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GAIL (India) Ltd.

BSE: 532155 Sector: Others
NSE: GAIL ISIN Code: INE129A01019
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OPEN 152.40
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VOLUME 2496577
52-Week high 170.00
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P/E 11.02
Mkt Cap.(Rs cr) 67,894
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OPEN 152.40
CLOSE 149.90
VOLUME 2496577
52-Week high 170.00
52-Week low 81.25
P/E 11.02
Mkt Cap.(Rs cr) 67,894
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

GAIL (India) Ltd. (GAIL) - Auditors Report

Company auditors report

To the members of GAIL (India) Limited

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the accompanying standalone financial statements of GAIL (India)Limited (hereinafter referred to as "the Company") which comprise of theStandalone Balance Sheet as at March 31 2021 the Standalone Statement of Profit and Loss(including Other Comprehensive Income) the Standalone Statement of Changes in Equity andthe Standalone Statement of Cash Flows for the year then ended and notes to the financialstatements including a summary of significant accounting policies and other explanatoryinformation (hereinafter referred to as "the standalone financial statements").

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the Companies Act 2013 ("the Act") in the manner so required and give a trueand fair view in conformity with the Indian Accounting Standards ("Ind AS")prescribed under section 133 of the Act read with the Companies (Indian AccountingStandards) Rules 2015 as amended and accounting principles generally accepted in Indiaof the state of affairs of the Company as at March 31 2021 its profit including othercomprehensive income changes in equity and its cash flows for the year ended on thatdate.

Basis for Opinion

We conducted our audit of the standalone financial statements in accordance with theStandards on Auditing (SAs) specified under section 143(10) of the Act. Ourresponsibilities under those Standards are further described in the Auditors'Responsibilities for the Audit of the Standalone Financial Statements section of ourreport. We are independent of the Company in accordance with the Code of Ethics issued bythe Institute of Chartered Accountants of India ("ICAI") 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 basisfor our opinion.

Emphasis of Matter

1. We draw attention to Note No. 33 (c) to the standalone financial statementsregarding various final transportation tariff orders issued by Petroleum and Natural GasRegulatory Board (PNGRB) which have been contested by the Company at Appellate Tribunalfor Electricity (APTEL) and also certain customers have challenged these orders of PNGRBin Court of Law. Adjustment if any will be recognized as and when matter is finallydecided.

2. We draw attention to Note No. 29 (I) (a) (iii) to the standalone financialstatements regarding CESTAT order confirming the demand for the differential amount by theCentral Excise Department in the matter pertaining to classification of 'Naphtha'manufactured by the Company of X 3139.92 crores including applicable penalty andinterest thereon. Considering the merits of the case Company has filed an appeal beforethe Hon'ble Supreme Court. Based on the legal opinion obtained the Company does notforesee any probable outflow in the matter and accordingly has disclosed the same undercontingent liability.

3. We draw attention to Note No. 52 (b)(iii) to the standalone financial resultsregarding corporate guarantees given by the Company on behalf of US subsidiary (X 535.41crores against guarantee fees towards meeting its obligation) and its Step down subsidiary(Rs. 7274.74 crores for furtherance of Company business). In this regard the Company isof the view that provision of Ind AS 109 is not applicable. However the Company hassought opinion from Expert Advisory Committee (EAC) constituted by The Institute ofChartered Accountants of India dated June9 2021.

4. We draw attention to Note No. 30 to the standalone financial statements regardingthe impact of COVID -19 pandemic on the Company. The impact of pandemic in future periodcannot be ascertained as on date. However the Management is of view that there will be nosignificant impact on the continuity of operations of the business on long term basis/ onuseful life of the assets/on financial position etc.

Our opinion is not modified in respect of matters mentioned in above paragraphs.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance 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 financialstatements as a whole and in forming our opinion thereon and we do not provide aseparate opinion on these matters. We have determined the matters described below to bethe key audit matters to be communicated in our report.

