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Interglobe Aviation Ltd.

BSE: 539448 Sector: Services
NSE: INDIGO ISIN Code: INE646L01027
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OPEN 2075.00
CLOSE 2069.35
VOLUME 10990
52-Week high 2379.00
52-Week low 1513.30
P/E
Mkt Cap.(Rs cr) 78,842
Buy Price 2045.90
Buy Qty 5.00
Sell Price 2047.35
Sell Qty 4.00

Interglobe Aviation Ltd. (INDIGO) - Auditors Report

Company auditors report

To the Members of InterGlobe Aviation Limited

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the accompanying standalone financial statements ofInterGlobe Aviation Limited ("the Company") which comprise the Balance sheet asat March 31 2022 the Statement of Profit and Loss including the statement of OtherComprehensive Income the Cash Flow Statement and the Statement of Changes in Equity forthe year then ended and notes to the standalone financial statements including a summaryof significant 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 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 March312022 its loss including other comprehensive income its cash flows and the changes inequity for the year ended on that date.

Basis for Opinion

We conducted our audit of the standalone 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'sResponsibilities for the Audit of the Standalone Financial Statements' section of ourreport. We are independent of the Company in accordance with the 'Code of Ethics' issuedby the Institute of Chartered Accountants of India together with the ethical requirementsthat are relevant to our audit of the financial statements under the provisions of the Actand the Rules thereunder and we have fulfilled our other ethical responsibilities inaccordance with these requirements and the Code of Ethics. We believe that the auditevidence we have obtained is sufficient and appropriate to provide a basis for our auditopinion on the standalone financial statements.

Emphasis of Matter

We draw attention to Note 46 to the standalone financial statementswhich describes the possible effects of uncertainties relating to COVID-19 pandemic on theCompany's operations and results as assessed by the management. Our opinion is notmodified in respect of this matter.

Key Audit Matters

Key audit matters are those matters that in our professional judgmentwere of most significance in our audit of the standalone financial statements for thefinancial year ended March 31 2022. These matters were addressed in the context of ouraudit of the standalone 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 have determined the matters described below to be the key auditmatters to be communicated in our report. We have fulfilled the responsibilities describedin the Auditor's responsibilities for the audit of the standalone 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 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 financial statements.

