2.31.1 :Disputed claims under' Karnataka Forest Act:

Government of Karnataka had introduced Forest Development Tax (FDT), to pay @ 12% on the sale value of iron ore with effect from 27.08.2008. NMDC preferred an appeal before Hon'ble High Court of Karnataka and the court passed an interim order directing the Company to pay 50% of FDT, consisting of 25% in cash and balance 25% in the form of Bank Guarantee. As against the total FDT demand of Rs.487.37 Crore( from August 2008 to Sep-2011), the Company has deposited an amount of Rs 121.84 Crore (25%) in cash which has been shown as amount recoverable and submitted a bank guarantee for similar amount. An amount of Rs. 365.53 Crore (balance 50% amount of Rs. 243.69 Crore plus 121.84 Crore paid and accounted as amount recoverable)is included under disputed claims at 1.1 .A. The amount of Rs. 121.84 Crore for which BG was given is included under contingent liability on BGs' at 1.2.

Hon'ble High Court of Karnataka vide order dated 03.12.2015 has quashed the orders of Government of Karnataka levying the FDT and ordered refund of the tax collected within three months and accordingly the Company has lodged refund claims. However, Government of Karnataka has filed a Special Leave Petition with Hon'ble Supreme Court of India, challenging the orders of Hon'ble High Court of Karnataka. Hon'ble Supreme Court of India has accepted the same and imposed stay on refund of the FDT amount.

Meanwhile Karnataka State Govt, had enacted Karnataka Forest (Amendment) Act 2016 vide Gazette notification dated 27.07.2016. The amendment substituted the word 'Tax' in the principal act to 'Fee' w.e.f 16th day of Aug 2008. Based on this the Monitoring Committee had started billing the Forest Development Fee in its invoices. Meanwhile consumers in Karnataka had filed separate Writ Petitions in Hon'ble High Court of Karnataka on the above. Karnataka High Court vide its order dated 20th Sept. 2016, had ordered that State Govt may restrain from collecting FDF during the pendency of the writ petition, subject to the condition of furnishing bank guarantee in respect of 25% of the demand in relation to future transactions. Karnataka State Govt, had approached Hon'ble Supreme Court on this. Hon'ble Supreme Court vide its order dated 13.02.201 7 modified the order of High Court of Karnataka and ordered for payment of 50% of the demanded amount and furnish Bond for balance amount.

The amount billed by the monitoring committee amounting to Rs.93.85 croretowards FDF has been accounted under sales revenue during the Financial year 2017-18. As, the Karnataka High Court vide its judgement dated 4th October 2017 has declared the Karnataka Forests (Amendment) Act, 2016 which was introduced for collection of Forest Development Fee (FDF) as unconstitutional, No FDF was collected nor paid with effect from 5^th October 201 7.

(H) Risk exposure:

Through its defined benefit plans, the Company is exposed to a number of risks, the most significant of which are detailed below:

I Investment risk:

Most of the plan asset investments are in government securities, other fixed income securities with high rating grades and mutual funds/ETFs (Exchange Traded Funds). The fair value of these assets is subject to volatility due to change in interest rates and other market & macro-economic factors. There is also a risk of asset liability matching i.e. the cash flow for plan assets does not match with cash flow for plan liabilities.

ii) Changes in discount rate:

The present value of defined benefit plan liabilities is calculated using a discount rate which is determined by reference to government bonds' yields at the end of the reporting period. A decrease (increase) in discount rate will increase (decrease) present values of plan liabilities, although this will be partially offset by an increase in the value of the plans' investments.

iii) Mortality rate risk:

The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the plan's liability.

iv) Salary escalation risk:

The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the plan's liability.

v) Turnover rate/Withdrawal rate of employee:

If the actual employee withdrawal rate in the future turns out to be more or less than expected then it may result in increase/decrease in the liability.

