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Tata Power Company Ltd.

BSE: 500400 Sector: Infrastructure
NSE: TATAPOWER ISIN Code: INE245A01021
BSE 12:01 | 23 May 234.00 0.75
(0.32%)
OPEN

235.10

HIGH

236.00

LOW

231.75

NSE 11:49 | 23 May 234.40 1.15
(0.49%)
OPEN

234.95

HIGH

235.90

LOW

231.75

OPEN 235.10
PREVIOUS CLOSE 233.25
VOLUME 1010682
52-Week high 298.00
52-Week low 102.45
P/E 54.55
Mkt Cap.(Rs cr) 74,770
Buy Price 233.90
Buy Qty 506.00
Sell Price 234.00
Sell Qty 3980.00
OPEN 235.10
CLOSE 233.25
VOLUME 1010682
52-Week high 298.00
52-Week low 102.45
P/E 54.55
Mkt Cap.(Rs cr) 74,770
Buy Price 233.90
Buy Qty 506.00
Sell Price 234.00
Sell Qty 3980.00

Tata Power Company Ltd. (TATAPOWER) - Auditors Report

Company auditors report

To the Members of

The Tata Power Company Limited

Report on the Audit of the Standalone Ind AS Financial StatementsOpinion

We have audited the accompanying standalone Ind AS financial statementsof The Tata Power Company Limited ("the Company") which comprise the Balancesheet as at March 31 2021 the Statement of Profit and Loss including the statement ofOther Comprehensive Income the Cash Flow Statement and the Statement of Changes in Equityfor the year then ended and notes to the standalone Ind AS financial statementsincluding a summary of 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 Ind AS financial statements give theinformation required by the Companies Act 2013 as amended ("the Act") in themanner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at March31 2021 its profit including other comprehensive income its cash flows and the changesin equity for the year ended on that date.

Basis for Opinion

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

Key Audit Matters

Key audit matters are those matters that in our professional judgmentwere of most significance in our audit of the standalone Ind AS financial statements forthe financial year ended March 31 2021. These matters were addressed in the context ofour audit of the standalone Ind AS financial statements as a whole and in forming ouropinion thereon and we do not provide a separate opinion on these matters. For eachmatter below our description of how our audit addressed the matter is provided in thatcontext.

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 Ind ASFinancial Statements' section of our report including in relation to these matters.Accordingly our audit included the performance of procedures designed to respond to ourassessment of the risks of material misstatement of the standalone Ind AS financialstatements. The results of our audit procedures including the procedures performed toaddress the matters below provide the basis for our audit opinion on the accompanyingstandalone Ind AS financial statements.

Key audit matters How our audit addressed the key audit matter
Management's assessment of appropriateness of Going Concern assumption (as described in Note 42.4.3 of the standalone
Ind AS financial statements)
The Company has current liabilities of Rs. 10434.06 crores and current assets of Rs. 3874.50 crores as at March 31 2021. Current liabilities exceed current assets as at the year end. Given the nature of its business i.e. contracted long term power supply agreements and a significant composition of cost plus contracts leading to significant stability of cashflows and profitability management is confident of refinancing and consider the liquidity risk as low and accordingly the Company uses significant short term borrowings to reduce its borrowing costs. Our procedures included the following:
Obtained an understanding of the process and tested the internal controls associated with the management's assessment of Going Concern assumption.
Discussed with management and assessed the assumptions judgements and estimates used in developing business plan and cash flow projections having regards to past performance and current emerging business trends affecting the business and industry.
Management has made an assessment of the Company's ability to continue as a Going Concern as required by Ind AS 1 Presentation of Financial Statements considering all the available information and has concluded that the going concern basis of accounting is appropriate. Assessed the Company's ability to refinance its short term obligation based on the past trends credit ratings analysis of solvency and liquidity ratios and ability to generate cash flows and access to capital.
Going Concern assessment has been identified as a key audit matter considering the significant judgements and estimates involved in the assessment and its dependence upon management's ability to complete the planned divestments raising long term capital and / or successful refinancing of certain current financial obligations. Assessed the adequacy of the disclosures in the standalone Ind AS financial statements.

