescription of how our audit addressed the matter is provided in that context.

We have determined the matters described below to be the key audit matters to becommunicated in our report. We have fulfilled the responsibilities described in theAuditor's responsibilities for the audit of the standalone Ind AS financial statementssection of our report including in relation to these matters. Accordingly our auditincluded the performance of procedures designed to respond to our assessment of the risksof material misstatement of the standalone Ind AS financial statements. The results of ouraudit procedures including the procedures performed to address the matters below providethe basis for our audit opinion on the accompanying standalone Ind AS financialstatements.

Revenue recognition for real estate projects (as described in note 27 of the standalone Ind AS financial statements)
The Company applies Ind AS 115 for recognition of revenue from real estate projects which is being recognised at a point in time upon the Company satisfying its performance obligation and the customer obtaining control of the underlying asset. Our audit procedures included:
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 the same has been considered as key audit matter. ? • Read the Company's revenue recognition accounting policies and assessed compliance of the policies with Ind AS 115.
? • Obtained and understood revenue recognition process including identi cation of performance obligations and determination of transfer of control of the asset underlying the performance obligation to the customer.
? • 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.
? • 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 recognised.
? • Assessed the revenue-related disclosures included in Note 27 to the nancial 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 including indemnifications and commitments given to a joint venture company which could have significant financial impact if the potential exposure were to materialize. Our audit procedures included:
Management estimates the possible outflow of economic resources based on legal counsel opinion and available information on the legal status of the proceedings. ? • Understood management's process relating to the identi cation and impact analysis of claims litigations contingencies (including commitment & indemni cations given to Joint Venture Company);
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. ? • Analyzed responses obtained from the legal advisors.
? • Obtained con rmation letters from legal counsels;
? • 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;
? • Assessed management's assumptions and estimates related to disclosures of contingent liabilities in the nancial statements.
Assessing the carrying value of Inventory and advances paid for land procurement (as described in note 12 to the standalone Ind AS financial statements)
The Company's inventory comprises of ongoing and completed real estate projects unlaunched projects and development rights. As at March 31 2020 the carrying values of inventories amounts to Rs.1068781.45 lakhs. Our audit procedures/testing included among others:
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. ? • Read and evaluated the accounting policies and disclosures made in the nancial statements with respect to 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. ? • Understood and reviewed the management's process and methodology of using key assumptions for determination of NRV of the inventories including considerations given to impact of Covid-19;
Further the Company has made various advances and deposits to the seller/ intermediary towards purchase of land during the course of obtaining clear and marketable title free from all encumbrances and transfer of legal title to the Company whereupon it is transferred to land stock under inventories. ? • Tested the NRV of the inventories to its carrying value in books on sample basis.
With respect to land advance given the net recoverable value is based on the management's estimates and internal documentation which include among other things the likelihood when the land acquisition would be completed the expected date of plan approvals for commencement of project estimation of sale prices and construction costs and Company's business plans in respect of such planned developments. In view of the Covid-19 pandemic the Company has reassessed its future business plans and key assumptions as at March 31 2020 while assessing the adequacy of carrying value of inventories and land advances. ? • Where the Company involved specialists to perform valuations we also performed the following procedures:
o Obtained and read the valuation report used by the management for determining the NRV;
o Considered the independence competence and objectivity of the specialist involved in determination of valuation.
o Involved experts to review the assumptions used by the management specialists.
For land advance our audit procedures included the following:
• Obtained status update from the management and veri ed the underlying documents for related developments.
• Compared the acquisition cost of the underlying land with current market price in similar locations.
• Evaluated the management assessment w.r.t. recoverability of those advances and changes if any in the business plans relating to such advances including considerations given to the impact of Covid-19.
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 March 31 2020 the carrying values of Company's investment in its subsidiaries joint ventures and associate entities amounts to Rs.1445589.72 lakhs. Our procedures in assessing the management's judgement for the impairment assessment included among others the following:
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". • Assessed the Company's valuation methodology applied in determining the recoverable amount of the investments including considerations given to impact of Covid-19;
In view of the Covid-19 pandemic the Company has reassessed its future business plans and key assumptions as at March 31 2020 while assessing the adequacy of carrying value of investments. ? • Obtained and read the valuation report used by the management for determining the fair value (‘recoverable amount') of its investments;
For investments where impairment indicators exist significant judgments are required to determine the key assumptions used in the valuation model and methodology such as revenue growth discount rates etc. ? • Considered the independence competence and objectivity of the management specialist involved in determination of valuation;
Considering the impairment assessment involves significant assumptions and judgement the same has been considered as key audit matter. ? • 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.
? • Involved experts to review the assumptions used by the management specialists. We reviewed the disclosures made in the nancial 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 March 31 2020 the Company has recognized deferred tax assets of Rs.247387.61 lakhs on deductible temporary differences and unused tax losses. Our audit procedures included amongst others:
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. • Obtained an understanding of the process and tested the controls over recording of deferred tax and review of deferred tax at each reporting date;
In view of the Covid-19 pandemic the Company has reassessed its future projections for recoverability of deferred tax assets as at March 31 2020 while assessing the adequacy of taxable income of future years. ? • Tested the computation of the amounts recognized as deferred tax assets;
Considering this involves significant judgement and estimates the same has been considered as key audit matter. ? • Evaluated management's assumptions including considerations given to impact of Covid-19 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 pro t trends and future business plans;
? • Assessed the disclosures on deferred tax included in Note 9 to the nancial 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 making new or additional investments in its subsidiaries; lending loans to related parties; sales and purchases to and from related parties etc. as disclosed in note 45 to the standalone Ind AS financial statements. Our procedures / testing included the following:
We identified the accuracy and completeness of the related party transactions and its disclosure as set out in respective notes to the financial statements as a key audit matter due to the significance of transactions with related parties and regulatory compliances thereon during the year ended March 31 2020. ? • 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;
? • Read minutes of shareholder 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 con rmation letters and other supporting documents;
? • Agreed the related party information disclosed in the nancial statements with the underlying supporting documents on a sample basis.