2.32.2. Segment Reporting as per Ind - AS-108A. Basis for segmentation

An operating segment is a component of the company that engages in business activities from which it may earn revenues and incur expenses and for which discrete financial information is available. All operating segments' operating results are reviewed regularly by the Board of Directors to make decisions about resources to be allocated to the segments and assess their performance.

The company has two reportable segments, as described below, which are the company's strategic business units. These business units offer different products and services, and are managed separately because they require different technology and marketing strategies. For each of the business units, the company's Board reviews internal management reports on a periodic basis.

The following summary describes the operations in each of the company's reportable segments:

B. Information about reportable segments

Information regarding the results of each reportable segment is included below. Performance is measured based on segment profit (before tax), segment revenue and segment capital employed as included in the internal management reports that are reviewed by the board of directors. Segment profit is used to measure performance as management believes that such information is the most relevant in evaluating the results of certain segments relative to other entities that operate within these industries. Inter-segment pricing is determined on an arm's length basis.

Trade receivables are non-interest bearing . As on March 2023, Rs 1,905.13 crore (March 2022: Rs 2,932.14 crore) was recognised as provision for expected credit losses on trade receivables.

Contract assets are generally recognised in case of supply of services only when the receipt of money is conditional on milestone even after satisfaction of performance obligation. In case of sale of goods, directly receivable is recognised as company has unconditional right to payment from the moment performance obligation is satisfied.

Contract liabilities includes advance received from customer which will be adjusted towards supply of goods or services.

2.32.4: Accounting policies, change in Accounting Estimates and Errors (As per Ind-AS 8):

i. Review of Accounting Policies

Property Plant and equipment's (Accounting Policy no. 1-1.2-v.b) :

In order to bring more clarity, the heading "Treatment of Enabling Assets" is modified as "Treatment of expenditure incurred on assets not owned by the Company". The change has no impact on the financials of the company.

2.32.7 Accounting for Deferred Taxes on income (lnd-As-12) : Necessary details have been disclosed in note no: 2.5.

2.32.8Discontinuing Operations (lndAS-105) :

Silica Sand Project, Lalapur

On 25/02/2008 the Board of directors had announced a plan to dispose-off the plant and machinery of Silica Sand Project, Lalapur which is included in the segment of "Other minerals and services." Pending disposal, the unit is kept under care & maintenance.

Screening Plant:

Board of director in its 525th meeting held on 10th December 2019 approved the termination of Screening Plant operation located at Vizag.

No Loans and Advances were given to the Associate Companies except the above company.

2.33.4 There are no loans and advances in the nature of loans to firms/companies in which directors areinterested except as stated above.

2.34. Others:2.34.1 Income Tax :

a) After completion of the assessment for the A.Y. 2020-21, NMDC has received a Notice of demand u/s 156 of IT Act 1961, by disallowing expenditure of Rs.791.39 crore with a tax implication of Rs.l 99.18 crores. This has resulted in reduction of claimed refund from Rs.261.40 crore to Rs.62.22 crore. NMDC has filed an appeal before the CIT(A) for tax implication of Rs.l 84.40 crore against the demand. The demand of Rs.l 99.18 Crores is shown under earlier years tax expenses in the accounts of F.Y. 2022-23. The net impact in earlier tax expenses including adjustment pertaining to other cases, is Rs. 172.13 Crore.

b) Current Tax assets (net) (note no. 2.9) includes an amount of Rs.302.12 crore (PY Rs.325.26 crore) of receivable from Income Tax Department under Vivad Se Vishwas (VsV), towards settlement of all disputed Income tax cases up to assessment year 2017-18.

2.34.2 Treatment expenditure incurred on Assets not owned by the Company:

During the year an amount of Rs. 2.33 crore (PY- Rs. 2.99 crore), Rs. 140.50 crore (PY- Rs. 122.25 crore)and Rs. 11.23 crores (PY Nil) is utilised by Railways for the doubling of Railway line between Jagdalpur to Ambagaon and Kirandul to Jagdalpur and for upgradation of In motion Weigh Bridge & other railways asssets respectively and the total amount of Rs. 154.06 crore (PY - Rs.l 25.24 crore) is included in "Other Expenses ".

