We have audited the accompanying Standalone Quarterly /Annual Ind AS Financial
Statements of BEML LAND ASSETS LTD ("the Company -BLAL"), which comprise the
standalone Balance Sheet as at March 31,2026, Statement of Profit and Loss and the
Statement of Cash Flows for the year then ended, and notes to the Indian Accounting
Standards ("Ind AS") Financial Statements, including a summary of significant accounting
policies and other explanatory information for the Quarter/year ended March 31 2026.

In our opinion and to the best of our information and according to the explanations given
to us, subject to the significance of the matter discussed in the Emphasis of Matter the
aforesaid Ind AS Financial Statements give the information required by the Companies
Act, 2013 ("the Act") in the manner so required and give a true and fair view in conformity
with the Ind AS prescribed under section 133 read with the Companies (Indian
Accounting Standards) Rules, 2015 as amended, ("Ind AS") and other accounting
principles generally accepted in India, of the state of affairs of the Company as at 31st
March, 2026 and its Loss and its cash flows for the year ended on that date.

Emphasis of Matter:Fair Valuation of Investment Property

We draw attention to Land & Buildings where they have been carried as Investment
property as per Ind AS-40. Cost model has been adopted for valuation of Investment
properties under Ind AS 40. The fair value of the property is Rs. 2,32,537 Lakhs as per the
report of a certified valuer Dt 22 Oct 2022.

In line with the disclosure requirements under Ind AS-40 Standard and as per the
Accounting Policy no 2.2 requires all entities to measure the fair value of investment
property for the purpose of disclosure even though they are required to follow the cost
model. Flowever, as per para 53 of Ind AS 40, in exceptional cases, if the fair value of the
investment property is not reliably measurable on a continuing basis, the entity shall
make the disclosures required by paragraph 79(e) that the reason why the fair value
cannot be measured reliably.

Company has initiated the valuation of assets during the Financial Year 2026-27 as the
registration of ownership titles for the majority of properties is currently in progress from
BEMLLtd toBLAL.

We conducted our audit in accordance with the Standards on Auditing ("SAs") specified
u/s 143 (10) of the Act. Our responsibilities under those Standards are further described in
the Auditor's Responsibilities for the Audit of the Ind AS Financial Statements section of
our report. We are independent of the Company in accordance with the Code of Ethics
issued by the Institute of Chartered Accountants of India together with the ethical
requirements that are relevant to our audit of the Ind AS Financial Statements under the
provisions of the Act and the Rules there under, and we have fulfilled our other ethical
responsibilities in accordance with these requirements and the ICAI's Code and of Ethics.
We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.

Key Audit Matters.

Key Audit Matters are those matters that, in our professional judgment, were of most
significance in our audit of the Standalone Ind AS financial statements for the financial
year ended March 31,2026. These matters were addressed in the context of our audit of
the Ind AS financial statements as a whole, and in forming our opinion thereon, and we
do not provide a separate opinion on these matters.

We have determined the matters described below to be the key audit matters to be
communicated in our report. We have fulfilled the responsibilities described in the
Auditor's responsibilities for the audit of the Ind AS financial statements section of our
report, including in relation to these matters.

Accordingly, our audit included the performance of procedures designed to respond to
our assessment of the risks of material misstatement of the Ind AS financial statements.
The results of our audit procedures, including the procedures performed to address the
matters below, provide the basis for our audit opinion on the accompanying Ind AS
financial statements.

We draw attention to the following points:Non-Compliance with Provision of the Companies Act, 2013 and SEBI (LODR),
Regulations 2015:

1. As per 2nd proviso to Sec 149(1) of the Companies Act 2013 and Rule 3 of the
Companies (Appointment and Qualification of Directors) Rules 2014, the Company was
required to appoint One Women Director. The Company being a Government Company,
appointments of Women or Independent Directors are made based on the Orders issued
by the Government of India through the Ministry of Defence. The Company has
requested Government of India to issue necessary order for appointment of
Women Independent Director and response from the Government of India is
awaited.

2. As per Sec 149 (4) of the Companies Act 2013 read with Regulations 17(1)(a) and
17(1 )(b) of the SEBI (Listing Obligation and Disclosure Requirements) Regulations 2015,
every Listed Public Company, whose Chairperson is an executive Chairperson, shall
consist of 50% of the total strength of the Board as Independent Directors/Non-Executive
Directors. The aforesaid requirement has not been met by the Company during the
financial year 2025-26.

