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Auditor Report of Oil India Ltd.

Mar 31, 2016

We have audited the accompanying standalone financial statements of OIL INDIA LIMITED ("the Company"), which comprise the Balance Sheet as at 31st March, 2016, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and Significant Accounting Policies and Additional Notes.

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 of 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.

AUDITORS'' 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 thereunder.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act and other applicable authoritative pronouncements issued by the Institute of Chartered Accountants of India. Those Standards and pronouncements require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the standalone 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 standalone 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 31st March, 2016, and its profit and its cash flows for the year ended on that date.

EMPHASIS OF MATTER

We draw attention to the following matters in the Notes to the standalone financial statements:

a) Note 3.3 to the financial statements which specifies about repayment and servicing of overseas borrowings from domestic resources based on management opinion.

b) Note 32.12(b) to the financial statements which describes uncertainty regarding payment related to the demand for Royalty raised by Director of Geology and Mines, Assam for 2008-09 to 2013-14 amounting to Rs.7224.20 crore and further estimated liability of Rs.2525.35 crore upto 31st March 2016 considered as contingent liability.

Our opinion is not modified in respect of these matters.

OTHER MATTERS

The attached financial statements include Company''s share of net fixed assets, net current assets, expenses and incomes aggregating to Rs. 530.15 crore, Rs. (-)70.21 crore, Rs. 237.63 crore and Rs. 0.51 crore respectively as at 31st March, 2016 in respect of thirteen of its unincorporated Joint Ventures, the accounts of which have been audited by the auditors of the respective Joint Ventures.

The attached financial statements include Company''s share of net fixed assets, net current liabilities, expenses and incomes aggregating to Rs. 324.57 crore, Rs. 96.73 crore, Rs. 389.78 crore and Rs. 46.68 crore respectively as at 31st March, 2016 in respect of seventeen of its unincorporated Joint Ventures, the accounts of which have not been audited and have been incorporated based on financial statements prepared and certified by the Management.

The audited and unaudited financial statements of the above unincorporated joint ventures are prepared to meet requirements of production sharing contracts and are special purpose statements and none of the statements, audited as well as unaudited, are drawn up in the same format as presented by the Company and we did not audit the financial statements/financial information of seventeen unaudited Joint Ventures included as above.

Our opinion is not modified in respect of these matters.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

1. With respect to the other matters to be included in the Auditor''s Report in terms of the directions of the Comptroller and Auditor-General of India (C&AG) under Section 143 (5) of the Act, and on the basis of our examination of the books and records of the Company carried out in accordance with the generally accepted auditing practices in India and according to the information and explanations given to us, we give in the Annexure ''A'' and Annexure ''B'', statement on the matters specified in the Directions and Sub-directions of C&AG respectively.

2. 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, and on the basis of our examination of the books and records of the Company carried out in accordance with the generally accepted auditing practices in India and according to the information and explanations given to us, we give in the Annexure ''C'', a statement on the matters specified in paragraphs 3 and 4 of the Order.

3. 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 31st March, 2016 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 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 control over financial reporting of the Company and the operating effectiveness of such controls, as required under Section 143 (3)(i) of the Act, refer to our separate report in Annexure D.

(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 litigations on its financial position in its standalone financial statements – Refer Note 32.15 I (i)(a) and 32.15 I (i)(b) to the standalone 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 AUDITORS'' REPORT

Statement on the matters specified in the Directions of CAG as referred in Paragraph 1 of Report on Other Legal and Regulatory Requirements paragraph of our report of even date to the members of OIL INDIA LIMITED on the Standalone Financial Statements for the year ended 31st March 2016

No. Direction Reply

1 Whether the Company has clear title/ lease deeds The Company has a clear title/ lease deeds for for freehold and leasehold land respectively? If not freehold and leasehold land respectively except in please state the area of freehold and leasehold land respect of 15763.93 bighas of freehold land. for which title/ lease deeds are not available. Further 3821.29 bighas of freehold land are pending for Mutation. (refer note 11.2 to the financial statements).

2 Whether there are cases of waiver / write-off of debts During the year there are cases of Well write off of /loans / interest etc. if yes, the reasons thereof and Rs. 454.61 crore due to absence of prospect and the amount involved. unsuccessful drilling of the Wells. There is also a case of receivables written off of Rs. 0.91 crores due to non recovery of CST on sale of LPG.

3 Whether proper records are maintained for The Company has maintained proper records for inventories lying with third parties & assets received inventories lying with third parties. The Company as gift/ grant(s) from Govt. or any other authorities. has not received any assets as gift from Govt or any other authorities.

ANNEXURE B TO THE INDEPENDENT AUDITORS'' REPORT

Statement on the matters specified in the Additional Directions of C&AG as referred in Paragraph 1 of Report on Other Legal and Regulatory Requirements paragraph of our report of even date to the members of OIL INDIA LIMITED on the Standalone Financial Statements of the Company for the year ended 31st March 2016

No. Direction Reply

The accounting treatment of income/ expenditure The accounting treatment of income/expenditure I and receivables/ liabilities arising from agreements/ and receivables/liabilities arising from contracts including JVs for exploration of Oil/Gas may agreements/contracts including JVs for be examined to ensure that they are strictly in exploration of Oil/Gas have been examined and conformity with the terms and conditions of the found that they are strictly in conformity with the terms and conditions of the respective Production respective Production Sharing Contract (or similar Sharing Contract (or similar arrangements arrangements including Joint Venture) including Joint Ventures)

II It may be verified that the expenditure incurred before We have verified and found that the expenditure obtaining the right(s) to explore, develop and produce incurred before obtaining the right(s) to explore, oil and gas have been booked under pre-acquisition develop and produce oil and gas have been booked under pre- acquisition costs. We have also costs. It may also be verified that these costs are verified that these costs are expensed as and when expensed as and when incurred, and the practice is incurred, and the practice is done in a consistent done in a consistent manner in respect of all the units. manner in respect of all the units. Please also refer Note no. 1.3.1 of Significant Accounting Policies

III It may be verified that the acquisition cost relating to We have verified and found that the acquisition cost projects under exploration or development are initially relating to projects under exploration or accounted for as capital work-in-progress and then development are initially accounted for as capital work-in- progress and then capitalised by capitalised by transferring to Producing Property transferring to Producing Property when a well is when a well is ready to commence commercial ready to commence commercial production. It is production. It may also be ensured that such costs are also verified that such costs are written-off in case written-off in case of abandonment/ relinquishment. of abandonment /relinquishment. Please also refer Note no. 1.3.4 of Significant Accounting Policies.

IV It may be verified that the Company is having a clear Read with Note no. 11.2 of Financial Statements, title and maintaining proper records in respect of land we have verified and found that the Company is having a clear title except in respect of 15763.93 along with full disclosures with respect to cost bighas of freehold land. Further 3821.29 bighas of computation (historical or revalued cost) and freehold land are pending for Mutation. The ownership (freehold or leasehold land) Company is maintaining proper records in respect of land along with full disclosures with respect to cost computation (historical or revalued cost) and ownership (freehold or leasehold land).

ANNEXURE ''C'' TO THE AUDITORS'' REPORT

The Annexure C referred to in paragraph 2 of Report on Other Legal and Regulatory Requirements paragraph of our report of even date to the members of OIL INDIA LIMITED on the Standalone Financial Statements of the Company for the year ended 31st March, 2016.

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

(b) As explained to us the fixed assets have been physically verified by the Management in phased manner designed to cover all items over a period of five years. No material discrepancies have been noticed on such verification;

(c) As per information and explanations given to us, the title deeds of immovable properties are held in name of the Company except in respect of 15763.93 bighas of freehold land pending transfer of title deeds. Further 3821.29 bighas of freehold land are pending for Mutation.

(ii) Inventories have been physically verified by the Management during the year. However, inventories of stores and spare parts (excluding stock in transit and/or under inspection with suppliers/contractors) have been physically verified by the Management in a phased manner. The frequency of verification is reasonable. No material discrepancies have been noticed on physical verification.

(iii) The Company has granted unsecured loans to parties covered in the register maintained under section 189 of the Companies Act, 2013 ("the Act"). In respect of aforesaid loans:

(a) The terms and conditions under which such loans were granted are not prejudicial to the Company''s interest;

(b) The schedule of repayment of principal and interest has been stipulated and the repayments or receipts are as per stipulation; and

(c) There is no amount which is overdue for more than ninety days.