2.34.3 Demerger / Disinvestment of NISP:

The demerger scheme of arrangement between NMDC Limited ( "Demerged Company" or the "Company") and NMDC Steel Limited (NSL) ("Resulting Company") and their respective shareholders and creditors (the "Scheme") pursuant to the provisions of Sections 230-232 of the Companies Act, 2013 ("Act"), other applicable provisions and rules thereof thereunder (hereinafter referred to as the "Scheme"), involving demerger of NMDC Iron & Steel Plant Business Undertaking ("Demerged Undertaking" or " NISP") from Demerged Company to the Resulting Company has been duly sanctioned by the Ministry of Corporate Affairs ("MCA") vide its order dated 6th October 2022 ("Order"). The Company received the Order on 1 IthOctober 2022 and filed the same with the concerned Registrar of Companies on 13thOctober 2022. Hence, the Scheme is operative from 13thOctober 2022 (Effective Date). The Appointed Date of the Scheme is 1 st April 2021. Accordingly, with effect from the Appointed Date, the entire Demerged Undertaking of NMDC Limited has been transferred and vested into NMDC Steel Limited.

As per the clarification issued by Ministry of Corporate Affairs vide Circular no.09/2019 dated 21 st August 2019 (MCA Circular), the Company has recognized the effect of the demerger on 1 stApril 2021, and made the following adjustments, pursuant to the Scheme:

i) Assets and liabilities of the NISR a unit of NMDC Limited have been transferred to NMDC Steel Limited at bookvalue.

ii) Difference between the value of transferred assets and liabilities pertaining to the NISP the unit of NMDCLimited amounting to Rs.l 7,048.54 crores has been adjusted from the general reserves of the Company.

iii) Investment in NMDC Steel Limited (NSL) amounting to Rs.0.11 crores has extinguished and adjusted fromthe reserves.

iv) As per the scheme, NCD (Non-Convertible Debentures) issued for NISP Project of Rs. 523 crores have beentransferred to NMDC Steel Limited (NSL).

v) The financial information in the financial statements in respect of prior periods is restated as if the demerger had occurred from the beginning of the preceding period in the financial statements,!respective of the actual date of the demerger as the Appointed Date of the Scheme is effective from 1 st April 2021.

vi) All transactions from 1st April 2021 to31st March 2023 of the Demerged Undertaking were carried on behalf of NMDC Steel Limited and the same is recorded as receivable on account of demerger from NMDC Steel Limited. Amount of Rs. 2,542.93 crore spent by NMDC Limited from 1st April 2021 to 31 st March 2023 is shown under the head Non- Current Asset under note no 2.4.3 "Other Financial Assets" and receivable from NMDC Steel Limited.

vii) Demerger expenditure pursuant to the scheme of demerger amounting to Rs.2.27 crores has adjusted from the reserves

2.34.4 Property, Plant & Equipment (PPE)

As per Ind AS 16 items such as spare parts, stand by equipment and service equipment are to be capitalized when they meet the definition of PPE and are expected to be used for more than one accounting year. After review of the inventory values and its consumption patterns in the major production Units, Company based on materiality has fixed a threshold limit of Rs 20 Lakhs for such spare parts, stand by equipment and service equipment meeting the definition of PPE.On issue of said PPE, the WDV is allowed to be depreciated over the life of the main asset or the life of the equipment whichever is less.

Gross value of Spare parts, stand by equipment and service equipment meeting the definition of PPE capitalised during the Year 2022-23 is Rs. 79.07 crore ( PY Rs. 42.77 crore).

2.34.5Dues from Monitoring Committee-Donimalai complex in Karnataka:

The total trade receivables from Monitoring Committee as on 31st March 2023 is Rs. 2907.91 crores (PY-Rs.4,555.27 crores) . This includes regular dues of Rs.2.24 crore, Rs.22.18 crores towards long pending dues for supply of LG Fines to Pellet plant and Rs. 2,883.49 crore towards 10% of sales proceeds retained by Monitoring Committee for the period from 4th October 2011 to 31st March 2023 pending directions from Hon'ble Supreme Court..