Information Other than the Financial Statements and Auditor's Report Thereon

The Company's Board of Directors is responsible for the other information. The otherinformation comprises the Message from Chairman Directors' Report Management Discussion& Analysis report and Corporate governance report but does not include thestandalone Ind AS financial statements and our auditor's report thereon.

Our opinion on the standalone Ind AS financial statements does not cover the otherinformation and we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone Ind AS financial statements ourresponsibility is to read the other information and in doing so consider whether suchother information is materially inconsistent with the financial statements or ourknowledge obtained in the audit or otherwise appears to be materially misstated. If basedon the work we have performed we conclude that there is a material misstatement of thisother information we are required to report that fact. We have nothing to report in thisregard.

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

The Company's Board of Directors is responsible for the matters stated in section134(5) of the Act with respect to the preparation of these standalone Ind AS financialstatements that give a true and fair view of the financial position financial performanceincluding other comprehensive income cash flows and changes in equity of the Company inaccordance with the accounting principles generally accepted in India including theIndian Accounting Standards (Ind AS) specified under section 133 of the Act read with theCompanies (Indian Accounting Standards) Rules 2015 as amended. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and the designimplementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the standalone Ind AS financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

In preparing the standalone Ind AS financial statements management is responsible forassessing the Company's ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessmanagement either intends to liquidate the Company or to cease operations or has norealistic alternative but to do so.

Those Board of Directors are also responsible for overseeing the Company's financialreporting process.

Auditor's Responsibilities for the Audit of the Standalone Ind AS Financial Statements

Our objectives are to obtain reasonable assurance about whether the standalone Ind ASfinancial statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these standalone Ind AS financial statements.

