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Auditor Report of Assam Company (India) Ltd.

Mar 31, 2018

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS financial statements of Assam Company India Limited, which comprise the Balance Sheet as at 31^st March, 2018, the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the financial year then ended, and a summary of the significant accounting policies and other explanatory information.

Managementâs 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 (âthe Actâ) with respect to the preparation of these standalone Ind AS financial statements that give a true and fair view of the State of affairs (financial position), profit or loss (financial performance including other comprehensive income), cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) prescribed under Section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguard 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 standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditorâs Responsibility

Our responsibility is to express an opinion on these standalone Ind AS 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 and other authoritative pronouncements 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 standalone Ind AS 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 Ind AS financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement in the standalone Ind AS 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 Ind AS 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 Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Standalone Financial Statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31^st March, 2018, and its loss and its cash flows for the financial year ended on that date.

Emphasis of Matter

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

a. Without qualifying our opinion, we draw attention to Note 47 in the financial statements which indicates that the Company incurred a net loss of Rs. 774.21 Crores during the year ended 31^st March 2018 and, as of that date, the Company''s current liabilities exceeded its total assets by Rs. 494.87 Crores. These conditions, along with other matters as set forth in the said Note, indicate the existence of a material uncertainty that may cast significant doubt about the Company''s ability to continue as a going concern.

b. Without qualifying our opinion, attention is drawn to Note No. 48 which indicates that the National Company Law Tribunal (NCLT) Guwahati Branch has by its order dated 26^th October 2017, initiated Corporate Insolvency Resolution Proceedings which is under process and we are unable to comment on the impact of the same on the financial performance and financial position of the company.

c. Without qualifying our opinion, attention is drawn to Note No. 40 in relation to admission of liability amounting to Rs. 319.47 crores on the happening of invocation of corporate guarantee given by the company to a third party on behalf of subsidiaries of the Company accordingly the loss of the Company and liability has increased by the same amount.

d. Without qualifying our opinion, attention is drawn to Note No. 45 in relation to the Oil and Gas Exploration & Production (E&P) Assets appearing in the Capital Work in Progress which have been impaired in accordance with the evaluation done by the management.

e. Without qualifying our opinion, attention is drawn to Note No. 40 in relation to the interest free loans of Rs. 706.83 crores given to Subsidiaries. According to section 186(7) of the Act, âNo loan shall be given under this section at the rate of interest lower than the prevailing yield of one year, three year, five year or ten year Government Security closer to the tenor of the loanâ. The impact of this contravention on the financial performance and financial position of the company is not ascertainable readily.

Other Matters

The comparative financial information of the Company for the year ended 31^st March, 2017 and the transition date opening balance sheet as at 1^st April, 2016 included in these Ind AS financial statements, are based on the previously issued statutory financial statements for the years ended 31^st March, 2017 and 31^st March, 2016 prepared in accordance with the Companies (Accounting Standards) Rules, 2006 (as amended) which were audited by us, on which we expressed an unmodified opinion dated 30^th May, 2017 and 27^th May, 2016 respectively. The adjustments to those financial statements for the differences in accounting principles adopted by the Company on transition to the Ind AS have been audited by us.

Report on Other Legal and Regulatory Requirements

As required by the Companies (Auditor''s Report) Order, 2016 (âthe Orderâ) issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure a 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, the Cash Flow Statement and the Statement of Changes in Equity dealt with by this Report are in agreement with the books of account and with the returns received from branches not visited by us.

(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) The impact, of the matters described in the Emphasis of Matter paragraph above, is not ascertainable in some cases and therefore we are unable to express an opinion if these will have an adverse effect on the functioning of the Company.

(f) On the basis of the written representations received from the directors as on 31st March, 2018 taken on record by the Board of Directors, none of the directors is disqualified as on 31^stMarch, 2018 from being appointed as a director in terms of Section 164 (2) of the Act.

(g) With respect to the adequacy of the internal financial controls over financial reporting of the company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Aâ.

(h) 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 as amended from time to time, 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 36 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 to the Independent Auditorâs Report

(Referred to in paragraphs in relation to Report on Other Legal and Regulatory Requirements of our report of even date to the member of Assam Company India Limited on the financial statements ended on 31^st March, 2018)

i) a) The company has maintained proper records showing full particulars including quantitative details and situation of Fixed Assets other than Oil and Gas Division. However, a list of fixed assets acquired for Oil & Gas Operation is maintained.

b) The Fixed Assets of the company have been physically verified by the management periodically in phased manner, which, in our opinion, is reasonable having regard to the size of the company and the nature of its assets. In respect of assets physically verified, the details have been compared with the book records and discrepancies noticed were not material and have been properly dealt with in the books of account.

c) The conveyance of any immovable property is not pending except the acquisition of land from Digulturung, Thanai and Nudwa tea estates measuring about 4.45 Hector, 5.95 Hector and 9.18 Hector respectively through Oil India Limited which is in progress.

ii) Physical verification of inventory has been conducted at reasonable intervals during the year by the management except for Oil and Gas Division.

iii) The Company has given interest free loan to 8 subsidiaries and 1 Step-down Subsidiary amounting to Rs.706.83 crores.

a) In our opinion, and according to information and explanations given to us, the rate of interest and other terms and conditions of loans given by the company, secured or unsecured, are generally not prejudicial to the interest of the company.

b) The loans are interest free, in violation to section to section 186(7), and are repayable on demand;

c) As the loans are repayable on demand and no call has been made, no amount is overdue; however, a provision of Rs. 455.34 Crores, being doubtful of recovery, out of such loans to subsidiaries has been created in the Balance Sheet.

iv) In respect of loans, investments, guarantees and security provisions of section 185 and 186 of the Companies Act 2013 have been generally complied with; with the exception of interest free loans of Rs. 706.83 crores given to 8 subsidiaries and 1 step-down subsidiary which is in contravention to section 186(7) of the Act.

v) The Company has not accepted any deposits from the public except for Rs. 0.71 Crores being loan taken from five non-corporate entities at its tea estates that were identified on test check.

vi) We have broadly reviewed the accounts maintained by the company in respect of tea products where, pursuant to the Rules made by the Central Government of India, the maintenance of cost records has been prescribed 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 with a view to determine whether they are accurate or complete. No cost record has been maintained with respect to its oil and gas products.

vii) (a) The company is not regular in depositing undisputed statutory dues including provident fund, employeesâ state insurance, income-tax, service tax, duty of customs, duty of excise, cess, Goods and Services Tax and any other statutory dues with the appropriate authorities where the amounts due in respect to Central Sales Tax is Rs. 1,00,76,166; VAT is Rs. 89,69,109, Service Tax is Rs. 68,47,654, and Provident Fund Rs 32,95,98,995 as on the last day of the financial year concerned for a period of more than six months from the date they became payable. As the Company is undergoing Corporate Insolvency Resolution Process (CIRP), all amounts outstanding as on the date of commencement of CIRP are under a moratorium till the CIRP is complete.

(b) Details of amounts involved and the forum where dispute is pending, is mentioned below for cases where dues of income tax or sales tax or service tax or duty of customs or duty of excise or value added tax or cess have not been deposited on account of any dispute.

