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Integrated Annual Report 2020-21

Litigations and claims (refer notes 2.3.4, 2.22, 19 and 45.1 to the Standalone Financial Statements)
The Key Audit Matter How the matter was addressed in our audit
The Company operates in various States within India, exposing Our audit procedures included:
it to a variety of different Central and State laws, regulations and • Obtaining an understanding of actual and potential
interpretations thereof. The provisions and contingent liabilities outstanding litigations and claims against the Company
relate to ongoing litigations and claims with various authorities. from the Company’s in-house Legal Counsel and other
Litigations and claims may arise from direct and indirect tax senior personnel of the Company and assessing their
proceedings, legal proceedings, including regulatory and other responses;
government/department proceedings, as well as investigations • Assessing status of the litigations and claims based on
by authorities and commercial claims.
correspondence between the Company and the various
Resolution of litigations and claims proceedings may span over tax/legal authorities and legal opinions obtained by the
multiple years beyond March 31 2021 due to the complexity Company;
and magnitude of the legal matters involved and may involve • Testing completeness of litigations and claims recorded by
protracted negotiation or litigation.
verifying the Company’s legal expenses and the minutes of
The determination of a provision or contingent liability requires the board meetings;
significant judgement by the Company because of the inherent • Assessing and challenging the Company’s estimate of the
complexity in estimating future costs. The amount recognised possible outcome of litigations and claims. This is based on
as a provision is the best estimate of the possible expenditure. applicable tax laws and legal precedence by involving our
The provisions and contingent liabilities are subject to changes tax specialists in taxation related matters and discussing
in the outcomes of litigations and claims over time as new facts with the Company’s internal legal counsel;
emerge as each legal case progresses and positions taken by the
Company. • Evaluating the Company’s internal control and judgements
made by comparing the estimates of prior year to the actual
There is an inherent complexity and magnitude of potential outcome;
exposures is significant across the Company. Significant judgment
is necessary to estimate the likelihood, timing and amount of the • Assessing and testing the adequacy and completeness
cash outflows, interpretations of the legal aspects, legislations and of the Company’s disclosures in respect of litigations and
judgements previously made by the authorities. Accordingly, this claims.
is identified as a key audit matter.
Information Other than the Standalone Financial Management’s and Board of Directors’
Statements and Auditors’ Report Thereon Responsibility for the Standalone Financial
The Company’s management and Board of Directors are Statements
responsible for the other information. The other information The Company’s Management and Board of Directors are
comprises the information included in the Company’s annual responsible for the matters stated in Section 134(5) of the Act
report, but does not include the Standalone Financial Statements with respect to the preparation of these Standalone Financial
and our auditors’ report thereon. Statements that give a true and fair view of the state of affairs,
profit/loss and other comprehensive income, changes in
Our opinion on the Standalone Financial Statements does not equity and cash flows of the Company in accordance with the
cover the other information and we do not express any form of accounting principles generally accepted in India, including the
assurance conclusion thereon.
Indian Accounting Standards (Ind AS) specified under Section
In connection with our audit of the Standalone Financial 133 of the Act. This responsibility also includes maintenance of
Statements, our responsibility is to read the other information and, adequate accounting records in accordance with the provisions
in doing so, consider whether the other information is materially of the Act for safeguarding of the assets of the Company and for
inconsistent with the Standalone Financial Statements or our preventing and detecting frauds and other irregularities; selection
knowledge obtained in the audit or otherwise appears to be and application of appropriate accounting policies; making
materially misstated. If, based on the work we have performed, judgments and estimates that are reasonable and prudent; and
we conclude that there is a material misstatement of this other design, implementation and maintenance of adequate internal
information, we are required to report that fact. We have nothing financial controls that were operating effectively for ensuring the
to report in this regard. accuracy and completeness of the accounting records, relevant

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