Key audit matters How our audit addressed the key audit matter
Recognition of Passenger Revenue (refer note 22 to the standalone financial statements)
The Company recognises passenger revenue on flown basis i.e. when the service is rendered. Moreover fees charged for cancellation of flight tickets is recognised as revenue on rendering of the said service. Further the company recognises revenue from unexercised rights of customers which are non-refundable in nature based on past trends in proportion to the pattern of rights exercised by the customer. Our procedures included but were not limited to the following:
The determination of passenger revenue to be recognised for each flight requires complex IT systems and involves high volume of transactions. • assessed that the revenue recognition policy is in line with Ind AS 115 'Revenue from Contracts with Customers';
We identified revenue recognition as a key audit matter because passenger revenue is one of the Company's key performance indicators it involves complicated IT systems that handle large volumes of transaction data and includes exchange of information with industry systems and partner airlines and the judgement required by management in determining the unexercised rights of passengers all of which give rise to an inherent risk that revenue could be recorded in the incorrect period or at incorrect amount. • involved our IT specialist to assist in assessing the design implementation and operating effectiveness of management's general IT controls and key application controls over the Company's IT systems and third- party systems (assessed the assurance report the SSA€ 16 report attesting the appropriateness and effectiveness of the internal control system established by the service provider) which govern revenue recognition and key manual internal controls over passenger revenue recognition including controls related to estimation of trends in respect of unused tickets and testing of preventive controls over unauthorised override;
• performed tests of details such as tested revenue and collection reconciliations of Company's records with reports generated from third party systems tested manual journal entries posted into relevant revenue accounts in the sub-ledger and general ledger which met specified risk-based criteria;
• analysed the terms related to passenger tickets and obtained data supporting Company's historical expiry trend in respect of unused passenger tickets and tested a sample of ticket documents from the source data to ascertain timing of the recognition they were recorded and evaluated the judgements used in determining the timing of the recognition of revenue from unexercised rights of passengers;
• performed tests to verify that the timing of passenger revenue recognition was appropriate.
Lease accounting incentives and corresponding tax implications
(refer note 17.b to the standalone financial statements)
The Company operates certain new and used aircraft under lease arrangements. Our audit procedures included but were not limited to:
For determination of the appropriate lease accounting under Ind AS 116 basis classification of leases sale and leaseback transactions and corresponding tax treatment the Company has considered the substance of the transaction rather than just the legal form including among other factors treatment of receipt of non-refundable incentives in connection with acquisition of new aircraft. • tested that the Company's accounting policies are in compliance with requirements of Ind AS 116 including consideration of exemptions;
We considered lease accounting of aircraft and other leases (including the corresponding tax treatment) as a key audit matter due to significant judgement required in the assumptions and estimates used to determine the Right of Use (ROU) asset and lease liability viz assessment of lease term (including modification terms) determination of appropriate incremental borrowing rate treatment of non-refundable incentives received in connection with the acquisition of the aircrafts and other assets in ROU componentisation of the ROU asset and the tax treatment of incentives involves a significant degree of management judgement in interpreting the various relevant rules regulations and practices. • assessed the design implementation and operating effectiveness of management's key internal controls over process for identifying lease contracts or contracts which contain leases related incentives and accounting thereof;
• tested the completeness of the data in the aircraft lease master by validating the key terms of the aircraft acquisition and leases agreements (including modifications) and assessed management judgements used in determining the classification of leases;
• performed tests of details to examine the inputs used for determining right of use assets and lease liabilities related to lease contracts with underlying lease agreements including related incentives received and performed computation checks on the amount of lease liability and the right to use tracing of the same to bank statements credit notes underlying contracts/ documents;
• assessed the inputs used for determination of the incremental borrowing rate including assessment of lease term by reference to the underlying lease contracts and market data; • engaged our internal tax specialists to assess Company's assumptions critical judgements made by management on the tax treatment of incentives which impacted their estimations of the provisions required for open tax assessments and for other years basis the favourable ITAT special bench orders received by the Company opinions given by third party tax advisors settlements being made by the Company under Vivad se Vishwas scheme for certain years; • assessed the adequacy of the disclosures in respect of the tax position in Note 31 to the standalone financial statements.
Aircraft Maintenance Obligations
(refer note 18 to the standalone financial statements)
The Company operates aircraft which are owned or held under lease arrangements and incurs liabilities for maintenance costs in respect of aircraft leased during the term of the lease. Our audit procedures to assess aircraft maintenance provisions included but were not limited to the following:
These arise from legal and contractual obligations relating to the condition of the aircraft when it is returned to the lessor. At each reporting date the calculation of the maintenance provision includes a number of variable factors and assumptions including: likely utilisation of the aircraft; the expected cost of the heavy maintenance check at the future date it is expected to occur; the condition of the aircraft engine contractual return conditions. • assessed the design implementation and operating effectiveness of the management's internal controls over the maintenance process including accounting for maintenance provisions for aircraft held under operating leases;
Given the involvement of inherent level of management judgement required as a result of the complex and subjective element around these variable factors and assumptions in order to quantify the provision amounts we have identified this as a key audit matter. • assessed the adequacy of the provision recorded and key assumptions adopted by management in estimating the provisions and any changes therein and reviewed the terms of the operating leases compared assumptions to contract terms and the Company's maintenance cost experience;
• obtained information about the utilisation pattern by reference to the expected future maintenance event dates from Company's appropriate personnel and assessed the consistency of the provisions with the engineering department's assessment of the condition of aircraft based on underlying engine borescope inspections and results analysis of historical flight hours estimate of the cost of maintenance work to historic invoices;
• assessed the adequacy of the provision by ensuring that all significant return condition obligations included in aircraft lease contracts have been considered;
• performed sensitivity analysis around the key assumptions.
Impact of COVID-19 on impairment of non-financial assets
(refer note 46 to the standalone financial statements)
During the current year due to significant impact of COVID-19 on the business operations of the Company impairment indicators were identified on the investments in non-financial assets namely PPE and ROU. As a result an impairment assessment was required to be performed. There was uncertainty in estimating the recoverable amount of the PPE and ROU which principally arose from the inputs used in both forecasting and discounting future cash flows. Furthermore the value in use is highly sensitive to changes in these inputs. Our audit procedures included but were not limited to:
The determination of the recoverable amount of the PPE and ROU was one of the key judgmental areas in preparing the financial statements due to a combination of the significance of the ROU and PPE and involved management making estimates and judgements that are critical to the outcomes of these inputs and the inherent uncertainty in the assumptions supporting the recoverable amount of these assets hence impact of COVID-19 on the impairment of non-financial assets has been determined to be a key audit matter. • obtained management's most recent financial results forecasts and liquidity analysis underlying their impairment assessment and tested the integrity of the forecasts including mathematical accuracy;
• together with our valuation specialists inspected management's most recent forecasts and assessed the underlying assumptions/ calculations the assumed duration of the disruption having considered information on capacity passenger load factors and expected growth rates from recent industry sources;
• assessed potential changes in key drivers with management in order to evaluate whether the inputs and assumptions used in the cash flow forecasts were suitable;
• assessed the most recent forecasts with the management of the entity to understand Company's and the Board's views on impairment of the non-financial assets;
• assessed the adequacy of the disclosures made in the Standalone financial statements.