Based on the order date 22.02.2023 of Hon'ble Supreme Court, Company has received an amount of Rs.l 015.58 crore (for the period from 1 st Jan 2019 to 31 st March 2022 Rs.957.60 crore shown as exceptional income at note no. 2.28 "Exceptional Item" and Current FY Rs. 57.98 crore) on 20.04.2023 against 10% retained by MC up to MC period. Accordingly, the provision for ECL Rs.957.60 crore is withdrawn during the F.Y 2022-23 and no further provision is made for the year 2022-23. The balance of total provision as on 31.03.2023 is Rs.l ,890.09 crore relates to the period prior to 1^st January, 2017.

During the year, Hon'ble Supreme Court of India, vide its order dated 20.05.2022, discontinued sale operations through Monitoring Committee and allowed lessees to sell the ore directly to the customers. Accordingly, NMDC is selling the ore directly to the customers through e-auctions.

2.34.6 Amount Recovered by Monitoring Committee:

During the year, Monitoring Committee has recovered an amount of Rs.l 24.77 crore against the sale of DIOM LG fines during the year 2011 -12 to 201 7-18 which has been protested by NMDC and file Revision Application with Mines Tribunal on 08.07.2022. This has been shown as Amount paid under protest.

2.34.7Common Cause Judgement for Bailadila Sector:

The Company had received Show Cause Notices dated 31 .07.2018 from Dist. Collector, South Bastar Dantewada as to why NMDC should not be asked to deposit an amount of Rs.7,241.35 crore as compensation as calculated by Collector based on the Hon'ble Supreme Court Common Cause Judgement related to Orissa Iron ore mines (Writ Petition Civil No 114 of 2014 dated 2nd August 2017). The Company had been contesting the Show Cause Notices with Dist. Collector, South Bastar Dantewada on the ground that the said judgement is not applicable to NMDC .

Meanwhile, revised showcause notices dated 26.09.2019 were received for a revised amount of Rs 1,623.44 Crore from Dist. Collector, South Bastar, Dantewada, to be replied within 21 days of notice.

NMDC while reiterating the fact of non-applicability of the Hon'ble Supreme Court Judgement in the state of Chhattisgarh, has sought time for replying to the show cause notices. Further to above, Dist. Collector, South Bastar, Dantewada had issued Demand notices dated 15/11 /2019 for the amount of Rs 1,623.44 Crore (Bacheli - Rs 1,131.97 Crore & Kirandul Rs 491.47 Crore) asking to deposit the amount within 15 days. As the Mining Leases of the company in the State of Chhattisgarh were expiring on 31 .3.2020 and due for renewal , the Company has paid an adhoc amount of Rs 600 Crore under protest and filed writ petitions in the Hon'ble High Court of Bilaspur, Chhattisgarh and a Revision application with Mines Tribunal, Ministry of mines, Government of India , New Delhi praying to set aside the demand notices.

Hon'ble High Court of Bilaspur has heard the WPs on 19.02.2020 and sought certain clarifications from the respondent and directed 'no coercive action till 12.3.2020 and listed the case for 12.3.2020. However due to COVID-19 situation, no further hearings could take place. Revision application with Mines Tribunal, Ministry of Mines, Government of India New Delhi is heard on 09.03.2022 wherein the representatives of State Government were directed to file comments/ para wise reply within two weeks.

Further hearing took place on 15.09.2022 where-in GoCG was directed to file comments / para wise reply within 15 days.

The demand amount of Rs 1,623.44 crores has been shown under 'Contingent Liabilities'.