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

??Identify and assess the risks of material misstatement of the standalone Ind ASnancial statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is suf cient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.

??Obtain an understanding of internal control relevant to the audit in order to designaudit procedures that are appropriate in the circumstances. Under section 143(3)(i) of theAct we are also responsible for expressing our opinion on whether the

Company has adequate internal nancial controls system in place and the operatingeffectiveness of such controls.

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

??Conclude on the appropriateness of management's use of the going concern basis ofaccounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast signi cant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe nancial 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 the standalone Ind ASnancial statements including the disclosures and whether the standalone Ind AS nancialstatements represent the underlying transactions and events in a manner that achieves fairpresentation.

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

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

From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the standalone Ind AS financialstatements for the financial year ended March 31 2020 and are therefore the key auditmatters. We describe these matters in our auditor's report unless law or regulationprecludes public disclosure about the matter or when in extremely rare circumstances wedetermine that a matter should not be communicated in our report because the adverseconsequences of doing so would reasonably be expected to outweigh the public interestbenefits of such communication.

Other Matters

We did not audit the financial statements and other financial information as regardsCompany's share of profit of partnership firm (post tax) amounting to Rs.873.53 lakhs forthe year ended 31 March 2020 included in the accompanying standalone Ind AS financialstatements of the Company whose financial statements and other financial information havebeen audited by the other auditors whose reports have been furnished to us by themanagement and our opinion in so far as it relates to Company's share of loss included inrespect of the partnership firm investments is based solely on the report of such otherauditor.

The accompanying standalone Ind AS financial statements include unaudited financialstatements and other unaudited financial information as regards Company's share in loss ofpartnership firm (post tax) `283.18 lakhs for the year ended 31 March 2020. Theseunaudited financial statements and other unaudited financial information has beenfurnished to us by the management. Our opinion in so far as it relates to Company's shareof loss included in respect of the partnership firm investments is based solely on the onsuch unaudited financial statements and other unaudited financial information. In ouropinion and according to the information and explanations given to us by the Managementthese financial statements and other financial information are not material to theCompany.

Our opinion above on the standalone Ind AS financial statements and our report on OtherLegal and Regulatory Requirements below is not modified in respect of the above matterswith respect to our reliance on the work done and the reports of the other auditor and thefinancial statements and other financial information certified by the Management.

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 based on our audit and onthe consideration of report of the other auditors on separate nancial statements and theother nancial information of the partnership rm as noted in the ‘Other Matter'paragraph we give in the "Annexure 1" a statement on the matters speci ed inparagraphs 3 and 4 of the Order.

2. As required by Section 143(3) of the Act we report that: (a) We have sought andobtained all the information and explanations which to the best of our knowledge andbelief were necessary for the purposes of our audit;

(b) In our opinion proper books of account as required by law have been kept by theCompany so far as it appears from our examination of those books;

(c) The Balance Sheet the Statement of Profit and Loss including the Statement ofOther Comprehensive Income the Cash Flow Statement and Statement of Changes in Equitydealt with by this Report are in agreement with the books of account;

(d) In our opinion the aforesaid standalone Ind AS financial statements comply withthe Accounting Standards specified under Section 133 of the Act read with Companies(Indian

Accounting Standards) Rules 2015 as amended;

(e) The matter described in ‘Emphasis of Matters' paragraph above in our opinionmay have an adverse effect on the functioning of the Company.