Information Other than the Standalone Financial Statements andAuditor's Report Thereon

The Company's Board of Directors is responsible for the otherinformation. The other information comprises the information included in the Annualreport but does not include the standalone financial statements and our auditor's reportthereon.

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

In connection with our audit of the standalone financial statementsour responsibility is to read the other information and in doing so consider whethersuch other 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 forthe Standalone Financial Statements

The Company's Board of Directors is responsible for the matters statedin section 134(5) of the Act with respect to the preparation of these standalone 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 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 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 FinancialStatements

Our objectives are to obtain reasonable assurance about whether thestandalone financial statements as a whole are free from material misstatement whetherdue to fraud or error and to issue an auditor's report that includes our opinion.Reasonable assurance is a high level of assurance but is not a guarantee that an auditconducted 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 financial statements.

As part of an audit in accordance with SAs we exercise professionaljudgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of thestandalone financial statements whether due to fraud or error design and perform auditprocedures responsive to those risks and obtain audit evidence that is sufficient andappropriate to provide a basis for our opinion. The risk of not detecting a materialmisstatement resulting from fraud is higher than for one resulting from error as fraudmay involve collusion forgery intentional omissions misrepresentations or the overrideof internal control.

• Obtain an understanding of internal control relevant to theaudit in order to design audit procedures that are appropriate in the circumstances. Undersection 143(3)(i) of the Act we are also responsible for expressing our opinion onwhether the Company has adequate internal financial controls with reference to financialstatements in place and the operating effectiveness of such controls.

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

• Conclude on the appropriateness of management's use of the goingconcern basis of accounting and based on the audit evidence obtained whether a materialuncertainty exists related to events or conditions that may cast significant doubt on theCompany's ability to continue as a going concern. If we conclude that a materialuncertainty exists we are required to draw attention in our auditor's report to therelated disclosures in the financial statements or if such disclosures are inadequate tomodify our opinion. Our conclusions are based on the audit evidence obtained up to thedate of our auditor's report. However future events or conditions may cause the Companyto cease to continue as a going concern.

• Evaluate the overall presentation structure and content of thestandalone financial statements including the disclosures and whether the standalonefinancial statements represent the underlying transactions and events in a manner thatachieves fair presentation.

We communicate with those charged with governance regarding amongother matters the planned scope and timing of the audit and significant audit findingsincluding any significant deficiencies in internal control that we identify during ouraudit.

We also provide those charged with governance with a statement that wehave complied with relevant ethical requirements regarding independence and tocommunicate with them all relationships and other matters that may reasonably be thoughtto bear on our 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 standalonefinancial statements for the financial year ended March 31 2022 and are therefore the keyaudit matters. 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.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order 2020("the Order") issued by the Central Government of India in terms of sub-section(11) of section 143 of the Act we give in the "Annexure 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 financial statementscomply with the Accounting Standards specified under Section 133 of the Act read withCompanies (Indian Accounting Standards) Rules 2015 as amended;

(e) On the basis of the written representations received from thedirectors as on March 312022 taken on record by the Board of Directors none of thedirectors is disqualified as on March 312022 from being appointed as a director in termsof Section 164 (2) of the Act;

(f) With respect to the adequacy of the internal financial controlswith reference to standalone financial statements and the operating effectiveness of suchcontrols refer to our separate Report in "Annexure 2" to this report;