2.34.8 Allotment of Coal Block Tokisud North Coal Mine

Ministry of Coal declared NMDC as a successful allottee for Tokisud North coal mine, in Jharkhand, on

16.12.2019. Allotment Agreement is signed on 24.12.2019 and Allotment order issued on

17.08.2020. NMDC paid the fixed Cost of Rs. 303.72 crores (PY- Rs.224.77 crore)& upfront amount of Rs.21.60 crore (PYRs.21,60crore) up to 31.03.2023. All the amounts paid up to 31.3.2023 are included under Capital Advances (Note 2.6).NMDC submitted a Bank guarantee of Rs.71.09 crore (PY Rs.71.09 crore) Pending execution of lease deed. Mine Developer cum Operator (MDO) has been appointed on 16.09.2021. Company has obtained Transfer of Environmental clearance and Forest Clearance (State-ll). The Company is in the process of obtaining Mining lease, transfer of Free hold land and lease hold land.

Rohne Coal Mine

Ministry of Coal declared NMDC as a successful allottee for Rohne Coal Mine, in Jharkhand, on

17.03.2020. Allotment Agreement of the coal mine is signed on 17.02.2021 and allotment order issued on 18.06.2021. NMDC paid, as on 31.03.2023, the fixed Cost of Rs.40.02 crores (PY Rs.39.46 crore), upfront amount of Rs.33.15 crore (PY Rs.33.15 crore) and Rs.l .01 crore (PY Nil) towards NPV & CA charges for exploration . All the amounts paid up to 31.3.2023 are included under Capital Advances (Note 2.6). Company has submitted a Bank guarantee of Rs.405.17 crore(PY Rs.405.1 7 crore) Pending execution of lease deed. Company has obtained Transfer of Environmental clearance and Forest Clearance (Stage-1).Company is in the process of complying conditions given in stage-1 forest clearance.

2.34.9 Sale of Iron Ore to Pellet Plant at Kumaraswamy, Karnataka:

Due to restrictions imposed in Karnataka for purchase / sale of Iron Ore, Pellet Plant was purchasing Iron Ore Fines from NMDC, DIOM/KIOM through e-auctions conducted by MC. As per the terms and conditions of Acceptance letter issued by MC and as per the guidelines given by Hon'ble Supreme Court of India, Pellet Plant was paying Basic Value, Royalty Value and Bulk Permit fee value to MC and GST amount to NMDC Donimalai account. After receipt of GST amount from PPT, DIOM/KIOM was issuing Advance receipt confirming the receipt of GST from Pellet plant along with necessary statutory documents to MC in the prescribed Format. Based on the advance receipt issued by DIOM/KIOM, MC was issuing Bulk Permit to PPT for lifting of material. DIOM/KIOM was raising Tax Invoice on PPT for the dispatched quantity, showing it as sales and also paying GST to Government.

Simultaneously, PPT was recognizing the same as purchases and availing input credit. The above procedure was followed due to Compulsion made by MC as they had denied permission for PPT to lift the Iron Ore without participating in auction and accordingly, separate GST registration is also taken as per MC instructions.

However, the entry for un-realized profit on sale of Iron Ore to Pellet Plant was accounted.

W.e.f Oct-22 NMDC-DIOM/KIOM is selling the Iron Ore to Pellet Plant directly based on the order of Hon'ble Supreme Court dt. 20.05.2022 and accounting the same as Inter Unit Sales. The Inter Unit sales, consumption and inventory is eliminated during consolidation and un-realized profit on stock of ore at pellet plant is accounted.

2.34.10 Review for Impairment of Investment in Legacy Iron Ore Ltd, Australia (LIOL):

The total investment of the Company in LIOL is Rs.214.70 cr as on 31.3.2023. This is 90.02% of the total shareholding of the Company. This investment in Legacy was reviewed for impairment with reference to Ind AS 36.