(iv) In respect of loans, investments, guarantees and security given or provided , provisions of Section 185 and 186 of the Companies Act, 2013 wherever applicable, have been complied with;

(v) The Company has not accepted deposits from the public. Hence, the direction issued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any other relevant provisions of the Act and the Rules framed thereunder are not applicable to the Company. As explained to us no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any court or any other tribunal in this regard;

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

(vii) (a) The Company is regular in depositing undisputed statutory dues including provident fund, employees'' state insurance, income tax, sales tax, wealth tax, service tax, duty of customs , duty of excise, value added tax, cess and any other statutory dues as applicable to it with the appropriate authorities. According to the information and explanations given to us there were no outstanding statutory dues as on 31st of March, 2016 for a period of more than six months from the date they became payable except for the following:

Name of the Statute Nature of Dues Period to which the (in Rs. Crores) amount relates (Financial year)

Assam VAT Act, 2005 VAT on Transportation 2009-10 to 2015-16 39.04 (including of Crude Oil interest of Rs 14.18 crore)

(b) Details of disputed dues in respect of income tax or sales tax or wealth tax or service tax or duty of customs or value added tax or cess and any other statutory dues which have not been deposited on account of any dispute are given below:

Name of the Statute Nature of Dues Period to which the amount relates (Financial year)

Central Excise Act, Demand for non 2011-12 to 2014-15 1944 payment of duty as oil cess, NCCD and education cess December''2008 to December''2009

January''2010 to December''2010

Central Excise Act, Excise Duty January''2011 to December'' 2011 1944 January''2012 to June''2012

July''2012 to December''2012

January''2013 to June''2013

April''2011 to December''2011

January''2012 to September''2012

Finance Act, 1994 Service Tax October''2012 to March''2013

July''2008 to March''2009

April''2009 to March''2010

Assam General CST and VAT April''2005 to March''2006 Sales Tax Act, 1993

Assam VAT Act, 2005 Assam VAT 2009-10 to 2012-13

Income Tax Act, 1961 Income Tax 2007-08 & 2008-09

Name of the Statute Amount Forum where (in Rs. Crores) Dispute is Pending

Central Excise Act, 1944 20.57 CESTAT, New Delhi

14.27

12.01

Central Excise Act, 1944 17.47 CESTAT, 20.93 Kolkata

10.48

9.81

40.42

13.45

Finance Act, 1994 6.59 CESTAT,

0.30 Kolkata

0.40

Assam General Sales Tax Act, 1993 8.41 Assistant Commissioner of Taxes, Assam

Assam VAT Act, 2005 1327.74 Commissioner of Taxes, Assam

Income Tax Act, 1961 2.18 High Court, Rajasthan

(viii) The Company has not defaulted in repayment of loans or borrowings to any financial institution, bank, Government or dues to debenture holders;

(ix) In our opinion and according to information and explanations given to us, the Company has not raised any money by way of initial public offer or further public offer (including debt instruments) during the year. The term loans were applied for the purposes for which those were raised;

(x) Based on the audit procedures performed and the information and explanations given to us, we report that no fraud on or by the Company has been noticed or reported during the year;

(xi) The Company has paid or provided for managerial remuneration in accordance with relevant approvals mandated by the provisions of Section 197 read with Schedule V to the Act;

(xii) As the Company is not a Nidhi company, Nidhi Rules, 2014 are not applicable to it and accordingly the reporting under clause 3(xii) of the Order is not applicable;

(xiii) The Company has entered into transactions with related parties in compliance with the provisions of Sections 177 and 178 of the Act. The details of such related party transactions have been disclosed in the financial statements as required under Accounting Standard 18- Related Party Disclosures, specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014;

(xiv) The Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review. Accordingly the reporting under clause 3(xiv) of the Order is not applicable;

(xv) Based on our examination of books and accounts and as per information and explanations given to us, the Company has not entered into any non cash transactions with directors or persons connected with him. Therefore reporting under para 3 (xv) of the Order is not applicable; and Accordingly,

(xvi) As per information and explanations given to us, the Company is not required to be registered under Section 45- IA of the Reserve Bank of India Act, 1934. Accordingly, reporting under para 3 (xvi) of the Order is not applicable.

For A.K.SABAT & CO. For N.C. BANERJEE & CO.

Chartered Accountants Chartered Accountants

Firm Regn. No: 321012E Firm Regn. No: 302081E

Sd/- Sd/-

(CA A.K.SABAT) (CA B.K.BISWAS)

Partner Partner

Membership No.: 030310 Membership No.: 055623

Place : Noida

Date : 27.05.2016


Mar 31, 2015

We have audited the accompanying standalone financial statements of OIL INDIA LIMITED ("the Company"), which comprise the Balance Sheet as at 31st March, 2015, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and Significant Accounting Policies and Additional Notes.

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 of 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, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. 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 31st March, 2015, and its profit and its cash flows for the year ended on that date.

EMPHASIS OF MATTERS

We draw attention to the following matters in the Notes to the financial statements:

a) Note 2.4 to the financial statements which, describes the treatment of exchange fluctuation on long term borrowings in accounts based on management opinion.

b) Note 31.13(a) to the financial statements which, describes uncertainty related to the demand for Assam VAT of Rs. 1349.71 crore raised by Assam Value Added Tax Authority.

c) Note 31.13 (b) to the financial statements which, describes uncertainty related to the demand for Royalty of Rs. 7224.20 crore raised by Director of Geology and Mines, Assam.

Our opinion is not modified in respect of these matters.

OTHER MATTER

The attached financial statements include Company's share of net fixed assets, net current assets, expenditure and income aggregating to Rs. 1.43 crore, Rs. 195.29 crore, Rs. 128.07 crore and Rs. 0.76 crore respectively as at 31st March, 2015 in respect of eighteen of its unincorporated Joint Ventures, the accounts of which have been audited by the auditors of the respective Joint Ventures.

The attached financial statements include Company's share of net fixed assets, net current liabilities, expenditure and income aggregating to Rs. 8.95 crore, Rs.97.40 crore, Rs. 85.59 crore and Rs. 96.01 crore respectively as at 31st March, 2015 in respect of eighteen of its unincorporated Joint Ventures, the accounts of which have not been audited and have been incorporated based on financial statements prepared and certified by the Management.

The audited and unaudited financial statements of the above unincorporated joint ventures are prepared to meet requirements of production sharing contracts and are special purpose statements and none of the statements audited as well as unaudited, are drawn up in the same format as presented by the Company and we did not audit the financial statements/financial information of eighteen unaudited Joint Ventures included as above.

Our opinion is not modified in respect of these matters.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

With respect to the other matters to be included in the Auditor's Report in terms of the directions of the Comptroller and Auditor-General of India (CAG) under Section 143 (5) of the Act, and on the basis of our examination of the books and records of the company carried out in accordance with the generally accepted auditing practices in India and according to the information and explanations given to us, we give in the Annexure 'A' and Annexure 'B', statement on the matters specified in the Directions and Additional Directions of CAG respectively.

As required by the Companies (Auditor's Report) Order, 2015 ("the Order"), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, and on the basis of our examination of the books and records of the company carried out in accordance with the generally accepted auditing practices in India and according to the information and explanations given to us, we give in the Annexure 'C', a statement on the matters specified in paragraphs 3 and 4 of the Order.

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 31st March, 2015 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2015 from being appointed as a director in terms of Section 164 (2) of the Act.

(f) 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 litigations on its financial position in its financial statements - Refer Note 31.16 I (i) (a) and 31.16 I (i) (b) (i) 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 'C' TO THE AUDITOR'S REPORT

(i) (a) The company has generally maintained proper records showing full particulars including quantitative details and situation of fixed assets;

(b) The fixed assets have been physically verified by the Management at reasonable interval in phased manner designed to cover all items over a period of five years. No material discrepancies have been noticed on such verification;

(ii) (a) Inventories (excluding stock in transit and/or under inspection with suppliers/contractors) have been physically verified by the management during the year, except the inventories of stores and spare parts which have been physically verified by the management in a phased manner. The frequency of verification is reasonable;

(b) The procedures of physical verification of inventory 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 inventories. No material discrepancies have been noticed on physical verification;

(iii) The Company has granted unsecured loans to parties covered in the register maintained under section 189 of the Companies Act, 2013 ("the Act").

(a) The receipt of principal amount and interest wherever applicable are regular except for loan granted by the company to one party; and

(b) There is no overdue amount exceeding Rs. 1 lac except for loan granted by the company to the aforesaid party for which necessary steps have been taken for recovery of the principal and interest amount and provision has been made in the accounts for the same.

(iv) There exists an adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventory and fixed assets and for the sale of goods and services. We have not come across any continuing failure to correct major weaknesses in internal control system.

(v) The Company has not accepted deposits within the meaning of the Act. Hence, the directives issued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any other relevant provisions of the Act and the Rules framed there under are not applicable to the Company.

(vi) We have broadly reviewed the books of account maintained by the Company, pursuant to the rules made by the Central Government for the maintenance of the cost records under sub-section (1) of Section 148 of the Act and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained.

(vii) (a) The Company is regular in depositing the undisputed statutory dues including provident fund, employees' state insurance, income tax, sales tax, wealth tax, service tax, duty of customs , duty of excise, value added tax, cess and any other statutory dues as applicable to it with the appropriate authorities.

