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JSW Steel Ltd.

BSE: 500228 Sector: Metals & Mining
NSE: JSWSTEEL ISIN Code: INE019A01038
BSE 00:00 | 21 Sep 669.20 34.80
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NSE 00:00 | 21 Sep 668.95 35.75
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OPEN 633.00
PREVIOUS CLOSE 634.40
VOLUME 637681
52-Week high 776.50
52-Week low 257.70
P/E 11.51
Mkt Cap.(Rs cr) 161,759
Buy Price 0.00
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Sell Price 0.00
Sell Qty 0.00
OPEN 633.00
CLOSE 634.40
VOLUME 637681
52-Week high 776.50
52-Week low 257.70
P/E 11.51
Mkt Cap.(Rs cr) 161,759
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

JSW Steel Ltd. (JSWSTEEL) - Auditors Report

Company auditors report

To the Members of JSW Steel Limited

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the accompanying standalone financial statements of JSW Steel Limited("the Company") which comprise the Balance sheet as at March 31 2021 theStatement of Profit and Loss including the statement of Other Comprehensive Income theCash Flow Statement and the Statement of Changes in Equity for the year then ended andnotes to the standalone financial statements including a summary of significantaccounting policies and other explanatory information.

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the Companies Act 2013 as amended ("the Act") in the manner so required andgive a true and fair view in conformity with the accounting principles generally acceptedin India of the state of affairs of the Company as at March 31 2021 its profitincluding other comprehensive income its cash flows and the changes in equity for the yearended on that date.

Basis for Opinion

We conducted our audit of the standalone financial statements in accordance with theStandards on Auditing (SAs) as specified under section 143(10) of the Act. Ourresponsibilities under those Standards are further described in the 'Auditor'sResponsibilities for the Audit of the Standalone Financial Statements' section of ourreport.

We are independent of the Company in accordance with the 'Code of Ethics' issued by theInstitute of Chartered Accountants of India together with the ethical requirements thatare relevant to our audit of the financial statements under the provisions of the Act andthe 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.

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 for the financial yearended March 31 2021. These matters were addressed in the context of our audit of thestandalone financial statements as a whole and in forming our opinion thereon and we donot provide a separate opinion on these matters. For each matter below our description ofhow our audit addressed the matter is provided in that context.

We have determined the matters described below to be the key audit matters to becommunicated in our report. We have fulfilled the responsibilities described in theAuditor's responsibilities for the audit of the standalone financial statements section ofour report including in relation to these matters. Accordingly our audit included theperformance of procedures designed to respond to our assessment of the risks of materialmisstatement of the standalone financial statements. The results of our audit proceduresincluding the procedures performed to address the matters below provide the basis for ouraudit opinion on the accompanying standalone financial statements.

Key audit matters How our audit addressed the key audit matter
Recoverability of investments in and loans / advances given to certain subsidiaries and joint ventures and financial guarantees given on behalf of certain subsidiaries (as described in note 48 of the standalone Ind AS financial statements)
The Company has investments in certain subsidiaries and joint ventures with a carrying value of ' 2056 crores. Further the Company has also provided loans and/or guarantees to or on behalf of these subsidiaries and the joint venture amounting to ' 14133 crores. These subsidiaries and joint venture have either been incurring losses or the investments made by them in the step down subsidiaries have been making losses. Our audit procedures included the following:
The Company has also recognised impairment allowance of ' 386 crores during the year ended March 31 2021 in respect of investments loans / advances given to certain overseas subsidiaries as described in note 50 of the standalone Ind AS financial statements. • We obtained and read management's assessment for impairment.
Further the Company has not recognised interest income of ' 368 crores during the year from some of its subsidiaries due to uncertainty of recoverability of such income. • We performed test of controls over impairment process through inspection of evidence of performance of these controls.
Assessment of the recoverable amount of the investments in and loans/advances including interest thereon given to these subsidiaries and joint ventures and financial guarantees given on behalf of these subsidiaries has been identified as a key audit matter due to: • We assessed the impairment model prepared by the management and the assumptions used with particular attention to the following:
• Significance of the carrying amount of these balances. - Benchmarking or assessing key assumptions used in the impairment models including discount rates risk free rate of return long term growth rate and other key assumptions against external and internal data;
• The assessment requires management to make significant estimates concerning the estimated future cash flows qualitative assessments of the status of the project and its future depending on balance work to be performed or approvals to be received associated discount rates and growth rates based on management's view of future business prospects including any possible impact arising out of the pandemic on these estimates. - assessing the cash flow forecasts including possible impact on account of global pandemic through analysis of actual past performance and comparison to previous forecasts;
• Changes to any of these assumptions could lead to material changes in the estimated recoverable amount impacting both potential impairment charges and potential reversals of impairment taken in prior years. - testing the mathematical accuracy and performing sensitivity analyses of the models; and
- understanding the commercial prospects of the assets/ projects and comparison of assumptions with external data sources;
• We assessed the competence capabilities and objectivity of the experts used by management in the process of evaluating impairment models.
• We assessed the conclusions reached by management and those charged with governance on account of various estimates and judgements including possible impact of pandemic.
• We assessed the compliance of the disclosures made in note 48 of the standalone Ind AS financial statements with the accounting standards.