Sr. No. Key Audit Matter How our audit addressed the Key Audit Matter
1 Recognition and measurement of revenues in view of adoption of Ind AS 115 "Revenue from Contracts with Customers" Principal Audit Procedures
We identified above as Key Audit Matter as the application of the revenue accounting standard involves certain key judgements relating to identification of distinct performance obligations determination of transaction price of the identified performance obligations the appropriateness of the basis used to measure revenue recognized over a period. Additionally revenue accounting standard contains disclosures which involves collation of information in respect of disaggregated revenue and periods over which the remaining performance obligations will be satisfied subsequent to the balance sheet date. Refer notes 1.10 21 and 38 to the standalone financial statements. We assessed the Company's process to identify the impact of adoption of the revenue accounting standard and checked the appropriateness of accounting policy. Our audit approach consisted testing of design and operating effectiveness of the internal controls as follows:
1. Evaluated the design of internal controls relating to implementation of the revenue accounting standard wherever applicable.
2. Selected a sample of continuing and new contracts and tested the operating effectiveness of the internal control relating to identification of the distinct performance obligations and determination of transaction price. We carried out a combination of procedures involving enquiry and observation re-performance and inspection of evidence in respect of operation of these controls.
3. Tested the relevant information technology systems' access and change management controls relating to contracts and related information used in recording and disclosing revenue in accordance with the revenue accounting standard. Selected a sample of continuing and new contracts and performed the following substantive procedures:
1. Read analyzed and identified the distinct performance obligations in these contracts.
2. Compared these performance obligationswith that identified and recorded by the Company.
3. Considered the terms of the contracts to determine the transaction price including any variable consideration to verify the transaction price used to compute revenue and to test the basis of estimation of the variable consideration.
2 Evaluation of uncertain tax positions and contingent liabilities We have applied the following audit procedures in this regard:
The Company operates in multiple jurisdictions and is subject to periodic challenges by local tax authorities and other regulatory authorities such as PNGRB on a range of matters during the normal course of business including indirect tax matters. We have identified above as Key Audit Matter as these involve significant judgment to determine the possible outcome of material uncertain tax positions and contingent liabilities including matters under dispute consequently having an impact on related accounting and disclosures. Refer note 29 (1) to the standalone financial statements. 1. Obtained an understanding of key tax matters and other contingent liabilities. 2. Read and analyzed the key correspondences external legal opinions/ consultations obtained by the Company 3. Evaluated and challenged key assumptions made by the Company in estimating the current and deferred tax balances 4. Assessed and challenged the Company's estimate of the possible outcome of the disputed cases by considering legal precedence and other judicial rulings 5. Assessed and tested the presentation and disclosures relating to uncertain tax positions and contingent liabilities
3 Derivative transaction and accounting of hedge transactions We have applied the following audit procedures in this regard:
We have identified above as Key Audit Matter as hedge accounting has resulted into significant impact on financial statements coupled with complexity of its accounting calculations and complex/numerous assumptions taken for establishing hedge relationship. Mark to market gain/ loss pertaining to these derivative contracts are recognized in other comprehensive income. Refer note 58 to the standalone financial statements. 1. Obtained an understanding of management's controls over recording of derivative transactions and application of hedge accounting. 2. Tested the accuracy and completeness of derivative transactions. 3. We have relied on the valuation report evaluating the appropriateness of the valuation methodologies applied and tested on sample basis the valuation of the derivative financial instruments. 4. Validated that the derivative financial instruments qualifies for hedge accounting and tested accuracy of hedge effectiveness and ineffectiveness on sample basis.
4 Technical parameters and voluminous transactions of Natural gas trading and transmission captured to measure Revenue and Inventory through integrated system and complexities involved therein. We have applied the following audit procedures in this regard:
We have identified above as Key Audit Matter because determination of the quantity of Natural Gas sold and in stock through gas-pipelines involves use of various technical aspects of the natural gas such as pressure temperature etc. captured from the measuring devices installed on the gas pipelines. We were informed that the methodology is standard and used industry-wide. This increases the complexity of validating quantity of Natural Gas sold and stock in pipeline as at March 312021. Refer notes 1.9 1.10 10 and 21 to the standalone financial statements. 1. We have performed test of controls assisted by our IT specialists over the accuracy and completeness of the quantity captured via IT system through to the accounting software. 2. We have obtained management representation that the IT system applies a standard methodology to capture the quantity of Natural Gas for the purpose of Revenue and inventory measurement. 3. We have verified valuation of closing Inventories by applying various aspects made available to us by the management such as conversion factors meter reading etc.
5 Evaluation of the recoverable amounts of investments in and advances to certain subsidiaries We have applied the following audit procedures in this regard:
The Company's evaluation of the recoverable amounts of investments in and advances to certain subsidiaries involves comparison of their recoverable value and the carrying amount. Management determines the recoverable amount based on management's estimates of future cash flows. Significant judgements are required to determine the aforesaid assumptions used in the discounted cash flow models. Due to the uncertainty of forecasting and discounting future cash flows being inherently subjective the level of management's judgement involved and the significance of the Company's investment as at March 31 2021 we have considered this as a key audit matter. Refer notes 1.23 5 and 7 to the standalone financial statements. 1. We have carried out assessment of forecasts of future cash flows prepared by the management evaluating the assumptions and comparing the estimates to externally available industry economicand financial data. 2. Assessed the reasonableness of the key business assumptions such as revenue growth and EBIDTA margins by understanding the management's plan and performing retrospective testing. 3. We have evaluated the Company's valuation methodology in determining the fair value of the investment. In making this assessment we also assessed the professional competence objectivity and capabilities of the valuation specialist engaged by the management. 4. Assessed the reasonableness of the key assumptions adopted in the cash flow forecasts with the assistance of our internal valuation experts. 5. We have carried out discussions with management on the performance of the Company's investments as compared to previous year in order to evaluate whether the inputsand assumptions used in the cash flow forecasts were suitable. 6. Evaluated management's sensitivity analysis around the key assumptions.
6 Provision for Performance Related Pay We have applied the following audit procedures in this regard:
The provision for performance related pay for financial year 2020-21 is made based on Department of Public enterprises guidelines (DPE). The rating factors are yet to be approved by Board of directors. 1. We have reviewed the circular issued by DPE and verified the computations shared by the management for FY 2020-21 to satisfy that the methodology as prescribed in the circular have been followed and the provision made is reasonable. 2. We have verified the self-evaluation report of GAIL's Memorandum of Understanding (MOU) for the FY 2019-20 where ratings have been approved by the Board of Directors to determine reasonability of assumptions used for FY 2020-21. 3. We have also obtained MOU ratings communicated by DPE for FY 2019-20 mentioning scores and rating of the Company.