(f) On the basis of the written representations received from the directors as on March31 2020 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2020 from being appointed as a director in terms of Section 164 (2) of theAct;

(g) With respect to the adequacy of the internal financial controls over financialreporting of the Company with reference to these standalone Ind AS financial statementsand the operating effectiveness of such controls refer to our separate Report in"Annexure 2" to this report;

(h) In our opinion the managerial remuneration for the year ended March 31 2020 hasbeen paid / provided by the Company to its directors in accordance with the provisions ofsection 197 read with Schedule V to the Act;

(i) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 as amended inour opinion and to the best of our information and according to the explanations given tous: i. The Company has disclosed the impact of pending litigations on its financialposition in its standalone Ind AS financial statements – Refer Note 50 to thestandalone Ind AS financial statements; ii. The Company has made provision as requiredunder the applicable law or accounting standards for material foreseeable losses if anyon long-term contracts including derivative contracts; iii. There has been no delay intransferring amounts required to be transferred to the Investor Education and ProtectionFund by the Company

For S.R. Batliboi & CO. LLP

Chartered Accountants ICAI Firm Registration Number: 301003E/ E300005 per ManojKumar Gupta

Partner

Membership No.: 083906 UDIN: 20083906AAAAAM2385

Gurugram 4 June 2020

Annexure 1 referred to in paragraph 1 under "Report on Other Legal and RegulatoryRequirements" section of our report of even date

Re: DLF Limited ("the Company")

(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of the fixed assets comprising of property plant andequipment and investment properties.

(b) All fixed assets comprising of property plant and equipment and investmentproperties have not been physically verified by the management during the year but thereis a regular programme of verification which in our opinion is reasonable having regardto the size of the Company and the nature of its assets. No material discrepancies werenoticed on such verification.

(c) According to the information and explanations given by the management the titledeeds of immovable properties included in property plant and equipment and investmentproperties are held in the name of the Company except: five immovable propertieshaving gross block of

Rs.1338.18 lakhs and net block of Rs.1338.18 lakhs title deed for which is in thename of one of the group company and the Company is in process of getting them registeredin their name. The Company has constructed building on such land having net block ofRs.12891.37 lakhs.

one immovable properties which includes land aggregating Rs.148.75 lakhs as at March31 2020 for which title deed is not in the name of the company and the company is in theprocess of getting the same registered in their name.

ii) In our opinion the management has conducted physical verification of inventory atreasonable intervals during the year except for inventory represented by developmentrights. Inventories represented by development rights have been confirmed as at March 312020 on the basis of custodian certificates obtained by the management. No materialdiscrepancies were noticed on such physical verification/ confirmations.

(iii) (a) The Company has granted unsecured loans to companies firms or other partiescovered in the register maintained under Section 189 of the Companies Act 2013. In ouropinion and according to the information and explanations given to us the terms andconditions of the grant of such loans are not prejudicial to the Company's interest.

(b) The Company has granted loans that are re-payable on demand to companies firms orother parties covered in the register maintained under Section 189 of the Companies Act2013. We are informed that the company has not demanded repayment of any such loan duringthe year and thus there has been no default on the part of the parties to whom the moneyhas been lent. The payment of interest has been regular.

(c) There are no amounts of loans granted to companies firms or other parties listedin the register maintained under Section 189 of the Companies Act 2013 which are overduefor more than ninety days.

(iv) In our opinion and according to the information and explanations given to usprovisions of Section 185 and 186 of the Companies Act 2013 in respect of loans todirectors including entities in which they are interested and in respect of loans andadvances given investments made and guarantees and securities given have been compliedwith by the Company.

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

(vi) We have broadly reviewed the books of account maintained by the Company pursuantto the rules made by the Central Government for the maintenance of cost records undersection 148(1) of the Companies Act 2013 in relation to construction industry and areof the opinion that prima facie the specified accounts and records have been made andmaintained. We have not however made a detailed examination of the same.

(vii) (a) Undisputed statutory dues including provident fund employees' stateinsurance income-tax sales-tax service tax duty of custom duty value added taxgoods and service tax cess and other statutory dues have generally been regularlydeposited with the appropriate authorities though there has been a slight delay in a fewcases. The provisions relating to duty of excise are not applicable to the Company.

(b) According to the information and explanations given to us no undisputed amountspayable in respect of provident fund employees' state insurance income-tax servicetax sales-tax duty of custom value added tax goods and service tax cess and otherstatutory dues were outstanding at the year end for a period of more than six monthsfrom the date they became payable. The provisions relating to duty of excise are notapplicable to the Company.