Sl. No.	Name of the Statute	Nature of dues	Amount Rs.	Period to which relates	Forum where dispute is pending
1	Income Tax Act, 1961	Income Tax	10,23,57,960	2010-11	Commissioner of Income Tax (appeals)
	Do	Do	5,38,41,660	2011-12	-Do-
	Do	Do	3,54,69,510	2012-13	-Do-
	Do	Do	8,47,53,370	2013-14	-Do-
	Do	Do	8,71,93,850	2014-15	-Do-
2.	Agricultural Income Tax	Do	9,22,98,080	2013-14	Hon''ble Guwahati High Court
	Do	Do	4,51,82,296	2014-15	-Do-

Sl. No.	Name of the Statute	Nature of dues	Amount Rs.	Period to which relates	Forum where dispute is pending
3.	The West Bengal Sales tax Act, 1994	West Bengal Sales Tax	1,93,70,205	2002-03	Sr. Jt. Comm. of Commercial Taxes
	Do	Do	15,36,066	2003-04	Appellate & Revisional Board of Commercial Taxes
	Do	Do	87,24,464	2004-05	-Do-
	Do	Do	1,90,72,936	2006-07	-Do-
	Do	Do	2,64,61,472	2008-09	-Do-
	Do	Do	15,55,430	2013-14	-Do-
	Do	Do	10,29,00,058	2014-15	-Do-
4.	The Central Sales tax Act, 1956	Central Sales Tax	1,68,552	2002-03	Sr. Jt. Comm. of Commercial Taxes
	Do	Do	61,83,248	2003-04	Appellate & Revisional Board of Commercial Taxes
	Do	Do	2,37,701	2004-05	-Do-
	Do	Do	1,34,56,558	2006-07	-Do-
	Do	Do	34,44,736	2008-09	-Do-
	Do	Do	15,56,162	2013-14	-Do-
	Do	Do	1,06,04,309	2014-15	-Do-
5.	Service Tax Act		12,25,527	2013-14	Office of the commissioner of Service Tax-II
	Do		2,63,79,459	Oct 2009- Dec 13	-Do-
	Do		3,77,71,996	Oct 2009- Sept 15	-Do-

viii) According to the records of the company examined by us and the information and explanations made available to us, at the Balance Sheet date, the company has defaulted in repayment of loans from banks and Financial Institutions amounting to Rs.819.45 crores, fell due on various dates during the year ending on 31^st March 2018 and also in earlier accounting periods as admitted by the Resolution Professional during the course of CIRP and detailed in the table below. The company has also defaulted in repayment of principal part of the matured Foreign Currency Convertible Bonds amounting to USD 3.1 million (Rs.20.16 crores) details of the same is given in note 46 forming part of the Financial Statements.

Loans From	Overdue (in Rs. Crores)
State Bank of India	397.52
Bank of Baroda	142.34
Allahabad Bank, Industrial Finance Branch	113.05
Union Bank of India	65.24
Central Bank	61.08
Oriental Bank of Commerce	26.32
Syndicate Bank	13.9
TOTAL	819.45

ix) No moneys were raised during the year by way of initial public offer or further public offer (including debt instruments). No term loan was taken by the Company during the Financial Year under review.

x) During the course 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 have neither come across any instance of fraud by the Company or on the company by its officers or employees, noticed or reported during the year, nor have we been informed of such case by the management.

xi) The managerial remuneration has been paid or provided in accordance with the requisite approvals mandated by the provisions of section 197 read with schedule V to the Act.

xii) The provisions of any special statute applicable to Nidhi Company are not applicable to the company.

xiii) All transactions with the related parties are in compliance with section 177 and 188 of the Companies Act, 2013 where applicable and the details have been disclosed in the financial statements etc., as required by the applicable accounting standards;

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

xv) During the course 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, the company has not entered into any non-cash transactions with directors or persons connected with such director.

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

âAnnexure Aâ to the Independent Auditorsâ Report of even date on the Standalone Ind AS Financial Statements

[Referred to in paragraph (h) under the heading âReport on Other Legal and Regulatory Requirementsâ of our report of even date to the members of Assam Company India Limited on the standalone Ind AS financial statements ended for the year on 31^st March, 2018]

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (âthe Actâ)

We have audited the internal financial controls over financial reporting of Assam Company India Limited (the Company) as of 31^st March, 2018 in conjunction with our audit of the standalone Ind AS financial statements of the Company for the year ended on that date.

Managementâs Responsibility for Internal Financial Controls

The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditorsâ Responsibility

Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the âGuidance Noteâ) and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

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

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

Meaning of Internal Financial Controls Over Financial Reporting

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

Inherent Limitations of Internal Financial Controls Over Financial Reporting

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

Opinion

In our opinion, and subject to the weaknesses stated below, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31^st March, 2018, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

a) The Policy on Internal Financial Control and documentation of the Standard Operating Processes has been prepared but these are yet to be fully implemented and become fully operational.

b) The Internal Audit is not designed to cover the processes and systems to verify the stage and effectiveness of the implementation of the policies and procedures.

c) As the documented policy and procedures on Internal Financial Control are yet to be fully implemented, we are unable to evaluate the effectiveness of communication and dissemination of information on the same across the organization. However, the informal system of oral communication and electronic communication is existing which at times is complemented by documented communication of information on the various aspects of Internal controls.

d) Weakness in control observed in the process of taking loans in from non-corporate entities in violation of Companies (Acceptance of Deposits) Rules, 2014 as amended.

e) The evaluation of procurement process, conducted by the management, reveals that the system of tender / multiple quotations to ensure unbiased decision is absent.

f) Recording of cash transactions in timely manner and control over physical cash balance is lacking at the tea estates.

For De Chakraborty & Sen

Chartered Accountants

FRN 303029E

Srijit Chakraborty

Place of Signature: Kolkata (Partner)

Date: 30^th May, 2018 Membership No. 055317

Mar 31, 2016

INDEPENDENT AUDITORâS REPORT

The Members of Assam Company India Limited Report on the Financial Statements

We have audited the accompanying standalone financial statements of Assam Company India Limited, which comprise the Balance Sheet as at 31st March, 2016, the Statement of Profit and Loss, the Cash Flow Statement for the fifteen months period then ended, and a summary of the significant accounting policies and other explanatory information.

Managementâs 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 (âthe Actâ) with respect to 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 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 safeguard 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.

Auditorâs Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

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

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31^st March, 2016, and its loss and its cash flows for the fifteen month period ended on that date.

Emphasis of Matter

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

a. Attention is drawn to Note No. 12 in relation to the AAON/7 Exploration & Production (E&P) Asset appearing in the Capital Work in Progress, about which we are unable to express any opinion on the outcome of the project, pending execution of the new Production Sharing Contract (PSC). Our opinion is not qualified in respect of this.

b. Attention is drawn to Note No. 30(i) & 39 which includes the contingent liability in relation to the bilateral agreement with Oil & Natural Gas Corporation Limited for operationalization of Amguri Field. As the quantum of this contingent liability is not ascertainable at present, no provision for liability has been made in respect to this âOnerous Contractâ. Our opinion is not qualified in respect of this.

c. Attention is drawn to Note No. 49 in relation to the interest free loans of Rs. 259.66 Crores given to Subsidiaries. According to section 186(7) of the Act, âNo loan shall be given under this Section at the rate of interest lower than the prevailing yield of one year, three year, five year or ten year Government Security closer to the tenor of the loanâ. The impact of this contravention on the profit/loss and the liability is not ascertainable readily. Our opinion is not qualified in respect of this.

Report on Other Legal and Regulatory Requirements

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 and with the returns received from branches not visited by us.

(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) The impact, of the matters described in the Emphasis of Matter paragraph above, is not ascertainable and therefore we are unable to express an opinion if these will have an adverse effect on the functioning of the Company.

(f) On the basis of the written representations received from the Directors as on 31^st March, 2016, taken on record by the Board of Directors, none of the directors is disqualified as on 31^stMarch, 2016 from being appointed as a director in terms of Section 164 (2) of the Act.

(g) In our opinion, the Company has, subject to the reservations stated in âAnnexure Aâ, adequate internal financial controls system and such controls are operating effectively.

(h) 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 30 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 to the Independent Auditorâs Report

(Referred to in paragraphs 3 and 4 of our Report of even date to the member of Assam Company India Limited on the financial statements ended on 31^stMarch, 2016)

i) a) The company has maintained proper records showing full particulars including quantitative details and situation of Fixed Assets other than Oil and Gas Division. However, a list of Fixed Assets acquired for Oil & Gas Operation is maintained.

b) The Fixed Assets of the company has been physically verified by the management periodically in phased manner, which, in our opinion, is reasonable having regard to the size of the company and the nature of its assets. In respect of assets physically verified, the details have been compared with the book records and discrepancies noticed were not material and have been properly dealt with in the books of account.

c) The conveyance of any immovable property is not pending.

ii) Physical verification of inventory has been conducted at reasonable intervals during the year by the management except for Oil and Gas Division.

iii) The Company has given interest free loan to 8 subsidiaries and 1 Step-down Subsidiary amounting to Rs. 259.66 crores.

b) The loans are interest free and repayable on demand;

c) As the loans are repayable on demand and no call has been made, no amount is overdue;

iv) In respect of loans, investments, guarantees and security provisions of section 185 and 186 of the Companies Act 2013 have been generally complied with; with the exception of interest free loans of Rs. 259.66 crores given to 8 subsidiaries and 1 step-down subsidiary which is in contravention to section 186(7) of the Act.

v) The Company has not accepted any deposits from the public.

vii) a) The Company is regular in depositing undisputed statutory dues including Provident Fund, Employees'' State

Insurance, Income-Tax, Service Tax, Duty of Customs, Duty of Excise, cess and any other statutory dues with the appropriate authorities except Sales Tax amounting to Rs.58,89,664 and VAT amounting to Rs.31,08,571 as on the last day of the financial year concerned for a period of more than six months from the date they became payable.

b) Details of amounts involved and the forum where dispute is pending, is mentioned below for cases where dues of Income Tax or Sales Tax or Service Tax or Duty of Customs or Duty of Excise or Value Added Tax or cess have not been deposited on account of any dispute.

