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Auditor Report of Linde India Ltd.

Dec 31, 2016

We have audited the accompanying standalone financial statements of Linde India Limited("the Company"), which comprise the Balance Sheet as at 31 December 2016, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Standalone Financial Statements

The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these standalone 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 principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

Our responsibility is to express an opinion on these standalone financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. 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 judgment, 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 financial control relevant to the Company''s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, 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 on the standalone financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone 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, of the state of affairs of the Company as at 31 December 2016, and its profit and its cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2016 ("the Order") issued by the Central Government of India in terms of sub-section (11) of Section 143 of the Act, we give in the Annexure A, a statement on the matters specified in the paragraph 3 and 4 of the order.

2. As required by Section 143 (3) of the Act, we report that:

a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;

b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;

c) The Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement dealt with by this Report are in agreement with the books of account;

d) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014;

e) On the basis of the written representations received from the directors as on 31 December 2016 taken on record by the Board of Directors, none of the directors is disqualified as on

31 December 2016 from being appointed as a director in terms of Section 164 (2) of the Act;

f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in ''Annexure B''; and

g) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigation on its financial position in its financial statements - Refer Note 32 to the financial statements;

ii. The Company did not have any long-term contracts, including derivative contracts, for which there were any material foreseeable losses;

iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

Annexure - A to the independent auditor''s report.

(Referred to in our report of even date)

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

b) The Company has a regular programme of physical verification of its fixed assets by which all the fixed assets are verified in a phased manner over a period of three years. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its fixed assets. No material discrepancies were noticed on such verification.

c) According to the information and explanations given to us and on the basis of our examination of their cords of the Company, the title deeds of immovable properties are held in the name of the Company.

ii) The inventory, except goods-in-transit, has been physically verified by the management during the year. In our opinion, the frequency of such physical verification is reasonable. No material discrepancies were noted on such physical verification.

iii) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under section 189 of the Act. Accordingly, provisions of paragraph 3(iii) of the Order are not applicable to the Company.

iv) According to the information and explanations given to us and based on our examination of the records of the Company, there are no loans, guarantees and security which requires compliance with provisions of section 185 and 186 of the Act. The provisions of section 186 of the Act in respect of investments have been complied with by the Company.

v) In our opinion and according to the information and explanations given to us, the Company has not accepted deposits as per the directives issued by the Reserve Bank of India under the provisions of section 73 to 76 or any other relevant provisions of the Act and the rules framed there under. Accordingly, provisions of paragraph 3(v) of the Order are not applicable to the Company.

vi) We have broadly reviewed the books of account maintained by the Company pursuant to the rules prescribed by the Central Government for maintenance of cost records under Section 148(1) of the Act and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of these records.

vii) a) According to the information and explanations given to us and

on the basis of our examination of the records of the Company, amounts deducted/accrued in the books of account in respect of undisputed statutory dues including provident fund, employees'' state insurance, income tax, sales tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues have been regularly deposited during the year by the Company with the appropriate authorities.

According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, employees'' state insurance, income tax, sales tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues were in arrears as at 31 December 2016 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there are no dues of income tax, sales tax, service tax, duty of customs, duty of excise, value added tax and cess which have not been deposited with the appropriate authorities on account of any dispute except the following:

Name of the Statute

Nature of Dues

Amount in (Rs. million) #

Period to which amount relates

Forum where the dispute is pending

Central Excise Act, 1944

Excise duty

21.72

1999-2009

Supreme Court

10.49

1998-2001

2008-2009

High court

151.34**

1991-2011

2014-2015

Custom, Excise and Service tax Appelate Tribunal

1.89

1991-2010

Commissioner (Appeals)

71.95

2007-2010

2012-2014

2015-2016

Commissioner of Central excise

15.24

1996-2000

2007-2012

Additional Commissioner

6.76

2006-2010

2014-2015

Deputy Commissioner

14.92

2005-2012

2014-2015

Assistant Commissioner

Finance Act, 1994

Service tax

558.50

2005-2008

2008-2015

Custom, Excise and Service tax Appelate Tribunal

5.94

2005-2010

Commissioner (Appeals)

160.00

2004-2010

2013-2015

Commissioner of Service tax

4.35

2004-2007

2009-2010

Additional Commissioner

0.13

2009-2011

Deputy Commissioner

6.49

2007-201 1

Assistant Commissioner

Central State Sales Tax Act and VAT

Sales tax / VAT

55.05*

2005-2006

High court

Acts

150.34

1998-2001

2007-2012

Revisional Board

141.21*

1995-2004

2005-2010

2011-2015

Tribunal

394.09*

1989-1991

2002-2003

2005-2007

2008-2009

2010-2013

Joint Commissioner (Appeals) of Commercial taxes

64.77

2004-2006

2009-2011

Deputy Commissioner (Appeals) of Commercial taxes

1.70

2012-2014

Additional Commissioner of Commercial taxes

''Including amount aggregating to Rs. 237.255 million in respect of sales tax cases, which have been stayed by respective authorities "Including amount aggregating to Rs. 81.76 million in respect of Excise cases, which have been stayed by various authorities

