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DLF LTD.

22 May 2024 | 03:59

Industry >> Realty

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ISIN No INE271C01023 BSE Code / NSE Code 532868 / DLF Book Value (Rs.) 159.30 Face Value 2.00
Bookclosure 28/07/2023 52Week High 968 EPS 11.02 P/E 76.92
Market Cap. 209757.91 Cr. 52Week Low 462 P/BV / Div Yield (%) 5.32 / 0.59 Market Lot 1.00
Security Type Other

NOTES TO ACCOUNTS

You can view the entire text of Notes to accounts of the company for the latest year
Year End :2023-03 

1. COMMITMENTS

i) Estimated amount of contracts remaining to be executed on capital account and not provided for: at 31 March 2023, the Company had commitments of ' 9,631.53 lakhs (31 March 2022: ' 974.61 lakhs) relating to completion of various projects.

ii) The Company is committed to provide business and financial support to certain subsidiary companies, which are in losses and is dependent on parent company for meeting out their cash requirements. Further, the Company has given letter of support in favour of certain joint ventures/ associate companies for their bank borrowings.

iii) The Company has commitment regarding payments under development agreements with certain partnership firms amounting to ' 139,215.97 lakhs (31 March 2022: ' 138,776.69 lakhs), where the Company or its subsidiaries are partner and certain third-party entities with whom development agreements are in place.

2. CONTINGENT LIABILITIES AND LITIGATIONS

Contingent liabilities

(' in lakhs)

31 March 2023

31 March 2022

a)

Claims against the Company not acknowledged as debts:

Income tax demands/ effects (refer note 1 and 2 below)

447,315.65

433,438.34

Service tax/ GST demands (refer note 3 below)

15,930.94

15,154.04

Sales tax/ VAT demands (refer note 3 below)

2,895.14

3,394.19

Property tax demands (refer note 3 below)

729.37

729.37

Custom duty demands (refer note 3 below)

791.53

791.53

Legal cases [refer note 4, 5, 6, 7 and 9(i)(c)(ii) below]

103,586.59

81,726.34

b)

Guarantees issued by the Company on behalf of:

Subsidiary companies

-

22,867.95

Others (Joint Ventures, KMP Entities and Others)

-

75,910.29

1) a) The Income Tax Authorities had made disallowances of SEZ profits u/s 80IAB of the Income-tax Act, 1961 during tax assessment of the Company raising demands amounting to ' 109.00 lakhs for the assessment year 2015-16; ' 1,056.00 lakhs for the assessment year 2014-15; ' 6,834.00 lakhs for the assessment year 2013-14; ' 7,308.99 lakhs for the assessment year 2011-12; ' 7,284.99 lakhs for the assessment year 2010-11; ' 35,523.71 lakhs for the assessment year 2009-10 and ' 48,723.00 lakhs for the assessment year 2008-09, respectively.

The Company had filed appeals before the appropriate appellate authorities against these demands for the said assessment years and have got full relief of ' 106,840.45 lakhs i.e. ' 105,675.62 lakhs from the Hon'ble Income Tax Appellate Tribunal against which, the department appeal(s) are pending before the Hon'ble Delhi High Court and ' 1,164.83 lakhs from CIT (Appeals), against which, the department appeal(s) are pending before the Hon'ble Income Tax Appellate Tribunal.

Based on the advice from independent tax experts and the development on the appeals, the management is confident that additional tax so demanded will not be sustained on completion of the appellate proceedings and accordingly, pending the decision by the appellate authorities, no provision has been made in these standalone financial statements.

