We have audited the attached Balance Sheet of M/s BONGAIGAON REFINERY &
 PETROCHEMICALS LIMITED as at 31st March, 2008, the related Profit and
 Loss Account and also the Cash flow Statement for the year ended on
 that date annexed thereto. These financial statements are the
 responsibility of the Companys management. Our responsibility is to
 express an opinion on these financial statements based on our audit.
 
 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 the management, as well as evaluating the overall financial
 statement presentation. We believe that our audit provides a reasonable
 basis for our opinion.
 
 1.  As required by the Companies (Auditors Report) Order, 2003 issued
 by the Central Government of India in terms of sub-section (4A) of
 section 227 of the Companies Act, 1956, we enclose in the Annexure, a
 statement on the matters specified in paragraphs 4 & 5 of the said
 Order.
 
 2.  Further to our comments in the Annexure referred to above, we
 report that:
 
 (i) 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;
 
 (ii) 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;
 
 (iii) The Balance Sheet, Profit and Loss Account and Cash flow
 Statement dealt with by this report are in agreement with the books of
 account;
 
 (iv) In our opinion the Balance Sheet, Profit and Loss Account and Cash
 flow Statement dealt with by this report comply with the Accounting
 Standards as referred to in sub-section (3C) of section 211 of the
 Companies Act, 1956;
 
 (v) Disclosure in terms of clause (g) of sub-section (1) of section 274
 of the Companies Act, 1956 is not required for Government Companies as
 per Notification No. GSR 829 (E) dated 21st October, 2003 issued by the
 Department of Company Affairs.
 
 (vi) In our opinion and to the best of our information and according to
 the explanations given to us the said accounts read with the
 significant accounting policies and Notes on Accounts (Schedule
 Q&R) and other Schedules A to Y enclosed thereto give the
 information required by the Companies Act, 1956, in the manner so
 required and give a true and fair view in conformity with the
 accounting principles generally accepted in India:
 
 (a) in the case of the Balance Sheet, of the state of affairs of the
 Company as at 31st March, 2008;
 
 (b) in the case of the Profit and Loss Account, of the profit for the
 year ended on that date ; and,
 
 (c) in the case of the Cash flow Statement, of the cash flows for the
 year ended on that date.
 
 THE ANNEXURE TO THE AUDITORS REPORT
 
 (Referred to in Paragraph 1 of our Report of even date)
 
 TO THE MEMBERS OF
 
 BONGAIGAON REFINERY & PETROCHEMICALS LTD.
 
 (i) (a) The Company has maintained proper records showing full
 particulars, including quantitative details and situation of fixed
 assets.
 
 (b) The fixed assets are physically verified once in every three years,
 which is considered reasonable in relation to the size of the Company.
 Discrepancies found on verification are being properly dealt with in
 the account.
 
 (c) The Company has not disposed of substantial part of fixed assets
 during the year.
 
 (ii) (a) Physical verification has been conducted by the management at
 reasonable intervals in respect of finished goods and raw material
 except in case of such finished goods and raw materials that were lying
 with other parties.
 
 (b) The procedure of physical verification of inventories followed by
 the management are reasonable and adequate in relation to the size of
 the Company and nature of its business.
 
 (c) The Company is maintaining proper records of inventory and
 discrepancies found in physical verification have been properly dealt
 with in the accounts. As stated by the Company in Clause 2.1.3 of Notes
 on accounts (Schedule R), obsolete and unserviceable items amounting
 to Rs. 3.66 lakh have been identified and written off.
 
 (iii) (a) As per information and explanations given to us, the Company
 has not granted any loans, secured or unsecured to the companies, firms
 or other parties covered in the Register maintained under Section 301
 of the Companies Act. Accordingly, clauses (iii) (b) to (iii) (d) of
 paragraph 4 of the Companies (Auditors Report) Order, 2003 are not
 applicable to the Company for the current year.
 
 (b) As per information and explanation given to us, the Company has not
 taken any loan, secured or unsecured from companies, firms or other
 parties covered in the Register maintained under Section 301 of the
 Companies Act. Accordingly, clauses (iii) (f) and (iii) (g) of
 paragraph 4 of the Companies (Auditors Report) Order, 2003 are not
 applicable to the Company for the current year.
 