#Excluding the demands the proceeding of which have been set aside or remanded for reassessment by the appropriate authorities. Amounts are net of pre deposits aggregating to Rs. 70.97 million.

viii) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of loans or borrowings from a financial institution or banks during the year. The Company did not have any outstanding dues to government or debenture holders during the year.

ix) According to the information and explanations given to us, the Company did not raise any money by way of initial public offer or further public offer (including debt instruments) during the year. Term loans raised during the year were applied for the purposes for which those were raised.

x) According to the information and explanations given to us, no fraud by the Company or on the Company by its officers or employees has been noticed or reported during the year.

xi) According to the information and explanations given to us and on the basis of our examination of their cords of the Company, remuneration paid to the Managing Director of the Company for the period 30 July 2016 to 31 December 2016 aggregating to Rs 5.93 million, is subject to the approval of the shareholders in the forthcoming annual general meeting.

xii) In our opinion and according to the information and explanations given to us, the Company is not a Nidhi Company. Accordingly, provisions of paragraph 3(xii) of the Order are not applicable to the Company.

xiii) According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with Section 177 and 188 of the Act, wherever applicable, and details of such transactions have been disclosed in the Financial Statements as required by the applicable accounting standards.

xiv) According to the information and explanations given to us, and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year. Accordingly, provisions of paragraph 3(xiv) of the Order are not applicable to the Company.

xv) According to the information and explanations given to us, and based on our examination of the records of the Company, the Company has not entered into any non-cash transactions with directors or persons connected with them. Accordingly, provisions of paragraph 3(xv) of the Order are not applicable to the Company.

xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.

Annexure - B to the independent auditor''s report.

(Referred to in our report of even date)

Report on the Internal Financial Controls under Clause (i) of Subsection 3 of Section 143 of the Companies Act, 2013 ("the Act")

We have audited the internal financial controls over financial reporting of Linde India Limited ("the Company") as of 31 December 2016 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.

Management''s Responsibility for Internal Financial Controls

The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India (ICAI). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.

Auditor''s Responsibility

Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the "Guidance Note") and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Act, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A Company''s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31 December 2016, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the ICAI.

for B S R & Co. LLP Mumbai

Chartered Accountants 11 February 2017

Firm Registration No. 101248W/W-1 00022

JAYANTA MUKHOPADHYAY,

Partner Membership No. : 055757


Dec 31, 2014

We have audited the accompanying financial statements of Linde India Limited (formerly known as BOC India Limited) [''the Company''], which comprise the Balance Sheet as at 31 December 2014, the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s responsibility for the financial statements

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 sub-section (3C) of section 211 of the Companies Act, 1956/ section 133 of the Companies Act 2013 (as applicable). 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.

Auditor''s 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 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 entity''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by 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 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 31 December 2014;

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

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

Emphasis of Matter

We draw attention to Note 42 (iii) which explains the impact of early adoption of Accounting Standard 30 "Financial Instruments: Recognition and Measurement" issued by the Institute of Chartered Accountants of India.

As a result of such adoption, the Company during the year ended 31 December 2014 has recognised a net loss of Rs. 426.51 million under ''Translation and hedging reserves'', representing net exchange gain on borrowings aggregating to Rs. 1,058.69 million and mark to market loss of Rs. 1,485.20 million arising from changes in fair value of principal and interest rate swaps, forward contracts against firm commitments, which qualify for hedge accounting being effective hedges.

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 of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956, 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 Companies Act, 1956/Section 143(3) of Companies Act, 2013 (as applicable), 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 purpose of our audit;

b) in our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;

c) the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account;

d) in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956/section 133 of the Companies Act, 2013 (as applicable); and

e) on the basis of written representations received from the directors as on 31 December 2014, and taken on record by the Board of Directors, none of the directors is disqualified as on 31 December 2014, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956/Section 164(2) of Companies Act, 2013 (as applicable).

Annexure to the auditor''s report.

(Referred to in our report of even date)

i)

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

b) The Company has a regular programme of physical verification of its fixed assets by which all fixed assets are verified in a phased manner over a period of three years. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.

c) Fixed assets disposed off during the year were not substantial, and therefore, do not affect the going concern assumption.

ii)

a) The inventory, except goods-in-transit has been physically verified by the management during the year. In our opinion, the frequency of such verification is reasonable.

b) The procedures for the physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

c) The Company is maintaining proper records of inventory.

The discrepancies noticed on verification between the physical stocks and the book records were not material.

iii)

a) The Company has not given any loans, secured or unsecured, to companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956/Section 189 of Companies Act, 2013 (as applicable). Accordingly, paragraphs 4(iii)(a) to 4(iii)(d) of the Order is not applicable.

b) The Company has taken loans from one party covered in the register maintained under section 189 of the Companies Act, 2013.