(b) Details of disputed dues in respect of income tax or sales tax or wealth tax or service tax or duty of customs or duty of excise or value added tax or cess which have not been deposited on account of any dispute are given below:

Name of the Nature Period to which the amount Statute of Dues relates Financial year

Income Tax Act Income Tax 2009-10 to 2013-14

Assam VAT ACT Assam VAT April'2005 to March'2006 2009-10 to 2012-13 April'2011 to December'2011 January'2012 to September' 2012 October'2012 to March' 2013

Finance Act' 1994 Service Tax

July'2008 to March' 2009 April'2009 to March' 2010 Oct, 2012 to March, 2013

Oil cess, NCCD 2011-12 to 2014-15 and education cess

December'2008 to December'2009 Central Excise January'2010 to December'2010 Act 1944 Excise January'2011 to December' 2011 Duty January'2012 to June'2012 July'2012 to December'2012 January'2013 to June'2013

Name of the Amount (in Forum where Statute Rs.Crores) Dispute is pending

Income Tax Act 3.96 CIT Appeals

Assam VAT ACT 8.41 Assam Board of 1349.71 Revenue 35.76 12.34 5.98 Finance CESTAT Act' 1994 Kolkata 0.34 0.40 012 18.48 CESTAT, New Delhi

14.27 Central Excise 11.92 Act 1944 17.47 CESTAT 20.93 Kolkata 10.48 9.68

(c) The amounts which were required to be transferred to the Investor Education and Protection Fund in accordance with the relevant provisions of the Act and rules made thereunder have been transferred to such fund within time.

(viii) The Company has no accumulated losses at the end of the financial year and it has not incurred any cash losses in the financial year and in the immediately preceding financial year;

(ix) The Company has not defaulted in repayment of dues to the financial institution or bank or debenture holders;

(x) The Company has given guarantee for loans taken by others from bank or financial institutions, the terms and conditions whereof are not prejudicial to the interest of the company;

(xi) Term loans were applied for the purpose for which the loans were obtained;

(xii) No material fraud on or by the Company has been noticed or reported during the year.

For SAHA GANGULI & ASSOCIATES For B.M.CHATRATH & CO. Chartered Accountants Chartered Accountants Firm Regn. No: 302191E Firm Regn. No: 301011E sd/- sd/- (S.K. Saha) (P.R. Paul) Partner Partner Membership No.: 051392 Membership No.: 051675

Place: Noida Date: 29/05/2015


Mar 31, 2014

1. We have audited the accompanying financial statements of Oil India Limited ("the Company''''), which comprise the Balance Sheet as at 31st March 2014, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and Significant Accounting Policies and Additional Notes, in which are incorporated the Company''s share in the total value of assets, liabilities, expenditure and income based on fifteen audited and eighteen unaudited financial statements of Joint Ventures for exploration and production of crude oil and natural gas.

2. The attached financial statements and other financial information include Company''s share of net of fixed assets, net current liabilities, expenses and incomes aggregating to Rs 210.01crore, Rs.40.77crore, Rs.313.74crore and Rs.48.51crore respectively as at March 31, 2014 in respect of fifteen of its unincorporated joint ventures, the accounts of which have been audited by the auditors of the respective Joint Ventures and relied upon by us.

3. The attached financial statements and other financial information include Company''s share of net of fixed assets, net current assets, expenses and incomes aggregating to Rs. 301.59 crore, Rs. 191.67 crore, Rs. 206.87 crore and Rs.175.33 crore respectively as at March 31, 2014 in respect of eighteen of its unincorporated joint ventures, the accounts of which have not been audited by the auditors of the respective Joint Ventures. The financial statements and other financial information have been incorporated based on un-audited financial statements prepared by the Management and relied upon by us.

4. The audited and the unaudited statements of the above unincorporated joint ventures are prepared to meet requirements of production sharing contracts and are special purpose statements and none of the statements audited as well as unaudited, are drawn up in the same format as presented by the Company.

Management''s Responsibility for the Financial Statements

5. 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 the General Circular No.15/2013 dated 13.09.2013 issued by Ministry of Corporate Affairs continues to apply under Section 133 of the Companies Act, 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

6. 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.

7. 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 policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

Opinion

9. 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 31st March, 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 Paragraph

10. Without qualifying our report, we draw attention to the following Notes appearing in the Financial Statement:

i. Note 16.2 - regarding uncertainty related to the outcome of appeal filed by the Company against the order of Hon''ble High Court and consequential payment of decreed amount of Rs.99.05 crore shown under "Other Non-Current Assets" and not treating the same as expense.

ii. Note 31.7.2- regarding recognition of gain on foreign currency translation of Rs 238.96 crore.

iii. Note 31.7.3 - regarding uncertainty due to non provision of the recoverable dues of Rs.94.47 crore from Suntera Nigeria 205 Ltd. shown under "Short Term Loans and Advances" in which the Company is having 25% interest in equity.

iv. Note 31.12- regarding Use of Depreciation method on other Production Facilities being part of Producing Properties, in preference to the Depletion Method based on Unit of Production as recommended vide "Guidance Note on Accounting for Oil & Gas Producing Activities-2013" issued by the Institute of Chartered Accountants of India.

Report on Other Legal and Regulatory Requirements

11. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order"), as amended, issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Act, and on the basis of our examination of the books and records of the company carried out in accordance with the generally accepted auditing practices in India and according to the information and explanations given to us, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

12. 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 sub- section (3C) of Section 211 of the Act;

e) Disclosure in terms of clause (g) of sub-section (1) of Section 274 of the Act is not required for Government Companies as per Notification No.GSR 829(E) dated October 21, 2003 issued by the Department of Company Affairs.

f) Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 441A of the Act nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the Company.

ANNEXURE TO THE AUDITORS'' REPORT (Referred to in paragraph 11 of our report to the members of Oil India Limited (''the company'') for the year ended 31st March 2014.)

1. (a) The Company has generally maintained proper records showing full particulars including quantitative details and situation of fixed assets. However, the records of the land are in the process of updating and reconciling with physical verification.

(b) The fixed assets and joint venture assets have been physically verified by the Management in phased manner designed to cover all items over a period of five years, which is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies have been noticed on such verification.

(c) None of the substantial part of fixed assets has been disposed off by the Company during the year.

2. (a) Stocks of Crude Oil and Liquefied Petroleum Gas (LPG) have been physically verified by the management during the year and stock of stores and spare parts (excluding stock in transit and/or under inspection with suppliers/contractors) have been physically verified by the management in phased manner. The frequency of verification is reasonable.

(b) The procedures of physical verification of inventory 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 in respect of stocks of crude oil, LPG and stock of stores and spare parts. No material discrepancies have been noticed on verification between the physical assets and the book records.

3. (a) The Company has granted unsecured loans to two parties covered in the register maintained under section 301 of the Companies Act, 1956 ("the Act"). The amount outstanding at the year-end was Rs. 360.50 crores and the maximum amount outstanding at any time during the year was Rs. 381.00 crores.

(b) The rate of interest and other terms and conditions of the loan granted is not prima facie prejudicial to the interest of the Company.

(c) The repayment of principal and the payment of interest is not over due.

(d) There is no overdue amount in respect of loans granted to the party listed in the register maintained under section 301 of the Act.

(e) The Company has not taken any loans secured or unsecured, from companies firms or other parties covered in the register maintained under section 301 of the Act and consequently, the requirements of clause (iii)(f) and (iii)(g) of paragraph 4 of the Order, are not applicable.

4. There exists an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods and services. We have not observed any continuing failure to correct major weaknesses in internal control system of the Company.

5. (a) The particulars of contracts or arrangement that need to be entered into the register maintained under Section 301 of the Act have been so entered.

(b) The transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Act and exceeding the value of Rs. 5 lakhs in respect of any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6. The Company has not accepted deposits from the public. Hence, the provisions of Sections 58A, 58AA or any other relevant provisions of the Act and the Rules framed there under are not applicable to the Company.

7. The Company has an internal audit system commensurate with the size and nature of its business.

However, the coverage of the area and monitoring of the internal audit system need to be strengthened.

8. The Central Government of India has prescribed maintenance of cost records under Section 209(1)(d) of the Act for the production of crude oil, natural gas, LPG, and pipeline activities for transportation of crude oil. We have broadly reviewed the books of account relating to materials, labour and other items of cost maintained by the Company pursuant to the rules made by the Central Government for the maintenance of such cost records and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

9. (a) The Company is regular in depositing with appropriate authorities undisputed statutory dues including provident fund, income tax, sales tax, wealth tax, service tax, customs duty, excise duty, and other material statutory dues applicable to it.

(b) No undisputed amounts payable in respect of income tax, sales tax, wealth tax, service tax, customs duty and excise duty were in arrears, as at 31.03.2014 for a period of more than six months from the date they became payable.

(c) Details of disputed dues in respect of income tax, sales tax, wealth tax, service tax, customs duty and excise duty which have not been deposited on account of any dispute are given below:-

Name of the Nature Period to which Amount Forum Statute of Dues the amount (Rs.in where relates Crores) Dispute is Financial year pending

Assam Tax on 2004-05 to 702.02 High Court, Taxation (on land 2013-14 Guwahati. specified land) Act, 2004

Central Excise December 2008 14.27 CESTAT, Excise Act, Duty to December 2009 Kolkata 1944 January 2010 to 11.92 -do- December 2010

January 2011 to 17.47 -do- December 2011

January 2012 to 31.54 -do- December 2012

January 2013 to -do- June 2013 9.68

Service April 11 to Dec 11 19.8 -do- Tax January 12 to 9.31 -do- September 12 0.34 Comm.Central July''08 to Mar''09 Excise & S. Tax (Appeal) April 09 to Mar''10 0.40 -do-

10. The Company has no accumulated losses as at the end of the financial year and it has not incurred any cash losses during the financial year and in the immediately preceding financial year.