Srl. No.	Name of the Statute	Nature of dues	Amount Rs.	Period to which relates	Forum where dispute is pending
1	Income Tax Act, 1961	Income Tax	10,23,57,960	AY 2010-11	Commissioner of Income Tax (appeals)
	Do	Do	5,38,41,660	AY 2011-12	-Do-
	Do	Do	3,54,69,510	AY 2012-13	-Do-
	Do	Do	8,47,53,370	AY 2013-14	-Do-
2	Agricultural Income Tax		9,22,98,080	AY 2013-14	Hon''ble Guwahati High Court
			4,51,82,296	AY 2014-15	-Do-
3	The West Bengal Sales Tax Act, 1994	West Bengal Sales Tax	1,93,70,205	2002-03	Sr. Jt. Comm. of Commercial Taxes
	Do	Do	15,36,066	2003-04	Appellate & Revisional Board of Commercial Taxes
	Do	Do	87,24,464	2004-05	-Do-
	Do	Do	1,90,72,936	2006-07	-Do-
	Do	Do	6,18,32,474	2008-09	-Do-
4	The Central Sales Tax Act, 1956	Central Sales Tax	1,68,552	2002-03	Sr. Jt. Comm. of Commercial Taxes
	Do	Do	61,83,248	2002-03	Appellate & Revisional Board of Commercial Taxes
	Do	Do	2,37,701	2003-04	-Do-
	Do	Do	1,34,56,558	2004-05	-Do-
	Do	Do	34,44,736	2006-07	-Do-
5	Service Tax		12,25,527	2013-14	Office of the Commissioner of Service Tax-II
	Do		1,77,61,881	Oct 2009- Dec 13	-Do-
	Do		1,98,17,372	Oct 2009- Sept 15	-Do-

viii) According to the records of the Company examined by us and the information and explanations made available to us, at the Balance Sheet date, the Company has defaulted in repayment of Bank Term Loans of Rs.151.20 crores, fell due on various dates during the 15 month period ending on 31^st March 2016. The company has also defaulted in repayment of principal part of the matured Foreign Currency Convertible Bonds amounting to USD 3.1 Million (Rs.20.56 crores) details of the same is given in note 40 forming part of the Financial Statements.

INR LOANS	Over due
Allahabad Bank	1,67,00,000
State Bank of Hyderabad	9,65,00,000
State Bank of Bikaner & Jaipur	105,00,08,662
Central Bank of India	34,88,00,000
Total INR Loans	151,20,08,662

ix) No moneys were raised during the year by way of initial public offer or further public offer (including debt instruments). Term loans taken during (by way of restructuring) the year were applied for the purpose for which those are raised.

xi) The Managerial Remuneration has been paid or provided in accordance with the requisite approvals mandated by the provisions of Section 197 read with schedule V to the Act.

xii) The provisions of any special statute applicable to Nidhi Company are not applicable to the Company.

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.

xv) During the course 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, the Company has not entered into any non-cash transactions with Directors or persons connected with such Director.

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

For De Chakraborty & Sen

Chartered Accountants

FRN:303029E

(Srijit Chakraborty)

Kolkata (Partner)

27^th May, 2016 (Membership No. 055317)

Dec 31, 2014

We have audited the accompanying financial statements of Assam Company India Limited, which comprise the Balance Sheet as at December 31,2014, and the Statement of Profit and Loss and Cash Flow Statement for the Year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility forthe Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards notified under the companies act, 1956 ("the act") read with the General circular15/2013 dated 13th September 2013 of the Ministry of corporate Affairs in respect of 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

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

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

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fairview 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 December 31,2014.

(b) In the case of the Statement of Profit and Loss Account, of the loss for the year ended on that date.

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

Emphasis of Matter

a. Without qualifying our opinion, we draw your attention to Note No.11 in relation to rate of depreciation on certain oil and gas producing assets of the company whose net book value at the year-end aggregate to Rs. 5,175.76 lakhs that are being depreciated on consistent basis in accordance with the "Unit of Production" method as per guidance note on "Accounting for Oil & Gas Producing Activities" issued by The Institute of Chartered Accountants of India in February 2003 because no rates have been specified for the aforesaid class of fixed assets under Schedule XIV to the Act. The depreciation on the balance oil and gas producing assets, whose net book value aggregating to Rs.102.35 lakhs has been provided as per Schedule XIV to the Act. The company is still awaiting the response to application to Central Government pursuant to Section 205 of the Act seeking approval to depreciate the aforesaid assets in accordance with the "Unit of Production" method. This financial statement does not include any adjustments on consequential impact should the Central Government direct the company to adopt any other method on rate of depreciation other than "Unit of Production" method.

b. Without qualifying our opinion, attention is drawn to Note No. 39 in relation to the AA ON/7 Exploration & Production (E&P) Asset,we are unable to express any opinion on the outcome of the project, pending execution of the new Production Sharing Contract (PSC).

c. Without qualifying our opinion, attention is drawn to Note No. 52 in relation to sale of assets both immovable and moveable, of Salonah Tea Estate pending execution of the conveyance in respect to the immovable properties.

Report on Other Legal and Regulatory Requirements

1. The Companies Act 2013 has been made effective since 1st April 2014. The Ministry of Corporate Affairs has not passed any Order under section 143(11) of the Companies Act, 2013 so far. Hence, until any Order, as aforesaid, is issued, no additional reporting under section 143(11) of the Companies Act, 2013 is required by the Auditors for Financial Year 2014-15. However, as the Financial Statements have been prepared as required under the Companies Act 1956, as required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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

a. we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit.

b. in our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books and proper returns adequate for the purposes of our audit have been received from branches and tea estates / gardens not visited by us.

bb. the accounts of tea estates / gardens have been audited under section 228 by the company''s auditors. Hence, the requirement of forwarding the report by other auditors on the accounts of such branch offices, tea estates / gardens and dealing with the same in our report did not arise.

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 and with the returns received from branches and tea estates.

d. in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards notified under the Companies Act,1956 read with the General Circular15/2013 dated 13th September 2013 of the Ministry of corporate Affairs in respect of section 133 of the companies Act, 2013.

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

Annexure to The Auditors'' Report

(Referred to in paragraph 3 of our report of even date to the member of Assam Company India Limited on the financial statements ended on 31st December, 2014)

i (a) The company has maintained proper records showing full particulars including quantitative details and

situation of Fixed Assets other than Oil and Gas Division. However, a list of fixed assets acquired for Oil & Gas Operation is maintained.

(b) The Fixed Assets of the company has been physically verified by the management periodically in phased manner, which, in our opinion, is reasonable having regard to the size of the company and the nature of its assets. In respect of assets physically verified, the details have been compared with the book records and discrepancies noticed were not material and have been properly dealt with in the books of account.

(c) The company has in the year 2012 entered into an Agreement for Sale of a substantial part (being a unit).The conveyance of the immovable property is pending.

ii (a) Physical verification of inventory has been conducted at reasonable intervals during the year by the

management except for Oil and Gas Division.

(b) In our opinion, 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 has maintained proper records of inventory. No material discrepancies were noticed on physical verification.

iii (a) According to the information and explanations given to us, the company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of The Companies Act, 1956.

(b) According to the information and explanations given to us, 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.