Information Other than the Standalone Financial Statements and Auditors' Report Thereon

The Company's Board of Directors is responsible for the preparation of otherinformation. The other information includes the Director's Report Corporate GovernanceReport Business Responsibility Report and Management Discussion and Analysis of AnnualReport but does not include the Standalone Financial Statementsand our report thereon.The Director's Report Corporate Governance Report Business Responsibility Report andManagement Discussion and Analysis of Annual Report is expected to be made available to usafter the date of this auditors' report.

Our opinion on the standalone financial statements does not cover the other informationand we will not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements our responsibilityis to read the other information identified above when it becomes available to us and indoing so consider whether the other information is materially inconsistent with theStandalone Financial Statements or our knowledge obtained during the course of our auditor otherwise appears to be materially misstated.

When we read such other information as and when made available to us and if we concludethat there is a material misstatement therein we are required to communicate the matterto those charged with governance.

Responsibilities of Management and Those Charged with Governance for the StandaloneFinancial 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 financial statementsthat give a true and fair view of the financial position financial performance includingother comprehensive income changes in equity and cash flows of the Company in accordancewith the accounting principles generally accepted in India including the IndianAccounting Standards (Ind AS) prescribed 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 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 financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

In preparing the standalone financial statements the Board of Directors is responsiblefor assessing the Company's ability to continue as a going concern disclosing asapplicable matters related to going concern and using the going concern basis ofaccounting unless management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so.

The Board of Directors are responsible for overseeing the Company's financial reportingprocess.

Auditors' Responsibilities for the Audit of the Standalone Financial Statements

Our objectives are to obtain reasonable assurance about whether the standalonefinancial statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditors' 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 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 standalonefinancial statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient 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 todesign 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 hasadequate internal financial controls system in place and the operating effectiveness ofsuch controls.

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

• Conclude on the appropriateness of management and Board of Directors use of thegoing concern basis of accounting and based on the audit evidence obtained whether amaterial uncertainty exists related to events or conditions that may cast significantdoubt on the Company's ability to continue as a going concern. If we conclude that amaterial uncertainty exists we are required to draw attention in our auditors' report tothe related disclosures in the standalone financial statements or if such disclosures areinadequate to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditors' report. However future events or conditions maycause the Company to cease to continue as a going concern.

• Evaluate the overall presentation structure and content of the standalonefinancial statements including the disclosures and whether the standalone financialstatements 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 ouraudit.

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 financial statementsof the current period and are therefore the key audit matters. We describe these mattersin our auditors' report unless law or regulation precludes public disclosure about thematter or when in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.