It is noted that the period of exploration is not expired and exploration activity is being continued and the company has not reached the stage of establishing the commercial viability of the tenements. Legacy Iron Ore Limited is an active exploration company with a diverse portfolio. For an exploration company, the future cash flows are from the exploration tenements which have been recognised as assets ie., Exploration and Evaluation (E&E) Assets. LIOL E&E assets as on 31.03.2023, after transfer of exploration expenses of Rs.9.99 crore (representing 18% interest) to Hancock pertaining to Mount Bevan tenements, is Rs. 87.60 crores (Previous year Rs.91.83 crores).

LIOL is systematically exploring all the exploration tenements that are at varying levels of exploration potential and maturity. The company plans to continue exploration in all the above tenements and does not intend to surrender the current list of tenements. It is observed that the total mineral resources estimated from Mt. Celia Project is increased to 3,12,600 ounces from 1,79,700 ounces during the previous period. NMDC has a positive outlook based on the progress and success that is achieved so far in exploration works of Mt.Celia Gold project towards mining and also identification of 3,12,600 ounces of gold metal resources. Hence, the FVLCTS shall normally be more than the carrying value of exploration and evaluation assets as per the balance sheet.

Further the quoted price of LIOL share as on 31.03.2023 is AUD $ 0.015 (Previous year AUD $0.019) with a market capitalisation ofAUD 96.07 million (Previous year $121.69 million). The market capitalisation of the company is more than its net assets ofAUD 24.85 million (Previous $23.32million) as on 31.03.2023. NMDCs share of Market cap @ 90.05% amounts to approx. Rs.476.06 crores (Previous year Rs.622.09 crores) which is more than the investment of Rs. 214.70 crores in LIOL.

Further, during the previous year, Legacy has also entered in to a new JV agreement, for Mt.Bevan Iron ore project, partnering with Hancock Prospecting Pty Ltd (HPPL) which is a mining giant in Australia with rich experience of developing green field iron ore projects. This has opened pathway for Legacy to develop its Iron Ore project. It is informed by JV partner that they have completed exploratory drilling activities and progressing towards completion PFS. It is also found that Mt.Bevan project has potential of Lithium, Nickle and other minerals.

In view of above no impairment is considered for Goodwill as well as Investment in LIOL for the current FY 2022-23.

2.34.11 Neelachallspat Nigam Ltd (NINL) disinvestment:

Cabinet Committee on Economic Affairs(CCEA) had accorded in principle approval for strategic disinvestment of 100% shareholding of MMTC, NMDC, Mecon, BHEL, IPICOL and OMC in Neelachallspat Nigam Ltd (NINL) along with transfer of Management control to a Strategic Buyer.

Tata Steel Long Products (TSLP) has purchased the NINL at a price of Rs.12,100 cores and Government has already signed SPA with TSLR The total liabilities of NINL is around Rs.6,600 crores. NMDC along with all other Associates has entered Share Sale and Purchase Agreement with TSLP on 10.03.2022.

NMDC had the total exposure of Rs. 188.65crore in the form of Equity investment of Rs.l00.60 Crore, Loan of Rs.80.52 Crore and interest thereon of Rs.7.53 crore as on 31.03.2022. Out of this an amount of Rs.0.52 crores is received against Loan from NINL during the year 2022-23.

As a part of strategic disinvestment, NMDC has received an amount of Rs.379.79 crores ( Gross Rs.380.27-TDS Rs.0.48 crore) against investment of Rs.l00.60 crores, Rs.80.00 crores against Loan of Rs.80.00 crs and Rs.6.79 crore (Gross Rs.7.53 - TDS Rs.074 crore) towards interest during July 2022. The gain of Rs.279.67 crore (Rs. 380.27 crore - Rs.l 00.60 crore) received over cost of investment is shown as Exceptional Income during F.Y 2022-23 and shown under Note no. 2.18 "Exceptional Items".

2.34.12lmpact due to amendment in MMDR Act:

Govt, of India has amended the MMDR Act 1957 on 28.03.2021 and as per the amended provisions all such Government companies or corporations whose mining lease has been extended after the commencement of the MMDR Amendment Act 2015, shall pay such additional amount as specified in the Fifth Schedule of Act for the mineral produced after the commencement of the MMDR Act 2021. For such Mining Leases of Iron Ore, an additional amount equivalent to 150% of the Royalty will be payable. The additional amount shall be in addition to royalty or payment to the District Mineral Foundation (DMF) and National Mineral Exploration Trust (NMET) or any other statutory payment. This amendment is applicable w.e.f 28.3.2021.