Revenue recognition and accrual of regulatory deferrals (asdescribed in Note 19 and Note 30 of the standalone Ind AS financial statements)

business of the Company the tari_ is determined by the regulator on cost plus return on equity basis wherein the cost is subject to prudential norms. The Company invoices its customers on the basis of pre-approved tari_ which is based on budget and is subject to true up. Read the Company's accounting policies with respect to accrualofregulatorydeferralsandassesseditscompliance with Ind AS 114 "Regulatory Deferral Accounts" and Ind AS 115 "Revenue from Contract with Customers".
The Company recognizes revenue as the amount invoiced to customers based on pre-approved tari_ rates agreed with regulator. As the Company is entitled to a fixed return on equity the difference between the revenue recognized and entitlement as per the regulation is recognized as regulatory assets / liabilities. The Company has recognized Rs. 1148.45 crore for generation and transmission business and Rs. 573.60 crore for distribution business as accruals as at March 31 2021. Performed test of controls over revenue recognition and accrual of regulatory deferrals through inspection of evidence of performance of these controls.
Performed substantive audit procedures including:
• Evaluated the key assumptions used by the Company by comparing it with prior years past precedents and the opinion of management's expert.
Accruals are determined based on tari_ regulations and past tari_ orders and are subject to verification and approval by the regulators. Further the costs incurred are subject to prudential checks and prescribed norms. Significant judgements are made in determining the accruals including interpretation of tari_ regulations. Further certain disallowances of claims have been litigated by the Company which are in various stages of dispute. • Considered the independence objectivity and competence of management's expert.
• Assessed management's evaluation of the likely outcome of the key disputes based on past precedents and / or advice of management's expert.
• Assessed the impact recognized by the Company In respect of tari_ orders received.
Revenue recognition and accrual of regulatory deferrals is a key audit matter considering the significance of the amount and significant judgements involved in the determination. • Assessed the disclosures in accordance with the requirements of Ind AS 114 "Regulatory Deferral Accounts" and Ind AS 115 "Revenue from Contract with Customers".

Recognition and Measurement of Deferred Tax (as described inNote 35 of the standalone Ind AS financial statements)

The Company has recognized Minimum Alternate Tax (MAT) credit receivable of Rs. 437.51 crores as at March 31 2021. Our procedures included the following:
The Company also has recognized deferred tax assets of Rs. 492.56 crores on long term capital loss on sale of investments. Read Company's accounting policies with respect to recognition and measurement of tax balances in accordance with Ind AS 12 "Income Taxes"
Further pursuant to the Taxation Laws (Amendment) Act 2019 (new tax regime) the Company has measured its deferred tax balances expected to reverse after the likely transition to new tax regime at the rate specified in the new tax regime. Performed test of controls over recognition and measurement of tax balances through inspection of evidence of performance of these controls.
Performed substantive audit procedures including:
The recognition and measurement of MAT credit receivable and deferred tax balances; is a key audit matter considering the significance of the amount judgement involved in assessing the recoverability of such credits estimation of the financial projections for determination of the year of transition to new tax regime and judgements involved in the interpretation of tax regulations and tax positions adopted by the Company. • Involved tax specialists who evaluated the Company's tax positions basis the tax law and also by comparing it with prior years and past precedents
• Discussed the future business plans and financial projections with the management
• Assessed the management's long-term financial projections and the key assumptions used in the projections by comparing it to the approved business plan projections used for estimation of likely year of transition to the new tax regime and projections used for impairment assessment where applicable.
Assessed the disclosures in accordance with the requirements of Ind AS 12 "Income Taxes".

Impairment of assets (as described in Note 5 and Note 7 of thestandalone Ind AS financial statements)