Other Matters

1. We draw attention to the Note no. 45(B)(iii) to the standalone financial statementsregarding inclusion of proportionate share in Jointly Controlled Operations in thestandalone financial statements of the Company. The total proportionate share includesAssets of X 1058.45 crore Liabilities of X 112.72 crores Expenditure of X 467.12 croreIncome of X 841.62 crore along with the elements making up the Cash Flow Statement andrelated disclosures. The aforesaid amounts have been included based on the unauditedstatements of these entities. Management is of view that this will not have a materialimpact on the Company's financial statements.

Our opinion is not modified in respect of above matter.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditors' Report) Order 2016 ("the Order")issued by the Central Government of India in terms of Section 143(11) of the Act and onthe basis of such checks of the books and records of the Company as we consideredappropriate and according to the information and explanation given to us we give in"Annexure A" a statement on the matters specified in paragraphs 3 and 4 of thesaid Order to the extent applicable.

2. As required by Comptroller and Auditor General of India throughdirections/sub-directions issued under Section 143(5) of the Companies Act 2013 on thebasis of written representation received from the management we give our report on thematter specified in the "Annexure-B" attached.

3. 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 bestof 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 theCompany so far as it appears from our examination of those books;

(c) The Standalone Balance Sheet the Standalone Statement of Profit and Loss(including the Other Comprehensive Income) the Standalone Statement of Changes in Equityand the Standalone Statement of Cash Flows dealt with by this Report are in agreement withthe books of account;

(d) In our opinion the aforesaid standalone financial statements comply with theIndian Accounting Standards (Ind AS) prescribed under section 133 of the Act read with theCompanies (Indian Accounting Standards) Rules 2015 as amended;

(e) Pursuant to the Notification No. GSR 463(E) dated 5th June 2015 issuedby the Ministry of Corporate Affairs Government of India provisions of sub-section (2)of Section 164 of the Act are not applicable to the Company being a Government Company;

(f) We are enclosing herewith a report in "Annexure - C" for our opinion onadequacy of internal financial controls system in place in the Company and the operatingeffectiveness of such controls;

(g) Pursuant to the Notification No. GSR 463(E) dated 5th June 2015 issuedby the Ministry of Corporate Affairs Government of India provisions of Section 197 ofthe Companies Act 2013 are not applicable to the Company being a Government Company;and

(h) With respect to the other matters to be included in the Auditors' Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financialposition in its standalone financial statements - Refer Note 29(l)(a) to the standalonefinancial statements;

ii. The Company has made provision as required under the applicable law or accountingstandards for material foreseeable losses if any and to the extent ascertainable onlong-term contracts including derivative contracts.

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

For ASA & Associates LLP For A.R. & Co.
Chartered Accountants Chartered Accountants
Firm Registration No.: 009571N/N500006 Firm Registration No.: 002744C
Parveen Kumar Pawan K Goel
Partner Partner
Membership No.: 088810 Membership No.:072209
UDIN: 21088810AAAACA7668 UDIN: 21072209AAAABR2599
Place: New Delhi
Dated: 09’hJune 2021

ANNEXURE - A TO THE INDEPENDENT AUDITORS' REPORT

Referred to in paragraph 1 to "Report on Other legal and regulatoryrequirements" of the Independent Auditors' Report of even date to the members of GAIL(INDIA) LIMITED on the Standalone Financial Statements for the year ended March 312021.

(i) (a) As informed to us the Company has maintained proper records showing fullparticulars including quantitative details and situation of fixed assets.

(b) According to information and explanation given to us there is a regular programmeof physical verification of the fixed assets by the management which in our opinion isreasonable having regard to the size of the Company and nature of its assets. As informedto us no material discrepancies were noticed on such verification.

(c) As informed to us and as verified by us during the course of our audit the titledeeds of immovable properties are held in name of the Company except for the cases asfollows.

Description of Asset No. of cases Area in Hectares Gross block ason 31.03.2021 (Rs. in crore) Net block as on 31.03.2021 (Rs. in crore)
Land
- Freehold 14 3.32 5.84 5.84
- Leasehold 10 37.98 17.07 17.07

(ii) As informed to us physical verification of inventory has been conducted atreasonable intervals by the management except the store and spares lying with the thirdparties. We have been explained that the stock of gas at the end of the year has beentaken with reference to reading of Turbine Flow Meter/Gas Chromatograph installed atTerminals Stock of LPG/Pentane/SBP Solvent are determined with reference to Tank LevelGauge measurement which are converted into tonnage by measurement of density and applyingcorrection factor for temperature. LPG vapors volume is converted to tonnage by standardformulae. As informed to us no material discrepancies were noticed on physicalverification of inventory.