This amendment was applicable to all the Iron Ore Mines of NMDC except Kumarswamy Iron Ore Mines at Karnataka (since the lease was extended before the commencement of MMDR Amendment Act 2015) up to F.Y 2021-22. However, this is applicable even for Kumaraswamy Iron ore mine w.e.f 18.10.2022 from the date of renewal of mining lease.

The impact of this amendment on the Financials of F.Y 2022-23 is Rs.3,971.39 crores (PY- Rs. 5084.32crores)which is included under Royalty and other levies.

2.34.13 CSR Expenditure :

a) Gross amount required to be spent by the company during the year is Rs. 186.70 crore (2% of the last three years average PBT Rs. 9334.85crore),(Previous Year Rs. 148.15 crore (2% of the last three years average PBT Rs. 7407.49 crore).

c) Provision of Rs 99.12 croreis created for the short fall and shown under Schedule No. 2.17 provision for unspent CSR

d) Total of previous year shortfall : Nil

e) Reason for shortfall : The shortfall of Rs 99.12 crore from the stipulated and prescribed spend is on account of delay in certain projects due to certain limitations faced by implementing agencies. However, the shortfall has been allocated against the specific projects and would be spent as per the provisions of companies Act 2023.

f) Nature of CSR activities: The corporation undertakes impactful social projects which are in lignment with the areas specified under Schedule VII of the companies Act 2023 of which the company takes up CSR projects largely in the projects related to Education, Health & Hygiene, Nutrition, Drinking Water, Rural Development, Skill Development and Income Generation, Promotion of Sports, Protection of Cultural and Heritage, Food Relief & Natural Calamities, Environment& Others.

g) Details of related party transaction: Nil

h) Where a provision is made with respect to a liability incurred by entering a contractual obligation:, the movement in the provision during the year should be shown separately. : Nil

2.34.14 TERM Loan:

NMDC Board in its 525th meeting held on 10.12.2019 had accorded approval for borrowing up to a limit of Rs.5,000 crores for capex requirements of the company by raising terms loans from Banks/ Financial Institutions etc., Accordingly, Rupee term Loan facility (RTL) of Rs. 4476.20 crores was availed from State Bank of India (SBI) for part funding of Nagarnar Integrated Steel Plant (NISP), at an interest rate fixed at 7.10% p.a till the Date of Commencement of Commercial Operation and there after 15 bps above the six months MCLR. NMDC, as a security, had hypothecated the entire Fixed Assets of the Project (NISP) including Plant and Machinery, equitable mortgage of Land & Building (except forest land) and First charge on the entire cash flows of the NISP The availability period of the loan is 6 months from the Date of commencement of Commercial Operation repayable in 30 quarterly instalments.

The common Loan agreement has been entered on 10.06.2021 with SBI for RTL not exceeding Rs.

4,476.20 crore and a drawdown of Rs.2,644.52 crores has been made till 30.09.2022 and same is transferred to NMDC Steel Ltd as per the approved scheme of Demerger, between NMDC and NSL, by MCA.

2.34.15 Bill Discounting:

During the year, Company discounted the Trade Receivables with the banks amounting to Rs 3,257.09crore (PY Rs.1236.15 crore) with recourse to the Company. The balance in the Bill discounting account as on 31.03.2023 is Rs.l 705.21 crore (Previous year -Rs.l 236.15 crore). In case of any claim on the company from the Banks, the amount outstanding as on 31.03.2023 shall be recovered from the Customers. This is shown under contingent liabilities.