At the end of every reporting period the Company assesses whether there is any indication that an asset or cash generating unit (CGU) may be impaired. If any such indication exists the Company estimates the recoverable amount of the asset or CGU. Our procedures included the following:
The determination of recoverable amount being the higher of fair value less costs to sell and value-in-use involves significant estimates assumptions and judgements of the long-term financial projections. Read the Company's accounting policies with respect to impairment in accordance with Ind AS 36 "Impairment of assets" Performed test of controls over key financial controls related to accounting valuation and recoverability of assets through inspection of evidence.
Performed substantive audit procedures including:
The Company is carrying impairment provision amounting to Rs. 3555.00 crores with respect to Mundra CGU (comprising of investment in companies owning Mundra power plant coal mines and related infrastructure) Rs. 446.09 crores for investment in Company owning hydro power plant in Georgia and Rs. 100 crores with respect to a generating unit in Trombay. During the year as the indication exists the Company has reassessed its impairment assessment with respect to the specified CGUs. • Obtainedthemanagement'simpairmentassessment
Impairment of assets is a key audit matter considering the significance of the carrying value estimations and the significant judgements involved in the impairment assessment. • Evaluated the key assumptions including projected generation coal prices exchange rate energy prices post power purchase agreement period and weighted average cost of capital by comparing them with prior years and external data where available.
• Obtained and evaluated the sensitivity analysis Assessed the disclosures in accordance with the requirements of Ind AS 36 "Impairment of assets".

Other Information

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 Ind AS financial statements and ourauditor's report thereon.

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

In connection with our audit of the standalone Ind AS financialstatements our responsibility is to read the other information and in doing so considerwhether such other information is materially inconsistent with the standalone Ind ASfinancial statements or our knowledge obtained in the audit or otherwise appears to bematerially misstated. If based on the work we have performed we conclude that there is amaterial misstatement of this other information we are required to report that fact. Wehave nothing to report in this regard.

Responsibilities of Management for the Standalone Ind AS FinancialStatements

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

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

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

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

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

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

Identify and assess the risks of material misstatement of thestandalone Ind AS financial statements whether due to fraud or error design and performaudit procedures responsive to those risks and obtain audit evidence that is sufficientand appropriate 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 the audit inorder to design audit procedures that are appropriate in the circumstances. Under section143(3) (i) of the Act we are also responsible for expressing our opinion on whether theCompany has adequate internal financial controls with reference to standalone Ind ASfinancial statements 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 standalone Ind AS financial statements or if such disclosuresare inadequate to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditor's report. However future events or conditionsmay cause the Company to cease to continue as a going concern.

Evaluate the overall presentation structure and content of thestandalone Ind AS financial statements including the disclosures and whether thestandalone Ind AS financial statements represent the underlying transactions and events ina manner that achieves fair presentation.

We communicate with those charged with governance regarding amongother matters the planned scope and timing of the audit and significant audit findingsincluding any significant de_ciencies 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 standalone IndAS financial statements for the financial year ended March 31 2021 and are therefore thekey audit matters. We describe these matters in our auditor's report unless law orregulation precludes public disclosure about the matter or when in extremely rarecircumstances we determine that a matter should not be communicated in our report becausethe adverse consequences of doing so would reasonably be expected to outweigh the publicinterest benefits of such communication.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order 2016("the Order") issued by the Central Government of India in terms of sub-section(11) of section 143 of the Act we give in the "Annexure 1" a statement on thematters specified in paragraphs 3 and 4 of the Order.

2. As required by Section 143(3) of the Act we report that: (a) Wehave sought and obtained all the information and explanations which to the best of ourknowledge and belief were necessary for the purposes of our audit;

(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 ofChanges in Equity dealt with by this Report are in agreement with the books ofaccount;

(d) In our opinion the aforesaid standalone Ind AS financialstatements comply 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 31 2021 taken on record by the Board of Directors none of thedirectors is disqualified as on March 31 2021 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 these standalone Ind AS financial statements and the operatingeffectiveness of such controls refer to our separate Report in "Annexure 2" tothis report;

(g) In our opinion the managerial remuneration for the year endedMarch 31 2021 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 theAuditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors)Rules 2014 as amended in our opinion and to the best of our information and according tothe explanations given to us: i. The Company has disclosed the impact of pendinglitigations on its financial position in its standalone Ind AS financial statements

- Refer Note 38 to the standalone Ind AS financial statements;

ii. The Company has made provision as required under the applicablelaw or accounting standards for material foreseeable losses if any on long-termcontracts including derivative contracts - Refer Note 24 to the standalone Ind ASfinancial statements;

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

For S R B C & CO LLP
Chartered Accountants
ICAI Firm Registration Number: 324982E/E300003
per Abhishek Agarwal
Partner
Mumbai Membership Number: 112773
Date: May 12 2021 UDIN: 21112773AAAADG2459

Annexure 1 to the Independent Auditor's Report referred to inparagraph 1 under the heading ‘Report on Other Legal and RegulatoryRequirements' of our report of even date on the standalone Ind AS financialstatements of The Tata Power Company Limited

(i) (a) The Company has maintained proper records showing fullparticulars including quantitative details and situation of fixed assets.

