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Auditor Report of Indian Hotels Company Ltd.

Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of THE INDIAN HOTELS COMPANY LIMITED (the "Company") which comprise the Balance Sheet as at 31st March, 2013, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

The Company''s Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in Section 211 (3C) of the Companies Act, 1956 (the "Act") and in accordance with the accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors'' Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company''s internal control. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(a) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2013;

(b) in the case of the Statement of Profit and Loss, of the loss of the Company for the year ended on that date; and

(c) in the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

Emphasis of Matter

We draw attention to footnote (iii) to Note 15 to the financial statements which describes the uncertainty related to the carrying value of investments in Orient Express Hotels Limited. Our opinion is not qualified in respect of this matter.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 (the "Order") issued by the Central Government in terms of Section 227(4A) of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

2. As required by Section 227(3) of the Act, we report that:

(a) We have 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, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

(d) In our opinion, the Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement comply with the Accounting Standards referred to in Section 211(3C) of the Act.

(e) On the basis of the written representations received from the directors taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2013 from being appointed as a director in terms of Section 274(1 )(g) of the Act.

ANNEXURE TO THE AUDITORS'' REPORT

(Referred to in paragraph 1 under ''Report on Other Legal and Regulatory Requirements'' section of our report of even date)

(i) Having regard to the nature of the Company''s business / activities clauses (viii), (xiii), (xiv), (xviii) and (xx) of paragraph 4 of CARO are not applicable to the Company.

(ii) In respect of its fixed assets:

(a) The Company has maintained proper records showing full particulars, including quantitative details and situation of the fixed assets.

(b) The fixed assets were physically verified during the year by the Management in accordance with a regular programme of verification which, in our opinion, provides for physical verification of all the fixed assets at reasonable intervals. According to the information and explanation given to us, no material discrepancies were noticed on such verification.

(c) In our opinion, the fixed assets disposed off during the year, do not constitute a substantial part of the fixed assets of the Company and such disposal has not affected the going concern status of the Company.

(iii) In respect of its inventory:

(a) As explained to us, the inventories were physically verified during the year by the Management at reasonable intervals.

(b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the Management were reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

(iv) According to the information and explanations given to us, the Company has neither granted nor taken any loan, secured or unsecured, to/from companies, firms or other parties covered in the Register under Section 301 of the Companies Act, 1956.

(v) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weakness in such internal control system.

(vi) In respect of contracts or arrangements entered in the Register maintained in pursuance of Section 301 of the Companies Act, 1956, to the best of our knowledge and belief and according to the information and explanations given to us:

(a) The particulars of contracts or arrangements referred to Section 301 that needed to be entered in the Register maintained under the said Section have been so entered.

(b) Where each of such transactions is in excess of Rs.5 lakhs in respect of any party, the transactions have been made at prices which are prima facie reasonable having regard to the prevailing market prices at the relevant time.

(vii) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Sections 58A and 58AA, or any other relevant provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975, with regard to the deposits accepted from the public. According to information and explanations given to us, no order has been passed by the Company Law Board or the National Company Law Tribunal or the Reserve Bank of India or any Court or any other Tribunal.

(viii) In our opinion, the Company has an adequate internal audit system commensurate with the size of the Company and the nature of its business.

(ix) According to the information and explanations given to us, in respect of statutory dues:

(a) The Company has generally been regular in depositing undisputed dues, including Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other material statutory dues with the appropriate authorities.

(b) There were no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income Tax, Sales tax. Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess and other material statutory dues in arrears as at 31st March, 2013 for a period of more than six months from the date they became payable.

(c) Details of dues of Income Tax, Sales Tax, Excise duty and Service Tax which have not been deposited as on 31st March, 2013 on account of disputes are given below:

Name of Statute Nature Rs. Period to which the amount relates of Dues crores

Central Sales Tax Sales 0.02 Financial years 2008-09 and 2009-10 Act, 1956 and Tax Sales Tax / Value Added Tax Act of 0.80 Financial years 1994-1995, 1995-1996, 1997- various states 1998, 2005-2006