b) The Income tax Authorities have disallowed one-time losses claimed by the company in assessment year 2017-18 and 2019-20 on account of mandatory adoption of erstwhile Ind AS 18 "Revenue” read with Guidance Note for Real Estate Transactions for Ind AS compliant entities and Ind AS 115 "Revenue from contract with customers”, respectively. The one-time losses were adjusted in the retained earnings of the respective financial years in accordance with the relevant accounting standards. However, the assessing officer has allowed alternate claim as per erstwhile Ind AS 7 "Construction Contracts”, read with "Guidance Note on Recognition of revenue by Real Estate Transactions” issued by ICAI, followed by the Company till the year ended 31 March 2016, for assessment year 2017-18 and assessment year 2019-20 to avoid double taxation of already assessed income, but have not allowed alternative claims filed for assessment year 2018-19, assessment year 2020-21 and assessment year 2021-22, consequential to disallowance of one-time losses in assessment year 2017-18 and 2019-20. During the year, a demand of ' 42,774.31 lakhs for assessment year 2021-22 has been created as setting off of business loss amounting to ' 117,967.00 lakhs of assessment year 2017-18 has not been allowed by assessing officer. The Company has preferred appeals against the orders of the assessing officer which are pending with CIT (A)/ NFAC.

Further, the management has evaluated the impact of the matter and believes that there will be no tax impact arising out of this, considering alternative claims are allowed by the assessing officer/ appellate authorities based on the fundamental law of taxation that the same income cannot be taxed twice. However, there may be an impact of ' 20,000.00 lakhs approximately on the carrying value of deferred tax asset due to non-adjustment of certain capital losses.

Based on legal opinion obtained from tax experts, management is confident that it has a strong likelihood of succeeding in the matter and therefore, no adjustments are required in the standalone financial statements of the Company.

2) Other than matters mentioned at point no. 1 above, the Income Tax Authorities have raised demands on account of various disallowances pertaining to different assessment years. The Company is contesting these demands, which are pending at various appellate levels.

Based on the advice from independent tax experts and the development on the appeals, the management is confident that additional tax so demanded as mentioned in point 1) and 2) above will not be sustained on completion of the appellate proceedings and accordingly, pending the decision by the appellate authorities, no provision has been made in these standalone financial statements.

3) There are various disputes pending with the authorities of excise, customs, service tax, GST, sales tax, VAT, property tax etc. The Company is contesting these demands raised by authorities and are pending at various appellate authorities.

Based on the grounds of the appeals and advice of the independent legal counsels, the management believes that there is a reasonably strong likelihood of succeeding before the various authorities. Pending the final decisions on the above matter, no adjustment has been made in these standalone financial statements.

4) There are various litigations going on against the Company primarily by Competition Commission of India (also refer note 50(9)(i)(a) below) and in Consumer Redressal Forum, which have been contested by the Company.

Based on the grounds of the appeals and advice of the independent legal counsels, the management believes that there is a reasonably strong likelihood of succeeding before the various authorities. Pending the final decisions on the above matter, no adjustment has been made in these standalone financial statements.

5) Interest and claims by customers/ suppliers may be payable as and when the outcome of the related matters are finally determined and hence not been included above.

Management based on legal advice and historical trends, believes that no material liability will devolve on the Company in respect of these matters.

6) During the earlier years, DLF Utilities Limited ("DUL') [Real estate undertaking of DUL, now merged with DLF Limited (refer note 57)] had received a notice from the Dakshin Haryana Bijli Vitran Nigam ("DHBVN”) wherein it had claimed cross subsidy surcharge of ' 3,328.00 lakhs on electricity being supplied by DUL to other companies for the period from 1 April 2011 to 30 September 2012 and had questioned the legality of such electricity supply. DUL filed an appeal to Haryana Electricity Regulatory Commission ("HERC”), wherein HERC vide order dated 11 August 2011 held that the supply of electricity by DUL was legal, however, DUL was liable to pay cross subsidy surcharge. Aggrieved by the said order, DUL filed an appeal before Appellate Tribunal of Electricity ("APTEL’) against the levy of cross subsidy surcharge. APTEL held that the supply of electricity for commercial establishments from the main receiving panel was not in accordance with law and must be discontinued.

Further, APTEL also held that the DUL was liable to pay the cross-subsidy surcharge and accordingly, a demand of ' 3,328.00 lakhs was received by DUL from DHBVN against the same. Aggrieved by the order of APTEL, DUL filed an appeal before the Hon'ble Supreme Court of India which had stayed the execution of the said order and asked DUL to deposit an amount of ' 284.36 lakhs to DHBVN which was duly deposited.