(c) In our opinion, and according to information and explanations given to us, the rate of interest and other terms and conditions of loans given or taken by the company, secured or unsecured, are generally not prejudicial to the interest of the company, except in one case which in our opinion was prima facie prejudicial to the interest of the company on the ground of rate of interest paid and charged.

iv In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the company and the nature of its business for the purchase of inventory, fixed assets and for the sale of goods and services. Further, on the basis of our examination of the books and records of the company, and according to the information and explanations given to us, we have neither come across nor we have been informed of any continuing or habitual failure to correct major weaknesses in the aforesaid internal control system.

v On the basis of our examination of the books of account, the company has not entered into any contract or arrangement with any party during the financial year that need to be entered in the register pursuant to Section 301 of the Companies Act, 1956.

vi The Company has not accepted any deposits from the public within the meaning of Section 58A and 58AA of the Act and the rules framed there under.

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

viii We have broadly reviewed the accounts maintained by the company in respect of tea products where, pursuant to the Rules made by the Central Government of India, the maintenance of cost records has been prescribed under clause (d) of sub-section (1) of Section 209 of the Act and are of the opinion prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete. No cost record has been maintained with respect to its oil and gas products.

ix (a) According to records examined by us, in our opinion, the company is regular in depositing undisputed statutory dues including TDS, Provident Fund, Investor Education and Protection Fund, Income-tax, Sales tax, Wealth Tax, Service Tax, Excise Duty, Tea Cess, profession tax and the outstanding dues on the last date of financial year are not for a period of more than 6 months from the day they become payable.

(b) According to information and explanations given to us, there is no disputed dues regarding service tax, professional tax, wealth tax, provident fund, tea cess, investor Education and Protection Fund, but the details of disputed dues of sales tax and income tax are as follows:

Sl. Name of the Statute Nature of dues Amount No. Rs.

1 Income Tax Act, 1961 Income Tax 28,631,700

2 The West Bengal West Bengal 1,93,70,205 Sales tax Act, 1994 Sales tax Act, 1994

Do Do 15,36,066

Do Do 87,24,464

Do Do 1,90,72,936

Do Do 6,18,32,474

3 Central Sales Central Sales 75,34,984 Tax, 1956 Tax

Do Do 1,68,552

Do Do 61,83,248

Do Do 2,37,701

Do Do 1,34,56,558

Do Do 34,44,737

4 Assam General Assam Sales Tax 6,63,927 Sales Tax Act, 1993

5. The Assan Professional Tax 2,35,000 Professions, TRADE, Calling & Employment Taxation Act, 1947

Name of the Statute Period to Forum where which relates dispute is pending

Income Tax Act, 1961 2011-12 Under Assessment.

The West Bengal Sales tax Act, 1994 2002-03 Sr. Jt. Comm. of Commercial Taxes

DO 2003-04 Appellate & Revisional Board of Commercial Taxes

DO 2004-05 Do

DO 2006-07 Do

DO 2008-09 Do

Central Sales Tax, 1956 2001-02 Appellate& Revisional Board of Commercial Taxes

DO 2002-03 Do

DO 2003-04 Do

DO 2004-05 Do

DO 2006-07 Sr. Jt. Comm., South Circle

DO 2008-09 Appellate & Revisional Board of Commercial Taxes

Assam General Sales Tax Act, 1993 2001-02 Commissioner of Taxes

The Assan Professions, TRADE, Calling & Employment Taxation Act, 1947 2013-14 Profession Tax Authority

x The company has no accumulated losses as at 31st December, 2014 and it has not incurred any cash losses in the financial year ended on that date or in the immediately preceding financial year.

xi According to the records of the company examined by us and the information and explanations made available to us, at the Balance Sheet date, the company has defaulted in repayment of bank term loans of Rs.121.45 crores (Rs 2.08 crores since repaid), fell due on various dates during the year 2014. The company has also defaulted in repayment of principal matured Foreign Currency Convertible Bonds of $3.1 million (Rs.19.63 crores) details of the same is given in note 40 forming part of the Financial Statements.

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

xiii The provisions of any special statute applicable to chit fund/ nidhi/ mutual benefit fund/ society are not applicable to the company.

xiv In our opinion, the company is not a dealer or trader in shares, securities, debentures and other investments.

xv In our opinion and according to information and explanations given to us, the terms and conditions of the guarantees given by the company, for loans taken by others from banks or financial institutions during the year are not prejudicial to the interest of the company.

xvi In our opinion and according to the information and explanations given to us, on an overall basis, the term loans have been applied for the purposes for which they were obtained.

xvii On the basis of an overall examination of the Balance Sheet of the company, in our opinion and according to the information and explanations, given to us, there are no funds raised on a short-term basis which have been used for long-term investment.

xviii On the basis of an overall examination of the Balance Sheet of the company, in our opinion and according to the information and explanations, given to us, the company has not made any preferential allotment to parties and Companies covered in the register maintained under 301 of the Act.

xix On the basis of an overall examination of the Balance Sheet of the company, in our opinion and according to the information and explanations, given to us, the company has not issued any debentures during the year.

xx On the basis of an overall examination of the Balance Sheet of the company, in our opinion and according to the information and explanations, given to us, the company has not raised any money by public issues during the year.

xxi During the course 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 have neither come across any instance of fraud on or by the company, noticed or reported during the year, nor have we been informed of such case by the management.

For De Chakraborty & Sen

Chartered Accountants

F.R. No. 303029E

(Srijit Chakraborty)

Place: Kolkata Partner

Date: 27th February 2015 Membership No.: 055317

Dec 31, 2012

1. We have audited the attached Balance Sheet of Assam Company India Limited as at 31st December, 2012 and the related Statement of Profit & Loss and also the Cash Flow Statement of the Company for the year ended on that date annexed thereto. The said Balance Sheet, Statement of Profit & Loss and the Cash Flow Statement have been signed by us under reference to this Report. 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 auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the Financial Statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the Financial Statements. An audit also includes assessing the accounting principles used and significant estimates made by Management, as well as evaluating the overall Financial Statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors'' Report) Order, 2003 as amended by the Companies (Auditors'' Report) (Amendment) Order, 2004 (together the "Order"), issued by the Central Government of India in terms of Sub-Section 4(A) of Section 227 of ''The Companies Act, 1956'' (the "Act") and on the basis of such checks of books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure hereto, a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Without qualifying out- opinion, we draw your attention to Note No.11 in relation to rate of depreciation on certain oil and gas producing assets of the Company whose net book value at the year-end aggregate to Rs. 5,175.76 lakhs that are being depreciated on consistent basis in accordance with the "Unit of Production" method as per guidance note on "Accounting for Oil & Gas Producing Activities" issued by The Institute of Chartered Accountants of India in February, 2003, because no rates have been specified for the aforesaid class of Fixed Assets under Schedule XIV to the Act. The depreciation on the balance oil and gas producing assets, whose net book value aggregating to Rs. 197.00 lakhs has been provided as per Schedule XIV to the Act. The Company is still awaiting the response to application to Central Government pursuant to Section 205 of the Act seeking approval to depreciate the aforesaid assets in accordance with the "Unit of Production" method. This Financial Statement does not include any adjustments on consequential impact should the Central Government direct the Company to adopt any other method on rate of depreciation other than "Unit of Production" method.

5. Without qualifying our opinion, attention is drawn to Note No. 40 in relation to the AA-ON/7 Exploration

& Production (E&P) Asset about which we are unable to express any opinion on the outcome of the project, pending execution of the new Production Sharing Contract (PSC).

6. Without qualifying our opinion, attention is drawn to Note No. 43 relating to loan given to one of its Wholly Owned Subsidiaries (WOS) namely Duncan Macneill Natural Resources Limited (DMNRL) situated in UK. In the absence of sufficient and appropriate evidences relating to the said WOS, we are unable to express any opinion on the status of the loan and the related Exploration & Production (E&P) activities.

7. Attention is drawn to the Note No. 54 relating to the Act, of discontinuance of accounting for all incomes and expenses arising at Salonah Tea Estate with effect from 20th August, 2012, adopted pursuant to Clauses 2.2 and 7.1 of the Agreement for Sale pending execution of Conveyance Deed and completion of sale, is in deviation to the Accounting Standard 9-"Revenue Recognition". The impact of the above, if any, on the Profit, Liabilities including Tax and consequent impact on the Reserves and Surplus, presently is not ascertainable. Further, the Net Block of Fixed Assets includes Rs. 28.54 Crores representing an asset held for disposal, rather than showing it as part of current assets at lower of cost or net realizable value, is not consistent with the Accounting Standard 10 -"Accounting for Fixed Assets". In our opinion, this does not affect the true and fair view.