 

Recoverability of VAT deferral / refunds under the GST regime (as described in note 30 of the standalone Ind AS financial statements)
The Company's units at Dolvi in Maharashtra and Vijayanagar in Karnataka are eligible and have been availing interest free VAT deferral loan / Net VAT refunds as an incentive under the incentive schemes notified by the State of Maharashtra and Karnataka. Our audit procedures included the following:
The Company has recognised income in relation these grants being the difference between the net present value of these interest free loans granted to the Company and the nominal value of such loans to the extent of SGST collected by the Company in respect of sales eligible for such grants eligible incentive of Net SGST paid as applicable in accordance with the industrial promotion subsidy schemes and notifications issued by the State of Maharashtra and Karnataka. • We obtained an understanding evaluated the design and tested operating effectiveness of the controls related to the recognition and measurement of government grants and income accruing therefrom.
The amount of incentive recognised during the year amounts to ' 462 crores and cumulative balance of these receivables amount to ' 2510 crores. • We read eligibility certificates in respect of VAT deferral / refund incentives available to the Company.
We considered VAT deferral / refund incentive as a Key audit matter due to: • We read the notification issued by the Government of Maharashtra (GoM) and Government of Karnataka (GoK) in respect of eligibility of VAT deferral / refund under the GST regime guidelines for certification of the eligible incentive amount modalities for sanction and disbursement of incentives.
• Significance of amount accrued during the year and carrying amount of these receivables as at March 31 2021. • We read letter dated October 18 2019 issued by Director of Industries of Maharashtra for in-principle approval for issuance of eligibility certificate and letter dated March 19 2021 by the Company for submission of appraisal report to Director of Industries of Maharashtra for availing incentive under PSI 2007 scheme.
• Significant judgement involved in assessment of the eligibility of incentive under the new GST regime. • We read the legal opinion obtained by the management for assessing the impact of new eligibility conditions and formula for determination of incentives based on latest Government Resolution issued by GoM including assessing the amounts withheld by the GoM on eligibility of certain duties which were refundable in the erstwhile VAT regime but have been denied in the new GST regime.
• We involved specialists to assist us in reviewing and evaluating the management's assessment of latest Government Resolution issued by GoM.
• We tested the calculation of incentives accrued for the year ended March 31 2021.