Based on the advice of the independent legal counsels and grounds of appeal, the management has assessed that there is a strong likelihood of succeeding before the Hon'ble Supreme Court of India. Pending the final decisions on the above matter, no adjustment has been made in these standalone financial statements.

7) During the year, on 23 December 2022, New Okhla Industrial Development Authority (NOIDA) demanded ' 23,421.31 lakhs against the Company on account of payment of enhanced compensation to farmers regarding land acquired by it. As per NOIDA, land which was acquired by it, falls under the plot taken by the Company through auction. While passing judgment dated 5 May 2022, the Hon'ble Supreme Court directed that, "Since the acquisition of land in question was made by NOIDA which was purchased by DLF through a public auction, therefore the liability to pay compensation would be of NOIDA". Subsequently, NOIDA filed a review petition with the Hon'ble Supreme Court, which was dismissed vide Order dated 10 August 2022. Even after this, NOIDA issued a Demand Notice on 23 December 2022 demanding a sum of ' 23,421.31 lakhs. The Company challenged the said demand through filing writ petition before Hon'ble High Court at Allahabad. The Hon'ble High Court vide order dated 24 January 2023 directed that no coercive measures shall be taken by NOIDA pursuant to the demand notice dated 23 December 2022.

Based on the advice of the independent legal counsel, management has assessed that there is a strong likelihood of succeeding before Hon'ble High Court of Allahabad. Pending the final outcome on the above matter, no adjustment has been made in these standalone financial statements. Also refer note 50(8)(iii) below.

8) Indemnification of DCCDL

As per the terms of the SPSHA, the Company has undertaken to indemnify, defend and hold harmless the Investor against all losses incurred or suffered by DCCDL arising out of following matters up to or prior to 25 December 2017 (i.e., Closing Date):

i) Income tax demands related to various matters and assessment years up to the closing date of ' 114,735.01 lakhs (31 March 2022: ' 108,382.65 lakhs);

ii) Indirect tax demands including service tax and entry tax related to various matters and financial years up to the closing date of ' 24,680.24 lakhs (31 March 2022: ' 25,383.26 lakhs);

iii) Liability arising out of matter discussed in note 50(6) and 50(7) above.

iv) The land parcel admeasuring 19.5 acres was acquired by the Company from Government of Haryana ('GoH') in August 2006 for development of Cyber City Project, which was earlier acquired by GoH from Gram Panchayat, Nathupur in February 2004 through proceedings of compulsory acquisition. DCCDL had constructed certain portions of its two IT/ IT SEZ buildings of the Cyber City Project as well as entered into third party rights vide lease/ sale of office space in the said buildings. Subsequently, the Hon'ble High Court of Punjab and Haryana, pursuant to a public interest litigation, vide order dated 1 October 2010, quashed the land acquisition proceedings and conveyance deed by GoH and directed the GoH to refund the amount, which was earlier paid by the Company and also directed the Company to remove any construction on the said land. Against the said order, the Company filed a Special Leave Petition in November 2010 before the Hon'ble Supreme Court of India, who vide order dated 3 January 2012, stayed the order of the High Court and the matter is pending for disposal before the Hon'ble Supreme Court of India.

During the previous year, 7 residents of Village Nathupur filed applications for impleadment, which were dismissed vide Order dated 15 March 2022. Further, in previous year impleadment application filed by 5 residents of Village Nathupur which are pending and to be listed in due course.

Based on the advice of the independent legal counsels and grounds of appeal, the management has assessed that there is a strong likelihood of succeeding before the Hon'ble Supreme Court of India. Also refer note 50(9)(i)(b) below.

v) The Company along with one of its subsidiary companies had acquired a land parcel admeasuring approximately 30 acres and 7 acres respectively from EIH Limited ('EIH') for development of IT/ ITES project at Silokhera, Gurugram, which EIH acquired from GoH. The Company constructed 2 IT/ ITES SEZ Buildings on the said land, which was sold to one of the subsidiary companies of the DCCDL. The Company is constructing another block of buildings on DCCDLs behalf. The net block and capital work-in-progress against Silokhera project appearing in DCCDLs books as at 31 March 2023 amounts to ' 148,818.33 lakhs (31 March 2022: ' 152,101.71 lakhs) and ' 89,111.66 lakhs (31 March 2022: ' 89,111.05 lakhs), respectively.