11. The Company has not defaulted in repayment of dues to any financial institution or bank. The Company has not issued any debentures.

12. The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13. The Company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore the provisions of paragraph 4 (xiii) of the Order are not applicable to the Company.

14. The Company is not dealing or trading in shares, securities, debentures and other investments. Therefore, the provisions of Clause 4 (xiv) of the Order are not applicable to the Company.

15. The terms and conditions of the guarantees given by the Company for loans taken by its subsidiaries and others from bank or financial institutions are not prejudicial to the interest of the company.

16. Term loans raised by the Company were applied for the purpose for which the loans were obtained.

17. The Company has raised short term bridge loan with an intent to replace it by long term loan which has been used for long term investment.

18. The Company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act.

19. The Company has not issued any debentures during the year.

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

21. No fraud on or by the Company has been noticed or reported during the course of our audit.

For SAHA GANGULI & ASSOCIATES For B.M. CHATRATH & CO.

Chartered Accountants Chartered Accountants

Firm Regn.No.302191E Firm Regn.No.301011E

Sd/ Sd/

(S. K. Saha) (P. R. Paul)

Partner Partner

Membership No.051392 Membership No.051675

Place: Noida Date : 27.05.2014


Mar 31, 2013

Report on the Financial Statements

1. We have audited the accompanying financial statements of Oil India Limited (''the Company''), which comprise the Balance Sheet as at 31st March 2013, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and Significant Accounting Policies and Additional Notes, in which are incorporated the Company''s share in the total value of assets, liabilities, expenditure and income based on sixteen audited and twenty six unaudited financial statements of Joint Ventures for exploration and production of crude oil and natural gas.

2. The attached financial statements and other financial information include Company''s share of net of fixed assets, net current liabilities, expenses and incomes aggregating to Rs.176.68 crore, Rs. 139.04 crore, Rs.190.51 crore and Rs.0.22 crore respectively as at March 31, 2013 in respect of sixteen of its unincorporated joint ventures, the accounts of which have been audited by the auditors of the respective Joint Ventures and relied upon by us.

3. The attached financial statements and other financial information include Company''s share of net of fixed assets, net current liabilities, expenses and incomes aggregating to Rs.320.16 crore, Rs. 142.27 crore, Rs.189.17 crore and Rs. 170.01 crore respectively as at March 31, 2013 in respect of twenty six of its unincorporated joint ventures, the accounts of which have not been audited by the auditors of the respective Joint Ventures. The financial statements and other financial information have been incorporated based on un-audited financial statements prepared by the Management and relied upon by us.

Management''s Responsibility for the Financial Statements

4. 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"). 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

5. 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.

6. 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 policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

Opinion

8. 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 31st March 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.

Emphasis of Matter

9. We draw attention to Note 15.2 to the financial statements which describes the uncertainty related to the outcome of the appeal filed by the Company against the order of Hon''ble Delhi High Court and consequential payment of decreed amount of Rs. 99.05 crore and shown under ''other non-current assets''. Our opinion is not qualified in respect of this matter.

Report on Other Legal and Regulatory Requirements

10. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order"), as amended, issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, and on the basis of our examination of the books and records of the Company carried out in accordance with the generally accepted auditing practices in India and according to the information and explanations given to us, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

11. 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 sub-section (3C) of section 211 of the Act;

e) disclosure in terms of clause (g) of sub-section (1) of Section 274 of the Act is not required for Government Companies as per Notification No. GSR 829(E) dated October 21, 2003 issued by the Department of Company Affairs.

f) Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 441A of the Act nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the Company.

(Referred to in paragraph 10 of our report to the members of Oil India Limited (''the Company'') for the year ended 31st March 2013.)

1. (a) The Company has generally maintained proper records showing full particulars including quantitative details and situation of fixed assets. However, the records of the land are in the process of updating and reconciling with physical verification.

(b) The fixed assets, other than underground assets and joint venture assets, have been physically verified by the Management in phased manner designed to cover all items over a period of five years, which is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies have been noticed on such verification.

(c) None of the substantial part of fixed assets has been disposed off by the Company during the year.

2. (a) Stocks of Crude Oil and Liquefied Petroleum Gas (LPG) have been physically verified by the management during the year and stock of stores and spare parts (excluding stock in transit and/or under inspection with suppliers/contractors) have been physically verified by the management in phased manner. The frequency of verification is reasonable.

(b) The procedures of physical verification of inventory 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 in respect of stocks of crude oil, LPG and stock of stores and spare parts. No material discrepancies have been noticed on verification between the physical assets and the book records.

3. (a) The Company has granted unsecured loans to two parties covered in the register maintained under section 301 of the Companies Act, 1956 (''the Act''). The amount outstanding at the year end was Rs. 381 crore and the maximum amount outstanding at any time during the year was Rs. 381 crore.

(b) The rate of interest and other terms and conditions of the loan granted is not prima facie prejudicial to the interest of the Company.

(c) The repayment of principal and the payment of interest is not yet due.

(d) There is no overdue amount in respect of loans granted to the party listed in the register maintained under section 301 of the Act.

(e) The Company has not taken any loans secured or unsecured, from companies firms or other parties covered in the register maintained under section 301 of the Act and consequently, the requirements of clause (iii)(f) and (iii)(g) of paragraph 4 of the Order, are not applicable.

4. There exists an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods and services. We have not observed any continuing failure to correct major weaknesses in internal control system of the Company.

5. a) The particulars of contracts or arrangement that need to be entered into the register maintained under Section 301 of the Act have been so entered.

b) The transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Act and exceeding the value of Rs. 5 lakhs in respect of any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6. The Company has not accepted deposits from the public. Hence, the provisions of Sections 58A, 58AA or any other relevant provisions of the Act and the Rules framed there under are not applicable to the Company.

7. The Company has an internal audit system commensurate with the size and nature of its business.

8. The Central Government of India has prescribed maintenance of cost records under Section 209(1)(d) of the Act for the production of crude oil, natural gas, LPG, and pipeline activities for transportation of crude oil. We have broadly reviewed the booksofaccountrelating to materials, labour and other items of cost maintained by the Company pursuant to the rules made by the Central Government for the maintenance of such cost records and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

9. (a) The Company is regular in depositing with appropriate authorities undisputed statutory dues including provident fund, income tax, sales tax, wealth tax, service tax, customs duty, excise duty, and other material statutory dues applicable to it.

(b) No undisputed amounts payable in respect of income tax, sales tax, wealth tax, service tax, customs duty and excise duty were in arrears, as at 31.03.2013 for a period of more than six months from the date they became payable.

(c) Details of disputed dues in respect of income tax, sales tax, wealth tax, service tax, customs duty and excise duty which have not been deposited on account of any dispute are given below:-

Name of the Nature Period to which Statute of Dues the amount relates Financial year

Assam Tax on 2004-05 to Taxation (on land 2012-13 specified land) Act, 2004

Central Excise December'' 2008 Excise Act, Duty to December'' 1944 2009

January'' 2010 to December'' 2010

January''11 to December''11

Name of the Statute Amount Forum (Rs. in where Crore) Dispute is pending

Assam Taxation (on Specified land) Act, 2004 702.02 High Court, Guwahati.

Central Excise Act,1944 14.27 CESTAT, Kolkata

11.92 CESTAT, Kolkata

17.47 CESTAT, Kolkata

10. The Company has no accumulated losses as at the end of the financial year and it has not incurred any cash losses during the financial year and in the immediately preceding financial year.

11. The Company has not defaulted in repayment of dues to any financial institution or bank. The Company has not issued any debentures.

12. The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13. The Company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore the provisions of paragraph 4 (xiii) of the Order are not applicable to the Company.

14. The Company is not dealing or trading in shares, securities, debentures and other investments. Therefore, the provisions of Clause 4 (xiv) of the Order are not applicable to the Company.

15. The Company has not given any guarantee for loans taken by others from bank or financial institutions. Therefore, the provisions of clause 4 (xv) of the Order are not applicable to the Company.

16. The Company has not raised any term loan during the year.

17. The Company did not raise any funds on short term basis which have been used for long term investment.

18. The Company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act.

19. The Company has not issued any debentures during the year.

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

21. No fraud on or by the Company has been noticed or reported during the course of our audit.

For SRB & ASSOCIATES. For SAHA GANGULI & ASSOCIATES

Chartered Accountants Chartered Accountants

Firm Regn. No: 310009E Firm Regn. No: 302191E

Sd/- Sd/-

(S.C. BHADRA) (S.K. SAHA)

Partner Partner

Membership No: 017054 Membership No: 051392

Place: New Delhi

Date: 25th May 2013


Mar 31, 2012

1. We have audited the accompanying financial statements of Oil India Limited ("the Company") which comprise the Balance Sheet as at 31st March, 2012, and the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and Significant Account- ing Policies and Additional Notes, in which are incorporated the company's share in the total value of assets, liabilities, expenditure and income based on three audited and thirty seven unaudited financial statements of Joint Ventures for exploration and production of crude oil and natural gas. 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 misstatement. An audit includes examining, on a test basis, evidence supporting the amount 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 ( Auditor's Report) Order, 2003 ("the Order"), as amended, issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Act and on the basis of our examination of the books and records of the Company carried out in accordance with the generally accepted auditing practices in India and according to the information and explanations given to us, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

4. Further to our comments in the Annexure referred under Para 3 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 appear 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 the directors, as on 31st March, 2012 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31st March, 2012 from being appointed as a director in terms of clause (g) of sub-section (1) of the Section 274 of the Companies Act, 1956; and

(f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read with the Significant Accounting Policies and the Additional Notes 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 31st March, 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 flow of the Company for the year ended on that date.