 

Capital Expenditure in respect of property plant and equipment and capital work in progress (as described in notes 4 and 5 of the standalone Ind AS financial statements)
The Company has incurred significant expenditure on capital projects as reflected by the total value of additions in property plant and equipment and capital work in progress in notes 4 and 5 of the standalone Ind AS financial statements. Our audit procedures included the following:
The Company is in the process of executing various projects for expansions of existing capacity across the locations. These projects take a substantial period of time to get ready for intended use. • We obtained an understanding of the Company's capitalisation policy and assessed for compliance with the relevant accounting standards.
We considered Capital expenditure as a Key audit matter due to: • We obtained understanding evaluated the design and tested the operating effectiveness of controls related to capital expenditure and capitalisation of assets.
• Significance of amount incurred on such items during the year ended March 31 2021. • We performed substantive testing on a sample basis for each element of capitalised costs including inventory issued to contractors for the purpose of these projects and physical verification performed by management alongwith reconciliation and directly attributable cost including verification of underlying supporting evidence and understanding nature of the costs capitalised.
• Judgement and estimate required by management in assessing assets meeting the capitalisation criteria set out in Ind AS 16 Property Plant and Equipment. • In relation to borrowing costs we obtained the supporting calculations verified the inputs to the calculation and tested the arithmetical accuracy of the model.
• Judgement involved in determining the eligibility of costs including borrowing cost and other directly attributable costs for capitalisation as per the criteria set out in Ind AS 16 Property Plant and Equipment • We assessed accounting for costs incurred when projects are suspended or delayed for any reasons including the global pandemic.
• We obtained understanding on management assessment relating to progress of projects and their intention to bring the asset to its intended use.

 

Accuracy and completeness of disclosure of related party transactions and compliance with the provisions of Companies Act 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 as amended ('SEBI (LODR) 2015') (as described in note 44 of the standalone Ind AS financial statements)
We identified the accuracy and completeness of disclosure of related party transactions as set out in respective notes to the standalone Ind AS financial statements as a key audit matter due to: Our audit procedures in relation to the disclosure of related party transactions included the following:
• the significance of transactions with related parties during the year ended March 31 2021. • We obtained an understanding evaluated the design and tested operating effectiveness of the controls related to capturing of related party transactions and management's process of ensuring all transactions and balances with related parties have been disclosed in the standalone Ind AS financial statements.
• Related party transactions are subject to the compliance requirement under the Companies Act 2013 and SEBI (LODR) 2015. • We obtained an understanding of the Company's policies and procedures in respect of evaluating arms-length pricing and approval process by the audit committee and the board of directors.
• We agreed the amounts disclosed with underlying documentation and read relevant agreements evaluation of arms-length by management on a sample basis as part of our evaluation of the disclosure.
• We assessed management evaluation of compliance with the provisions of Section 177 and Section 188 of the companies Act 2013 and SEBI (LODR) 2015.
• We evaluated the disclosures through reading of statutory information books and records and other documents obtained during the course of our audit.

 

Claims and exposures relating to taxation and litigation (as described in note 45 of the standalone Ind AS financial statements)
The Company has disclosed in note 45 of the standalone Ind AS financial statements contingent liabilities of ' 3675 crores in respect of disputed claims/ levies under various tax and legal matters and ' 3035 crores towards Claims related to Forest development tax/ fee. In addition the Company has assessed several claims as 'Remote' and hence are not required to be disclosed as contingent liabilities. Our audit procedures included the following:
Taxation and litigation exposures have been identified as a key audit matter due to: • We obtained understanding evaluated the design and tested the operating effectiveness of the controls related to the identification recognition and measurement of provisions for disputes potential claims and litigation and contingent liabilities.
• Significance of these amounts and large number of disputed matters with various authorities. • We obtained details of legal and tax disputed matters and evaluation made by the management and assessed management's position through discussions on both the probability of success in significant cases and the magnitude of any potential loss.
• Significant judgement and assumptions required by management in assessing the exposure of each case to evaluate whether there is a need to set up a provision and measurement of exposures as well as the disclosure of contingent liabilities. • We read external legal opinions (where considered necessary) and other evidence to corroborate management's assessment of the risk profile in respect of legal claims.
We focused on this matter because of the potential financial impact on the standalone Ind AS financial statements. Additionally the treatment of taxation and litigation cases require significant judgement due to the complexity of the cases timescales for resolution and involvement of various authorities.
• We involved tax specialists to assist us in evaluating tax positions taken by management.
• We assessed the relevant disclosures made in the standalone Ind AS financial statements for compliance in accordance with the requirements of Ind AS 37.