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

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

(b) In our opinion, proper books of account as required by law have been kept by the Company, so far as it appears from our examination of those books and proper returns adequate for the purpose of our audit have been received from the places not visited by us;

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

(d) In our opinion, the Balance Sheet, the Profit & Loss Account and the Cash Flow Statement read with Notes on Accounts including Significant Accounting Policies comply with the Accounting Standards referred to in Sub-Section (3C) of Section 211 of the Act except for and to the extent mentioned in paragraph number 7 above.

(e) On the basis of written representations from the Directors as on 31st December, 2012 and taken on record by the Board of Directors, none ofthe Director is disqualified on 31st December, 2012, from being appointed as a Director in terms of Sub-Section (I)(g) of Section 274 of the Act.

(f) In our opinion and to the best of our information and according to the explanations given to us, the said Financial Statements together with the notes thereon and attached thereto and including SignificantAccounting Policies give, in the prescribed manner, the information required bytheAct, and, except for the effects of the matter referred to in paragraph 7 above give a true and fair view in conformity with the accounting principles generally accepted in India:

(a) in the case of Balance Sheet, of the state of affairs of the Company as at31st December, 2012:

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

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

Annexure to The Auditors'' Report

(Referred to in paragraph 3 of our Report of even date to the Member of Assam Company India Limited on the Financial Statements ended on 31st December, 2012)

i. (a) The Company has maintained proper records showing full particulars including quantitative details and situation of Fixed Assets other than Oil and Gas Division. However, a list of Fixed Assets acquired for Oil & Gas Operation is maintained.

(b) The Fixed Assets of the Company, has been physically verified by the Management periodically in phased manner, which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. In respect of assets physically verified, the details have been compared with the book records and discrepancies noticed were not material and have been properly dealt with in the books of account.

(c) The Company has during the year entered into an Agreement for Sale of a substantial part (being a unit). However on going through the evidences as made available to us, in our opinion, the same has not affected the going concern.

ii. (a) Physical verification of inventory has been conducted at reasonable intervals during the year by the Management except for Oil and Gas Division.

(b) In our opinion, 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 has maintained proper records of inventory. No material discrepancies were noticed on physical verification. However, in view of the Agreement for Sale of a unit entered into by the Company during the year, records of the same were available upto 19th August, 2012.

iii. (a) According to the information and explanations given to us, the Company has not granted any loans, Secured or Unsecured to Companies, firms or other parties covered in the Register maintained under Section 301 ofTheCompaniesAct, 1956.

(b) According to the information and explanations given to us, the Company has not taken any loans. Secured or Unsecured, from Companies, firms or other parties covered in the Register maintained underSection 301 ofTheCompaniesAct, 1956.

(c) In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions of loans given or taken by the Company, Secured or Unsecured, are generally not prejudicial to the interest of the Company, except in one case which in our opinion was prima facie prejudicial to the interest of the Company on the ground of rate of interest paid and charged.

iv. In our opinion and according to the information and explanations given to us, there is an adequate Internal Control System commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets and for the sale of goods and services. Further, on the basis of our examination of the books and records of the Company and according to the information and explanations given to us, we have neither come across nor we have been informed of any continuing or habitual failure to correct major weaknesses in the aforesaid Internal Control System.

v. On the basis of our examination of the books of account, the Company has not entered into any contract or arrangement with any party during the Financial Year that need to be entered in the Register pursuant to Section 301 of the Companies Act, 1956.

vi. The Company has not accepted any deposits from the public within the meaning of Section 58A and 58AA of the Act and the Rules framed there under.

vii. The Company has an Internal Audit System commensurate with the size and nature of its business. However, there is scope of improving the effectiveness of Internal Audit system in the area of implementation of the Internal Audit recommendations.

viii. We have broadly reviewed the accounts maintained by the Company in respect of tea products where, pursuant to the Rules made by the Central Government of India, the maintenance of cost records has been prescribed under Clause (d) of sub-section (1) of Section 209 of the Act and are of the opinion prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete. No cost record has been maintained with respect to its oil and gas products.

ix. (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is regular in depositing provident fund, tea cess and other material statutory dues as applicable with the appropriate authorities except that the Company is not regular in depositing Income Tax, Value Added Tax, Central Sales Tax, Land Revenue, Corporate Dividend Tax and Family Pension Fund Contribution. However, according to the information and explanations given to us and the records of the Company examined by us, there are no undisputed amounts payable in respect of statutory dues which were in arrears, as at 31st December, 2012, for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of Service Tax, Customs Duty, Wealth Tax, Excise Duty and Cess which have not been deposited on account of any dispute. The particulars of dues of Income-Tax and Sales-Tax as at 31st December, 2012, which have not been deposited on account of disputes are as follows:

Particulars of Income Tax, Sales Tax which have not been deposited on account of dispute:-

Sl. Name of the Statute Nature of dues Amount No.

1. The West Bengal West Bengal 19.370.205 Sales tax Act, 1994 Sales Tax

Do Do 1,536,066

Do Do 8,724,464

Do Do 19,072,936

Do Do 61,832,474

2. Central Sales Tax, Central Sales 357,866 1956 Tax

Do Do 790,022

Do Do 993,902

Do Do 8,141,318

Do Do 24,990,676

Do Do 168,552

Do Do 6,183,248

Do Do 237,701

Do Do 13,456,558 Do Do 3,444,737

3. Assam General Sales Assam Sales 9,190 Tax Act, 1993 Tax

Do Do 2,219,788

Do Do 2,655,377

Do Do 87,127

Name Period to Forum where which relates dispute is pending

The West Bengal 2002-03 Sr.Jt. Comm.of

Commercial Taxes.

Do 2003-04 Appellate &

Revisional Board of Commercial Taxes

Do 2004-05 Do

2006-07 Do

2008-09 Appellate &

Revisional Board of Commercial Taxes

1996-97 Do

1997-98 Do

1999-00 Do

2000-01 Do

2001-02 Do

2002-03 Do

2003-04 Do

2004-05 Do

2006-07 Sr.Jt.Comm., South Circle

2008-09 Appellate & Revisional Board of Commercial Taxes

1996-97 Commissioner of Commercial Taxes

2000-01 Do

2001-02 Do

2006-07 Do

x. The Company has no accumulated losses as at 31st December, 2012 and it has not incurred any cash losses in the Financial Year ended on that date or in the immediately preceding Financial Year.

xi. According to the records of the Company examined by us and the information and explanations made available to us, at the Balance Sheet date, The Company has defaulted in repayment ofbank term loans oft 0.24 Crores which has since been repaid. The Company has also defaulted in repayment of matured Foreign Currency Convertible Bonds of 143.52 Crores, out of which 112.27 Crores has since been repaid, and details ofthe same is given in note 41 forming part ofthe Financial Statements.

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

xiii. The provisions of any special statute applicable to chit fund/ nidhi/ mutual benefit fund/ society are not applicable to the Company.

xiv. In our opinion, the Company is not a dealer or trader in shares, securities, debentures and other investments. In our opinion and according to information and explanations given to us, the terms and conditions of the guarantees given by the Company, for loans taken by others from banks or Financial Institutions during the year are not prejudicial to the interest of the Company.

xvi. In our opinion and according to the information and explanations given to us, on an overall basis, the term loans have been applied for the purposes for which they were obtained.

xvii. On the basis of an overall examination of the Balance Sheet of the Company in our opinion and according to the information and explanations, given to us, there are no funds raised on a short-term basis which have been used for long-term investment.

xviii.The Company has not made any preferential allotment to parties and Companies covered in the Register maintained under301 oftheAct.

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

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

xxi. During the course 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 have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case bythe Management.