(Referred to in paragraph 3 of our report to the members of Oil India Limited ("the company") for the year ended 31st March 2012.)

1. (a) The company has generally maintained proper records showing full particulars including quantitative details and situation of fixed assets. However, the records of the land are in the process of updation and reconciliation.

(b) The fixed assets, other than underground assets and joint venture assets, have been physically verified by the Management in phased manner designed to cover all items over a period of five years, which is reasonable having regard to the size of the company and the nature of its assets. No material discrepancies have been noticed on such verification.

(c) None of the substantial part of fixed assets has been disposed off by the company during the year.

2. (a) Stocks of Crude Oil and Liquefied Petroleum Gas (LPG) have been physically verified by the management during the year and stock of stores and spare parts (excluding stock in transit and/or under inspection with suppliers/contractors) have been physically verified by the management in phased manner. The frequency of verification is reasonable.

(b) The procedures of physical verification of inventory 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 in respect of stocks of crude oil, LPG and stock of stores and spare parts. No material discrepancies have been noticed on verification between the physical assets and the book records.

3. (a) The company has granted unsecured loan to one party covered in the register maintained under section 301 of the Companies Act, 1956 ("the Act"). The amount outstanding at the year end was Rs. 131 crores and the maximum amount outstanding at any time during the year was Rs. 131 crores.

(b) The rate of interest and other terms and conditions of the loan granted is not prima facie prejudicial to the interest of the company.

(c) The repayment of principal and the payment of interest is not yet due.

(d) There is no overdue amount in respect of loans granted to the party listed in the register maintained under section 301 of the Act.

(e) The company has not taken any loans secured or unsecured, from companies firms or other parties covered in the register maintained under section 301 of the Act and consequently, the requirements of clause (iii)(f) and (iii)(g) of paragraph 4 of the Order, are not applicable.

4. There exists an adequate internal control system commensurate with the size of the company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods and services. We have not observed any continuing failure to correct major weaknesses in internal control system of the company.

5. (a) The particulars of contracts or arrangement that need to be entered into the register maintained under Section 301 of the Act have been so entered.

(b) The transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Act and exceeding the value of Rs. 5 lakhs in respect of any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6. The company has not accepted deposits from the public. Hence, the provisions of Sections 58A, 58AA or any other relevant provisions of the Act and the Rules framed thereunder are not applicable to the company.

7. The company has an internal audit system commensurate with the size and nature of its business.

8. The Central Government of India has prescribed maintenance of cost records under Section 209(1)(d) of the Act for the production of crude oil, natural gas, LPG, and pipeline activities for transportation of crude oil. We have broadly reviewed the books of account relating to materials, labour and other items of cost maintained by the company pursuant to the rules made by the Central Government for the maintenance of such cost records and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

9. (a) The company is regular in depositing with appropriate authorities undisputed statutory dues including provident fund, income tax, sales tax, wealth tax, service tax, customs duty, excise duty, and other material statutory dues applicable to it.

(b) No undisputed amounts payable in respect of income tax, sales tax, wealth tax, service tax, customs duty and excise duty were in arrears, as at 31.03.2012 for a period of more than six months from the date they became payable.

(c) Details of disputed dues in respect of income tax, sales tax, wealth tax, service tax, customs duty and excise duty which have not been deposited on account of any dispute are given below:-

Name of the Statute Nature Period to which the Amount Forum where of Dues amount relates (Rs. in Dispute is Financial year Crores) pending

Assam Taxation (on Tax on 2004-05 to 2011-12 624.82 High Court, specified land) Act, land Guwahati. 2004

Finance Act, 1994 Service 2003-04 0.79 CESTAT, Delhi Tax

Central Excise Act, Excise December 2008 to 14.27 CESTAT, 1944 Duty December 2009 Kolkata

January 2010 to 11.92 CESTAT, December 2010 Kolkata

10. The company has no accumulated losses as at the end of the financial year and it has not incurred any cash losses during the financial year and in the immediately preceding financial year.

11. The company has not defaulted in repayment of dues to any financial institution or bank. The company has not issued any debentures.

12. The company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13. The company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore the provisions of paragraph 4 (xiii) of the Order are not applicable to the company.

14. The company is not dealing or trading in shares, securities, debentures and other investments. Therefore, the provisions of Clause 4 (xiv) of the Order are not applicable to the company.

15. The company has not given any guarantee for loans taken by others from bank or financial institutions. Therefore, the provi- sions of clause 4 (xv) of the Order are not applicable to the company.

16. The company has not raised any term loan during the year.

17. The company did not raise any funds on short term basis which have been used for long term investment.

18. The company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act.

19. The company has not issued any debentures during the year.

20. The company has not raised any money by public issue during the year.

21. No fraud on or by the company has been noticed or reported during the course of our audit.

For SRB & ASSOCIATES For SAHA GANGULI & ASSOCIATES

Chartered Accountants Chartered Accountants

Firm Regn. No: 310009E Firm Regn. No: 302191E

Sd/- Sd/-

(S.C. BHADRA) (S.K. SAHA)

Partner Partner

Membership No: 017054 Membership No: 051392

Place: New Delhi

Date: 28th May 2012


Mar 31, 2011

1. We have audited the attached Balance Sheet of Oil India Limited, as at 31st March, 2011 and the Profit and Loss Account and also the Cash Flow Statement for the year ended on that date annexed thereto in which are incorporated the Company's share in the total value of assets, liabilities, expenditure and income of forty two Joint Ventures for exploration and production based on five nos. audited and thirty seven nos. unaudited financial statements (Refer Note 7 of Schedule 28). 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 misstatement. An audit includes examining, on a test basis, evidence supporting the amount 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 ( Auditor's Report) Order, 2003 issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act,1956 and on the basis of such checks as we considered appropriate and according to the information and explanations given to us, we set out in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the aforesaid Order.

4. Attention is invited to the following:

(a) Accounting Policy No.2 of Schedule-27 relating to treatment of exploration costs, development expenditure and abandonment costs and Accounting Policy No. 4.1(b) of Schedule-27 relating to capitalization of depreciation to exploration and development wells are significant to the oil and gas exploration and production industry under the "Successful Efforts Method".

(b) Categorization of wells as exploratory (whether successful in discovery of commercial hydrocarbons and producing properties or otherwise) or development and depletion of producing properties on the basis of proved and developed hydrocarbon reserves are based on management's evaluation whether technical or otherwise, which we have relied upon.

(c) Accounting Policy No.6 of Schedule-27 and Note No.4(iv) of Schedule-28 relating to impairment of assets are based on management's evaluation/estimates, whether technical or otherwise, which we have relied upon.

5. Further to our comments in the Annexure referred under Para(3) 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 appear 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 Companies Act,1956;

(e) On the basis of written representations received from the directors, as on 31st March, 2011 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31st March, 2011 from being appointed as a director in terms of clause(g) of sub-section (1) of Section 274 of the Companies Act,1956; and

(f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read with the Significant Accounting Policies (Schedule 27) and the Notes to Accounts (Schedule 28) 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 31st March, 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 flow of the Company for the year ended on that date.

ANNEXURE TO THE AUDITORS' REPORT OF OIL INDIA LIMITED

( Referred to in our report of even date attached)

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

(b) The fixed assets, other than those which are underground/ under joint venture, have been physically verified by the management in phased manner designed to cover all items over a period of five years.

Land records along with documents and Fixed Assets register are pending reconciliation.

As per information and explanations available, no material discrepancies have been observed on such verification. Adjustment, if any, required for such discrepancies is carried out on final reconciliation with books of account.

(c) According to the information and explanations provided to us, a substantial part of the fixed assets have not been disposed off during the year, which might affect the going concern concept.

2. (a) As explained to us, stocks of Crude Oil and Liquefied Petroleum Gas (LPG) have been physically verified by the management at reasonable intervals and stock of stores and spare parts (excluding stock in transit and/or under inspection with suppliers/ contractors) have been physically verified by the management in accordance with the phased programme.

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

(c) In our opinion, the Company has maintained proper records in respect of stock of crude oil, LPG and stock of stores and spare parts. No material discrepancies have been noticed between physical and book stocks of crude oil and LPG. In respect of stores and spare parts, the discrepancies on physical verification noticed by the management between physical stock and book records are not material considering the size of the Company and the nature of its business and the same have been properly adjusted in the accounts to the extent reconciliations have been completed.

3 (a) The Company has granted unsecured loan to one party covered in the register maintained under section 301 of the Companies Act,1956. The amount outstanding at the year end is Rs. 131 crores and the maximum amount outstanding at any time during the year was Rs. 131 crores.

(b) The rate of interest and other terms and conditions of the loan granted is not prejudicial to the interest of the Company.

(c) The payment of principal amount and interest are regular as per the terms of contract.