(g) In our opinion the managerial remuneration for the year endedMarch 312022 has been paid / provided by the Company to its directors in accordance withthe provisions of section 197 read with Schedule V to the Act;

(h) With respect to the other matters to be included in the Auditor'sReport in accordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 asamended in our opinion and to the best of our information and according to theexplanations given to us:

i. The Company has disclosed the impact of pending litigations on itsfinancial position in its standalone financial statements - Refer Note 31 to thestandalone financial statements;

ii. The Company did not have any long-term contracts includingderivative contracts for which there were any material foreseeable losses;

iii. There were no amounts which were required to be transferred to theInvestor Education and Protection Fund by the Company;

iv. a) The management has represented that to the best of itsknowledge and belief no funds have been advanced or loaned or invested (either fromborrowed funds or share premium or any other sources or kind of funds) by the company toor in any other person(s) or entity(ies) including foreign entities("Intermediaries") with the understanding whether recorded in writing orotherwise that the Intermediary shall whether directly or indirectly lend or invest inother persons or entities identified in any manner whatsoever by or on behalf of theCompany ("Ultimate Beneficiaries") or provide any guarantee security or thelike on behalf of the Ultimate Beneficiaries;

b) The management has represented that to the best of its knowledgeand belief no funds have been received by the company from any person(s) or entity(ies)including foreign entities ("Funding Parties") with the understanding whetherrecorded in writing or otherwise that the company shall whether directly or indirectlylend or invest in other persons or entities identified in any manner whatsoever by or onbehalf of the Funding Party ("Ultimate Beneficiaries") or provide any guaranteesecurity or the like on behalf of the Ultimate Beneficiaries; and

c) Based on such audit procedures that were considered reasonable andappropriate in the circumstances nothing has come to our notice that has caused us tobelieve that the representations under sub-clause (a) and (b) contain any materialmisstatement.

v. No dividend has been declared or paid during the year by theCompany.

Annexure 1 referred to in paragraph 1 under the heading "Report onOther Legal and Regulatory Requirements" of our report of even date

Re: InterGlobe Aviation Limited ('the Company')

(i) (a) (A) The company has maintained proper records showing fullparticulars including quantitative details and situation of Property Plant andequipment.

(B) The company has maintained proper records showing full particularsof intangible assets.

(b) The Company has a regular programme of physical verification of itsProperty Plant and equipment by which all of them are verified in a phased manner over aperiod of two years except for aircraft and spare engines which are verified on an annualbasis and rotables which are verified in a phased manner over a period of three years. Inour opinion this periodicity of physical verification by management is reasonable havingregard to the size of the Company and the nature of its assets. In accordance with thisprogramme certain Property Plant and Equipment were physically verified during the year.As informed to us no material discrepancies were noticed on such verification.

(c) There is no immovable property (other than properties where theCompany is the lessee and the lease agreements are duly executed in favour of the lessee)held by the Company and accordingly the requirement to report on clause 3(i)(c) of theOrder is not applicable to the Company.p>

(d) The Company has not revalued its Property Plant and Equipment(including Right of use assets) or intangible assets during the year ended March 312022.

(e) There are no proceedings initiated or are pending against theCompany for holding any benami property under the Prohibition of Benami PropertyTransactions Act 1988 and rules made thereunder.

(ii) (a) The management has conducted physical verification ofinventory at reasonable intervals except for inventories lying with third parties andgoods in transit amounting to Rs. 218.33 mn which have not been verified at the end of theyear. In our opinion the coverage and the procedure of such verification by the managementis appropriate. Inventories lying with third parties have been confirmed by them as atyear end. Discrepancies of 10% or more in aggregate for each class of inventory have notbeen noticed on such physical verification and in respect of confirmations from thirdparties.

(b) As disclosed in note 17 (a) to the Standalone financial statementsthe Company has been sanctioned working capital limits in excess of Rs. five crores inaggregate from banks during the year on the basis of security of current assets of theCompany. As stated in the aforesaid note no quarterly returns/statements were required tobe filed by the Company with such banks during the year ended March 312022. Accordinglythe reporting requirement in relation to agreement of such quarterly returns/statementswith the books of account is not applicable to the Company.