For De Chakraborty & Sen

Chartered Accountants

F.R. No. 303029E

(A.Deb)

Place: Kolkata Partner

Date: 28th February, 2013 M. No.: 051845

Dec 31, 2011

1. We have audited the attached Balance Sheet of Assam Company India Limited as at 31st December, 2011 and the related Profit & Loss Account and also the Cash Flow Statement of the Company for the year ended on that date annexed thereto. The said Balance Sheet, Profit & Loss Account and the Cash Flow Statement have been signed by us under reference to this report. These financial statements are the responsibility of the CompanyÃs Management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies (AuditorÃs Report) Order, 2003 (as amended by the Companies AuditorÃ Report) Amendment Order, 2004 (the Order), issued by the Central Government of India in terms of sub-section 4(A) of Section 227 of ÃThe Companies Act, 1956Ã (the Act) and on the basis of such checks and records as we considered appropriate and according to the information and explanations given to us, we give in the Annexure hereto, a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Attention is drawn to Note No. 31 relating to overdue Export Debtors balance of Rs.15.26 crores from certain customers who has assured the Company of payment of such balance. However, the Management could not provide sufficient and appropriate evidences to confirm the realisability of the aforesaid overdue outstanding payment for our examination and we are unable to express any opinion on the ManagementÃs assertion in this respect that adequate consideration has been given to the concept of prudence set out in Accounting Standard 1Ã Disclosure of Accounting Policies. The amount of overdue debts that may require suitable provision, impact thereof on the reported Profit Before Tax for the year, Sundry Debtors Balance and Reserves and Surplus Balance at the year end, could not be ascertained.

5. Without qualifying our opinion, we draw your attention to Note No.17(l) of Schedule No.13 in relation to rate of depreciation on certain oil and gas producing assets of the Company whose net book value at the year end aggregate to Rs. 5,175.76 lakhs that are being depreciated on consistent basis in accordance with the ÃUnit of ProductionÃ method as per guidance note on ÃAccounting for Oil & Gas Producing ActivitiesÃ issued by The Institute of Chartered Accountants of India in February 2003 because no rates have been specified for the aforesaid class of fixed assets under Schedule XIV to the Act. The depreciation on the balance oil and gas producing assets, whose net book value aggregating to Rs.277.00 lakhs has been provided as per Schedule XIV to the Act. The Company is still awaiting the response to application to Central Government pursuant to Section 205 of the Act seeking approval to depreciate the aforesaid assets in accordance with the ÃUnit of ProductionÃ method. This financial statement does not include any adjustments on consequential impact should the Central Government direct the Company to adopt any other method on rate of depreciation other than ÃUnit of ProductionÃ method.

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

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

(b) In our opinion, proper books of account as required by law have been kept by the Company, so far as it appears from our examination of those books and proper returns adequate for the purpose of our audit have been received from the places not visited by us;

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

(d) In our opinion, the Balance Sheet, the Profit & Loss Account and the Cash Flow Statement read with Notes on Accounts in Schedule No.13 including Significant Accounting Policies respectively comply with the Accounting Standards referred to in sub- section (3C) of Section 211 of the Act.

(e) On the basis of written representations from the Directors as on 31st December, 2011 and taken on record by the Board of Directors, none of the Director is disqualified on 31st December, 2011 from being appointed as a Director in terms of sub-section (1) (g) of Section 274 of the Act.

(f) In our opinion and to the best of our information and according to the explanations given to us, the said financial statements together with the notes thereon and attached thereto and including Significant Accounting Policies give, in the prescribed manner, the information required by the Act, and, except for the effects of the matter referred to in paragraph 4 above, give a true and fair view in conformity with the accounting principles generally accepted in India:

(a) in the case of Balance Sheet, of the state of affairs of the Company as at 31st December, 2011;

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

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

ANNEXURE TO THE AUDITORSÃ REPORT (Referred to in paragraph 3 of our Report of even date to the Member of Assam Company India Limited on the financial statements ended on 31st December, 2011 )

i. (a) The Company has maintained proper records showing full particulars including quantitative details and situation of Fixed Assets other than Oil and Gas Division. However, a list of fixed assets acquired for Oil & Gas Operation is maintained.

(b) The Fixed Assets of the Company, has been physically verified by the Management periodically in phased manner, which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. In respect of assets physically verified, the details have been compared with the book records and discrepancies noticed were not material and have been properly dealt with in the books of account.

(c) In our opinion and according to information and explanations given to us , no substantial part of fixed assets have been disposed of during the year.

ii. (a) Physical verification of inventory has been conducted at reasonable intervals during the year by the Management except for Oil and Gas Division.

(b) In our opinion, 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 has maintained proper records of inventory. No material discrepancies were noticed on physical verification.

iii. (a) The Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of The Companies Act, 1956.

(b) 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.

iv. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets and for the sale of goods and services. Further, on the basis of our examination of the books and records of the Company, and according to the information and explanations given to us, we have neither come across nor we have been informed of any continuing or habitual failure to correct major weaknesses in the aforesaid internal control system.

v. On the basis of our examination of the books of account, the Company has not entered into any contracts or arrangements with any party during the financial year that need to be entered in the register pursuant to the Section 301 of the Companies Act, 1956.

vi. The Company has not accepted any deposits from the public within the meaning of Section 58A and 58AA of the Act and the rules framed there under.

vii. The Company has an internal audit system commensurate with the size and nature of its business. However, there is scope of improving the effectiveness of Internal Audit system.

viii. We have broadly reviewed the accounts maintained by the Company in respect of tea products where, pursuant to the Rules made by the Central Government of India, the maintenance of cost records has been prescribed under clause (d) of sub-section (1) of Section 209 of the Act and are of the opinion prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete. No cost record has been maintained with respect to its oil and gas products.

ix. (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is regular in depositing provident fund, made tea cess and other material statutory dues as applicable with the appropriate authorities except that the Company is not regular in depositing income tax, value added tax, central sales tax, land revenue, corporate dividend tax and family pension fund contribution. However, according to the information and explanations given to us and the records of the Company examined by us, there are no undisputed amounts payable in respect of statutory dues which were in arrears, as at 31st December, 2011 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of service tax, customs duty, wealth tax, excise duty and cess which have not been deposited on account of any dispute. The particulars of dues of income-tax and sales-tax as at 31st December, 2011 which have not been deposited on account of disputes, are as follows:

Particulars of Income Tax Sales Tax which have not been deposited on account of dispute :-

Amount Sl Name of the Statute Nature of the Dues (in Rs.) No.

1 Income Tax Act,1961 Income Tax Nil

2 The West Bengal Sales tax Act,1994 West Bengal Sales 19,370,205 Tax,1994

Do Do 1,536,066

Do Do 8,724,464

Do Do 19,072,936

3 Central Sales Tax,1956 Central Sales Tax 2,37,701 Do Do 13,456,558

4 Assam General Sales Tax Act,1993 Assam Sales Tax 87,127

Name of the Statue Period to which Forum where the the amount relates dispute is pending

Income Tax Act,1961 N.A. N.A.

The West Bengal Sales tax Act,1994 2002-03 Sr. Jt. Comm. of Commercial Taxes.

Do 2003-04 Appellate & Revis -ional Board of Commercial Taxes

Do 2004-05 Do

Do 2006-07 Do

Central Sales Tax,1956 2004-05 Appellate Authority

Do 2006-07 Sr.Jt.Comm.,South Circle

Assam General Sales Tax Act,1993 2006-07 Commissioner of Taxes

x . The Company has no accumulated losses as at 31st December, 2011 and it has not incurred any cash losses in the financial year ended on that date or in the immediately preceding financial year.

xi. According to the records of the Company examined by us and the information and explanations given to us, the Company has not defaulted in repayment of dues to any financial institution or bank at the Balance Sheet date.

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

xiii. The provisions of any special statute applicable to chit fund/ nidhi/ mutual benefit fund/ society are not applicable to the Company.

xiv. In our opinion , the Company is not a dealer or trader in shares, securities, debentures and other investments.

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

xvi. In our opinion and according to the information and explanations given to us, on an overall basis, the term loans have been applied for the purposes for which they were obtained.

xvii. On the basis of an overall examination of the Balance Sheet of the Company, in our opinion and according to the information and explanations, given to us, there are no funds raised on a short-term basis which have been used for long-term investment.

xviii. The Company has not made any preferential allotment to parties and Companies covered in the register maintained under Section 301 of the Act.

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

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

xxi. During the course 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 have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the Management.