(d) There is no overdue amount in respect of loans granted to the parties listed in the register maintained under Section 301 of the Companies Act,1956.

(e) The Company has not taken any loans secured or unsecured, from companies firms or other parties covered in the register maintained under Section 301 of the Companies Act,1956 and consequently, the requirements of clause (iii)(f) and (iii)(g) of paragraph 4 of the Companies (Auditor's Report) Order, 2003 are not applicable.

4. 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 purchases of inventory, fixed assets and for the sale of goods and services and we have not observed any continuing failure to correct major weaknesses in internal control system.

5 (a) Based on the audit procedures applied by us and according to the information and explanations provided by the management, we are of the opinion that the particulars of contracts or arrangement referred to in Section 301 of the Companies Act,1956 have been so entered.

(b) According to the information and explanations given to us, the transaction made in pursuance of such contracts or arrangements have been made at prices, which are reasonable having regard to the prevailing market prices at the relevant time.

6. According to the information and explanations given to us, the Company has not accepted deposits from the public. Hence, the provisions of Sections 58A, 58AA or any other relevant provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 are not applicable to the Company.

7. The Company has its internal audit system, which appears to be commensurate with its size and nature of its business.

8. The Central Government of India has prescribed maintenance of cost records under Section 209(1)(d) of the Companies Act for the activities of manufacturing of crude oil and gases. We have broadly reviewed the books of account relating to materials, labour and other items of cost maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under section 209(1)(d) of the Companies Act,1956 and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

9. (a) According to the records of the Company and information and explanations given to us, the Company is regular in depositing undisputed statutory dues including provident fund, investor education and protection fund, employees' state insurance (not applicable to the Company), income tax, sales tax, wealth tax, fringe benefit tax, service tax, custom duty, excise duty, cess and any other statutory dues with the appropriate authorities. There are no material outstanding dues as of the last date of financial year concerned for a period more than six months from the date they became payable.

(b) According to the records of the Company and information and explanations given to us, as at 31st March, 2011 details of disputed dues in respect of income tax, sales tax, wealth tax, fringe benefit tax, service tax, custom duty, excise duty, cess are given below:

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

Assam Taxation (on Tax on land 2004-05 to 2009-10 526.78 High Court, Guwahati specified land) Act,2004

Finance Act,1994 Service Tax 2003-04 0.79 CESTAT, Delhi

Central Excise Act,1944 Excise Duty December' 2008 to 14.27 CESTAT, Kolkata December' 2009

10. The Company has no accumulated losses as at the end of the financial year and it has not incurred any cash losses during the financial year and in the immediately preceding financial year.

11. Based on our audit procedures and the information and explanations given by the management, the Company has not defaulted in repayment of dues to any financial institution or bank. The Company has not issued debentures.

12. Based on our examination of documents and records, we are of the opinion that the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13. In our opinion, the Company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore the provision of paragraph 4(xiii) of the Order is not applicable to the Company.

14. According to the records of the Company, the Company is not dealing or trading in shares, securities, debentures and other investments. Therefore the provisions of Clause 4 (xiv) of the Order are not applicable to the Company.

15. According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from bank or financial institutions. Therefore, the provisions of clause 4 (xv) of the Order are not applicable to the Company.

16. According to the records of the Company and information and explanations given to us, the term loans have been applied for the purpose for which the loans were obtained.

17. On an overall examination of the Balance Sheet of the Company and according to the information and explanations given to us, the Company did not raise any funds on short term basis which have been used for long term investment. No long-term funds have been used to finance short-term assets.

18. The Company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956.

19. The Company has not issued any debentures. Therefore the provisions of clause 4(xix) of the Order are not applicable to the Company.

20. The Management has disclosed the end-use of the money raised by the public issue of shares ( Refer Note 3 of Schedule 28 to the Financial Statement). The same has been verified by us.

21. During the course of our examination of books of account carried out in accordance with the generally accepted auditing practices in India and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company nor have we been informed of such case by the management.

For CHATTERJEE & CO. For SRB & ASSOCIATES

Chartered Accountants Chartered Accountants

Firm Regn. No: 302114E Firm Regn. No: 310009E

Sd/- Sd/-

(S.K.CHATTERJEE) (R.S.SAHOO)

Partner Partner

Membership No: 3124 Membership No: 53960

Place : New Delhi

Date : 30th May, 2011












Mar 31, 2010

1. We have audited the attached Balance Sheet of Oil India Limited, as at 31st March, 2010 and the Profi t and Loss Account and also the Cash Flow Statement for the year ended on that date annexed thereto in which are incorporated the Companys share in the total value of assets, liabilities, expenditure and income of thirty nine Joint Ventures for exploration and production based on eighteen nos. audited and twenty-one nos. unaudited financial statements (Refer Note 7(H) of Schedule 28). 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 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 misstatement. An audit includes examining, on a test basis, evidence supporting the amount and disclosures in the financial statements. An audit also includes assessing the accounting principles used and signifi cant 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 issued by the Central Government of India in terms of sub- section (4A) of Section 227 of the Companies Act, 1956 and on the basis of such checks as we considered appropriate and according to the information and explanations given to us, we set out in the Annexure a statement on the matters specifi ed in paragraphs 4 and 5 of the aforesaid Order.

4. Attention is invited to the following:

(a) Accounting Policy No.2 of Schedule-27 relating to treatment of exploration costs, development expenditure and abandonment costs and Accounting Policy No. 4.1(b) of Schedule-27 relating to capitalization of depreciation to exploration and development wells are signifi cant to the oil and gas exploration and production industry under the "Successful Efforts Method".

(b) Categorization of wells as exploratory (whether successful in discovery of commercial hydrocarbons and producing properties or otherwise) or development and depletion of producing properties on the basis of proved and developed hydrocarbon reserves are based on managements evaluation whether technical or otherwise, which we have relied upon.

(c) Accounting Policy No.6 of Schedule-27 and Note No. 4(iii) of Schedule-28 relating to impairment of assets are based on managements evaluation / estimates, whether technical or otherwise, which we have relied upon.

5. Further to our comments in the Annexure referred under Para(3) 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 appear from our examination of those books;

c) The Balance Sheet, Profi t 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, Profi t 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 the directors, as on 31st March, 2010 and taken on record by the Board of Directors, we report that none of the directors is disqualifi ed as on 31st March, 2010 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956; and

f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read with the Signifi cant Accounting Policies (Schedule 27) and the Notes to Accounts (Schedule 28) 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 31st March, 2010;

(ii) In the case of the Profi t and Loss Account, of the profi t of the Company for the year ended on that date; and

(iii) In the case of the Cash Flow Statement, of the cash fl ow of the Company for the year ended on that date.

ANNEXURE TO THE AUDITORS REPORT OF OIL INDIA LIMITED (Referred to in our report of even date attached)

1 (a) The Company has generally maintained proper records showing full particulars including quantitative details and situation of fi xed assets.

(b) The fi xed assets, other than those which are underground/under joint venture, have been physically verifi ed by the Management in phased manner designed to cover all items over a period of fi ve years.

Land records along with documents and Fixed Assets register are pending reconciliation.

As per information and explanations available, no material discrepancies have been observed on such verifi cation. Adjustment, if any, required for such discrepancies is carried out on fi nal reconciliation with books of account.

(c) According to the information and explanations provided to us, a substantial part of the fi xed assets have not been disposed off during the year, which might affect the going concern concept.

2. (a) As explained to us, stocks of Crude Oil and Liquefi ed Petroleum Gas (LPG) have been physically verifi ed by the management at reasonable intervals and stock of stores and spare parts (excluding stock in transit and/or under inspection with suppliers/contractors) have been physically verifi ed by the management in accordance with the phased programme.

(b) In our opinion and according to the information and explanations given to us, the procedures of physical verifi cation of inventory followed by the management appears to be reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) In our opinion, the Company has maintained proper records in respect of stocks of crude oil and LPG and in respect of stock of stores and spare parts. No material discrepancies have been noticed between physical and book stocks of crude oil and LPG. In respect of stores and spare parts, the discrepancies on physical verifi cation noticed by the management between physical stock and book records are not material considering the size of the Company and the nature of its business and the same have been properly adjusted in the accounts to the extent reconciliations have been completed.

3. The Company has neither granted nor taken any loans, secured or unsecured to/from companies, fi rms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, the provisions regarding rate of interest, payment of principal and interest and overdue amount as per sub clauses (b) to (g) of this clause are not applicable.

4. 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 purchases of inventory, fi xed assets and for the sale of goods and services and we have not observed any continuing failure to correct major weaknesses in internal control system.

5. (a) Based on the audit procedures applied by us and according to the information and explanations provided by the management, we are of the opinion that the particulars of contracts or arrangement referred to in Section 301 of the Companies Act, 1956 have been so entered.

(b) According to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements have been made at prices, which are reasonable having regard to the prevailing market prices at the relevant time.

6. According to the information and explanations given to us, the Company has not accepted deposits from the public. Hence, the provisions of Sections 58A, 58AA or any other relevant provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 are not applicable to the Company.