2.34.16 General:

i. The company owns certain office space at New Delhi. It is not the company's intention to hold the property for a long term for capital appreciation nor for rental purpose. Hence the same is not treated as Investment Property and included under PPE.

ii. Some of the balances appearing under Trade receivables, Trade payables, advances, Security deposits and other payables are subject to confirmations.

iii. Figures for the previous year have been regrouped/ rearranged wherever considered necessary so as to confirm to the classification of the current year.

"(1) Assets that are not financial assets (such as receivables from statutory authorities, prepaid expenses, advances paid and certain other receivables) as of 31^st March 2023, and 31^st March 2022, respectively, are not included.(2) Other liabilities that are not financial liabilities (such as statutory dues payable, advances from customers and certain other accruals) as of 31^st March 2023, and 31^st March 2022, respectively, are not included."

The carrying amounts of above financial assets and liabilities are considered to be same as their fair values, due to their short-term nature.

Note No: 2.34.28 Financial Risk Management

a) Risk management framework

The Company's Board of Directors has overall responsibility for the establishment and oversight of the Company's risk management framework. The Board of Directors has established the Risk Management Committee, which is responsible for developing and monitoring the Company's risk management policies. The committee reports regularly to the Board of Directors on its activities.

The Company's risk management policies are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company's activities. The Company, through its training and management standards and procedures, aims to maintain a disciplined and constructive control environment in which all employees understand their roles and obligations.

The Board of Directors monitors the compliance with the Company's risk management policies and procedures, and reviews the adequacy of the risk management framework in relation to the risks faced by the Company.

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and deposits with banks.

(a) Trade receivables

"The Company sales are generally based on advance payments and through LC's. The trade receivables in the books are mainly on account of credit sales to M/s RINL Limited, CPSE under the Ministry of Steel and the Sales of Iron Ore in the State of Karnataka which is through Mentoring Committee (MC) appointed by Hon'ble Supreme Court of India. "

Expected credit loss for trade receivables under simplified approach is detailed as per the below tables Year

The impairment provisions for trade receivables disclosed above are based on assumptions about risk of default and expected loss rates.

(b) Financial instruments and cash deposits

Credit risk from balances with banks is managed by the Company's treasury department in accordant with DPE guidelines & Company's policy. Investments of surplus funds are made only with scheduled commercial banks having a minimum net worth of Rs 500 Crore within limits assigned to each bank and Debt based mutual funds of public sector AMCs. The limits are reviewed by the Company's Boarc of Directors on an annual basis. The limits are set to minimise the concentration of risks and therefore mitigate financial loss through counterparty's potential failure to make payments.

B. Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Company's approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company's reputation.

Typically the Company ensures that it has sufficient cash on demand to meet expected operational expenses for a period of 60 days, including the servicing of financial obligations; this excludes the potential impact of extreme circumstances that cannot reasonably be predicted, such as natural disasters. In addition, the Company has taken fund based limits with banks to meet its short term financial obligations.

Market risk is the risk that changes in market prices, such as foreign exchange rates and interest rates will affect the Company's income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return.

(i) Foreign currency risk

Since majority of the company's operations are being carried out in India and since all the material balances are denominated in its functional currency, the company does not carry any material exposure to currency fluctuation risk.

The Company's exposure to foreign currencies is minimal and hence no sensitivity analysis is presented.

(ii) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The company quite often bridges its short term cash flow mismatch by availing working capital loans from banks against its fixed deposits. Such loans have a very short tenure and the interest rate on such loans is based upon the rates offered by banks on fixed deposits , increased by a few basis points. Since the interest rates on fixed deposits are fixed, the company does not have any interest rate risk on such loans availed on a loan to loan basis.

The Company's exposure to interest rate risk is minimal and hence no sensitivity analysis is presented.

Note No. : 2.34.19 Capital Management a) Risk management

The primary objective of the Company's capital management is to maximise the shareholder value. The Company's objectives when managing the capital are to safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders.

The Board's policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. The Board of Directors and senior management monitors the return on capital, which the Company defines as result from operating activities divided by total shareholders' equity.