(i) (b) All fixed assets have not been physically verified by themanagement during the year but there is a regular programme of verification which in ouropinion is reasonable having regard to the size of the Company and the nature ofits assets. No material discrepancies were noticed on such verification.

(i) (c) According to the information and explanations given by themanagement the title deeds of immovable properties included in property plant andequipment are held in the name of the Company except for a. immovable propertiesaggregating to Rs. 0.88 crore acquired during merger of Chemical Terminal Trombay Limitedin the earlier year for which registration of title of deeds is in progress.

b. immovable properties aggregating to Rs. 8.01 crore acquired inearlier years for which registration of title of deeds is in progress.

Further registration of title deed is in progress in respect ofleasehold land classified under Asset held for sale aggregating to Rs. 215.56 crore (Grossvalue Rs. 225.65 crore).

According to the information and explanations given by the managementthe title deeds of immovable properties included in property plant and equipment arepledged with the banks and not available with the Company as described in note 22 ofstandalone Ind AS financials statements. The same has not been independently confirmed bythe bank and hence we are unable to comment on the same.

(ii) The management has conducted physical verification of inventory atreasonable intervals during the year and no material discrepancies were noticed on suchphysical verification.

(iii) (a) The Company has granted loans to sixteen companies covered inthe register maintained under section 189 of the Companies Act 2013. In our opinion andaccording to the information and explanations given to us the terms and conditions of thegrant of such loans are not prejudicial to the Company's interest.

(iii) (b) The Company has granted loans to seventeen companies coveredin the register maintained under section 189 of the Companies Act 2013. The scheduleof repayment of principal and payment of interest has been stipulated for the loansgranted and the repayment/receipts are regular.

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

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

(v) The Company has not accepted any deposits within the meaning ofSections 73 to 76 of the Companies Act 2013 and the Companies (Acceptance ofDeposits) Rules 2014 (as amended). Accordingly the provisions of clause 3(v) of theOrder are not applicable.

We are informed by the management that no order has been passed by theCompany Law Board National Company Law Tribunal Reserve Bank of India or any Court orany other Tribunal.

(vi) We have broadly reviewed the books of account maintained by theCompany pursuant to the rules made by the Central Government for the maintenance of costrecords under section 148(1) of the Companies Act 2013 related to generationtransmission and distribution of electricity arms and ammunitions Radar radionavigational aid apparatus and electricals or electronic machinery 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) According to the information and explanations given to us inrespect of statutory dues:

(a) The Company is regular in depositing with appropriate authoritiesundisputed statutory dues including provident fund employees' state insuranceincome-tax goods and service tax duty of custom cess and other statutory duesapplicable to it.

(b) No undisputed amounts payable in respect of provident fundemployees' state insurance income tax service tax sales tax custom duty exciseduty value added tax goods and service tax cess and other statutory dues wereoutstanding at the year end for a period of more than six months from the date theybecame payable.

(c) According to the records of the Company the dues of income taxsales tax service tax custom duty excise duty value added tax and cess on account ofany dispute are as follows:

Name of Statute Nature of dues Amount in Crores Period to which amount relates Forum where the dispute is pending
The Customs Act 1962 Customs Duty 34.43 2011-12 and 2012-13 The Customs Excise and Service Tax Appellate Tribunal (CESTAT)
3.60 2004-05 to 2005-06 CESTAT
1.37 2004-05 to 2005-06 and 2009-10 Principal Commissioner of Customs
The Central Excise Act 1944 Excise Duty 0.81 1993-94 to 1995-96 CESTAT
The Water (Prevention & Control of Pollution) Cess Act 1977 Cess 1.13 2009-10 Chairman Maharashtra Pollution Control Board (MPCB)
Income Tax Act 1961 Income Tax 8.99 2008-09 Income Tax
1.08 2009-10 Appellate
100.19 2011-12 - 2014-15 Tribunal
Tax deducted at source 50.19 2016-17 Commissioner of Income Tax (Appeals)
The Finance Act 1994 Service Tax 375.29 July 2012 to June 2017 High Court
5.86 2011-12 to 2014-15 CESTAT
0.25 2007-08 Joint Commissioner (Appeals)

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

(ix) In our opinion and according to the information and explanationsgiven by the management and audit procedures performed by us the Company has utilized themonies raised by way of debt instruments in the nature of debentures and term loans forthe purposes for which they were raised. According to the information and explanationsgiven by the management the Company has not raised any money by way of initial publicoffer or further public offer.