7. The Company has its internal audit system, which appears to be commensurate with its size and nature of its business.

8. The Central Government of India has prescribed maintenance of cost records under Section 209(1)(d) of the Companies Act for the activities of manufacturing of crude oil and gases. We have broadly reviewed the books of account relating to materials, labour and other items of cost maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under section 209(1)(d) of the Companies Act, 1956 and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

9. (a) According to the records of the Company and information and explanations given to us, the Company is regular in

depositing undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance (not applicable to the Company), income tax, sales tax, wealth tax, fringe benefi t tax, service tax, customs duty, excise duty, cess and any other statutory dues with the appropriate authorities. There are no outstanding dues as of the last date of financial year concerned for a period more than six months from the date they became payable.

(b) According to the records of the Company and the information and explanations given to us, as at 31st March 2010, details of disputed dues in respect of income tax, sales tax, wealth tax, fringe benefi t tax, service tax, customs duty, excise duty and cess are given below:-

Name of the Statute Nature of Dues Period to which the Amount Forum where amount relates
Assam Taxation (on Tax on land 2004-05 to 2008-09 43612.57 High Court, specified land) Act, 2004 Guwahati.

10. The Company has no accumulated losses as at the end of the fi nancial year and it has not incurred any cash losses during the fi nancial year and in the immediately preceding financial year.

11. Based on our audit procedures and the information and explanations given by the management, the Company has not defaulted in repayment of dues to any financial institution or bank. The Company has not issued debentures.

12. Based on our examination of documents and records, we are of the opinion that the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13. In our opinion, the Company is not a chit fund or a nidhi / mutual benefi t fund / society. Therefore the provision of paragraph 4 (xiii) of the Order is not applicable to the Company.

14. According to the records of the Company, the Company is not dealing or trading in shares, securities, debentures and other investments. Therefore, the provisions of Clause 4 (xiv) of the Order are not applicable to the Company.

15. 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. Therefore, the provisions of clause 4 (xv) of the Order are not applicable to the Company.

16. According to the records of the Company and information and explanations given to us, the term loans have been applied for the purpose for which the loans were obtained.

17. On an overall examination of the Balance Sheet of the Company and according to information and explanations given to us, the Company did not raise any funds on short term basis which have been used for long term investment. No long-term funds have been used to fi nance short-term assets.

18. The Company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956.

19. The Company has not issued any debentures. Therefore, the provisions of clause 4 (xix) of the Order are not applicable to the Company.

20. The Management has disclosed the end-use of the money raised by the public issue of shares (Refer Note 3 of Schedule 28 to the Financial Statement). The same has been verifi ed by us.

21. During the course of our examination of books of account carried out in accordance with the generally accepted auditing practices in India and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company nor have we been informed of such case by the management.

For Chatterjee & Co. For SRB & Associates

Chartered Accountants Chartered Accountants

Sd/- Sd/-

(S.K. CHATTERJEE) (S.C. BHADRA)

Partner Partner

Membership No: 3124 Membership No: 17054

Firm Regn. No: 302114E Firm Regn. No: 310009E

Place: Delhi Date: 26th May 2010




Mar 31, 2009

1. We have audited the attached Balance Sheet of Oil India Limited, as at 31st March, 2009 and the profit and Loss Account and also the Cash Flow Statement for the year ended on that date annexed thereto in which are incorporated the Companys share in the total value of assets, liabilities, expenditure and income of thirty three Joint Ventures for exploration and production based on 13 Nos. audited and 20 Nos. unaudited fi nancial statements (Refer Note 1 (E) of Schedule 28). These fi nancial statements are the responsibility of the Companys Management. Our responsibility is to express an opinion on these fi nancial 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 misstatement. An audit includes examining, on a test basis, evidence supporting the amount and disclosures in the fi nancial statements. An audit also includes assessing the accounting principles used and signifi cant estimates made by Management, as well as evaluating the overall fi nancial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003 issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956 and on the basis of such checks as we considered appropriate and according to the information and explanations given to us, we set out in the Annexure a statement on the matters specifi ed in paragraphs 4 and 5 of the aforesaid Order.

4. Attention is invited to the following:

(a) Accounting Policy No.2 of Schedule-27 relating to treatment of exploration costs, development expenditure and abandonment costs and Accounting Policy No. 4.1(b) of Schedule-27 relating to capitalization of depreciation to exploration and development wells are signifi cant to the oil and gas exploration and production industry under the "Successful Efforts Method".

(b) Categorization of wells as exploratory (whether successful in discovery of commercial hydrocarbons and producing properties or otherwise) or development and depletion of producing properties on the basis of proved and developed hydrocarbon reserves are based on Managements evaluation whether technical or otherwise, which we have relied upon.

(c) Accounting Policy No.6 of Schedule-27 and Note No. 5 of Schedule-28 relating to impairment of assets are based on Managements evaluation/ estimates, whether technical or otherwise, which we have relied upon.

5. Further to our comments in the Annexure referred under Para(3) 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 appear 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 Companies Act, 1956;

(e) On the basis of written representations received from the directors, as on 31st March, 2009 and taken on record by the Board of Directors, we report that none of the directors is disqualifi ed as on 31st March, 2009 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956; and

(f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read with the Signifi cant Accounting Policies (Schedule 27) and the Notes to Accounts (Schedule 28) 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 31st March, 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 fl ow of the Company for the year ended on that date.

ANNEXURE TO THE AUDITORS REPORT OF OIL INDIA LIMITED (Referred to in our Report of even date attached)

1. (a) The Company has maintained proper records showing full particulars including quantitative details and situation of fi xed assets.

(b) We are informed that certain fi xed assets of the Company have been physically verifi ed by the Management during the year in accordance with a phased programme designed to cover all items over a period of fi ve years, which is considered to be reasonable.

As per information and explanations available, no material discrepancies have been observed on such verifi cation. Adjustment, if any, required for such discrepancies is carried out on fi nal reconciliation with books of account.

Land records along with documents and Fixed Assets register are pending reconciliation.

(c) According to the information and explanations provided to us, a substantial part of the fi xed assets have not been disposed off during the year, which might affect the going concern concept.

2. (a) As explained to us, stocks of Crude Oil and Liquefi ed Petroleum Gas (LPG) have been physically verifi ed

by the Management at reasonable intervals and stock of stores and spare parts (excluding stock in transit and/or under inspection with suppliers/contractors) have been physically verifi ed by the Management in accordance with the phased programme. However, stock of stores at certain storage locations valued at Rs.92.65 Crores have not been covered during the year under such phased programme.

(b) In accordance with the information and explanations received by us, the procedures of physical verifi cation of inventory followed by the Management appears to be reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) In our opinion, the Company has maintained proper records in respect of stocks of crude oil and LPG and in respect of stock of stores and spare parts. No material discrepancies have been noticed between physical and book stocks of crude oil and LPG. In respect of stores and spare parts, the discrepancies on physical verifi cation noticed by the Management between physical stock and book records are not material considering the size of the Company and the nature of its business and the same have been properly adjusted in the accounts to the extent reconciliations have been completed.

3. The Company has neither granted nor taken any loans, secured or unsecured to/from companies, fi rms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, the provisions regarding rate of interest, payment of principal and interest and overdue amount as per sub clauses (b) to (g) of this clause are not applicable.

4. 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 purchases of inventory, fi xed assets and for the sale of goods and services and we have not observed any continuing failure to correct major weaknesses in internal control system.

5. (a) Based on the audit procedures applied by us and according to the information and explanations provided by the Management, we are of the opinion that the particulars of contracts or arrangement referred to in Section 301 of the Companies Act, 1956 have been so entered. (b) According to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements have been made at prices, which are reasonable having regard to the prevailing market prices at the relevant time.

6. According to the information and explanations given to us, the Company has not accepted deposits from the public. Hence, the provisions of Sections 58A, 58AA or any other relevant provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 are not applicable to the Company.

7. The Company has its internal audit system, which appears to be commensurate with its size and nature of its business. However, as explained to us, the Management is taking necessary measures to further strengthen the system.

8. We have broadly reviewed the books of account relating to materials, labour and other items of cost maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956 and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

9. (a) According to the records of the Company and information and explanations given to us, the Company is regular in depositing undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance (not applicable to the Company), income tax, sales tax, wealth tax, fringe benefit tax, service tax, customs duty, excise duty, cess and any other statutory dues with the appropriate authorities. There are no outstanding dues as of the last date of fi nancial year concerned for a period more than six months from the date they became payable.

(b) According to the records of the Company and the information and explanations given to us, as at 31st March 2009, details of disputed dues in respect of income tax, sales tax, wealth tax, fringe benefit tax, service tax, customs duty, excise duty and cess are given below:-

Name of the Nature of Period to which Amount Forum where Statute Dues the amount relates (Rs in Lakhs) Dispute is pending (Financial Year)

Assam Tax on 2004-05 to Taxation (On land 2008-09 34555.46 Supreme Court Specified Land) Act, 2004

10. The Company has no accumulated losses as at the end of the fi nancial year and it has not incurred any cash losses during the fi nancial year and in the immediately preceding fi nancial year.

11. Based on our audit procedures and the information and explanations given by the Management, the Company has not defaulted in repayment of dues to any fi nancial institution or bank. The Company has not issued debentures.