3. During the Financial Year 2025-26, the Company has not constituted the Audit
Committee, Nomination and Remuneration Committee and Stakeholder
Relationship Committee as per Regulation 18, 19 & 20 of SEBI (Listing Obligation
and Disclosure Requirements) Regulations 2015 and Sec 177 & 178 of the
Companies Act 2013. An Audit Committee, Nomination and Remuneration
Committee and Shareholders Relationship Committee were constituted during the
FY 2025-26 but requirement of two independent directors on the audit committee
is not met as per the Companies Act, 2013 and SEBI listing regulation. One
independent director was ceased to be the director with effect from 17.04.2026
and consequently all the set committees ceased to exist

4. Penalty for Non-compliance Stock Exchange

The Company has been in non-compliance with certain provisions of the SEBI (Listing
Obligations and Disclosure Requirements) Regulations, 2015 during the financial years
2023-24 and 2024-25. For the financial year 2023-24, the Company was non-compliant
with Regulations 17 to 20 and 33, and for the financial year 2024-25, the Company
continued to be non-compliant with Regulations 17 to 20.and for the financial year
2025-26, the Company continued to be non-compliant with Regulations 17 to 20 of SEBI
(Listing Obligation and Disclosure Requirements) Regulations 2015

In respect of the above non-compliances. Stock Exchanges have imposed penalties
amounting to Rs. 95.77 lakhs (including GST) for FY 2023-24 and Rs. 95.70 lakhs
(including GST) for FY 2024-25, and Rs. 78.99 lakhs (including GST) for the FY 2025-26
aggregating to Rs. 270.46 lakhs as on March 31, 2026 (including an estimate for the
fourth quarter of FY 2025-26).

It has also been informed that the penalty is expected to continue for upcoming quarters
until three Independent Directors, including one Woman Director, are appointed by the
Ministry on the Board of BEML Land Assets Limited. In respect of penalty so imposed, the
Company has been submitting applications periodically to BSE & NSE seeking wavier of
fines and reply is awaited. Further, Company has written letters to Ministry of Defence to
take necessary action for the appointment of requisite number of Executive Directors and
Independent Directors including woman director on Board for ensuring compliance.
Regulation 102 of SEBI (LODR) provides for relaxation of penalty charges if SEBI is satisfied
that the non-compliance is caused due to factors affecting a class of entities but being
beyond the control of these entities.

5. Land registration:

It has been reported that out of Land Parcels 401.356 acres at Mysore as per schedule 1 of
the Scheme of arrangement identified for Demerger, the unused portion of the Township
has been taken back by KIADB and 302.284 acres have been transferred to BLAL. Further
registration of property with respect to Bhopal and Delhi and Chennai Building - Flats at
Supriya Estate and Goa Flats - Victor Building - 3 Flats and 2 shops, Kochi-Land with
building is completed as on 21.3.2025 and 8.4.2025 and 21.05.2025 and 31.12.2025
and 28.04.2026 respectively. Further other properties registration is under progress.

6. Status of transfer of title of properties to BEML LAND ASSETS LTD from BEML Ltd

The transfer of title from BEML Ltd to BLAL Land Assets Ltd is under progress. As per
amended Indian Stamp Act (Section 8G). Stamp duty charges are exempted. All State
Governments have granted exemption from stamp duty. However, The Commerce &
Industries department that the cabinet has advised to restrict to 50% stamp duty and
100% registration fees exemption, as already granted vide notification dated
12.02.2025. however, company has taken up the matter with Govt of Karnataka for
100% exemption on stamp duty.

7. Rental Income is recognised for only certain properties utilized by BEML Ltd.

As a part of strategic disinvestment of BEML and the scheme of arrangement approved by
Ministry of Corporate Affairs, the identified surplus/ non-core assets of BEML have been
demerged from BEML to BEML Land Assets Limited (BEML LAND ASSETS LTD). The
properties have already been transferred in the Books from BEML Ltd. to BEML Land
Assets Ltd. However, transfer of title of property is under process. The title transfer of the
Bhopal property and Delhi Property and Chennai Building - Flats at Supriya Estate -
building assets and Goa Flats - Victor Building - 3 Flats and 2 Shops, Kochi-Land with
building in favour of BLAL was completed on 21.03.2025, 08.04.2025, 21.05.2025,
31.12.2025 and on 28.04.2026 respectively.

BEML Limited has taken in-principle approval for utilizing the BEML LAND ASSETS LTD
properties by BEML in its 394th Board Meeting held on 23rd March 2023 which was
approved by 17th Board Meeting of BEML Land Assets Ltd. Presently, the above said
properties are maintained by BEML Ltd. It was proposed to continue utilization of the
above properties by BEML Ltd instead of keeping the properties vacant.