A. Deb Partner

Membership Number 051845

For De Chakraborty & Sen

Firm Registration Number Ã 303029E Kolkata, 31st August, 2012 Chartered Accountants

Dec 31, 2010

1. We have audited the attached Balance Sheet of Assam Company India Limited as at 31 December, 2010 and the related Profit and Loss Account and Cash Flow Statement for the year ended on that date annexed thereto, which we have signed under reference to this report. 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 amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditor's Report) Order, 2003, as amended by the Companies (Auditor's Report) (Amendment) Order, 2004, (together the 'Order1), issued by the Central Government of India in terms of sub-section (4A) of Section 227 of 'The Companies Act, 1956' of India (the 'Act') and on the basis of such checks of the books and records of the Company as we considered appropriate 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 said Order.

4. We draw your attention to Note no. 30 on Schedule no. 13, regarding overdue amounts, aggregating to Rs 2,777.64 lacs at the year end, due from certain customers which, according to the Management, are recoverable. However, the Management could not provide sufficient and appropriate evidence as to the realisability of the aforesaid overdue amounts for our examination and we are unable to concur with the Management's assertion in this respect that adequate consideration has been given to the concept of prudence set out in Accounting Standard 1 - Disclosure of Accounting Policies. The amount of overdue debts that may be required to be provided for, and impact thereof on the reported profit before tax for the year, debtors' balance and Reserves and Surplus balance at the year-end, could not be determined.

5. Without qualifying our opinion, we draw your attention to Note no. 31 (b) on Schedule no. 13, in relation to certain Oil and Gas producing properties of the Company, whose net book value at the year-end aggregated Rs. 5,193.06 lacs, that are being depreciated on consistent basis in accordance with the 'Unit of Production' method recommended in the Guidance Note on "Accounting for Oil and Gas Producing Activities" issued by the Institute of Chartered Accountants of India in February, 2003 because no rates have been prescribed for the aforesaid fixed assets in Schedule XIV to the Act. The Company is awaiting response to its application to the Central Government pursuant to Section 205 of the Act seeking approval to depreciate the aforesaid assets in accordance with the Unit of Production method. These financial statements do not include any adjustments, should the Central Government direct the Company to adopt a method/ rate of depreciation for the aforesaid assets other than the Unit of Production method.

6. Further to our comments in the Annexure referred to in paragraph 3 above, we report that:

(a) Except for the matter referred to in paragraph 4 above, 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, except for the indeterminate effects of the matter referred to in paragraph 4 above, 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, 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, except for the matter referred to in paragraph 4 above, 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 Act;

(e) On the basis of written representations received from the directors, as on 31 December, 2010 and taken on record by the Board of Directors, none of the directors is disqualified as on 31 December, 2010 from being appointed as a director in terms of clause (g) of sub- section (1) of Section 274 of the Act;

(f) In our opinion and to the best of our information and according to the explanations given to us, the financial statements, together with the notes thereon and attached thereto, give, in the prescribed manner, the information required by the Act, and, except for the indeterminate effects of the matter referred to in paragraph 4 above, 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 31 December, 2010;

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

(iii) 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 paragraph 3 of our report of even date to the members of Assam Company India Limited on the financial statements for the year ended 31 December, 2010]

1. (a) The Company is maintaining proper records showing full particulars including quantitative details and situation of fixed assets other than Oil and Gas Division. However, a list of fixed asset acquired for Oil & Gas operation is maintained.

(b) The fixed assets of the Company, except assets pertaining to Oil and Gas operations, have been physically verified by the management during the year, which in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. In respect of assets physically verified, the details have been compared with the book records and discrepancies noticed thereof were not material and have been properly dealt with in the books of account.

(c) In our opinion and according to the information and explanations given to us, a substantial part of fixed assets has not been disposed off by the Company during the year.

2. (a) The inventories have been physically verified by the management during the year except in respect of stocks lying with third parties for which certificates have been obtained. Stock in transit at the year end has been verified by the management with reference to subsequent receipt and /or relevant documents. In our opinion, the frequency of such verification is reasonable.

(b) In our opinion, 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) On the basis of our examination of the inventory records, in our opinion, the Company is maintaining proper records of inventory. The discrepancies noticed on physical verification of inventory as compared to book records were not material and have been properly dealt with in the books of account.

3. (a) The Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Act.

(b) 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.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory, fixed assets and for the sale of goods and services. Further, on the basis of our examination of the books and records of the Company, and according to the information and explanations given to us, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in the aforesaid internal control system.

5. On the basis of our examination of the books of account, the Company has not entered into any contracts or arrangements with any party durinc the financial year that need to be entered in the register pursuant to the Section 301 of the Act except remuneration paid to a relative of a directoi which has been approved by the Central Government.

6. The Company has not accepted any deposits from the public within the meaning of Sections 58A and 58AA of the Act and the rules framec there under.

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

8. We have broadly reviewed the books of account maintained by thi Company in respect of tea products where, pursuant to the Rules madi by the Central Government of India, the maintenance of cost records ha been prescribed under clause (d) of sub-section (1) of Section 209 of tin Act and are of the opinion that prima facie, the prescribed accounts an records have been made and maintained. We have not, however, mad a detailed examination of the records with a view to determine whetht they are accurate or complete. No cost record has been maintained im'I respect to its oil and gas products.

9. (a) According to the information and explanations given to us and records of the Company examined by us, in our opinion, th Company is regular in depositing provident fund, made tea cess an other material statutory dues as applicable with the appropriat authorities except that Company is not regular in depositing incorr tax, value added tax, central sales tax, land revenue, corpora dividend tax and family pension fund contribution. Howeve according to the information and explanations given to us and tt records of the Company examined by us, there are no undisputc amounts payable in respect of statutory dues which were in arrear as at 31 December, 2010 for a period of more than six months fro the date they became payable.

(b) According to the information and explanations given to us and tl records of the Company examined by us, there are no dues service tax, customs duty, wealth tax, excise duty and cess whÃÂ» have not been deposited on account of any dispute. The particula of dues of income-tax and sales-tax as at 31 December, 2010 whi have not been deposited on account of a dispute, are as follows:

Amount Period to which Name of the Statute Nature of the Dues (inRs) the amount relates

West Bengal Sales Tax Act, 1994 West Bengal Sales Tax 29,333,466 2003-04

2004-05 2006-07

19,370,205 2002-03

8,608,490 2005-06

2007-08

Assam General Sales Tax Act, 1993 Assam Sales Tax 4,902,623 1996-97

2000-01 2001-02 2005-06

Central Sales Tax Act, 1956 Central Sales Tax 20,235,373 1996-97

2003-04 2004-05 2006-07

639,644 2005-06

2007-08

34,760,848 1997-98

1999-00 2000-01 2001-02 2005-06

168,552 2002-03

Income Tax Act, 1961 Income Tax 20,824,240 2008-09

Name of the Statue Forum where the dispute is pending

West Bengal Sales Tax Act, 1994 Appellate and Revisional Board of Commercial Taxes

Joint Commissioner of Commercial Taxes

Senior Joint Commissioner of Commercial Taxes

Assam General Sales Tax Act, 1993 Commissioner of Taxes

Central Sales Tax Act, 1956 Appellate and Revisional Board of Commercial Taxes

Sr Joint Commissioner of Commercial Taxes

Commissioner of Taxes

Joint Commissioner of Commercial Taxes

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

10. The Company has no accumulated losses as at 31 December, 2010 and it has not incurred any cash losses in the financial year ended on that date or in the immediately preceding financial year.

11. According to the records of the Company examined by us and the information and explanations given to us, the Company has not defaulted in repayment of dues to any financial institution or bank at the Balance Sheet date.

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 provisions of any special statute applicable to chit fund / nidhi / mutual benefit fund/societies are not applicable to the Company.

14. In our opinion, the Company is not a dealer or trader in shares, securities, debentures and other investments.

15. In our opinion and according to the information and explanations given to us, the terms and conditions of the guarantees given by the Company, for loans taken by others from banks or financial institutions during the year, are not prejudicial to the interest of the Company.

16. In our opinion and according to the information and explanations given to us, on an overall basis, the term loans have been applied for the purposes for which they were obtained.

17. On the basis of an overall examination of the balance sheet of the Company, in our opinion and according to the information and explanations given to us, there are no funds raised on a short-term basis which have been used for long-term investment.

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

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

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

21. During the course 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 have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the management.