(x) Based upon the audit procedures performed for the purpose ofreporting the true and fair view of the standalone Ind AS financial statements andaccording to the information and explanations given by the management we report that nofraud by the Company or no material fraud on the Company by the officers and employees ofthe Company has been noticed or reported during the year.

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

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

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

(xiv) According to the information and explanations given by themanagement and audit procedures performed by us the Company has complied with provisionsof section 42 of the Companies Act 2013 in respect of the preferential allotment ofshares during the year. According to the information and explanations given by themanagement we report that the amounts raised have been used for the purposes for whichthe funds were raised. Further according to the information and explanations to us and onan overall examination of the balance sheet the Company has not made any preferentialallotment or private placement of fully or partly convertible debentures during the year.

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

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

For S R B C & CO LLP
Chartered Accountants
ICAI Firm Registration Number: 324982E/E300003
per Abhishek Agarwal
Partner
Membership Number: 112773
UDIN: 21112773AAAADG2459
Mumbai
Date: May 12 2021

Annexure 2 to the Independent Auditor's Report of even date on thestandalone Ind AS financial statements of The Tata Power Company Limited

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

We have audited the internal financial controls over financialreporting of The Tata Power Company Limited ("the Company") as of March 31 2021in conjunction with our audit of the standalone Ind AS financial statements of the Companyfor the year 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 (the "Guidance Note") issued by the Institute of CharteredAccountants of India (‘ICAI'). These responsibilities include the designimplementation and maintenance of adequate internal financial controls that were operatingeffectively for ensuring the orderly and efficient conduct of its business includingadherence to the 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 Act.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company's internalfinancial controls over financial reporting with reference to these standalone Ind ASfinancial statements based on our audit. We conducted our audit in accordance with theGuidance Note and the Standards on Auditing as specified under section 143(10) of the Actto the extent applicable to an audit of internal financial controls and both issued bythe Institute of Chartered Accountants of India. Those Standards and the Guidance Noterequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls over financialreporting with reference to these standalone Ind AS financial statements was establishedand maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence aboutthe adequacy of the internal financial controls over financial reporting with reference tothese standalone Ind AS financial statements and their operating effectiveness. Our auditof internal financial controls over financial reporting included obtaining anunderstanding of internal financial controls over financial reporting with reference tothese standalone Ind AS financial statements assessing the risk that a material weaknessexists and testing and evaluating the design and operating effectiveness of internalcontrol based on the assessed risk. The procedures selected depend on the auditor'sjudgement including the assessment of the risks of material misstatement of thestandalone Ind AS 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 internal financial controlsover financial reporting with reference to these standalone Ind AS financial statements.

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

A company's internal financial control over financial reporting withreference to these standalone Ind AS financial statements is a process designed to providereasonable assurance regarding the reliability of financial reporting and the preparationof standalone Ind AS financial statements for external purposes in accordance withgenerally accepted accounting principles.

A company's internal financial control over financial reporting withreference to these standalone Ind AS financial statements includes those policies andprocedures that (1) pertain to the maintenance of records that in reasonable detailaccurately and fairly reflect the transactions and dispositions of the assets of thecompany; (2) provide reasonable assurance that transactions are recorded as necessary topermit preparation of standalone Ind AS 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 standalone Ind AS financial statements.

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

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

Opinion

In our opinion the Company has in all material respects adequateinternal financial controls over financial reporting with reference to these standaloneInd AS financial statements and such internal financial controls over financial reportingwith reference to these standalone Ind AS financial statements were operating effectivelyas at 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 Institute of Chartered Accountants of India.

For S R B C & CO LLP
Chartered Accountants
ICAI Firm Registration Number: 324982E/E300003
per Abhishek Agarwal
Partner
Membership Number: 112773
UDIN: 21112773AAAADG2459
Mumbai
Date: May 12 2021

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