The maximum amount outstanding during the year was Euro 103.40 million (equivalent to Rs. 8,785.28 million) and Rs. 5,241.57 million and the year-end balance of such loans were Euro 82.20 million (equivalent to Rs. 6,268.81 million) and Rs. 5,241.57 million.

c) In our opinion, the rate of interest and other terms and conditions on which loans have been taken from party listed in the register maintained under Section 189 of the Companies Act, 2013 are not, prima-facie, prejudicial to the interest of the Company.

d) In the case of loans taken from the above party listed in the register maintained under Section 189 of the Companies Act, 2013, the Company has been regular in repaying the principal amounts as stipulated and in the payment of interest.

iv)

In our opinion and according to the information and explanations given to us, and having regard to the explanation that purchases of certain items of inventories and fixed assets are for the Company''s specialised requirements and suitable alternative sources are not available to obtain comparable quotations, 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 inventories and fixed assets and with regard to the sale of goods and services. We have not observed any major weakness in the internal control system during the course of the audit.

v)

In our opinion, and according to the information and explanations given to us, there are no contracts and arrangements the particulars of which need to be entered into the register maintained under section 301 of the Companies Act, 1956/Section 189 of Companies Act, 2013 (as applicable).

vi)

The Company has not accepted any deposits from the public during the year.

vii)

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

viii) We have broadly reviewed the books of account maintained by the Company pursuant to the rules prescribed by the Central Government for maintenance of cost records under section 209(1)(d) of the Companies Act, 1956/Section 128 of Companies Act, 2013 (as applicable) in respect of the products and are of the opinion that, prima-facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the records.

ix) a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/accrued in the books of account in respect of undisputed statutory 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 other material statutory dues have generally been regularly deposited during the year by the Company with appropriate authorities.

According to the information and explanations given to us, 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 were in arrears as at 31 December 2014 for a period of more than six months from the date they became payable.

b) According to the information and explanations given to us, there are no dues of Customs duty and Wealth tax which have not been deposited with the appropriate authorities on account of any dispute are no dues of Customs duty and Wealth tax which have not been deposited with the appropriate authorities on account of any dispute.

According to the information and explanations given to us, dues of Sales tax, Service tax and Excise duty which have not been deposited by the Company on account of any dispute are listed below:

Name of the Statute Nature of Dues Amount in Period to (Rs. which million) # amount relates Central State Sales Tax Act and VAT Acts Sales Tax/VAT 1982-1992 57.08* 2005-2006

1981-1982 1986-1988 149.74 1992-2009

1995-1999 2004-2010 74.83* 2008-2013

2010-11 12.22 2012-13

2004-2005 64.79 2009-2011

2006-2007 35.70 2007-2008

2009-2010 221.89 2010-2011

0.36 2002-2003

Central Excise Act, 1944 Excise Duty 21.72 1999-2009

1998-2001 10.49 2008-2009 116.04** 1991-2011 789 1991-2010

2007-2010 56.65 2012-2014 1996-2000 15.24 2007-2012

2.89 2006-2010

5.07 2005-2012

Finance Act, 1994 Service tax 2005-2008 32.40 2008-2014

5.94 2005-2010

225.84 2004-2010

2004-2007 4.35 2009-2010

0.13 2009-2011

6.49 2007-2011

Name of the Statute Period to Forum where the dispute is pending which amount relates Central State Sales Tax Act and VAT Acts 1982-1992 2005-2006 High Court

1981-1982 1986-1988 1992-2009 Revisional Board

1995-1999 2004-2010 2008-2013 Tribunal

2010-11 Joint Commissioner (Appeals) of 2012-13 Commercial taxes

2004-2005 Deputy Commissioner (Appeals) of 2009-2011 Commercial Taxes

2006-2007 Joint Commissioner of 2007-2008 Commercial taxes

2009-2010 Additional Commissioner of 2010-2011 Commercial taxes

2002-2003 Commissioner of Commercial taxes

Central Excise Act, 1944 1999-2009 Supreme Court

1998-2001 2008-2009 High Court

Customs, Excise and Service 1991-2011 Tax Appellate Tribunal 1991-2010 Commissioner (Appeals)

2007-2010 Commissioner of 2012-2014 Central Excise 1996-2000 2007-2012 Additional Commissioner

2006-2010 Deputy Commissioner

2005-2012 Assistant Commissioner

Finance Act, 1994 2005-2008 Customs, Excise and Service 2008-2014 Tax Appellate Tribunal

2005-2010 Commissioner (Appeals)

2004-2010 Commissioner of Service tax

2004-2007 2009-2010 Additional Commissioner

2009-2011 Deputy Commissioner

2007-2011 Assistant Commissioner

* Including amounts aggregating to Rs. 80.69 million in respect of sales tax cases, which have been stayed by respective authorities ** Including amounts aggregating to Rs. 81.76 million in respect of Excise cases, which have been stayed by respective authorities

# Excluding the demands the proceedings of which have been set aside or remanded for reassessment by the appropriate authorities

x) The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the financial year 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 repayment of dues to its bankers. The Company did not have any outstanding debentures during the year.

xii) The Company has not granted any loans and advances 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 Company is not a chit fund or a nidhi/mutual benefit fund/ society.

xiv) According to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

xv) According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions.

xvi) In our opinion and according to the information and explanations given to us, the term loans were applied for the purpose for which the loans were obtained.

xvii) According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we are of the opinion that funds raised on short term basis have not been used for long-term investment.

xviii) The Company has not made any preferential allotment of shares to companies/firms/parties covered in the register maintained under Section 301 of the Companies Act, 1956/Section 189 of Companies Act, 2013 (as applicable).