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

The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the Annual report but does not includethe standalone financial statements and our auditor's report thereon.

Our opinion on the standalone financial statements does not cover the other informationand we do 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 and in doing so consider whether such other informationis materially inconsistent with the financial statements or our knowledge obtained in theaudit or otherwise appears to be materially misstated. If based on the work we haveperformed we conclude that there is a material misstatement of this other information weare required to report that fact. We have nothing to report in this regard.

Responsibilities of Management for the Standalone Financial Statements

The Company's Board of Directors is responsible for the matters stated in section134(5) of the Act with respect to the preparation of these standalone financial statementsthat give a true and fair view of the financial position financial performance includingother comprehensive income cash flows and changes in equity of the Company in accordancewith the accounting principles generally accepted in India including the IndianAccounting 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 is responsible forassessing the Company's ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessmanagement either intends to liquidate the Company or to cease operations or has norealistic alternative but to do so.

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

Auditor's Responsibilities for the Audit of the Standalone 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 auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these standalone 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 Companyhas adequate internal financial controls with reference to financial statements in placeand the operating effectiveness of such 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's use of the going concern basisof accounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe financial statements or if such disclosures are inadequate to modify our opinion.Our conclusions are based on the audit evidence obtained up to the date of our auditor'sreport. However future events or conditions may cause the Company to cease to continue asa going concern.

• Evaluate the overall presentation structure and content of the 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 our audit.

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

From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the standalone financial statementsfor the financial year ended March 31 2021 and are therefore the key audit matters. Wedescribe these matters in our auditor's report unless law or regulation precludes publicdisclosure about the matter or when in extremely rare circumstances we determine that amatter should not be communicated in our report because the adverse consequences of doingso would reasonably be expected to outweigh the public interest benefits of suchcommunication.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in terms of sub-section (11) of section 143 ofthe Act we give in the "Annexure 1" a statement on the matters specified inparagraphs 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 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 Balance Sheet the Statement of Profit and Loss including the Statement ofOther Comprehensive Income the Cash Flow Statement and Statement of Changes in Equitydealt with by this Report are in agreement with the books of account;

(d) In our opinion the aforesaid standalone financial statements comply with theAccounting Standards specified under Section 133 of the Act read with Companies (IndianAccounting Standards) Rules 2015 as amended;

(e) On the basis of the written representations received from the directors as on March31 2021 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2021 from being appointed as a director in terms of Section 164 (2) of theAct;

(f) With respect to the adequacy of the internal financial controls with reference tothese standalone financial statements and the operating effectiveness of such controlsrefer to our separate Report in "Annexure 2" to this report;

(g) I n our opinion the managerial remuneration for the year ended March 31 2021 hasbeen paid / provided by the Company to its directors in accordance with the provisions ofsection 197 read with Schedule V to the Act;

(h) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 as amended inour opinion and to the best of our information and according to the explanations given tous:

i. The Company has disclosed the impact of pending litigations on its financialposition in its standalone financial statements - Refer Note 45 to the standalonefinancial statements;

ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses;

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

For S R B C & CO LLP Chartered Accountants

ICAI Firm Registration Number: 324982E/E300003

per Vikram Mehta

Partner

Membership Number: 105938

UDIN No: 21105938AAAACT7376

Place of Signature: Mumbai

Date: May 21 2021

Annexure 1

Referred to in paragraph 1 under the heading "Report on Other Legal and RegulatoryRequirements" of our report of even date

i. (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of fixed assets.

(b) All fixed assets have not been physically verified by the management during theyear but there is a regular programme of verification which in our opinion is reasonablehaving regard to the size of the Company and the nature of its assets. No materialdiscrepancies were noticed on such verification.

(c) According to the information and explanations given by the management and auditprocedures performed by us the title deeds of immovable properties included in propertyplant and equipment and right of use assets are held in the name of the Company except for

(i) I easehold land aggregating to ' 67 crores wherein the lease deed has expired. Asexplained to us the Company is in the process of converting the title into freehold asper the lease cum sale agreement.