0.06 Financial year 2003-2004

0.85 Financial year 2004-2005 to 2009-2010

0.08 Financial year 2003-2005

4.90 Financial year 1999-2005

0.31 Financial years 1992-93, 1993-94 and 1997-98

0.07 Financial years 2000-2001 and 2002-2003

Finance Act, 1994 Central 0.28 Financial year 2006-10 Excise

Finance Act, 1994 Service 12.32 Financial year 2006-07 to 2010-11 and Service Tax Tax Laws 1.61 Financial years 2002 to 2011

0.14 Financial years 2002 to 2007

0.59 Financial years 2003-2006 and 2011-2012

Income Tax Act, Income 0.31 Financial years 2005-06 to 2007-2008 1961 Tax

Name of Statute Forum where dispute is pending

Central Sales Tax Act 1956 Additional Commercial Tax Officer, Panaji, Goa

Appellate Board

Appellate Deputy Commissioner

Deputy Commissioner of Commercial Taxes

Joint Commissioner of Sales Tax

Joint Commissioner of Sales Tax (Appeal)

Tribunal

Assistant commissioner

Finance Act 1994 Commissioner of Central Excise

Finance Act 1994 CESTAT

Custom Excise and Service Tax Appellate Tribunal

Assistant commissioner of Service Tax (Appeals)

Joint Commissioner of Service Tax

Income Tax Act 1961 Commissioner of Income Tax (Appeals), Panaji, Goa

(x) The Company does not have accumulated losses as at the end of the financial year. The Company has not incurred cash losses during the financial year covered by our audit and in the immediately preceding financial year.

(xi) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to banks, financial institutions and debenture holders.

(xii) In our opinion and according to the information and explanations given to us, the Company has not granted any loan or advance on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion and according to the information and explanations given to us, the terms and conditions of the guarantees given by the Company for loans taken by others from banks and financial institutions are prima fade, not prejudicial to the interests of the Company.

(xiv) In our opinion and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were obtained, other than temporary deploymeM ending application.

(xv) In our opinion and according to the information and explanations given to us and on an overall examination of the Balance Sheet, there is a temporary usage of short-term funds for long-term investment to the extent of Rs. 331.97 crores.

(xvi) According to the information and explanations given to us and the records examined by us, unsecured debentures of Rs. 200.00 crores are issued during the year. Accordingly, the Company has not created any security in respect of debentures issued.

(xvii) To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company and no material fraud on the Company has been noticed or reported during the year.

For DELOITTE HASKINS & SELLS For PKF SRIDHAR & SANTHANAM

Chartered Accountants Chartered Accountants

(Registration No. 117366W) (Registration No. 003990S)

Sanjiv V. Pilgaonkar S. Ramakrishnan

Partner Partner

(Membership No. 39826) (Membership No. 18967)

MUMBAI, 30th May, 2013


Mar 31, 2012

1. We have audited the attached Balance Sheet of THE INDIAN HOTELS COMPANY LIMITED ("the Company") as at March 31, 2012, the Statement of Profit and Loss and the Cash Flow Statement of the Company for the year ended on that date, both annexed thereto. These financial statements are the responsibility of the Company's Management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with the auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and the disclosures in the financial statements. An audit also includes assessing the accounting principles used and the significant estimates made by the Management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. Without qualifying our opinion, we draw attention to Note no. 15(iii) to the financial statements which describes the uncertainty related to long term investments and other exposures aggregating Rs 1,462.85 crores. The Company's reasons for regarding potential diminution arising in respect of these investments to be temporary in nature, have been explained in the same note.

4. As required by the Companies (Auditor's Report) Order, 2003 ("CARO" / "the Order") issued by the Central Government in terms of Section 227(4A) of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

5. Further to our comments in paragraph 3 above and in the Annexure referred to in paragraph 4 above, we report as follows:

(a) we have 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 and the Cash Flow Statement dealt with by this report are in agreement with the books of account;

(d) in our opinion, the Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement dealt with by this report are in compliance with the Accounting Standards referred to in Section 211(3C) of the Companies Act, 1956;

(e) in our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(i) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2012;

(ii) in the case of the Statement of Profit and Loss, of the profit of the Company for the year ended on that date and

(iii) in the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

6. On the basis of the written representations received from the Directors as on 31st March, 2012 taken on record by the Board of Directors, none of the Directors is disqualified as on 31st March, 2012 from being appointed as a director in terms of Section 274(1)(g) of the Companies Act, 1956.