The 'day to day expenses' viz., repairs and maintenance, security charges, electricity, water
charges etc. is borne by BEML Ltd. A Memorandum of Understanding (MoU) had been
signed with BEML Limited on 20.01.2026 which is effective from 01.01.2026 and leasing
out 302.26 acres of land in Mysuru and 36 Acres of land in Bengaluru at 3.93 Crs per
annum payable at ?.98.25 lakhs on quarterly basis and ^.81,25,000 (^.95,87,500 with
GST) invoice raised on 20th jan 2026 of Bengaluru property and ?.17,00,000
(?.20,06,000 inclusive GST) raised on 17th Feb 2026 of Mysuru property. Valuation of rent
has arrived as per the Property valuation has been carried out by Housing and Urban
Development Corporation Ltd (Hudco), The same has been relied for the purpose of the
audit. During the tenure of usage, BEML will pay the property taxon behalf of BEML Land
Assets Limited and account the same as a loan to BEML Land Assets Limited. However,
the following discrepancies exist -

1. The Lease arrangement with BEML Ltd is executed by way of Unregistered MoU
dated 20.01.2026 and not a formal registered Lease Agreement.

2. There is no clause related to payment of Rent Deposit in the aforesaid MoU which
raises concerns on Default Risk. However, terms of payment of lease rent is
quarterly in advance on or before 7th day of each quarter.

Information Other than the Standalone Ind AS Financial Statements and Auditor's
Report There on

The Company's Board of Directors is responsible for the preparation of the other
information. The other information comprises the information included in the Board's

Report including Annexures to Board's Report, Management Discussion and Analysis,
Business Responsibility Report, Corporate Governance and Shareholder's Information,
but does not include the standalone Ind AS financial statements and our auditor's report
thereon.

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

In connection with our audit of the standalone Ind AS financial statements, our
responsibility is to read the other information and, in doing so, consider whether the
other information is materially inconsistent with the standalone Ind AS financial
statements or our knowledge obtained during the course of our audit or otherwise
appears to be materially misstated. If, based on the work we have performed, we
conclude that there is a material misstatement of this other information, we are required
to report that fact.

Responsibilities of Management and Those Charged with Governance for the
Standalone Ind AS Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section 134(5)
of the Companies Act, 2013 ("the Act") with respect to the preparation of these
standalone Ind AS financial statements that give a true and fair view of the financial
position, financial performance, changes in equity and cash flows of the Company in
accordance with the accounting principles generally accepted in India, including the
Indian Accounting Standards (Ind AS) specified under Section 133 of the Act, read with
Companies (Indian Accounting Standards) Rules, 2015 (as amended).

This responsibility also includes maintenance of adequate accounting records in
accordance with the provisions of the Act for safeguarding the assets of the Company
and for preventing and detecting frauds and other irregularities; selection and
application of appropriate accounting policies; making judgments and estimates that are
reasonable and prudent; and design, implementation and maintenance of adequate
internal financial controls, that were operating effectively for ensuring the accuracy and
completeness of the accounting records, relevant to the preparation and presentation of
the standalone Ind AS financial statements that give a true and fair view and are free from
material misstatement, whether due to fraud or error.

In preparing the standalone Ind AS financial statements the Board of Directors is
responsible for assessing the Company's ability to continue as a going concern,
disclosure, as applicable, matters relating to going concern and using the going concern
basis of accounting unless the Board of Directors either intends to liquidate the company
or cease operations or has no realistic alternative but to do so.

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

Auditor's Responsibilities for the Audit of the Standalone Ind AS Financial Statements Our
objectives are to obtain reasonable assurance about whether the standalone Ind AS
financial statements as a whole are free from material misstatement, whether due to
fraud or error, and to issue an auditor's report that includes our opinion. Reasonable
assurance is a high level assurance but is not a guarantee that an audit conducted in
accordance with SAS will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or
in the aggregate, they could reasonably be expected to influence the economic decisions
of users taken on the basis of these standalone Ind AS financial statements.

Auditor's responsibilities for the audit of the standalone financial statements

Our responsibility is to express an opinion on these financial statements based on our
audit. We have considered the provisions of the Act, the accounting and auditing
standards and matters which are required to be included in the audit report under the
provisions of the Act and the Rules made thereunder.

Our objectives are to obtain reasonable assurance about whether the financial
statements as a whole are free from material misstatement, whether due 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 audit conducted in accordance with
SAs will always detect a material misstatement when it exists. Misstatements can arise
from fraud or error and are considered material if, individually or in the aggregate, they
could reasonably be expected to influence the economic decisions of users taken on the
basis of these financial statements.

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

* Identify and assess the risks of material misstatement of the financial statements,
whether due to fraud or error, design and perform audit procedures responsive to
those risks, and obtain audit evidence that is sufficient and appropriate to provide a
basis for our opinion. The risk of not detecting a material misstatement resulting
from fraud is higher than for one resulting from error, as fraud may involve collusion,
forgery, intentional omissions, misrepresentations, or the override of internal
control.