 (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 and fixed assets and for the sale of goods and
 services. During the course of our audit, we have not observed any
 continuing failure to correct major weakness in Internal Control
 System.
 
 (v) According to the information and explanations given to us, there
 were no contracts or arrangements during the year that need to be
 entered into the register maintained under Section 301 of the Companies
 Act, 1956. Accordingly, clause (v) (b) of paragraph 4 of the Companies
 (Auditors Report) Order, 2003 is not applicable to the Company for the
 current year.
 
 (vi) According to the information and explanations given to us, the
 Company has not accepted any deposits from public during the year.
 
 (vii) In our opinion and according to the information and explanations
 given to us, the Company has an internal audit system commensurate with
 the size and nature of its business.
 
 (viii) We have broadly reviewed the books of account relating to
 materials, labour and other items of cost maintained by the Company
 pursuant to the Rules made by the Central Government for the
 maintenance of cost records under Section 209(1) (d) of the Companies
 Act, 1956 and we are of the opinion that prima facie the prescribed
 accounts and records have been made and maintained.
 
 (ix) (a) In our opinion and according to the information and
 explanations given to us, the Company is regular in depositing with
 appropriate authorities undisputed statutory dues including provident
 fund, investor education protection fund, income tax, sales tax / VAT,
 wealth tax, service tax, custom duty, excise duty, cess and other
 material statutory dues applicable to it and according to the
 information and explanations given to us, no undisputed amounts payable
 in respect of income tax, sales tax/VAT, wealth tax, service tax,
 custom duty, excise duty and cess were in arrears, as at 31.03.2008 for
 a period of more than six months from the date they became payable.
 
 (b) According to the information and explanations given to us, there
 are no dues outstanding over six months in respect of sales tax/VAT,
 income tax, custom duty, wealth tax, excise duty and cess which have
 not been deposited on account of any dispute except as stated as
 contingent liability in clause 3.11.2 of Schedule R enclosed.
 
 (x) According to the information and explanations given to us, the
 Company has neither any accumulated loss nor incurred cash losses in
 the current year and immediately preceding financial year.
 
 (xi) According to the information and explanations given to us, the
 Company has not defaulted in repayment of dues to any financial
 institution or bank. The Company has not issued any debentures.
 
 (xii) As per information and explanations given to us, the Company has
 not granted any loans and advances on the basis of security by way of
 pledge of shares and debentures other than the house building loans to
 the employees against security / mortgage of title deeds of the
 property.
 
 (xiii) The Company is neither a Chit Fund nor a Nidhi / Mutual benefit
 fund / society. Therefore the provisions of this clause 4 (xiii) (a) to
 (d) are not applicable.
 
 (xiv) In our opinion and according to the information and explanations
 given to us, the Company is not engaged in dealing or trading in
 shares, securities, debentures and other investments. Accordingly the
 provisions of clause 4(xiv) are not applicable.
 
 (xv) According to the information and explanations given to us, the
 Company has not given any guarantee for loans taken by others from
 banks or financial institutions.
 
 (xvi) According to the information and explanations given to us, the
 Company has not taken any Term loan during the year.
 
 (xvii) According to the information and explanations given to us and on
 an overall examination of the Balance Sheet of the Company, we report
 that no short terms funds have been used for long term investments.
 
 (xviii) According to the information and explanations given to us,
 during the period covered by our audit the Company has not made any
 preferential allotment of shares to the parties and companies covered
 in the Register maintained under Section 301 of the Act.
 
 (xix) The Company has not issued any debenture during the year covered
 by our audit.
 
 (xx) The Company has not raised any fund by public issue during the
 year covered by our audit.
 
 (xxi) According to the information and explanations given to us, no
 fraud on or by the Company has been noticed or reported during the
 period covered by our Audit.
 
                                           For Ghoshal & Ghosal
                                          Chartered Accountants
 
                                           CA. D.K. Dutta Gupta
                                                        Partner
                                                  M. No. 014855      
 Place :   Mumbai
 Date  :   May 16,2008