ANNEXURE TO THE AUDITORS' REPORT

(Referred to in paragraph 4 of our report of even date)

(i) Having regard to the nature of the Company's business/activities/result/transactions, etc. clauses (viii), (x), (xiii), (xiv), (xviii) and (xx) of paragraph 4 of CARO are not applicable.

(ii) In respect of its fixed assets:

(a) The Company has maintained proper records showing full particulars, including quantitative details and situation of the fixed assets.

(b) Physical verification of fixed assets has been carried out by the Management at most of the Units in accordance with a programme of verification which, in our opinion, provides for physical verification of all the fixed assets at reasonable intervals. We have been informed that the reconciliation of assets verified with the fixed assets register is in progress at one of the Units and physical verification report is not received for two of the units for which verification was conducted during the year. According to the information and explanations given to us, no material discrepancies were noticed on such verification. "

(c) The fixed assets disposed off during the year, in our opinion, do not constitute a substantial part of the fixed assets of the Company and such disposal has, in our opinion, not affected the going concern status of the Company.

(iii) In respect of its inventory:

(a) As explained to us, the inventories were physically verified during the year by the Management at reasonable intervals.

(b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the Management were reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

(iv) According to the information and explanations given to us, the Company has neither granted nor taken any loan, secured or unsecured, to / from companies, firms or other parties listed in the Register under Section 301 of the Companies Act, 1956.

(v) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weakness in such internal control system.

(vi) In respect of contracts or arrangements entered in the Register maintained in pursuance of Section 301 of the Companies Act, 1956, to the best of our knowledge and belief and according to the information and explanations given to us:

(a) The particulars of contracts or arrangements referred to Section 301 that needed to be entered in the Register maintained under the said Section have been so entered.

(b) There were no transactions in excess of Rs 5 lakhs each in respect of any party during the year.

(vii) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Sections 58A and 58AA, or any other relevant provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975, with regard to the deposits accepted from the public. According to information and explanations given to us, no order has been passed by the Company Law Board or the National Company Law Tribunal or the Reserve Bank of India or any Court or any other Tribunal.

(viii) In our opinion, the Company has an adequate internal audit system commensurate with the size of the Company and the nature of its business.

(ix) According to the information and explanations given to us, in respect of statutory dues:

(a) The Company has generally been regular in depositing undisputed dues, including Provident Fund, Investor Education and Protection Fund, Employees' State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other material statutory dues with the appropriate authorities.

(b) There were no undisputed amounts payable in respect of Income Tax, Wealth Tax, Custom Duty, Excise Duty, Cess and other material statutory dues in arrears as at 31st March, 2012 for a period of more than six months from the date they became payable.

(c) Details of dues of Sales Tax, Excise duty and Service Tax which have not been deposited as on 31st March, 2012 on account of disputes are given below:

Name of Statute Nature of Dues Rs in Period to which the Forum where dispute is pending crores amount relates

Central Sales Tax Sales Tax 4.90 1999-05 Joint Commissioner of Sales Tax (Appeal) Act, 1956 and Sales 0.25 1995-1996 Appellate Board Tax Act of various 0.16 2003-04 Appellate Deputy Commissioner

0.02 2000-01 Assistant Commissioner

0.05 2002-03 Assistant Commissioner

0.03 2004-05 Deputy Commissioner

0.54 2005-07 Deputy Commissioner of Commercial Taxes

0.06 2003-05 Joint Commissioner of Sales tax

0.10 1992-95 Tribunal

0.25 1997-98 Tribunal

Central Excise Act, Central Excise 0.28 2006-10 Commissioner of Central Excise 1994 Tax

Finance Act, 1994 Service Tax 0.32 2004-07 Appellate Tribunal and Service Tax 0.12 2005-07 Assistant Commissioner (Service tax)

Laws 0.01 2002-05 Assistant Commissioner ST (Appeals)

Custom Excise & Service Tax Appellate 0.63 2002-2005 Tribunal

0.33 2003-2006 Joint Commissioner

7.33 2001-2011 Commissioner of Service Tax

Total 15.38

(x) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to banks, financial institutions and debenture holders.

(xi) In our opinion and according to the information and explanations given to us, the Company has not granted any loan or advance on the basis of security by way of pledge of shares, debentures and other securities.