(iii) According to the information and explanations given to us duringthe year the Company has not provided loans advances in the nature of loans stoodguarantee or provided security to companies firms Limited Liability Partnerships or anyother parties. Accordingly the requirement to report on clause 3(iii)(a) (b) (c) (d)(e) and (f) of the Order is not applicable to the Company.

(iv) There are no loans investments guarantees and security inrespect of which provisions of sections 185 and 186 of the Companies Act 2013 areapplicable and accordingly the requirement to report on clause 3(iv) of the Order is notapplicable to the Company.

(v) The Company has neither accepted any deposits from the public noraccepted any amounts which are deemed to be deposits within the meaning of sections 73 to76 of the Companies Act and the rules made thereunder to the extent applicable.Accordingly the requirement to report on clause 3(v) of the Order is not applicable tothe Company.

(vi) The Central Government has not specified the maintenance of costrecords under Section 148(1) of the Companies Act 2013 for the products/services of theCompany.

(vii) (a) Company is regular in depositing with appropriate authoritiesundisputed statutory dues including goods and services tax provident fund employees'state insurance income-tax duty of customs cess and other statutory dues applicable toit. As explained to us the Company did not have any dues on account of duty of excisesales tax service tax and value added tax. According to the information and explanationsgiven to us and based on audit procedures performed by us no undisputed amounts payablein respect of these statutory dues were outstanding at the year end for a period of morethan six months from the date they became payable.

(b) According to the records of the Company the dues of income taxsales-tax service tax customs duty value added tax and cess which have not beendeposited on account of any dispute are as follows:

Name of the statute Nature of dues Amount (Rs. in million) Amount paid under protest (Rs. in million) Period to which the amount relates Forum at which the dispute is pending
Income Tax Act Revision to the taxable income on account of Tax treatment of certain incentives received by the company from manufacturers with the acquisition of the aircraft and engine and disallowance of certain expenses / adjustments (Refer Note 31) AY 2007-08 High Court of Delhi and CIT (A)
Income Tax Act Revision to the taxable income on account of Tax treatment of certain incentives received by the company from manufacturers with the acquisition of the aircraft and engine and disallowance of certain expenses / adjustments (Refer Note 31) 8.66 1.3 AY 2010-11 ITAT and CIT(A)
Income Tax Act Writ Petition before High Court challenging the reopening of assessment on account of Tax treatment of certain incentives received by the company from manufacturers with the acquisition of the aircraft and engine and disallowance of certain expenses / adjustments (Refer Note 31) 3921.14 AY 2011-12 High Court of Delhi
Income Tax Act Revision to the taxable income on account of Tax treatment of certain incentives received by the company from manufacturers with the acquisition of the aircraft and engine and disallowance of certain expenses / adjustments (Refer Note 31) 7981.03 350 AY 2012-13 AY 2013-14 AY 2014-15 AY 2015-16 Assessing officer
Income Tax Act Revision to the taxable income on account of Tax treatment of certain incentives received by the company from manufacturers with the acquisition of the aircraft and engine and disallowance of certain expenses / adjustments (Refer Note 31) 7396.76 381.26 AY 2016-17 CIT(A)
Income Tax Act Revision to the taxable income on account of Tax treatment of certain incentives received by the company from manufacturers with the acquisition of the aircraft and engine and disallowance of certain expenses / adjustments (Refer Note 31) 9270.31 391.92 AY 2017-18 CIT(A)
Income Tax Act Revision to the taxable income on account of Tax treatment of certain incentives received by the company from manufacturers with the acquisition of the aircraft and engine disallowance of certain expenses and (Refer Note 31) 2297.53 AY 2018-19 CIT(A)
Income Tax Act Tax deducted at source 22.78 11.41 AY 2012-13 CIT(A)
Income Tax Act Tax deducted at source 13.90 2.18 AY 2007-08 AY 2008-09 AY 2009-10 AY 2013-14 AY 2014-15 AO ITAT
Income Tax Act Tax deducted at source 115.74 - AY 2013-14 CIT(A)
Finance Act 1994 (Service Tax) Penalty for late payment of service tax on various expenses incurred on ECB 358.56 89.64 FY 2012-13 to FY 2013-14 CESTAT
Finance Act 1994 (Service Tax) Service tax on food and beverages sold in aircraft to on-board passengers 344.93 18.26 FY 2013-14 to FY 2017-18 (till 30 June 2017) CESTAT
Finance Act 1994 (Service Tax) Service tax on passenger ticket cancellation and refund processing charges 2238.89 87.53 FY 2012-13 to FY 2017-18 (till 30 June 2017) CESTAT
Finance Act 1994 (Service Tax) Cenvat credit availment on input services used for providing cargo service and credit availed on the basis of ineligible invoices 204.56 7.67 FY 2008-09 to FY 2011-12 CESTAT
Finance Act 1994 (Service Tax) Service Tax on incentives received from engine manufacturer and other equipment suppliers 4710.95 60 FY 2014-15 (from October 2014) to FY 2017-18 (till 30 June 2017) CESTAT
Finance Act 1994 (Service Tax Service tax on notice pay and security forfeited from its employees. 31.16 FY 14-15 to (from October 2014) to FY 2017-18 (till 30 June 2017) Commissioner Appeals
The Customs Act IGST (under customs) on engine stand imported 25.37 1.9 FY 2017-18 to FY 2018-19 CESTAT
The Customs Act Customs duty and penalty on import of aircraft engines 481.20