(iii) As informed to us the Company has granted secured and unsecured loans tocompanies covered in the register maintained under section 189 of the Companies Act 2013.In respect of such loans:

a) In our opinion and as informed to us the terms and conditions of the grant of suchloans are not prejudicial to the Company's interest.

b) The schedule of repayment of principal and payment of interest has been stipulatedand repayments or receipts of principal amounts and interest have been regular as perstipulations.

c) As informed to us no amount of loan is overdue as at end of the year fora periodmore than ninety days.

(iv) According to the information and explanations given to us the Company hascomplied with the provisions of Section 185 and 186 of Companies Act 2013 in respect ofloans/ investment/ guarantee/ security granted during the year.

(v) The Company has not accepted any deposits in terms of the directives issued by theReserve Bank of India and the provisions of sections 73 to 76 or any other relevantprovisions of the Companies Act 2013 and the rules framed there under.

(vi) We have broadly reviewed the accounts and records maintained by the Companypursuant to the Rules made by the Central Government for the maintenance of cost recordsunder sub-section (1) of Section 148 of the Companies Act 2013 read with Companies (CostRecords & Audit) Rules 2014 and we are of the opinion that prima facie the prescribedaccounts and records have been made and maintained. We have not however made detailedexamination of the records with a view to determine whether they are accurate andcomplete.

(vii) (a) According to records of the Company and information and

explanation given to us the Company has generally been regular in depositing undisputedstatutory dues including provident fund employees1 state insuranceincome-tax sales-tax service tax duty of customs duty of excise value added taxcess Goods and Service Tax and any other statutory dues with the appropriate authorities.According to information and explanation given to us there are no outstanding statutorydues as referred above as at the last day of the financial year under audit for a periodof more than six months from the date they became payable.

(b) As certified by the management on which we have relied upon the dues of income taxor sales tax or service tax or duty of custom or duty of excise or value added tax or cessor Goods and Service Tax which have not been deposited on account of dispute or depositedunder protest and the forum where the dispute is pending are given below:

(Rs. in crore)

S. Name of No. Statute Nature of the Dues Period to which the amount relates Forum where the dispute is pending Gross disputed amount Amount deposited under protest/appeal Amount not deposited
1 Entry Tax Act of respective States Entry Tax / Penalty / Interest 2002-03 to 2004-05 Hon. High Court Allahabad 23.10 - 23.10
1999-00 to 2009-10 CommercialTax Tribunal.UP 241.34 6.41 234.96
2008-09 Additional Commissioner (Appeals) Noida Commercial Taxes 0.60 - 0.60
2015-16 Additional commissioner (Appeals) Gwalior Commercial Taxes 0.90 0.90 -
2002-03 to 2005-06 Dy. Commissioner (Appeals) Commercial Tax Ajmer 1.40 - 1.40
SUB-TOTAL 267.34 7.31 260.06
2 Central Sales TaxAct 1956 and respective State Sales Tax / VAT Act CST / Sales Tax / VAT/ Penalty / Interest 2003-2004 Hon. High Court Mumbai 0.63 0.03 0.60
2003-2004 Hon. High Court Guwahati 0.29 0.14 0.15
2007-08 SalesTaxTribunal Mumbai 25.27 3.80 21.47
2013-14 Joint Commissioner Thanjavur 0.09 - .09
Oct 2011 to Dec 2011 Joint Commissioner of Commercial Taxes Trichy 0.92 - 0.92
2011-12 & 2012 to 2015 Joint Commissioner (Appeals) Sales Tax Mumbai 82.17 2.32 79.81
2014-15 Joint Commissioner (Appeals) Sonepat 5.88 - 5.88
2003-04 Joint Commissioner (Appeals) Commercial Tax Vadodara 4.79 1.19 3.60
SUB-TOTAL 120.04 7.48 112.52
3. Central Excise Act 1944 Central Excise Duty / Interest/ Penalty Jan 2008 to March 2012 Hon. Supreme Court 3139.92 20.00 3119.92
Oct 2001 to Aug 2004 Customs Excise and Service Tax AppellateTribunal Mumbai 223.47 - 223.47
Aug 2006 to Feb 2014 Customs Excise and Service Tax AppellateTribunal Delhi 11.23 - 11.23
Nov 2010 to March 2011 Customs Excise and Service Tax Appellate Tribunal Ahmedabad 1.66 - 1.66
May 2007 to May 2009 Customs Excise and Service Tax AppellateTribunal Kolkata 8.78 0.66 8.12
SUB-TOTAL 3385.06 20.66 3364.40
4 Goods & Service Tax 2017 GST/ Interest/ Penalty Jan 2019 High Court Allahabad 0.85 0.85 -
5 FinanceAct1994 (Service Tax) Service Tax/ Interest/ Penalty Apr 2009 to Mar 2014 Customs Excise and Service Tax AppellateTribunal Delhi 6.84 0.42 6.42
6 Customs Act 1962 Customs Duty/ Interest/Penalty March 2006 Customs Excise and Service Tax AppellateTribunal Delhi 0.53 0.46 0.07
March 2013 to July 2014 Commissioner of Customs Excise and Service Tax (Appeals) Ahmedabad 7.78 7.78 -
7 Income Tax Act 1961 Income Tax/ Penalty/ Interest A.Y. 2008-09 to A.Y. 2018-19 Jurisdictional Assessing Officer (TDS) 0.41 - 0.41
8 Gujarat Municipalities Act 1963 Notified Area Tax / GIDC Tax / Interest 1998-99 to 2005-06 & 1985-86 to 2009-10 Hon. High Court Ahmedabad 6.50 - 6.50
TOTAL 3795.35 44.96 3750.38