(xii) In our opinion and according to the information and explanations given to us, the terms and conditions of the guarantees given by the Company for loans taken by others from banks and financial institutions are prima facie, not prejudicial to the interests of the Company.

(xiii) In our opinion and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were obtained, other than temporary deployment pending application.

(xiv) In our opinion and according to the information and explanations given to us and on an overall examination of the Balance Sheet, there is a temporary usage of short-term funds for long-term investment to the extent of Rs 288.17 crores. The Management has represented that it is in the process of bringing in additional long-term funds in the near future.

(xv) According to the information and explanations given to us and the records examined by us, securities have been created during the year in respect of thfe debentures issued.

(xvi) To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company and no material fraud on the Company has been noticed or reported during the year.

For DELOITTE HASKINS & SELLS For PKF SRIDHAR & SANTHANAM

Chartered Accountants Chartered Accountants

(Registration No. 117366W) (Registration No. 003990S)

Sanjiv V. Pilgaonkar S. Santhanakrishnan

Partner Partner

(Membership No. 39826) (Membership No. 19071)

Mumbai, May 28, 2012


Mar 31, 2011

1. We have audited the attached Balance Sheet of THE INDIAN HOTELS COMPANY LIMITED ("the Company") as at March 31, 2011, the profit and Loss Account and the Cash Flow Statement of the Company for the year ended on that date, both annexed thereto. These financial statements are the responsibility of the Company's Management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with the auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the fi nancial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and the disclosures in the financial statements. An audit also includes assessing the accounting principles used and the significant estimates made by the Management, as well as evaluating the overall fi nancial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. Without qualifying our report, we invite attention to Notes 26, 27 and 28 of Schedule 14 regarding the Company's investments in and exposure to certain companies, where there is significant diminution in the value of the investments. The total amount of such investments and exposure is Rs. 1,283.08 crores.

4. As required by the Companies (Auditor's Report) Order, 2003 (CARO) issued by the Central Government in terms of Section 227(4A) of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

5. Further to our comments in paragraph 3 above and in the Annexure referred to in paragraph 4 above, we report as follows:

(a) we have 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 profit and Loss Account and the Cash Flow Statement dealt with by this report are in agreement with the books of account;

(d) in our opinion, the Balance Sheet, the profit and Loss Account and the Cash Flow Statement dealt with by this report are in compliance with the Accounting Standards referred to in Section 211(3C) of the Companies Act, 1956;

(e) in our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(i) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2011;

(ii) in the case of the profit and Loss Account, of the profit of the Company for the year ended on that date; and

(iii) in the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

6. On the basis of the written representations received from the Directors as on 31st March, 2011 taken on record by the Board of Directors, none of the Directors is disQualified as on 31st March, 2011 from being appointed as a Director in terms of Section 274(1)(g) of the Companies Act, 1956.

ANNEXURE TO THE AUDITORS' REPORT

(Referred to in paragraph 4 of our report of even date)

(i) Having regard to the nature of the Company's business/activities/result/transactions, etc. clauses (viii), (x), (xiii), (xiv) and (xx) of paragraph 4 of CARO are not applicable.

(ii) In respect of its fixed assets:

(a) The Company has maintained proper records showing full particulars, including quantitative details and situation of the fixed assets. In respect of the assets acquired by the Taj Mahal Palace, Mumbai as part of the restoration programme pursuant to the terrorist attack in November 2008, the fixed asset records will be updated only after the insurance claim for reinstatement has been settled, upon which only the final cost of each of these assets will be ascertainable.

(b) Physical verification of fixed assets has been carried out by the Management at most of the Units in accordance with a programme of verification which, in our opinion, provides for physical verifi cation of all the fixed assets at reasonable intervals. We have been informed that the reconciliation of assets verified with the fixed assets register is in progress at one of the Units. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

(c) The fixed assets disposed off during the year, in our opinion, do not constitute a substantial part of the fixed assets of the Company and such disposal has, in our opinion, not affected the going concern status of the Company.

(iii) In respect of its inventory:

(a) As explained to us, the inventories were physically verified during the year by the Management at reasonable intervals.

(b) In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the Management were reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories and no material discrepancies were noticed on physical verification.

(iv) According to the information and explanations given to us, the Company has neither granted nor taken any loan, secured or unsecured, to/from companies, firms or other parties listed in the Register under Section 301 of the Companies Act, 1956.