-

FY 2011-12 to FY 2012-13 Supreme Court
The Customs Act Refund of customs duty attributable to notional freight charges added to the value of ATF 0.12 0.12 April 2015 to August 2017; Commissioner of Customs (Appeals) New Delhi
The Customs Act Customs Duty and Penalty demanded on notional freight charges added to value of ATF 0.97 0.05 FY 2018-19 and FY 201920 Commissioner of Customs (Appeals)
The Customs Act Demand for Cost Recovery Charges for transshipment 2.75 2.75 FY 2018-19 to 2020-21 CESTAT
The Customs Act Penalty for non-filing/incorrect filing of EGM 0.14 FY 2009-10 to 2020-21 Commissioner of Customs (Appeals)
Central Sales Tax Act 1956 & Maharashtra Value Added Tax 2003 CST on sale of goods in an international flight 7.85 0.95 FY 2012-13 Joint Commissioner (Appeals)
Maharashtra Value Added Tax 2003 Tax on inflight sales on international flights and denial of Input Tax Credit 20.22 4.3 FY 2012-13 FY 2013-14 FY 2015-16 FY 2016-17 FY 2017-18 Joint Commissioner (Appeals)
Mumbai Municipal Corporations Act 1888 Octroi on import/inward movement of aircraft engine and engines stand into city of Mumbai for installation 74.39 74.39 FY 2016-17 High Court
Rajasthan Value Added Tax 2003 Demand raised by AC of Commercial Taxes on account of mismatch in turnover and denial of Input Tax Credit 0.34 FY 2012-13 FY 2015-16 FY 2018-19 FY 2019-20 Assistant Commissioner of Commercial Taxes Jaipur
Karnataka Value Added tax 2003 Demand raised by DC on differential tax of 9% on the goods sold @ 5.5% and denied refund. 4.75 1.12 FY 2015-16 Deputy Commissioner (Appeals)
Central Sales Tax Act 1956 & Karnataka Vat Rules 2005 Central Sales Tax on sale of goods in international flights in state of Karnataka 1.80 0.54 FY 2015-16 Deputy Commissioner (Appeals)
Central Sales Tax Act 1956 & Karnataka Vat Rules 2005 Central Sales Tax on sale of goods in international flights in state of Karnataka 1.23 0.37 FY 2016-17 Deputy Commissioner (Appeals)
Customs Tariff Act 1975 and The Integrated Goods and Services Tax 2017 Integrated Goods and Services Tax on re-import of aircraft engines & certain aircraft parts after repair 10616.39 10616.39 FY 2017-18 to FY 2021-22 Supreme Court CESTAT and Commissioner of Customs (Appeals) ND/ Bengaluru / Hyderabad/ Chennai
Maharashtra GST Act 2017 Demand of ITC due to non-deposit of tax by the Supplier 3.06 FY 2019-20 Joint Commissioner (Appeals)
Andhra Pradesh Goods and Services Tax Act 2017 Central and State Goods and Service Tax on various matters 39.04 3.9 July 2017 to March 2019 Joint Commissioner (Appeals)
Delhi Value Added Tax Act 2004 Denial of input tax credit on account of mismatch in sale reported by Suppliers 1.01 April 2012 to March 2013 Special Commissioner (Appeals)
The Customs Act Penalty on incorrect IGST notification applied at the time of import 0.05 FY 2017-18 Commissioner of Customs (Appeals)

(viii) The Company has not surrendered or disclosed any transactionpreviously unrecorded in the books of account in the tax assessments under the Income TaxAct 1961 as income during the year. Accordingly the requirement to report on clause3(viii) of the Order is not applicable to the Company.