xix) The Company did not have any outstanding debentures during the year.

xx) The Company has not raised any money by public issues during the year.

xxi) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the year.

for B S R & Co. LLP Jaipur Chartered Accountants 17 February 2015 Firm Registration No. 101248W/W-1 00022 Jayanta Mukhopadhyay, Partner Membership No.: 055757


Dec 31, 2013

We have audited the accompanying financial statements of Linde India Limited (formerly known as BOC India Limited) [''the Company''], which comprise the Balance Sheet as at 31 December 2013, the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s responsibility for the financial statements

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 sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act") which, as per a clarification issued by the Ministry of Corporate Affairs, continues to apply under section 133 of the Companies Act 2013 (which has superseded section 211(3C) of the Companies Act, 1956 w.e.f. 12 September 2013). 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.

Auditor''s 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 disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, 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. An audit also includes evaluating the appropriateness of accounting polices used and the reasonableness of the accounting estimates made by 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 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 31 December 2013;

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

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

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 of India in terms of sub- section (4A) of section 227 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 purpose of our audit;

b) in our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;

c) the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account;

d) in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in subsection (3C) of section 211 of the Companies Act, 1956 which as per a clarification issued by the Ministry of Corporate Affairs continue to apply under section 133 of the Companies Act 2013 (which has superseded section 211(3C) of the Companies Act 1956 w.e.f. 12 September 2013); and

e) on the basis of written representations received from the directors as on 31 December 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on 31 December 2013, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

i)

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

b) The Company has a regular programme of physical verification of its fixed assets by which all fixed assets are verified in a phased manner over a period of three years. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets. No material discrepances were noticed on such verification.

c) Fixed assets disposed off during the year were not substantial, and therefore, do not affect the go,ng concern assumption.

ii)

a) The inventory, except goods-,n-transit has been physically verified by the management during the year. In our opinion, the frequency of such verification is reasonable.

b) The procedures for the physical verification of inventories followed by the management are reasonable and adequate in relation to the s,ze of the Company and the nature of its business.

c) The Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material.

iii)The Company has neither granted nor taken any loans, secured or unsecured, to or from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

iv)in our opinion and according to the information and explanations given to us, and having regard to the explanation that purchases of certain items of inventories and fixed assets are for the Company''s specialised requirements and suitable alternative sources are not available to obtain comparable quotations, 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 inventories and fixed assets and with regard to the sale of goods and services. We have not observed any major weakness in the internal control system during the course of the audit.

v)a) in our opinion and according to the information and explanations given to us, the particulars of the contract or arrangement referred to in section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that section.

b) Under the aforesaid contract or arrangement, certain services that are rendered by the Company as per the specialised requirements of a buyer and the value of such services exceeds Rs. 0.50 million during the year, suitable alternative sources are not available to obtain comparable quotations. However, on the basis of information and explanations provided, the same appear reasonable.

vi)The Company has not accepted any deposits from the public during the year.

vii)in our opinion, the Company has an internal audit system commensurate with the size and nature of its business.

viii)We have broadly reviewed the books of account maintained by the Company pursuant to the rules prescribed by the Central Government for maintenance of cost records under section 209(1)(d) of the Companies Act, 1956 in respect of the products and are of the opinion that prima face, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the records.

ix)a) According to the information and explanations given to us and on the bas,s of our examination of the records of the Company, amounts deducted/accrued in the books of account in respect of undisputed statutory 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 other material statutory dues have generally been regularly deposited during the year by the Company with appropriate authorities.

According to the information and explanations given to us, 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 were in arrears as at 31 December 2013 for a period of more than six months from the date they became payable.

b) According to the information and explanations given to us, there are no dues of Customs duty and Wealth tax which have not been deposited with the appropriate authorities on account of any dispute.

According to the information and explanations given to us, dues of Sales tax, Service tax and Excise duty which have not been deposited by the Company on account of any dispute are listed below:

Name of the Statute Nature of Dues Amount in Period to which (Rs. million) amount relates

Central State Sales Tax Act and VAT Acts Sales Tax/VAT 1982-1992

2005-2006

57.58* 2009-2010

1981-1982

1983-1984

1986-1987

154.37 1992-2009

1993-1994

1995-1997

2003-2006

74.45* 2008-2013

18.12 2005-2011

2004-2008

64.79 2009-2011

2006-2007

29.25 2007-2008

59.15 2002-2003

2009-2010

170.60 2010-2011

1998-1999

2001-2003

2.06 2005-2007

Central Excise Act, 1944 Excise Duty 21.72 1999-2009

1998-2001

10.49 2008-2009

116.04 1991-2011

7.89 1991-2010

24.69 2007-2010

15.24 1996-2000

2007-2012

2.89 2006-2010

5.07 2005-2012

Finance Act, 1994 Service tax 32.40 2005-2008

5.94 2005-2010

121.48 2004-2010

2004-2007

4.35 2009-2010

0.13 2009-2011

6.49 2007-2011

Name of the Status Forum where the dispute is pending

Central State Sales Tax Act and VAT acts High Court

Revisional Board

Tribunal

joint Commissioner (Appeals) of Commercial taxes

Deputy Commissioner (Appeals) of Commercial Taxes

Assistant Commissioner of Commercial taxes

Additional Commissioner of Commercial taxes

Senior joint Commissioner (Appeals) of Commercial taxes

Commissioner of Commercial taxes

Central Exice Act 1944 Supreme Court

High Court

Customs, Excise and Service Tax Appellate Tribunal

Commissioner (Appeals)"