(v) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weakness in such internal control system.

(vi) In respect of contracts or arrangements entered in the Register maintained in pursuance of Section 301 of the Companies Act, 1956, to the best of our knowledge and belief and according to the information and explanations given to us:

(a) The particulars of contracts or arrangements referred to Section 301 that needed to be entered in the Register maintained under the said Section have been so entered.

(b) There were no transactions in excess of Rs. 5 lakhs each in respect of any party during the year.

(vii) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Sections 58A and 58AA, or any other relevant provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975, with regard to the deposits accepted from the public. According

to information and explanations given to us, no order has been passed by the Company Law Board or the National Company Law Tribunal or the Reserve Bank of India or any Court or any other Tribunal.

(viii) In our opinion, the Company has an adequate internal audit system commensurate with the size of the Company and the nature of its business.

(ix) According to the information and explanations given to us, in respect of statutory dues:

(a) The Company has generally been regular in depositing undisputed dues, including Provident Fund, Investor Education and Protection Fund, Employees' State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess and any other material statutory dues with the appropriate authorities.

(b) There were no undisputed amounts payable in respect of Income Tax, Wealth Tax, Custom Duty, Excise Duty, Cess and other material statutory dues in arrears as at 31st March, 2011 for a period of more than six months from the date they became payable.

(c) Details of dues of Sales Tax, Income Tax and Service Tax which have not been deposited as on 31st March, 2011 on account of disputes are given below:

Name of Nature of Amount Period to which Forum where dispute is pending Statute Dues (^ cro res) the amount relates

Central Sales Tax 0.11 2000-2001 / Additional Commissioner of Sales Tax Sales Tax 2002-2003 (Appeals)

Act, 1956 0.03 1996-98 Appellate & Revision Board and Sales 0.25 1995-1996 Appellate Board

Tax Act 0.03 2007-08 Commissioner of Sales Tax of vari ous 0.54 2005-07 Deputy Commissioner of Commercial Taxes 0.06 2003-05 Joint Commissioner of Trade Tax

4.90 1999-05 Joint Commissioner of Sales Tax

0.25 1997-98 Maharashtra Sales Tax Tribunal

0.10 1992-95 Tribunal

Income Tax Income Tax 0.31 2006-09 Commissioner of Income Tax (Appeals) Act, 1961

Finance Act, Service Tax 0.58 2002-04 Central Excise Service Tax Appellate 1994 Tribunal

0.32 2004-05 Appellate Tribunal

5.86 2006-10 Commissioner of Service Tax

0.43 2005-10 Additional Commissioner of Service Tax(Appeals) 0.05 2002-05 Assistant Commissioner of Service Tax(Appeals)

0.01 2005-07 Assistant Commissioner Service tax

1.15 2001-05 / 2006-07 Commissioner of Service Tax 0.04 2002-05 Deputy Commissioner of Central Excise

0.33 2003-06 Joint Commissioner of Service Tax(Appeals)

Total 15.35

(x) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to banks, financial institutions and debenture holders.

(xi) In our opinion and according to the information and explanations given to us, the Company has not granted any loan or advance on the basis of security by way of pledge of shares, debentures and other securities.

(xii) In our opinion and according to the information and explanations given to us, the terms and conditions of the guarantees given by the Company for loans taken by others from banks and financial institutions are prima facie, not prejudicial to the interests of the Company.

(xiii) In our opinion and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were obtained, other than temporary deployment pending application.

(xiv) In our opinion and according to the information and explanations given to us and on an overall examination of the Balance Sheet, funds raised on short-term basis have not been used during the year for long-term investment.

(xv) According to the information and explanations given to us, the Company has not made any preferential allotment of shares to parties and companies/firms covered in the Register maintained under Section 301 of the Companies Act, 1956.

(xvi) According to the information and explanations given to us and the records examined by us, securities have been created during the year in respect of the debentures issued during the previous year.

(xvii) To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company and no material fraud on the Company has been noticed or reported during the year.

For DELOITTE HASKINS & SELLS For N. M. RAIJI & CO.

Chartered Accountants Chartered Accountants

(Registration No. 117366W) (Registration No. 108296W)

Nalin M. Shah Vinay D. Balse

Partner Partner

(Membership No.15860) (Membership No. 39434)

Mumbai, May 24, 2011

 
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