Subsequently, the Hon'ble High Court of Punjab and Haryana, pursuant to a public interest litigation and vide its order dated 3 February 2011 directed the GoH to carry out the acquisition proceedings again from the notification stage under the Land Acquisition Act, 1894 and directed the Company and its subsidiaries to remove all constructions made on the said land. The Company filed a Special Leave Petition before the Hon'ble Supreme Court of India and the Hon'ble Supreme Court of India vide order dated 20 September 2011 stayed the order of the Hon'ble High Court and the matter is currently pending before the Hon'ble Supreme Court of India and the next date of hearing is yet to be notified by the registry.

Based on the advice of the independent legal counsels and grounds of appeal, the management has assessed that there is a strong likelihood of succeeding before the Hon'ble Supreme Court of India. Pending the final decision on the above matter, no adjustment has been made in these standalone financial statements. Also refer note 50(9)(i)(b) below.

9) Matters pending in litigation with Courts/ Appellate Authorities

i) a) The Competition Commission of India (CCI) on a complaint filed by the Belaire/ Magnolias/ Park Place owners association had passed orders dated 12 August 2011 and 29 August 2011 wherein the CCI had imposed a penalty of ' 63,000.00 lakhs on DLF Limited ("DLF” or "the Company”) or, restraining DLF from formulating and imposing allegedly unfair conditions with buyers in Gurugram and further ordered to suitably modify the alleged unfair conditions on its buyers.

The said orders of CCI were challenged by DLF on several grounds by filing appeals before the Competition Appellate Tribunal (COMPAT).

COMPAT vide its order dated 19 May 2014 upheld the penalty imposed by CCI.

The Company had filed an appeal in the Hon'ble Supreme Court of India against the order dated 19 May 2014 passed by the COMPAT. The Hon'ble Supreme Court of India vide order dated 27 August 2014 admitted the Appeal and directed the Company to deposit penalty of ' 63,000.00 lakhs in the Court. In compliance of the order, the Company had deposited ' 63,000.00 lakhs with the Hon'ble Supreme Court of India and is continued to be shown as recoverable.

The matter is to be listed in due course.

Based on the advice of the independent legal counsels and grounds of appeal, the management has assessed that there is a strong likelihood of succeeding before the Hon'ble Supreme Court of India. Pending the final decisions on the above matter, no adjustment has been made in these standalone financial statements. Also refer point 50(4) above.

b) During the year ended 31 March 2011, the Company, one of its subsidiary companies and a joint venture company received judgments from the Hon'ble High Court of Punjab and Haryana cancelling the sale deeds of land/ removal of construction relating to two IT SEZ/ IT Park Projects in Gurugram admeasuring 49.05 acres. The Company and the subsidiary company filed Special Leave Petitions (SLPs) challenging the orders in the Hon'ble Supreme Court of India.

The Hon'ble Supreme Court of India had admitted the matters and stayed the operation of the impugned judgments till further orders in both the cases. Also refer point 50(8)(iv) and 50(8)(v) above.

Based on the advice of the independent legal counsels and grounds of appeal, the management has assessed that there is a strong likelihood of succeeding before the Hon'ble Supreme Court of India. Pending the final decisions on the above matter, no adjustment has been made in these standalone financial statements.

c) i) The Securities and Exchange Board of India ('SEBI') vide order dated 10 October 2014 restrained

the Company and its Officers/ certain directors from accessing the securities market and prohibited them from buying, selling, or otherwise dealing in securities, directly or indirectly, in any manner, whatsoever, for a period of three years. This Order was passed pursuant to a Show Cause Notice (SCN) dated 25 June 2013 which inter alia alleged that the Offer Documents issued by the Company at the time of its initial public offer in the year 2007 suffered from material non-disclosures and misstatements.