Partha Mitra Partner

Membership Number 50553

For Lovelock & Lewes

Firm Registration Number - 301056E

Kolkata, 5th September, 2011 Chartered Accountants

Dec 31, 2009

To The Members of Assam Company India Limited (formerly known as Assam Company Limited)

1. We have audited the attached Balance Sheet of Assam Company India Limited (formerly known as Assam Company Limited) as at 31 December, 2009 and the related Profit and Loss Account on that date annexed thereto, and Cash Flow Statement for the year ended on that date, which we have signed under reference to this report. 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 financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003, as amended by the Companies (Auditors Report) (Amendment) Order, 2004, (together the Order1), issued by the Central Government of India in terms of sub-section (4A) of Section 227 of The Companies Act, 1956 of India (the Act) and on the basis of such checks of the books and records of the Company as we considered appropriate 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 said Order.

4. Further to our comments in the Annexure referred to in paragraph 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 appears from our examination of those books;

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

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

(e) On the basis of written representations received from the Directors, as on 31 December, 2009 and taken on record by the Board of Directors, none of the Directors is disqualified as on 31 December, 2009 from being appointed as a Director in terms of clause (g) of sub-section (1) of Section 274 of the Act;

(f) In our opinion and to the best of our information and according to the explanations given to us, the said financial statements together with the notes thereon and attached thereto give in the prescribed manner the information required by the Act 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 31 December, 2009;

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

(iii) 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 paragraph 3 of our report of even date to the members of Assam Company India Limited (formerly known as Assam Company Limited) on the financial statements for the year ended 31 December, 2009].

1. (a) The Company is maintaining proper records showing full particulars including quantitative details and situation of fixed assets other than Oil and Gas Division.

(b) The fixed assets of the Company other than Oil and Gas Division are physically verified by the management according to a phased programme designed to cover all the items over a period of three

years, which in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. No physical verification of the fixed assets was carried out during the year pursuant to the above programme except for certain assets at one of the tea estate. In respect of assets physically verified, the details have been compared with the book records and discrepancies noticed thereof were not material and have been properly dealt with in the books of account.

(c) In our opinion and according to the information and explanations

given to us, a substantial part of fixed assets has not been disposed off by the Company during the year except assets at abandoned oil fields which has been surrendered. In our opinion, the disposal of the said part of fixed assets has not affected the going concern status of the Company.

2. (a) The inventories have been physically verified by the management

during the year except in respect of stocks lying with third parties for which certificates have been obtained. Stock in transit at the year end has been verified by the management with reference to subsequent receipt and /or relevant documents. In our opinion, the frequency of such verification is reasonable.

(b) In our opinion, 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) On the basis of our examination of the inventory records, in our opinion, the Company is maintaining proper records of inventory. The discrepancies noticed on physical verification of inventory as compared to book records were not material and have been properly dealt with in the books of account.

3. (a) The Company has not granted any loans, secured or unsecured to

companies, firms or other parties covered in the register maintained under Section 301 of the Act.

(b) 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.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with

the size of the Company and the nature of its business for the purchase of inventory, fixed assets and for the sale of goods and services. Further, on the basis of our examination of the books and records of the Company, and according to the information and explanations given to us, we have neither come across nor have been informed of any continuing failure to correct major weaknesses in the aforesaid internal control system.

5. On the basis of our examination of the books of account, the Company has not entered into any contracts or arrangements with any party during the financial year that need to be entered in the register pursuant to the Section 301 of the Act except remuneration paid to a relative of a director which has been approved by the Central Government.

6. The Company has not accepted any deposits from the public within the meaning of Sections 58A and 58AA of the Act and the rules framed there under.

7. In our opinion, the Company has an internal audit system commensurate with its size and nature of its business. No internal audit was conducted for the Oil and Gas Division in the current year.

8. We have broadly reviewed the books of account maintained by the Company in respect of tea products where, pursuant to the Rules made by the Central Government of India, the maintenance of cost records has been prescribed under clause (d) of sub-section (1) of Section 209 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 with a view to determine whether they are accurate or complete. No cost record has been maintained with respect to its oil and gas products.

9. (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is regular in depositing provident fund, service tax and other material statutory dues as applicable, with the appropriate authorities except that Company is not regular in depositing income tax, sales-tax, wealth tax, cess, deposit linked insurance, family pension fund, land revenue, professional tax and undisputed statutory dues in respect of tax deducted at source from supplier of green leaf.

(b) According to the information and explanations given to us and the records of the Company examined by us, the particulars of undisputed amounts payable in respect of statutory dues which were in arrears, as at 31 December, 2009 for a period of more than six months from the date they became payable, are as follows -

Name of the Statute Nature of Dues Amount (Rs.) Period to which the amount relates Assam Value Added Value Added Tax 117,308 April, 2009 Tax Act, 2003 Assam Taxation Land Revenue 1,290,605 Various (on Specified Lands) Act, 1990 Assam Taxation Tax Deducted at 371,428 March, 2009 (on Specified Lands) Source from supplier to June, 2009 Act, 1990 of Green Leaf Consent Fee under Water Air and Water 600,250 Various (Prevention & Control of Pollution Cess Pollution) Act, 1974 and Air (Prevention & Control of Pollution) Act, 1981

Name of the Statute Due Date Date of Payment Assam Value Added 21 May, 2009 19 April, 2010 Tax Act, 2003 Assam Taxation Various Not Yet Paid (on Specified Lands) Act, 1990 Assam Taxation Various 20 March, 2010 (on Specified Lands) Act, 1990 Consent Fee under Water Various Not Yet Paid (Prevention & Control of Pollution) Act, 1974 and Air (Prevention & Control of Pollution) Act, 1981

(c) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of service tax, customs duty, wealth tax, excise duty and cess which have not been deposited on account of any dispute. The particulars of dues of income-tax and sales-tax as at 31 December, 2009 which have not been deposited on account of a dispute, are as follows:

Amount Name of the Statute Nature of the Dues (in Rs) West Bengal Sales Tax Act, 1994 West Bengal Sales Tax 1,536,066 23,718,210 8,724,464 19,370,205 Assam General Sales Act, 1993 Assam Sales Tax 3,745,636 Central Sales Tax Act, 1956 Central Sales Tax 33,659,292 6,420,949 98,207,659 168,552 Income Tax Act, 1961 Income Tax 10,84,258

Period to which Forum where the Name of the Statute the amount relates dispute is pending West Bengal Sales Tax Act, 1994 2003-04 Appellate and Revisional Board of Commercial Taxes 2005-06,2006-07 Deputy Commissioner of Commercial Taxes 2004-05 Senior Joint Commissioner of Commercial Taxes 2002-03 Assistant Commissioner of Commercial Taxes Assam General Sales Act, 1993 2000-01,2001-02 Commissioner of Taxes Central Sales Tax Act, 1956 1999-00,2000-01 Commissioner of Taxes 2001-02 2003-04,2004-05 Appellate and Revisional Board of Commercial Taxes 2005-06,2006-07 Deputy Commissioner of Commercial Taxes 2002-03 Assistant Commissioner of Commercial Taxes Income Tax Act, 1961 2006-07 Assistant Commissioner of Income Tax

10. The Company has no accumulated losses as at 31 December, 2009 and it has not incurred any cash losses in the financial year ended on that date or in the immediately preceeding financial year.

11. According to the records of the Company examined by us and the information and explanations given to us, the Company has not defaulted in repayment of dues to any financial institution or bank as at the balance sheet date.

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 provisions of any special statute applicable to chit fund / nidhi / mutual benefit fund/societies are not applicable to the Company.

14. In our opinion, the Company is not a dealer or trader in shares, securities, debentures and other investments.

15. In our opinion and according to the information and explanations given to us, the terms and conditions of the guarantees given by the Company, for loans taken by others from banks or financial institutions during the year, are not prejudicial to the interest of the Company.

16. In our opinion and according to the information and explanations given to us, on an overall basis, the term loans have been applied for the purposes for which they were obtained.

17. On the basis of an overall examination of the balance sheet of the Company, in our opinion and according to the information and explanations given to us, there are no funds raised on a short-term basis which have been used for long-term investment.

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

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

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

21. During the course 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 have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the management.

Partha Mitra Partner Membership Number 50553 For Lovelock & Lewes Firm Registration Number - 301056E Kolkata, 7th May, 2010 Chartered Accountants

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