(viii) Based on our audit procedures and in accordance with the information andexplanations given to us by the management the Company has not defaulted in repayment ofdues to a bank or government or bonds holders.

(ix) The Company has not raised any money by way of initial public offer or furtherpublic offer or further public offer (including debt instrument). In our opinion andaccording to the information and explanations given by the management the Company hasutilized the monies raised by way of term loans for the purposes for which they wereraised.

(x) According to the information and explanations given to us and as represented by themanagement and based on our examination of the books and records of the Company and inaccordance with generally accepted auditing practices in India no case of frauds by theCompany or any fraud on the Company by its officers or employees has been noticed orreported during the year.

(xi) As per notification no. GSR 463(E) dated 5 June 2015 issued by the Ministry ofCorporate Affairs Government of India Section 197 is not applicable to the GovernmentCompanies. Accordingly paragraph 3 (xi) of the Order is not applicable to the Company.

(xii) The Company is not a nidhi Company and therefore paragraph 3(xii)of the Orderrelated to such companies is not applicable to the Company.

(xiii) In our opinion the Company has complied with provisions of sections 177 and 188of Companies Act 2013 in respect of transactions with the related parties and the detailshave been disclosed in the Standalone Financial Statements as required by the applicableaccounting standards.

(xiv) The Company has not made any preferential allotment or private placement ofshares or fully or partly convertible debentures during the year. Accordingly paragraph3(xiv) of the Order is not applicable to the Company.

(xv) As informed to us during the year the Company has not entered into any non-cashtransactions with any of its directors or persons connected with the Directors.

(xvi) The Company is not required to get registered under section 45-IA of Reserve Bankof India Act'1934.

For ASA & Associates LLP For A.R. & Co.
Chartered Accountants Chartered Accountants
Firm Registration No.: 009571N/N500006 Firm Registration No.: 002744C
Parveen Kumar Pawan K Goel
Partner Partner
Membership No.: 088810 Membership No.:072209
UDIN: 21088810AAAACA7668 UDIN: 21072209AAAABR2599
Place: New Delhi
Dated: 09th June 2021

ANNEXURE - B TO THE INDEPENDENT AUDITORS' REPORT

Referred to in paragraph 2 to "Report on Other legal and regulatoryrequirements" of the Independent Auditors' Report of even date to the members of GAIL(INDIA) LIMITED on the standalone financial statements for theyearended March 312021.