The Company and the said Directors filed appeals before the SEBI Appellate Tribunal ("SAT"). SAT, by majority order dated 13 March 2015, allowed the appeals on the ground that there was nothing that suggested that the investors were prejudiced due to non-disclosure of information by DLF in its offer document, or that such non-disclosure resulted in any benefit to DLF or its Directors in violation of the Erstwhile DIP Guidelines.

SEBI filed an appeal with the Hon'ble Supreme Court of India, which stand admitted vide order dated 24 April 2015 without granting any interim stay in favour of SEBI.

In February 2015, SEBI, in similar matters, imposed penalties upon Company, some of its directors/ officers and its three subsidiaries and their directors. The Company approached the SAT which held that the SEBI order cannot be sustained. In October 2015, SEBI filed applications before the Hon'ble Supreme Court seeking, restraint on the Company, its promoters and/ or directors from proceeding with the sale of 159,699,999 Cumulative Compulsorily Convertible Preference Shares of DLF Cyber City Developers Limited held by the promoter group companies to third party institutional investors. The said applications came up for hearing before the Hon'ble Supreme Court on 04 November 2015 and the Hon'ble Supreme Court did not pass any orders restraining the Transaction and simply directed that the said applications be listed along with the appeal. The matter is pending and to be listed in due course.

ii) SEBI issued a SCN dated 28 August 2013 under Sections 15HA and 15HB of the SEBI Act and under Rule 4 of the SEBI (Procedure for Holding Inquiry and Imposing Penalties by Adjudicating Officer) Rules,1995 ('Adjudication Rules') making allegations similar to the SCN dated 25 June 2013. The Company filed its Reply to the same opposing the allegations made against it. Similar SCNs were also issued to three subsidiaries, their directors and certain other entities.

By way of order dated 26 February 2015, the Adjudicating Officer, SEBI imposed monetary penalties upon Company, some of its Officers/ Directors, its three subsidiaries and their Directors under Section 15HA and under Section 15HB of the SEBI Act.

The Company and other parties aggrieved by the aforesaid order filed appeals before the Hon'ble SAT against the aforesaid order dated 26 February 2015. When these appeals were listed before Hon'ble SAT on 15 April 2015, SEBI's counsel under instructions stated that during the pendency of the said appeals, the Order dated 26 February 2015 would not be enforced. The Hon'ble SAT vide its order passed on 25 April 2018 held that in view of Hon'ble SAT's majority decision dated 13 March 2015, the SEBI Order dated 26 February 2015 cannot be sustained.

Accordingly, the Hon'ble SAT disposed off the appeals with a direction that these appeals, shall stand automatically revived once the Hon'ble Supreme Court of India disposes of the civil appeals filed by SEBI against the Hon'ble SAT's judgment dated 13 March 2015.

Based on the advice of the independent legal counsels and grounds of appeal, the management has assessed that there is a strong likelihood of succeeding before the Hon'ble Supreme Court of India. Pending the final decisions on the above matter, no adjustment has been made in these standalone financial statements.

d) During the previous year, one of the joint venture company, Joyous Housing Limited (JHL) had defaulted in meeting its debt obligation to a housing finance company (HFC or lender). The lender amongst various actions to recover its dues, initiated e-auction of the project, served notices to initiate legal proceedings for alleged contravention related to the loan agreement against JHL, its directors and shareholders. Further, the lender has also initiated the process to take control of the board of JHL and offered the pledged shares to all the three shareholders. In this regard, the Company has submitted a formal expression of interest to purchase 100% shares of JHL for a consideration above the reserve price at which the lender has offered the shares to ensure repayment of the dues to the lender and other financial creditors of JHL.

However, one of the shareholders has filed a petition opposing the actions taken by the other shareholders at the instructions of the lender before National Company Law Tribunal, NCLT, Mumbai. Subsequently, NCLT has passed a status quo order with regard to such actions. Further, the Company has also initiated arbitration proceedings.