Commissioner of Central Excise

Additional Commissioner

Deputy Commissioner

Assistant Commissioner

Finance Act,1944 Customs, Excise and Service Tax Appellate Tribunal

Commissioner (Appeals)

Commissioner of Service tax

Additional Commissioner

Deputy Commissioner

Assistant Commissioner

* including amounts aggregating to Rs. 80.69 million in respect of Sales tax cases, which have been stayed by respective authorities " including amounts aggregating to Rs. 81.76 million in respect of Excise cases, which have been stayed by respective authorities *" Excluding the demands the proceedings of which have been set aside or remanded for reassessment by the appropriate authorities

x)The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the financial year and in the immediately preceding financial year.

xi)in our opinion and according to the information and explanations g,ven to us, the Company has not defaulted in repayment of dues to its bankers. The Company did not have any outstanding debentures during the year.

xii)The Company has not granted any loans and advances 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 Company is not a chit fund or a nidhi/mutual benefit fund/ society.

xiv)According to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

xv)in our opinion and according to the information and explanations given to us, the terms and conditions on which the Company has given guarantees for loans taken by others from banks or financial institutions are not prejudicial to the interest of the Company.

xvi)in our opinion and according to the information and explanations given to us, the term loans taken by the Company have been applied for the purpose for which they were raised.

xvii)According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we are of the opinion that funds raised on short term basis have not been used for long- term investment.

xviii)The Company has not made any preferential allotment of shares to companies/firms/parties covered in the register maintained under Section 301 of the Companies Act, 1956.

xix)The Company did not have any outstanding debentures during the year.

xx)The Company has not raised any money by public issues during the year.

xxi)According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.



For B S R & Co.LLP Mumbai

Chartered Accountants 7 February 2014

Firm Registration No. 101248W

Vikram Advani, Partner Membership No, 091765


Dec 31, 2012

We have audited the attached Balance Sheet of BOC India Limited (''the Com- pany'') as at 31 December 2012 and also the related Statement of Profit and Loss and the Cash Flow Statement of the Company for the year ended on that date 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.

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

As required by the Companies (Auditor''s Report) Order, 2003, as amended (''Order''), issued by the Central Government of India in terms of sub- section (4A) of Section 227 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.

Further to our comments in the Annexure referred to above, 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 appears from our examination of those books;

c) the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report are in agreement with the books of account;

d) in our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956;

e) on the basis of written representations received from directors as on 31 December 2012 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31 December 2012 from being appointed as a Director in terms of Section 274 (1) (g) of the Companies Act, 1956;

f) 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:

- in the case of the Balance Sheet, of the state of the affairs of the Company as at 31 December 2012;

- in the case of the Statement of Profit and Loss, of the profit for the year ended on that date; and

- in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

I.

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

b) The Company has a regular programme of physical verification of its fixed assets by which all fixed assets are verified in a phased manner over a period of three years. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.

c) Fixed assets disposed off during the year were not substantial, and therefore, do not affect the going concern assumption.

II.

a) The inventory, except goods-in-transit has been physically verified by the management during the year. In our opinion, the frequency of such verification is reasonable.

b) The procedures for the physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

c) The Company is maintaining proper records of inventory. The discrepan- cies noticed on verification between the physical stocks and the book records were not material.

III.

The Company has neither granted nor taken any loans, secured or unse- cured, to or from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

In our opinion and according to the information and explanations given to us, and having regard to the explanation that purchases of certain items of inventories and fixed assets are for the Company''s specialised requirements and suitable alternative sources are not available to obtain comparable quo- tations, 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 inventories and fixed assets and with regard to the sale of goods and services. We have not observed any major weakness in the internal control system during the course of the audit.

a) In our opinion and according to the information and explanations given to us, the particulars of the contract or arrangement referred to in Section 301 of the Companies Act, 1956 have been entered in the reg- ister required to be maintained under that Section.

b) Under the aforesaid contract or arrangement, certain services that are rendered by the Company as per the specialised requirements of a buyer and the value of such services exceeds Rs. 0.50 mil- lion during the year, suitable alternative sources are not available to obtain comparable quotations. Flowever, on the basis of infor- mation and explanations provided, the same appear reasonable.

The Company has not accepted any deposits from the public during the year.

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

VIII.

We have broadly reviewed the books of account maintained by the Company pursuant to the rules prescribed by the Central Government for maintenance of cost records under Section 209(1) (d) of the Companies Act, 1956 in respect of the products and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the records.

IX.

a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted / accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Investor Education and Protec- tion Fund, Employees'' State Insurance, Income tax, Sales tax, Wealth tax, Service tax, Customs duty, Excise duty, Cess and other material statutory dues have generally been regularly deposited during the year by the Company with appropriate authorities.