(ii) freehold land aggregating to ' 9 crores as noted below for which title deeds werenot available with the Company and hence we are unable to comment on the same

Nature of immovable Property

Total Number of Cases —

As at March 31 2021 (' in crores)

Gross Block Net Block
Land located at Maharashtra 12 9 9

(iii) freehold land aggregating to ' 40 crores acquired pursuant to acquisition ofWelspun PCMD business on March 31 2021 the registration of title deeds is in progress.

ii. The inventory has been physically verified by the management during the year. Inour opinion the frequency of verification is reasonable. No material discrepancies werenoticed on such physical verification. Inventories lying with third parties have beenconfirmed by them and no material discrepancies were noticed in respect of suchconfirmations.

iii. According to the information and explanations given to us and audit proceduresperformed by us the Company has not granted any loans secured or unsecured to companiesfirms Limited Liability Partnerships or other parties covered in the register maintainedunder section 189 of the Companies Act 2013 ('the Act'). Accordingly the provisions ofclause 3(iii) (a) (b) and (c) of the Order are not applicable to the Company and hencenot commented upon.

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

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

vi. We have broadly reviewed the books of account maintained by the Company pursuant tothe rules made by the Central Government for the maintenance of cost records under section148(1) of the Act related to the manufacture of its products and are of the opinion thatprima facie the specified accounts and records have been made and maintained. We havenot however made a detailed examination of the same.

vii. (a) The Company is generally regular in depositing with appropriate authoritiesundisputed statutory dues including provident fund employees' state insuranceincome-tax goods and service tax duty of custom duty of excise value added tax cessand other statutory dues applicable to it.

(b) According to the information and explanations given to us and audit proceduresperformed by us no undisputed amounts payable in respect of provident fund employees'state insurance income- tax service tax sales-tax duty of custom duty of excisevalue added tax goods and service tax cess and other statutory dues were outstanding atthe year end for a period of more than six months from the date they became payable.

(c) According to the records of the Company the dues outstanding of income-tax sales-tax wealth-tax service tax customs duty excise duty value added tax and cess onaccount of any dispute are as follows:

Name of Statue

Nature of Dues

Amount (' in crores)*

Period

Forum
The Central Excise Act 1944

Excise Duty

97

2012-2015

High Court
377

2001-2018

Central Excise Service Tax Appellate Tribunal (CESTAT)
30

1998-2017

Commissioner/Joint Commissioner/Asst. Commissioner
The Custom Act 1962

Custom Duty

225

2002-2012

High Court
281

1995-2018

Central Excise Service Tax Appellate Tribunal (CESTAT)
86

2000-2017

Commissioner (Appeals) / Joint Commissioner
Name of Statue Nature of Dues

Amount (' in crores)*

Period

Forum

Karnataka VAT 2003 VAT

2

2006-2008

Joint Commissioner

The Central Sales Tax Act 1956 CST

29

2011-2012

High Court

40

2012-2013

Commissioner/Joint Commissioner

Karnataka Tax on Entry of Goods Act 1979 Entry Tax

1

2016-2017

Commissioner

Maharashtra Value Added Tax 2002 VAT

153

2011-2017

Commissioner (Appeals)/Joint Commissioner/Asst.

Commissioner / Assessing Officer

Chapter V of the Finance Act 1994 Service Tax

0.09

2006-2012

High Court

98

1998-2016

Central Excise Service Tax Appellate Tribunal (CESTAT)

57

2013-2017

Commissioner/Joint Commissioner

Income Tax Act 1961 Income Tax

14

2014-2015

Commissioner (Appeals)

* Net of amounts paid under protest.