Based on the legal advice, management believes that there is a strong likelihood of successful outcome in its favour. Still, due to ongoing dispute and uncertainties involved w.r.t. outcome of litigation/ arbitration and consequential impact on recoverability of the Company's investment/ loan, the provision was recognised against such investment/ loan in earlier years which was disclosed under "Exceptional Items”, refer note 33. The management considers such provision to be adequate and the net carrying value amounting to ' 18,036.37 lakhs is considered good for recovery, as the project has adequate inherent value, once it is litigation free.

9 ii) a) The petitions were filed before the Hon'ble Punjab and Haryana High Court challenging the action of the Haryana Government to acquire the land belonging to Gram Panchayat of village Wazirabad, District Gurugram for public purpose and thereafter selling the same to the Company, seeking directions from the court for quashing of the acquisition proceedings under Sections 4 and 6 dated 8 August 2003 and 20 January 2004.

The petitioners therein also sought quashing of the award dated 19 January 2006 and the Regular letter of allotment (RLA) dated 9 February 2010 issued in favour of the Company for 350.715 acres of land. The Company has paid ' 99,969.26 lakhs to Government towards purchase of this land out of total consideration of ' 182,437.49 lakhs.

The Hon'ble Punjab and Haryana High Court, vide its final order dated 3 September 2014, while upholding the acquisition of land has however disapproved the allotment in favour of the Company. The Hon'ble High Court passed an order to keep the RLA dated 9 February 2010 issued in favour of the Company in abeyance and further directed the Haryana State Industrial and Infrastructure Development Corporation ('HSIIDC') to initiate fresh allotment process for higher returns in respect of the land in question with an option to State to revive the RLA in case no better bid is quoted by the public at large.

The Company has filed a Special Leave Petition before the Hon'ble Supreme Court of India challenging the judgment dated 3 September 2014 passed by the Hon'ble Punjab and Haryana High Court. The Hon'ble Supreme Court of India issued notice to the respondents and directed status quo to be maintained by the parties.

Based on the advice of the independent legal counsels and grounds of appeal, the management has assessed that there is a strong likelihood of succeeding before the Hon'ble Supreme Court of India. Pending the final decisions on the above matter, no adjustment has been made in these standalone financial statements.

b) The Company has filed a Special Leave Petition (SLP) against the order dated 2 December 2016 passed by the Hon'ble Punjab and Haryana High Court in Writ Petition No.12210 of 2013 challenging the findings and directions passed by the Hon'ble High Court requiring DLF to allocate additional land measuring 10.6 Acres for DLF Park Place complex. DLF has taken the ground that after having rejected the contentions of the association on the claim of extra land based on FAR and PPA norms, the Hon'ble High Court could not have passed the order for allocation of additional land based on the representations made in the Brochure. The Company has further raised the ground that Hon'ble High Court has given a complete go by to the terms and conditions of the binding agreement where it was specifically provided the area of Park Place as 12.67 acres, granted leave in the Special Leave Petition.

Against the same order, DLF Park Place Residents Welfare Association has also filed an SLP before the Hon'ble Supreme Court of India on the grounds that the Hon'ble High Court has misinterpreted the statutory provisions of the applicable law to hold that GH Park Place is not a separate and independent Company Housing Complex but is part of DLF Phase-V, constructed over 476.42 Acres, having 15 Company Housing Complexes. In accordance with the FAR ratio of 1:1.75, the association was entitled to additional land of 46.20 Acres on the total constructed area which has not been considered by the Hon'ble High Court.

The Court after hearing, granted leave in the SLPs. The appeals will be listed for arguments before the Hon'ble Supreme Court of India in due course.

Based on the advice of the independent legal counsels and grounds of appeal, the management has assessed that there is a strong likelihood of succeeding before the Hon'ble Supreme Court of India.

Pending the final decisions on the above matter, no adjustment has been made in these standalone financial statements.

c) During the previous year, Company has initiated the arbitration proceedings against Haryana Urban Development Authority (HUDA) in respect to outstanding amount of ' 6,002.90 lakhs recoverable under a joint development agreement entered with HUDA for construction of certain roads and underpass in Gurugram, Haryana on 50:50 cost sharing basis.