(c) According to the records of the Company the dues of income-tax sales-tax servicetax duty of custom value added tax goods and service tax and cess on account of anydispute are as follows:

Nature of Statute Nature of dues Amount Rs.( in lakhs) Amount paid under protest Rs.( in lakhs) Period to which the amount relates Forum where dispute is pending
Income Tax Act 1961 Tax demands on account of various disallowances during tax assessment 303942.11 7115.45 2006-07 and 2009- 10 to 2016-17 Income Tax Appellate Tribunal
Income Tax Act 1961 Tax demands on account of various disallowances during tax assessment 84243.90 - 1992-93 1995-96 to 2001-02 to 2008-09 Hon'ble High Court of Delhi
Income Tax Act 1961 Tax demands on account of various disallowances during tax assessment 114.39 - 2000-01 Hon'ble Supreme Court
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 Act 2012 Entry tax demand on purchase of goods in the state of West Bengal 5.14 - 2012-13 Hon'ble High Court of Kolkata
Uttar Pradesh Entry Tax Act 2012 Demand of VAT on account of taxable turnover 11.00 - 2016-17 Additional Commissioner (Appeals) Noida
West Bengal VAT Act2003 Demand of VAT on account of taxable turnover 16.15 - 2017-18 Commissioner (Appeals)
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 101.09 22.56 2014-15 to 2015-16 VAT Appellate Tribunal Odisha
Uttar Pradesh Value Added Tax Act 2008 Demand of VAT on account of taxable turnover 94.57 7.60 2011-12 2013-2014 and 2016-17 Additional Commissioner (Appeals) Noida
Haryana General Sales Tax Act 1973 Disallowance of refund 145.01 145.01 1997-98 to 1999-2000 Hon'ble High Court Punjab & Haryana
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 Supreme Court of India
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 19.40 2008 Custom Tribunal Kandla

(viii) In our opinion and according to the information and explanations given by themanagement the Company has not defaulted in repayment of loans or borrowings to afinancial institution bank or dues to debenture holders. The Company did not have anyoutstanding loans or borrowings due to government.

(ix) In our opinion and according to the information and explanations given by themanagement the Company has utilized the monies raised during the year for allotment ofequity shares against share warrants issued in earlier years non-convertible debenturesand term loans for the purposes for which they were raised. According to the informationand explanations given by the management the Company has not raised any money during theyear by way of initial public offer/ further public offer.

(x) Based upon the audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to the information and explanationsgiven by the management we report that no fraud by the Company or no fraud on the Companyby the officers and employees of the Company has been noticed or reported during the year.

(xi) According to the information and explanations given by the management themanagerial remuneration has been paid/ provided in accordance with the requisite approvalsmandated by the provisions of Section 197 read with

Schedule V to the Companies Act 2013.

(xii) In our opinion the Company is not a nidhi Company. Therefore the provisions ofclause 3(xii) of the order are not applicable to the Company and hence not commented upon.

(xiii) According to the information and explanations given by the managementtransactions with the related parties are in compliance with Section 177 and 188 ofCompanies Act 2013 where applicable and the details have been disclosed in the notes tothe financial statements as required by the applicable accounting standards.

(xiv) According to the information and explanations given by the management theCompany has complied with provisions of Section 42 of the Companies Act 2013 in respectof conversion of compulsorily convertible debentures into equity shares and allotment ofequity shares against share warrants issued in earlier years. According to theinformation and explanations given by the management we report that the amounts raisedduring the year in respect of allotment of equity shares against share warrants andamounts raised in previous year through Qualified Institutions Placement have been usedfor the purposes for which the funds were raised.

(xv) According to the information and explanations given by the management the Companyhas not entered into any non-cash transactions with directors or persons connected withhim as referred to in Section 192 of Companies Act 2013.