Obtain an understanding of internal control relevant to the audit in order to design
audit procedures that are appropriate in the circumstances. Under section 143(3)(i)
of the Companies Act, 2013, we are also responsible for expressing our opinion on

whether the company has adequate internal financial controls system in place and
the operating effectiveness of such controls

' Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by management.

* Conclude on the appropriateness of management's use of the going concern basis
of accounting and, based on the audit evidence obtained, whether a material
uncertainty exists related to events or conditions that may cast significant doubt on
the Company's ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required to draw attention in our auditor's report to the
related disclosures in the 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's report. However, future events or conditions may cause
the Company to cease to continue as a going concern.

’ Evaluate the overall presentation, structure, and content of the financial statements,
including the disclosures, and whether the financial statements represent the
underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters,
the planned scope and timing of the audit and significant audit findings, including any
significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied
with relevant ethical requirements regarding independence, and to communicate with
them all relationships and other matters that may reasonably be thought to bear on our
independence, and where applicable, related safeguards. From the matters
communicated with those charged with governance, we determine those matters that
were of most significance in the audit of the financial statements of the current period
and are therefore the key audit matters. We describe these matters in our auditor's report
unless law or regulation precludes public disclosure about the matter or when, in
extremely rare circumstances, we determine that a matter should not be communicated
in our report because the adverse consequences of doing so would reasonably be
expected to outweigh the public interest benefits 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 in terms of Section 143(11) of the Act, we give in "Annexure
A" a statement on the matters specified in paragraphs 3 and 4 of the Order.

2. As required bySection143(3)oftheAct, based on our audit we report that

a) We have sought and obtained all the information and explanations which to the best
of 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 the
Company so far as it appears from our examination of those books.

c) The Balance Sheet, the Statement of Profit and Loss including Other Comprehensive
Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by
this Report are in agreement with the books of account.

d) In our opinion, the aforesaid financial statements comply with the Indian Accounting
standards specified under section 133 of the Act, read with rule 7 of the Companies
(Accounts) Rules, 2014;

e) As per notification No.GSR 463(F) dated 5th June 2015 issued by MCA, Government
of India, provisions of section 164(2) of the Companies Act, 2013 relating to
disqualification of directors are applicable to the Company, being a Government
Company.

f) With respect to the adequacy of the internal financial controls over financial
reporting of the Company and the operating effectiveness of such controls, refer to
our separate Reporting "Annexure B". Our report expresses an unmodified opinion
on the adequacy and operating effectiveness of the Company's internal financial
controls over financial reporting.

g) With respect to the other matters to be included in the Auditor'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 to the
explanations given to us:

I) The Company has following pending litigations with respect to the assets
transferred from BEML as confirmed by the Legal Team:

Impact on financial position- we do not have legal opinion to assess the impact on
financial position.

ii. The Company did not have any long-term contracts including derivative contracts for
which there were any materials for useable losses.

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

iv. (a) The Management has represented that, to the best of its knowledge and belief, no
funds (which are material either individually or in the aggregate) have been advanced or
loaned or invested (either from borrowed funds or share premium or any other sources or
kind of funds) by the Company to or in any other person(s) or entity (ies), including
foreign entities (the "Intermediaries"), with the understanding, whether recorded in
writing or otherwise, that the Intermediary shall, directly or indirectly lend or invest in
other persons or entities identified in any manner whatsoever by or on behalf of the
Company (the "Ultimate Beneficiaries of funds advanced, loaned or investment") or
provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries of funds
advanced, loaned or invested.

(b) The Management has represented, that, to the best of its knowledge and belief, no
funds (which are material either individually or in the aggregate) have been received by
the Company from any person(s) or entity (ies),including foreign entities (the "Funding
Parties"), with the understanding, whether recorded in writing or otherwise, that the
Company shall, directly or indirectly, lend or invest in other persons or entities identified
in any manner whatsoever by or on behalf of the Funding Party ("Ultimate Beneficiaries")
or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

(c) Based on the audit procedures that has been considered reasonable and appropriate
in the circumstances, nothing has come to our notice that has caused us to believe that
their presentations under sub-clause (i) and (ii) of Rule 11 (e), as provided under (a) and (b)
above, contain any material misstatement.

v. The Company has not proposed, declared or paid any interim or final dividend during
the year.

vi. Proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 for maintaining books of
account using accounting software which has a feature of recording audit trail (edit log)
facility is applicable to the Company with effect from April 1, 2023, and accordingly,
reporting under Rule 11 (g) of Companies (Audit and Auditors) Rules, 2014 is applicable
for the financial year ended March 31,2026.

For N. Tatia & Associates

Chartered Accountants

Firm Registration Number: 011067S

Nidhi Tatia
Partner

Membership No.: FCA 061355
Peer Review No. 016257
UDIN No- 26061355BSVFCA2526

Date: 01-06-2026
Place- Bangalore