According to the information and explanations given to us, no undis- puted 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 mate- rial statutory dues were in arrears as at 31 December 2012 for a period of more than six months from the date they became payable.

b) According to the information and explanations given to us, there are no dues of Income tax, Customs duty, Wealth tax and Cess which have not been deposited with the appropriate authorities on account of any dispute.

According to the information and explanations given to us, dues of Sales tax, Service tax and Excise duty which have not been deposited by the Company on account of any dispute are listed below:

Amount in Period to which Name of the Statute Nature of dues (Rs. million)* amount relates Forum where the dispute is pending

Central State Sales Tax Act and VAT Acts Sales tax/VAT 2.53 1982-1992 High Court

1981-1982

1983-1984

1986-1987

180.99 1992-2009 Revisional Board

1993-1994

1995-1997

2003-2006

31.12** 2008-2010 Tribunal

1997-1998

2003-2006

46.12 2006-2011 Joint Commissioner (Appeals) of Commercial Taxes

1990-1991

2004-2006

64.80 2009-2011 Deputy Commissioner (Appeals) of Commercial Taxes

7.87 2002-2003 Additional Commissioner of Commercial Taxes

2.05 2007-2008 Assistant Commissioner of Commercial Taxes

1998-1999

2001-2003

5.03 2005-2007 Commissioner of Commercial Taxes

Central Excise Act, 1994 Excise duty 21.72 1999-2009 Supreme Court

1998-2001

10.49 2008-2009 High Court

118.70*** 1991 -2011 Customs, Excise and Service Tax Appellate Tribuna

7.89 1991-2010 Commissioner (Appeals)

24.69 2007-2010 Commissioner of Central Excise

1996-2000

15.24 2007-2012 Additional Commissioner

2.89 2006-2010 Deputy Commissioner

5.07 2005-2012 Assistant Commissioner

Finance Act, 1994 Service tax 32.40 2005-2008 Customs, Excise and Service Tax Appellate Tribuna

5.94 2005-2010 Commissioner (Appeals)

121.48 2004-2010 Commissioner of Service Tax

2004-2007

4.35 2009-2010 Additional Commissioner

0.13 2009-2011 Deputy Commissioner

6.49 2007-2011 Assistant Commissioner

* Excluding the demands the proceedings of which have been set aside or remanded for reassessment by the appropriate authorities.

** Including disputed dues aggregating to Rs. 25.64 million in respect of sales tax dispute, which have been stayed by respective authorities.

*** Including disputed dues aggregating to Rs. 81.76 million in respect of Excise dispute, which have been stayed by respective authorities.

X.

The Company does not have any accumulated losses at the end of the finan- cial year and has not incurred cash losses in the financial year 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 repayment of dues to its bankers. The Company did not have any outstanding debentures during the year.

XII.

The Company has not granted any loans and advances on the basis of secu- rity 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 Company is not a chit fund or a nidhi / mutual benefit fund / society.

XIV.

According to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other invest- ments.

XV.

In our opinion and according to the information and explanations given to us, the terms and conditions on which the Company has given guarantees for loans taken by others from banks or financial institutions are not preju- dicial to the interest of the Company.

XVI.

Based on the information and explanations given to us by the management, term loans were applied for the purpose for which the loans were obtained.

XVII.

According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we are of the opinion that the Company has used funds raised on short term basis amounting to Rs. 648.19 million for long term investments.

XVIII.

The Company has not made any preferential allotment of shares to companies/firms/parties covered in the register maintained under Section 301 of the Companies Act, 1956.

XIX.

The Company did not have any outstanding debentures during the year.

XX.

The Company has not raised any money by public issues during the year.

XXI.

According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.

For B S R & Co. Kolkata

Chartered Accountants 4 February 2013

Firm Registration No.: 101248W

Vikram Advani, Partner

Membership No.: 091765


Dec 31, 2010

1. We have audited the attached Balance Sheet of BOC India Limited as at 31 December 2010 and also the Profit and Loss Account and the Cash Flow Statement of the Company for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with 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 misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003 (Order), issued by the Central Government of India in terms of sub-section (4A) of Section 227 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.

4. Further to our comments in the Annexure referred to above, 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, Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account;

(d) In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the CompaniesAct, 1956;

(e) On the basis of written representations received from directors as on 31 December 2010 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31 December 2010 from being appointed as a Director in terms of Section 274(1 )(g) of the Companies Act, 1956;

(f) 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 the affairs of the Company as at 31 December 2010;

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 thatdate.

Annexure to the Auditorsreport (Referred to in our report of even date)

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

(b) The Company has a regular programme of physical verification of its fixed assets by which all fixed assets are verified in a phased manner over a period of three years. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.

(c) Fixed assets disposed off during the year were not substantial, and therefore, do not affect the going concern assumption.

(ii) (a) The inventory, except goods-in-transit has been physically verified by the management during the year. In our opinion, the frequency of such verification is reasonable.

(b) The procedures for the physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material.

(iii) The Company has neither granted nor taken any loans, secured or unsecured, to or from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

(iv) 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 inventories and fixed assets and with regard to the sale of goods and services. In our opinion and according to the information and explanations given to us, there is no continuing failure to correct major weaknesses in internal control system.