12. Based on our examination of documents and records, we are of the opinion that the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13. In our opinion, the Company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore the provision of paragraph 4 (xiii) of the Order is not applicable to the Company.

14. According to the records of the Company, the Company is not dealing or trading in shares, securities, debentures and other investments. Therefore, the provisions of Clause 4 (xiv) of the Order are not applicable to the Company.

15. According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from bank or fi nancial institutions. Therefore, the provisions of clause 4 (xv) of the Order are not applicable to the Company.

16. According to the records of the Company and information and explanations given to us, the term loans have been applied for the purpose for which the loans were obtained.

17. On an overall examination of the Balance Sheet of the Company and according to information and explanations given to us, the Company did not raise any funds on short term basis which have been used for long term investment. No long-term funds have been used to fi nance short-term assets.

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

19. The Company has not issued any debentures. Therefore, the provisions of clause 4 (xix) of the Order are not applicable to the Company.

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

21. During the course of our examination of books of account carried out in accordance with the generally accepted auditing practices in India and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company nor have we been informed of such case by the Management.



For Chatterjee & Co. For A.K. Sabat & Co., Chartered Accountants Chartered Accountants

Sd/- Sd/- (S. K. CHATTERJEE) (A. K. SABAT) Partner Partner Membership No. 3124 Membership No. 30310

Place : NOIDA Date : 29.05.2009


Mar 31, 2003

We have audited the attached Balance Sheet of Oil India Limited as at 31st March, 2003 and also the Profit and Loss Account for the year ended on that date annexed thereto and Cash Flow Statement for the year ended on that date. These financial statements are the responsibility of the management of the Company. Our responsibility is to express our 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 about whether the financial statements are free of material misstatement. An audit includes examining, on 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 reasonable basis for our opinion.

As required by the Manufacturing and Other Companies (Auditors Report) Order, 1988 issued by the Central Government of India in terms of section 227(4A) of the Companies Act,1956, we enclose in the Annexure a report on the matters specified in paragraphs 4 and 5 of the aforesaid Order.

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

1. (a) Accounting Policy No. 2 relating to treatment of exploration and development expenditure and Accounting Policy No. 3(b) relating to capitalization of depreciation to exploration and development wells are significant to the oil and gas exploration and production industry under the "Successful Efforts Method".

(b) Categorization of wells as exploratory (whether successful in discovery of commercial hydrocarbons and producing properties or otherwise) or development and depletion of producing properties on the basis of proved, developed and producing hydrocarbon reserves are based on managements evalaution whether technical or otherwise, which we have relied upon.

2. Attention is drawn to the following notes in Schedule 27:

2.1 Note1(d) regarding incorporation of unaudited figures of joint venture projects : and

2.2 Note 4(ii) regarding pending reconciliation of fixed assets.

3. Subject to our comments in paragraphs 2 above, with consequential effects if any, on the profit for the year and the net assets at the year end, the quantum of which is not ascertainable at this stage :-

3.1 We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of the audit;

3.2 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;

3.3 The Balance Sheet and Profit and Loss Account dealt with by this report are in agreement with the books of account;

3.4 In our opinion the Balance Sheet and Profit and Loss Account are in compliance with the accounting standards referred to in sub-section(3C) of Section 211 of the Companies Act,1956 to the extent applicable;

3.5 On the basis of written representation received from the Directors of the Company which were taken on record by the Board of Directors of the Company and the information and explanations as made available, none of the Directors of the Company is disqualified as on 31st March, 2003 from being appointed as a Director in terms of Clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956;

3.6 Cess is not payable by the Company under the provision of Section 441A of the Companies Act, 1956, as no notification under the said provision has been issued by the Central Government till 31st March, 2003.

3.7 In our opinion and to the best of our information and according to the explanations given to us, the said accounts read with the notes to accounts of Schedule 27, give the information required by 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 :

a) in case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2003;

b) in case of the Profit and Loss Account, of the profit of the Company 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.

ANNEXURE TO THE AUDITORS REPORT (Referred to in our report of even date)

1. The Company has generally maintained proper records showing full particulars including quantitative details and project/ department-wise situation of fixed assets. However, as explained to us, additions/deletions during the year are in the process of being incorporated in the fixed asset records. Fixed assets have been partially physically verified by the management during the year based on phased programme to cover the physical verification of all assets. Since reconciliation of discrepancies, noticed on physical verification of fixed assets as on 31st March 1998 is in progress as referred to in the Note No. 4(ii) of Schedule 27, we are unable to make comment on the materiallity of the discrepancy at this stage.

2. The fixed assets of the Company have not been revalued during the year.

3. As explained to us, the stocks of Crude oil and LPG have been physically verified by the management at reasonable intervals and the stocks of stores and spare parts (excluding stock-in-transit and/or under inspection with the suppliers/contractors) have been physically verified by the management in accordance with a phased programme of verification, which in our opinion, is reasonable.

4. According to the information and explanations given to us, the procedure for physical verification of stocks followed by the management to the extent verified, is generally reasonable and adequate in relation to the size of the Company and the nature of its business.

5. No material discrepancies have been noticed between physical and book stocks in relation to Crude oil and LPG. In respect of stocks of stores and spare parts, the discrepancies noticed by the management on verification of the physical stock and the book records are not material considering the size of the operations of the Company and the same have been properly adjusted in the accounts to the extent reconciliation has been completed.

6. On the basis of our examination of stockrecords, in our opinion the value of the stocks of Crude Oil, LPG and stores and spare parts is fair and proper in accordance with the normally accepted accounting principles and is on the same basis as in the previous year.

7. The Company has not taken any loan, secured or unsecured, from companies, firms and other parties listed in the Register maintained under Section 301 of the Companies Act,1956. In terms of sub-section(6) of Section 370 of the Companies Act, 1956, provisions. of the Section are not applicable to a Company on or after 31st October, 1998.

8. The Company has granted interest free unsecured loan to its wholly owned subsidiary company during the year. However the Loan shall become interest bearing from the date of commercial discovery. In terms of sub-section (6) of Section 370 of the Companies Act, 1956, provisions of the Section are not applicable to a Company on or after 31st October, 1998.

9. The parties (including employees) to whom loans or advances in the nature of loans have

been given are repaying the principal and interest amounts as stipulated, where stipulations have been made, in most cases. However, in case of deposits with a Public Sector Undertaking (PSU), amounting to Rs. 4126.90 lakhs (including Rs. 2626.90 lakhs towards interest accrued and due thereon), though matured have not been paid by the said PSU. The entire amount of interest of Rs. 2626.90 has been written off against provision therefor upto 31.3.2002 without waiving the right to further recourse as detailed in Note 6(iii) of Schedule 27. Steps as being taken by the management to recover the over due amount.

10. The internal control procedure followed by the Company for the purchase of stores, including components, plant and machinery, equipment and other assets, and for sale of goods, appears to be adequate and commensurate with the size of the Company and the nature of its business. However, the internal control procedure needs to be strengthened for timely recording of all purchases.

11. According to the information and explanations given to us, there are no transactions for purchase of goods and materials and sale of goods, materials and services made by the Company in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Companies Act, 1956 aggregating to Rs.50,000/- or more in respect of each party.

12. There is a system for determining unserviceable or damaged stores and spare parts on the basis of technical evaluation and on such basis, necessary adjustments have been made for write-offs, wherever necessary, in the accounts.

13. The Company has not accepted any deposit from the public within the meaning of Section 58A of the Companies Act, 1956.

14. In our opinion, reasonable records have generally been maintained by the Company for the sale and disposal of realizable scraps, where significant. The Company does not have any by-product.

15. In our opinion, the Company has an internal audit system commensurate with its size and nature of its business. However, the management is taking necessary measures for further improvement of its scope in respect of intensity and effective monitoring thereof.

16. We are informed that the maintenance of cost records has not been prescribed for any of the products and services of the Company by the Central Government under Section 209(1)(d) of the Companies Act, 1956.

17. The Company is regular in depositing provident fund dues with the appropriate authorities. We are informed that the provisions of Employees State Insurance Scheme are not applicable to the Company.

18. According to the records maintained by the Company and the information and explanations given to us, there were no undisputed amounts payable in respect of Income Tax, Wealth Tax, Sales Tax, Customs Duty and Excise Duty which were due as at 31st March, 2003 for

more than six months from the date they became payable.

19. In our opinion and according to the information and explanations given to us, no personal expenses other than expenses incurred under service contract obligations with employees/directors and/or under generally accepted business practices have been charged to revenue account.

20. The Company is not a Sick Industrial Company within the meaning of Clause (o) of Sub- section (1) of Section 3 of the Sick Industrial Companies (Special Provisions) Act, 1985.

21. In respect of services rendered we state:

(a) Considering the nature of services rendered and the basis of billing, as explained to us by the management, there is an adequate system for allocation of consumption of stores and man-hours to the related jobs.

(b) There is a reasonable system of authorization at proper levels and an adequate system of internal controls commensurate with the size of the Company and the nature of its business on issue of stores and spare parts.



For B.M. Chatrath & Co. For Ray & Ray Chartered Accountants Chartered Accountants

Sd/- Sd/- P.R. Paul B.K. Ghosh Partner Partner

Place: New Delhi Date : 21st June, 2003

 
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