Sr. No. Directions / Sub Directions Action taken Impact on standalone financial statement
1 Whether the Company has system in place to process all the accounting transactions through IT systemRs. If yes the implications of processing of accounting transaction outside IT system on the integrity of the accounts along with the financial implications if any may be statedRs. The Company maintains its books of account on IT system SAP which is an ERP system. All accounting transactions are processed in accounts maintained on SAP. Based on the audit procedures carried out and as per the information and explanations given to us no accounting transactions have been processed or carried outside the IT system of the Company. Accordingly in our opinion there are no implications on the integrity of the accounts. Nil
2 Whether there is any restructuring of an existing loan or cases of waiver/write off of debts/loans/interest made by a lender due to Company's inability to repay the loanRs. If yes the financial impact may be statedRs. (In case lender is a government Company then this direction is also applicable for statutory auditor of lender Company) In accordance with the audit procedures carried out and as per the information and explanations given to us by the Company there was no restructuring of existing loans or cases of waiver/write off of debts/ loans/interest made by a lender to the Company due to the Company's inability to repay the loan. Nil
3 Whether funds received/ receivable for specific schemes from central state agencies were properly accounted for/utilized as per its terms and conditionsRs. List the cases of deviation. Refer to Note 55 of the standalone financial statements regarding the grant received by the Company for the project Jagdishpur Haldia Bokaro Dhamra Pipeline Project (JHBDPL). According to the information and explanations given to us and as represented by the Management and based on our examination of the books and records of the Company these have been utilized as per its terms and conditions. We did notencounter any deviation. Nil

 

For ASA & Associates LLP For A.R. & Co.
Chartered Accountants Chartered Accountants
Firm Registration No.: 009571N/N500006 Firm Registration No.: 002744C
Parveen Kumar Pawan K Goel
Partner Partner
Membership No.: 088810 Membership No.:072209
UDIN: 21088810AAAACA7668 UDIN: 21072209AAAABR2599
Place: New Delhi
Dated: 09th June 2021

ANNEXURE - C TO THE INDEPENDENT AUDITORS' REPORT

Referred to in paragraph 3(f) to "Report on Other legal and regulatoryrequirements" of the Independent Auditors' Report of even date to the members of GAIL(INDIA) LIMITED on the standalone financial statements for the year ended March 312021.

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

We have audited the internal financial controls over financial reporting of GAIL(INDIA) LIMITED ("the Company") as of March 31 2021 in conjunction with ouraudit of the standalone financial statements of the Company for the year ended on thatdate.

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 Reportingissued by the Institute of Chartered Accountants of India. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to Company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe Companies Act 2013.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting(the "Guidance Note") and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. 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 was established andmaintained and if such controls operated effectively in all material respects. Our auditinvolves performing procedures to obtain audit evidence about the adequacy of the internalfinancial controls system over financial reporting and their operating effectiveness.

Our audit of internal financial controls over financial reporting included obtaining anunderstanding of internal financial controls over financial reporting assessing the riskthat a material weakness exists and testing and evaluating the design and operatingeffectiveness of internal control based on the assessed risk. The procedures selecteddepend on the auditors’ judgment including the assessment of the risks of materialmisstatement of the financial statements whether due to fraud or error. We believe thatthe audit evidence we have obtained is sufficient and appropriate to provide a basis forour audit opinion on the Company’s internal financial controls system over financialreporting.

Meaning of Internal Financial Controls Over Financial Reporting

A Company's internal financial control over financial reporting is a process designedto provide 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 includes those policies and procedures 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

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

Opinion

In our opinion the Company has in all material respects an adequate internalfinancial controls system except strengthening of procedures around annual financialstatement closure process owing to working restrictions around reduced manpower lockdownsimposed in various states and workings from home due to Covid-19 pandemic over financialreporting and such internal financial controls over financial reporting were operatingeffectively as at March 312021 based on the internal control over financial reportingcriteria established by the Company considering the essential components of internalcontrol stated in the Guidance Note on Audit of Internal Financial Controls Over FinancialReporting issued by the Institute of Chartered Accountants of India.

We have considered the areas of improvement identified which needs furtherstrengthening as reported above in determining the nature timing and extent of audittests applied in our audit of the March 312021 standalone Ind AS financial statements ofthe Company. However these areas of improvement do not affect our opinion on thestandalone Ind AS financial statements of the Company.

For ASA & Associates LLP For A.R. & Co.
Chartered Accountants Chartered Accountants
Firm Registration No.: 009571N/N500006 Firm Registration No.: 002744C
Parveen Kumar Pawan K Goel
Partner Partner
Membership No.: 088810 Membership No.:072209
UDIN: 21088810AAAACA7668 UDIN: 21072209AAAABR2599
Place: New Delhi
Dated: 09’hJune 2021

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