Based on the advice of the independent legal counsels and grounds of appeal, the management has assessed that claims by the Company are as per terms of agreement entered with HUDA and based on merits of the case, there is a strong likelihood of a favorable outcome for the Company in aforesaid case.

52. SEGMENT REPORTING

The Company's business activities which are primarily real estate development and related activities falls within a single reportable segment as the management of the Company views the entire business activities as real estate development. Accordingly, there are no additional disclosures to be furnished in accordance with the requirement of Ind AS 108 - Operating Segments with respect to single reportable segment. Further, the operations of the Company are domiciled in India and therefore there are no reportable geographical segment.

54. The investments made in related parties are long-term and strategic in nature. Further, all loans, guarantees and securities given are for meeting business and working capital requirements.

55. The Company had entered into an operation and management agreement with DLF Golf Resorts Limited ("DGRL"), a wholly-owned subsidiary of the Company. As per the agreement, DGRL transfers 97% revenue generated and expenses incurred during the year to the Company and the remaining 3% is retained by DGRL

for operation and management services provided to the Company. Accordingly, revenues of ' 10,830.29 lakhs (31 March 2022: ' 8,501.49 lakhs) and expenses of ' 8,617.42 lakhs (31 March 2022: ' 6,309.02 lakhs) [including ' 7,676.89 lakhs (31 March 2022: ' 5,494.27 lakhs) transferred from DGRL] pertaining to golf course operations, further depreciation of ' 1,185.02 lakhs (31 March 2022: ' 1,185.02 lakhs) in respect of assets taken on lease for golf operations has been recognized in these standalone financial statements.

57. SCHEME OF ARRANGEMENT (THE "SCHEME")

During the previous year, the Hon'ble National Company Law Tribunal ("NCLT”), Chandigarh Bench vide its Order dated 2 February 2022, had approved the Scheme of Arrangement involving merger/ demerger of wholly-owned subsidiary companies, namely DLF Phase-IV Commercial Developers Limited, DLF Real Estate Builders Limited, DLF Residential Builders Limited ("Transferor Companies”) and demerger and Transfer/ Vesting of real estate undertaking of DLF Utilities Limited ("Demerged Company”) with DLF Limited ("Transferee Company”) pursuant to Section 230-232 and other relevant provisions of the Companies Act, 2013 read with the Rules made thereunder with the appointed date as 1 April 2021. The Company has applied principles of Appendix C to Ind AS 103 - 'Business Combinations' on 'Business Combinations of entities under Common Control' w.e.f. 1 April 2020 and accordingly the impact of scheme was accounted in previous year and accordingly there is no impact of the Scheme of arrangement in current year.

These Transferor Companies and the Demerged Company are wholly owned subsidiaries of the Company which were engaged in the business which inter-alia includes real estate activities and carrying on business activities in terms of their respective Memorandum of Association.

58. The Code on Social Security, 2020 ('Code') relating to employee benefits during employment and post-employment benefits received Presidential assent in September 2020. The Code has been published in the Gazette of India. However, the date on which the Code will come into effect has not been notified and the final rules/ interpretation have not yet been issued. The Company will assess the impact of the Code when it comes into effect and will record any related impact in the period the Code becomes effective. Based on the preliminary assessment the entity believes the impact of the change will not be significant.

59. The Company has given corporate guarantees to banks for availment of loans and believes that there is no service rendered and thus there is no GST obligations. During the year, audit have been conducted and observed that there could be GST obligation on the said guarantees. Based on advice of tax experts, the management obtained an arm's length assessment report from an external expert only for the sole purpose of discharging payment of GST, if any and accordingly, has deposited GST on the said CGs given w.e.f. 1 July 2017, along with interest of ' 292.20 lakhs during the year on voluntary basis to avoid any litigation and accordingly the payment of interest shall not be construed as an irregularity in the deposit of GST on the part of the Company.

60. The figures for the corresponding previous year have been regrouped/ reclassified, wherever considered necessary, to make them comparable with current year classification.