The above table doesn't include cases decided in favour of the Company for which thedepartment has preferred an appeal at higher levels amounting to ' 745 crores (net ofamount paid under protest) and matters remanded back amounting to ' 227 crores (net ofamount paid under protest).

viii. In our opinion and according to the information and explanations given by themanagement the Company has not defaulted in repayment of loans or borrowing to afinancial institution bank or government or dues to debenture holders.

ix. In our opinion and according to the information and explanations given by themanagement and audit procedures performed by us monies raised by the company by way ofdebt instruments in the nature of non-convertible debentures commercial papers and termloans were applied for the purposes for which they were raised though idle/surplus fundswhich were not required for immediate utilisation have been gainfully invested in fixeddeposits. According to the information and explanations given by the management and auditprocedures performed by us the Company has not raised any money way of initial publicoffer / further public offer and hence not commented upon.

x. Based upon the audit procedures performed for the purpose of reporting the true andfair view of the standalone financial statements and according to the information andexplanations given by the management we report that no fraud by the Company or nomaterial fraud on the Company by the officers and employees of the Company has beennoticed or reported during the year.

xi. According to the information and explanations given by the management and auditprocedures performed by us the managerial remuneration has been paid / provided inaccordance with the requisite approvals mandated by the provisions of section 197 readwith Schedule V to the Act.

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

xiii. According to the information and explanations given by the management and auditprocedures performed by us transactions with the related parties are in compliance withsection 177 and 188 of the Act where applicable and the details have been disclosed in thenotes to the financial statements as required by the applicable accounting standards.

xiv. According to the information and explanations given to us and on an overallexamination of the balance sheet the Company has not made any preferential allotment orprivate placement of shares or fully or partly convertible debentures during the yearunder review and hence reporting requirements under clause 3(xiv) are not applicable tothe Company and not commented upon.

xv. According to the information and explanations given by the management and auditprocedures performed by us the Company has not entered into any non-cash transactionswith directors or persons connected with him as referred to in section 192 of the Act.

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

For S R B C & CO LLP

Chartered Accountants

ICAI Firm Registration Number: 324982E/E300003

per Vikram Mehta

Partner

Membership Number: 105938

UDIN No: 21105938AAAACT7376

Place of Signature: Mumbai

Date: May 21 2021

Annexure 2

To the Independent Auditor's Report of even date on the standalone financial statementsof JSW Steel Limited

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

We have audited the internal financial controls with reference to standalone financialstatements of JSW Steel Limited ("the Company") as of March 31 2021 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 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 ("ICAI"). 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 internal financialcontrols with reference to these standalone financial statements based on our audit. Weconducted our audit in accordance with the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting (the "Guidance Note") and the Standards onAuditing as specified under section 143 (10) of the Act to the extent applicable to anaudit of internal financial controls both issued by ICAI. Those Standards and theGuidance Note require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether adequate internal financial controlswith reference to these standalone financial statements was established and maintained andif such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls with reference to these standalone financial statementsand their operating effectiveness. Our audit of internal financial controls with referenceto standalone financial statements included obtaining an understanding of internalfinancial controls with reference to these standalone financial statements assessing therisk that 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 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 and appropriate toprovide a basis for our audit opinion on the Company's internal financial controls withreference to these standalone financial statements.

Meaning of Internal Financial Controls With Reference to Standalone FinancialStatements

A company's internal financial controls with reference to standalone financialstatements is a process designed to provide reasonable assurance regarding the reliabilityof financial reporting and the preparation of financial statements for external purposesin accordance with generally accepted accounting principles. A company's internalfinancial controls with reference to standalone financial statements includes thosepolicies 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 authorisations of management and directors of the company; 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 to StandaloneFinancial Statements

Because of the inherent limitations of internal financial controls with reference tostandalone financial statements including the possibility of collusion or impropermanagement override of controls material misstatements due to error or fraud may occurand not be detected. Also projections of any evaluation of the internal financialcontrols with reference to standalone financial statements to future periods are subjectto the risk that the internal financial control with reference to standalone 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 adequate internal financialcontrols with reference to standalone financial statements and such internal financialcontrols with reference to standalone financial statements were operating effectively asat March 31 2021 based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note issued by the ICAI.

For S R B C & CO LLP

Chartered Accountants

ICAI Firm Registration Number: 324982E/E300003

per Vikram Mehta

Partner

Membership Number: 105938

UDIN No: 21105938AAAACT7376

Place of Signature: Mumbai

Date: May 21 2021

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