(ix) (a) The Company has not defaulted in repayment of loans or otherborrowings or in the payment of interest thereon to any lender.

(b) The Company has not been declared wilful defaulter by any bank orfinancial institution or government or any government authority.

(c) Term loans were applied for the purpose for which the loans wereobtained.

(d) On an overall examination of the financial statements of theCompany no funds raised on short-term basis have been used for long-term purposes by theCompany.

(e) On an overall examination of the financial statements of theCompany the Company has not taken any funds from any entity or person on account of or tomeet the obligations of its subsidiary.

(f) The Company has not raised loans during the year on the pledge ofsecurities held in its subsidiaries joint ventures or associate companies. Hence therequirement to report on clause 3(ix)(f) of the Order is not applicable to the Company.

(x) (a) The Company has not raised any money during the year by way ofinitial public offer / further public offer (including debt instruments) hence therequirement to report on clause 3(x)(a) of the Order is not applicable to the Company.

(b) The Company has not made any preferential allotment or privateplacement of shares /fully or partially or optionally convertible debentures during theyear under audit and hence the requirement to report on clause 3(x)(b) of the Order isnot applicable to the Company.

(xi) (a) No fraud/ material fraud by the Company or no fraud / materialfraud on the Company has been noticed or reported during the year.

(b) During the year no report under sub-section (12) of section 143 ofthe Companies Act 2013 has been filed by cost auditor/ secretarial auditor or by us inForm ADT - 4 as prescribed under Rule 13 of Companies (Audit and Auditors) Rules 2014with the Central Government.

(c) We have taken into consideration the whistle blower complaintsreceived by the Company during the year while determining the nature timing and extent ofaudit procedures.

(xii) The Company is not a Nidhi Company as per the provisions of theCompanies Act 2013. Therefore the requirement to report on clause 3(xii) (a) (b) and(c) of the Order is not applicable to the Company.

(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) (a) The Company has an internal audit system commensurate withthe size and nature of its business.

(b) The internal audit reports of the Company issued till the date ofthe audit report for the period under audit have been considered by us.

(xv) The Company has not entered into any non-cash transactions withits directors or persons connected with its directors and hence requirement to report onclause 3(xv) of the Order is not applicable to the Company.

(xvi) (a) The provisions of section 45-IA of the Reserve Bank of IndiaAct 1934 (2 of 1934) are not applicable to the Company. Accordingly the requirement toreport on clause (xvi)(a) of the Order is not applicable to the Company.

(b) The Company has not conducted any Non-Banking Financial or HousingFinance activities without obtaining a valid Certificate of Registration (CoR) from theReserve Bank of India as per the Reserve Bank of India Act 1934.

(c) The Company is not a Core Investment Company as defined in theregulations made by Reserve Bank of India. Accordingly the requirement to report onclause 3(xvi)(c) of the Order is not applicable to the Company.

(d) There is no Core Investment Company as a part of the Group hencethe requirement to report on clause 3(xvi)(d) of the Order is not applicable to theCompany.

(xvii) The Company has incurred cash losses amounting to Rs. 2991million in the current year and amounting to Rs. 18563 million in the immediatelypreceding financial year respectively.

(xviii) There has been no resignation of the statutory auditors duringthe year and accordingly requirement to report on Clause 3(xviii) of the Order is notapplicable to the Company.

(xix) On the basis of the financial ratios disclosed in note 49 readtogether with note 46 to the financial statements ageing and expected dates ofrealization of financial assets and payment of financial liabilities other informationaccompanying the financial statements our knowledge of the Board of Directors andmanagement plans and based on our examination of the evidence supporting the assumptionsread together with emphasis in matter of our report of even date nothing has come to ourattention which causes us to believe that any material uncertainty exists as on the dateof the audit report that Company is not capable of meeting its liabilities existing at thedate of balance sheet as and when they fall due within a period of one year from thebalance sheet date. We however state that this is not an assurance as to the futureviability of the Company. We further state that our reporting is based on the facts up tothe date of the audit report and we neither give any guarantee nor any assurance that allliabilities falling due within a period of one year from the balance sheet date will getdischarged by the Company as and when they fall due.