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

For S.R. Batliboi & CO. LLP

Chartered Accountants ICAI Firm Registration Number: 301003E/ E300005 per ManojKumar Gupta

Partner

Membership No.: 083906 UDIN: 20083906AAAAAM2385

Gurugram 4 June 2020

ANNExuRE II TO THE INDEPENDENT AuDITOR'S REPORT OF EvEN DATE ON THE STANDALONE IND ASFINANCIALSTATEMENTS OF DLF LIMITED

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls over financial reporting of DLF Limited("the Company") as of March 31 2020 in conjunction with our audit of thestandalone Ind AS financial statements of the Company for the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's Management is responsible for establishing and maintaining internalfinancial controls 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 Reporting issued by the Institute of Chartered Accountants ofIndia. These responsibilities include the design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theorderly and efficient conduct of its business including adherence to the Company'spolicies the safeguarding of its assets the prevention and detection of frauds anderrors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Companies Act 2013.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting with reference to these standalone Ind AS financialstatements based on our audit. We conducted our audit in accordance with the Guidance

Note on Audit of Internal Financial Controls Over Financial

Reporting (the "Guidance Note") and the Standards on Auditing as specifiedunder Section 143(10) of the Companies Act 2013 to the extent applicable to an audit ofinternal financial controls and both issued by the Institute of Chartered Accountants of

India. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting with reference to thesestandalone Ind AS financial statements was established and maintained and if such controlsoperated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls over financial reporting with reference to thesestandalone Ind AS financial statements and their operating effectiveness. Our audit ofinternal financial controls over financial reporting included obtaining an understandingof internal financial controls over financial reporting with reference to these standaloneInd AS financial statements assessing the risk that a material weakness exists andtesting and evaluating the design and operating effectiveness of internal control based onthe assessed risk. The procedures selected depend on the auditor's judgement includingthe assessment of the risks of material misstatement of the financial statements whetherdue to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the internal financial controls over financialreporting with reference to these standalone Ind AS financial statements.

Meaning of Internal Financial Controls Over Financial Reporting With Reference to theseFinancial Statements

A company's internal financial control over financial reporting with reference to thesestandalone Ind AS financial statements is a process designed to provide reasonableassurance regarding the reliability of financial reporting and the preparation offinancial statements for external purposes in accordance with generally acceptedaccounting principles. A company's internal financial control over financial reportingwith reference to these standalone Ind AS financial statements includes those policies andprocedures that

(1) pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorizations of management and directors of the company; and

(3) provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the company's assets that could have amaterial effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting WithReference to these Standalone Ind AS Financial Statements

Because of the inherent limitations of internal financial controls over financialreporting with reference to these standalone Ind AS financial statements including thepossibility of collusion or improper management override of controls materialmisstatements due to error or fraud may occur and not be detected. Also projections ofany evaluation of the internal financial controls over financial reporting with referenceto these standalone Ind AS financial statements to future periods are subject to the riskthat the internal financial control over financial reporting with reference to thesestandalone Ind AS financial statements may become inadequate because of changes inconditions or that the degree of compliance with the policies or procedures maydeteriorate.

Opinion

In our opinion the Company has in all material respects adequate internal financialcontrols over financial reporting with reference to these standalone Ind AS financialstatements and such internal financial controls over financial reporting with reference tothese standalone Ind AS financial statements were operating effectively as at March 312020 based on the internal control over financial reporting criteria established by theCompany considering the essential components of internal control stated in the Guidance

Note on Audit of Internal Financial Controls Over Financial Reporting issued by theInstitute of Chartered Accountants of India.

For S.R. Batliboi & CO. LLP

Chartered Accountants ICAI

Firm Registration Number: 301003E/ E300005

per Manoj Kumar Gupta

Partner

Membership No.: 083906

UDIN: 20083906AAAAAM2385

Gurugram 4 June 2020

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