(v) (a) In our opinion and according to the information and explanations given to us, the particulars of the contract or arrangement referred to in section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that section.

(b) Under the aforesaid contract or arrangement, certain services that are rendered by the Company as per the specialised requirements of a buyer and the value of such services exceeds Rs. 5 lakhs during the year, suitable alternative sources are not available to obtain comparable quotations. However, on the basis of information and explanations provided, they appear reasonable.

(vi) The Company has not accepted any deposits from the public during the year.

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

(viii) We have broadly reviewed the books of account maintained by the Company pursuant to the rules prescribed by the Central Government for maintenance of cost records under section 209(1 )(d) of the Companies Act, 1956 in respect of the products and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the records.

(ix) (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/accrued in the books of account in respect of undisputed statutory 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 other material statutory dues have generally been regularly deposited during the year by the Company with appropriate authorities.

There were no dues on account of Cess under Section 441A of the Act since the date from which the aforesaid Section comes into force has not yet been notified by the Central Government.

According to the information and explanations given to us, 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 were in arrears as at 31 December 2010 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there are no dues of Customs duty, Wealth tax and Cess which have not been deposited with the appropriate authorities on account of any dispute.

According to the information and explanations given to us, dues of Income-tax, Sales tax, Service tax and Excise duty which have not been deposited on account of any dispute are listed below:

Name of the Statute Nature of Amount Period to Forum where Dues (Rs. 000) which amount the dispute is pending relates

Income-Tax Act, 1961 Income-tax 442,195 2006-2007 Commissioner of Income-tax (Appeals)

Central Sales Tax Act Sales Tax 4,781 1982-1992 High Court and various State Sales 1981-1988 Tax Acts 209,112 1992-2005 Revisional Board 1990-1991

1,152 1995-1997 Tribunal

2001-2004

2005-2006

33,080 2005-2008 Senior Joint Commissioner (Appeals) of Commercial Taxes

9,269 2002-2009 Joint Commissioner (Appeals) of Commercial Taxes

305 2006-2007 Additional Commissioner of Commercial Taxes

301 1997-1998 Deputy Commissioner (Appeals) of Commercial Taxes

1991-1992

38,521 1998-1999 Assistant Commissioner of

2000-2001 Commercial Taxes 2005-2008

Central Excise Act Excise Duty 11,693 1999-2009 Supreme Court 870 1998-2001 High Court 32,308 1991-2009 Customs, Excise and Service Tax Appellate Tribunal 12,515 1991-2009 Commissioner (Appeals)

90,198 1999-2010 Commissioner of Central Excise

2,814 2005-2009 Additional Commissioner

2,517 2006-2010 Deputy Commissioner

10,285 1991-2010 Assistant Commissioner

Service Tax Act Service Tax 29,236 2005-2007 Customs, Excise and Service Tax Appellate Tribunal

1,669 2003-2009 Commissioner (Appeals)

106,731 2004-2009 Commissioner of Service tax

7,909 2003-2009 Additional Commissioner 107 2006-2008 Assistant Commissioner

(x) The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the financial year 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 repayment of dues to its bankers or to any financial institution. The Company did not have any outstanding debentures during the year.

(xii) The Company has not granted any loans and advances 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 Company is not a chit fund or a nidhi/ mutual benefit fund/ society.

(xiv) According to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments. (xv) In our opinion and according to the information and explanations given to us, the terms and conditions on which the Company has given guarantees for loans taken by others from banks or financial institutions are not prejudicial to the interest of the Company.

(xvi) Based on the information and explanations given to us by the management, term loans were applied for the purpose for which the loans were obtained, though idle/surplus fund which were not required for immediate utilisation nave been gainfully invested in fixed deposits with banks. The maximum amount idle/surplus fund in fixed deposits during the year was Rs. 1,470,000 thousands of which Rs. 300,000 thousand was outstanding at the end of the year.

(xvii) According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we are of the opinion that the funds raised on short-term basis have not been used for long-term investment.

(xviii) The Company has not made any preferential allotment of shares to companies/firms/parties covered in the register maintained under Section 301 of the Companies Act, 1956.

(xix) The Company did not have any outstanding debentures during the year.

(xx) The Company has not raised any money by public issues during the year.

(xxi) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.

For BSR & Co.

Chartered Accountants Firm Registration No.: 101248W

Vikram Advani Partner Membership No: 091765

Place: Kolkata Date : 25 February, 2011


Dec 31, 2009

1. We have audited the attached Balance Sheet of BOC India Limited as at 31 December 2009, the Profit and Loss Account and the Cash Flow Statement of the Company for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Companys manasement. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with auditing standards senerally 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 misstatement. An audit includes examinins, on a test basis, evidence supportins the amounts and disclosures in the financial statements. An audit also includes assessms the accountins principles used and sisnificant estimates made by manasement, as well as evaluates the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003 (Order), issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in parasraphs 4 and 5 of the said Order.

4. Further to our comments in the Annexure referred to above, we report that:

(a) We have obtained all the information and explanations, which to the best of our knowledse 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 the books,-

(c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account;

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

(e) On the basis of written representations received from directors as on 31 December 2009, and taken on record by the Board of Directors, we report that, none of the directors is disqualified as on 31 December 2009 from being appointed as a Director in terms of Section 274(1 )(g) of the Companies Act, 1956;

(f) 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 the affairs of the Company as at 31 December 2009;

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.