(xx) (a) In respect of other than ongoing projects there are nounspent amounts that are required to be transferred to a fund specified in Schedule VII ofthe Companies Act (the Act) in compliance with second proviso to sub section 5 of section135 of the Act. This matter has been disclosed in note 37 to the financial statements.

(b) There are no unspent amounts in respect of ongoing projects thatare required to be transferred to a special account in compliance of provision of subsection (6) of section 135 of Companies Act. This matter has been disclosed in note 37 tothe financial statements.

Annexure 2 referred in paragraph 2(f) under the heading "Report onOther Legal and Regulatory Requirements" of our report on the Standalone FinancialStatements of InterGlobe Aviation 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 InterGlobe Aviation Limited ("the Company") as of March 31 2022 inconjunction with our audit of the standalone financial statements of the Company for theyear ended on 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 the safeguardingof its assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required under the Companies Act 2013.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company's internalfinancial controls over financial reporting with reference to standalone financialstatements based on our audit. We conducted our audit in accordance with the Guidance Noteon Audit of Internal Financial Controls Over Financial Reporting (the "GuidanceNote") and the Standards on Auditing as specified under section 143(10) of theCompanies Act 2013 to the extent applicable to an audit of internal financial controlsand both issued by the Institute of Chartered Accountants of India. Those Standards andthe Guidance Note require that we comply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whether adequate internal financialcontrols over financial reporting with reference to these financial statements wasestablished and maintained and if such controls operated effectively in all materialrespects.

Our audit involves performing procedures to obtain audit evidence aboutthe adequacy of the internal financial controls system over financial reporting and theiroperating effectiveness. Our audit of internal financial controls with reference tostandalone financial statements included obtaining an understanding of internal financialcontrols with reference to these standalone financial statements assessing the risk thata material weakness exists and testing and evaluating the design and operatingeffectiveness of internal control based on the assessed risk. The procedures selecteddepend on the auditor's judgement including the assessment of the risks of materialmisstatement of the financial statements whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the Company's internal financialcontrols with reference to these standalone financial statements.

Meaning of Internal Financial Controls With Reference to theseFinancial Statements

A Company's internal financial controls with reference to standalonefinancial statements is a process designed to provide reasonable assurance regarding thereliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles. A Company'sinternal financial controls with reference to standalone financial statements includesthose policies and procedures that (1) pertain to the maintenance of records that inreasonable detail accurately and fairly reflect the transactions and dispositions of theassets of the Company; (2) provide reasonable assurance that transactions are recorded asnecessary to permit preparation of financial statements in accordance with generallyaccepted accounting principles and that receipts and expenditures of the Company arebeing made only in accordance with authorisations of management and directors of theCompany; and (3) provide reasonable assurance regarding prevention or timely detection ofunauthorised acquisition use or disposition of the Company's assets that could have amaterial effect on the financial statements.

Inherent Limitations of Internal Financial Controls With Reference tothese Financial Statements

Because of the inherent limitations of internal financial controls withreference to standalone financial statements including the possibility of collusion orimproper management override of controls material misstatements due to error or fraud mayoccur and not be detected. Also projections of any evaluation of the internal financialcontrols with reference to these standalone financial statements to future periods aresubject to the risk that the internal financial control with reference to these financialstatements may become inadequate because of changes in conditions or that the degree ofcompliance with the policies or procedures may deteriorate.

Opinion

In our opinion the Company has in all material respects adequateinternal financial controls with reference to standalone financial statements and suchinternal financial controls with reference to standalone financial statements wereoperating effectively as at March 31 2022 based on the internal control over financialreporting criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note issued by the ICAI.

For S.R. Batliboi & Co. LLP
Chartered Accountants
ICAI Firm Registration Number: 301003E/E300005
per Sanjay Vij
Partner
Membership Number: 095169
UDIN: 22095169AJOYQA1189
Place of Signature: Gurugram
Date: May 25 2022

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