Annexure to the Auditors report (Referred to in our report of even date)

(i) (a) The Company has maintained proper records showins full particulars, includes quantitative details and situation of fixed assets.

(b) The Company has a regular programme of physical verification of its fixed assets by which all fixed assets are verified in a phased manner over a period of three years. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.

(c) Fixed assets disposed of during the year were not substantial, and therefore, do not affect the going concern assumption.

(ii) (a) The inventory, except goods-in-transit has been physically verified by the management during the year. In our opinion, the frequency of such verification is reasonable.

(b) The procedures for the physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material.

(iii) The Company has neither granted nor taken any loans, secured or unsecured, to or from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

(iv) 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 inventories and fixed assets and with regard to the sale of goods and services. In our opinion and according to the information and explanations given to us, there is no continuing failure to correct major weaknesses in internal control system.

(v) (a) In our opinion and according to the information and explanations given to us, the particulars of the contract or arrangement referred to in section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that section.

(b) Under the aforesaid contract or arrangement, certain services that are rendered by the Company as per the specialised requirements of a buyer and the value of such services exceeds Rs. 5 lakhs during the year, suitable alternative sources are not available to obtain comparable quotations. However, on the basis of information and explanations provided, they appear reasonable.

(vi) The Company has not accepted any deposits from the public during theyear.

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

(viii) We have broadly reviewed the books of account maintained by the Company pursuant to the rules prescribed by the Central Government for maintenance of cost records under section 209(1 )(d) of the Companies Act, 1956 in respect of the products and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the records.

(ix) (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/accrued in the books of account in respect of undisputed statutory 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 other material statutory dues have generally been ¦ regularly deposited during theyear by the Company with appropriate authorities.

There were no dues on account of Cess under Section 441A of the Act since the date from which the aforesaid Section comes into force has notyet been notified by the Central Government.

According to the information and explanations given to us, 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 were in arrears as at 31 December 2009, for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there are no dues of Income-tax, Customs duty, Wealth tax and Cess which have not been deposited with the appropriate authorities on account of any dispute.

According to the information and explanations given to us, dues of Sales tax, Service tax and Excise duty which have not been deposited on account of any dispute are listed below:

Name of the Statute Nature of Amount Period to Forum where Dues (Rs. 000) which amount the dispute is pending relates

Central Sales Tax Act Sales Tax 4,935 1982-1992 High Court and various State Sales 1981-1987 Revisional Board Tax Acts 1994-1996

1997-2000 2001-2005

Name of the Statute Nature of Amount Period to Forum where Dues (Rs. 000) which amount the dispute is pending relates

1990-1991 Tribunal 9,012 1995-1997 1999-2004

1992-1993 Senior Joint Commiss -ioner (Appeals) 35,567 2005-2006 of Commercial Taxes

11,658 1999-2000 Joint Commissioner (Appeals) of 2001-2008 Commercial Taxes

67,893 1996-1997 Additional Commis -sioner of 2000-2001 Commercial Taxes 2004-2006

5,289 1992-2004 Deputy Commissioner (Appeals) of Commercial Taxes 38,810 1992-2007 Assistant Commis -sioner of Commercial Taxes

Central Excise Act Excise Duty 28,976 2007-2009 Supreme Court

447 1990-2009 High Court

22,161 1991-2009 Customs, Excise and Service Tax Appellate Tribunal

6,110 1991-2009 Commissioner (Appeals)

63.815 1991 -2009 Commissioner of Central Excise

15.744 1991-2009 Additional Commissioner

99,022 1991-2009 Assistant Commissioner

Service Tax Service Tax 54 470 2005-2009 Customs, Excise and Service Tax Appellate Tribunal

333 2003-2009 Commissioner (Appeals) Commissioner of Central Excise (Stay 81,409 2008-2009 Order obtained by the Company Rs. 29,236 thousand)

1,822 2003-2009 Additional Commissioner

28,063 2004-2009 Assistant Commissioner

(x) The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the financial year 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 repayment of dues to its bankers or to any financial institution. The Company did not have any outstanding debentures during the year.

(xii) The Company has not granted any loans and advances 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 Company is not a chit fund or a nidhi/ mutual benefit fund/society.

(xiv) According to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

(xv) According to the information and explanations given to us, the terms and conditions on which the Company has given guarantees for loans taken by others from banks or financial institutions are not prejudicial to the interest of the Company.

(xvi) In our opinion and according to the information and explanations given to us, the term loans taken by the Company have been applied forthe purpose forwhich they were raised.

(xvii) According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we are of the opinion that the funds raised on short-term basis have not been used for long-term investment.

(xviii) The Company has not made any preferential allotment of shares to companies/firms/parties covered in the register maintained under Section 301 of the Companies Act, 1956.

(xix) The Company did not have any outstanding debentures during theyear.

(xx) The Company has not raised any money by public issues during the year. •

(xxi) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.

For B S R & Company Chartered Accountants

Vikram Aggarwal

Place: Gurgaon Partner

Date: 22 February, 2010 Membership No: 089826

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