1.  We have audited the attached Balance Sheet of Cipla Limited (the
 Company) as at 31st March 2011, the profit and Loss Account and the
 Cash Flow Statement of the Company for the year ended on that date
 annexed thereto.  These financial statements are the responsibility of
 the 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. These standards require that we plan and
 perform the audit to obtain reasonable assurance about whether the f
 nancial 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.
 
 3.  As required by the Companies (Auditors'' Report) Order, 2003,
 (hereinafter referred to as the Order), as amended, issued by the
 Central Government of India in terms of section 227(4A) of the
 Companies Act, 1956 (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 enclose
 in the Annexure, a statement on the matters specified in paragraphs 4
 and 5 of the said Order.
 
 4.  Further to our comments in the Annexure referred to 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, the profit and Loss Account and the Cash Flow
 Statement dealt with by this report are in agreement with the books of
 account;
 
 d.  In our opinion, the Balance Sheet, the profit and Loss Account and
 the Cash Flow Statement dealt with by this report comply with the
 Accounting Standards referred to in section 211(3C) of the Companies
 Act,1956;
 
 e.  On the basis of the written representations received from the
 Directors of the Company as on 31st March 2011 and taken on record by
 the Board of Directors of the Company, we report that none of the
 Directors is disqualified as on 31st March 2011, from being appointed
 as a Director in terms of section 274(1)(g) of the Companies Act, 1956;
 
 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 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:
 
 i.  In the case of the Balance Sheet, of the state of Affairs of the
 Company as at 31st March 2011;
 
 ii.  In the case of the profit and Loss Account, of the profit 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 Cipla Limited (the Company) for the year ended 31st March 2011)
 
 1.  a.  The Company has generally maintained proper records showing
 full particulars including quantitative details and situation of fixed
 assets, other than the situation of furniture and fixtures and office
 equipment where the situation recorded is the location of the Company''s
 different establishments.
 
 b.  The Company has a policy of physically verifying its fixed assets
 periodically, which in our opinion, is reasonable having regard to the
 size of the Company and the nature of its business. During the year,
 some of the fixed assets have been physically verified by the
 management and discrepancies noticed during the physical verification
 and the assets scrapped during the year has been properly dealt with in
 the books of account.
 
 c.  The fixed assets that have been sold/disposed of during the year do
 not constitute a substantial part of the total fixed assets of the
 Company. Hence, the going concern concept has not been affected.
 
 2.  a.  The inventory, except goods in transit, has been physically
 verified by the Management at reasonable intervals during the year. The
 verification was done on the basis of the perpetual inventory system
 operated by the Company. In case of materials lying with third parties,
 certificates confirming such inventory have been obtained by the
 Company from most of the third parties.
 
 b.  In our opinion and on the basis of the information and explanations
 given to us, the procedures for 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 has maintained proper records of inventory. The
 discrepancies noticed on physical verification of inventory as compared
 to the book records were not material and have been properly dealt with
 in the books of account.
 
 3.  a.  As informed to us, the Company has not granted any loans,
 secured or unsecured to companies, firms or other parties listed in the
 Register maintained under section 301 of the Companies Act, 1956. The
 loans outstanding that were repayable on demand have been recovered
 along with interest; as applicable.
 
 b. The Company has not taken any loans from parties covered in the
 Register maintained under section 301 of the Companies Act, 1956.
 Consequently, the requirements of clause (iii-f) and (iii-g) of
 paragraph 4 of the Order are not applicable to the Company.
 
 4.  In our opinion and according to the information and explanations
 given to us, there are generally adequate internal control systems
 commensurate with the size of the Company and the nature of its
 business for purchase of inventory and 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 during the course of audit, no major weakness
 has been noticed in these internal control systems.
 
 5.  a.  In our opinion and according to the information and
 explanations given to us, the particulars of contracts or arrangements
 referred to in section 301 of the Companies Act, 1956 have been entered
 in the Register required to be maintained under that section.
 
 b. In our opinion and according to the information and explanations
 given to us, the transactions made in pursuance of contracts or
 agreements referred to in 5.a. above and exceeding the value of rupees
 five lakhs in respect of any party during the year have been made at
 prices which are reasonable having regard to the prevailing market
 prices at the relevant time.
 
 6.  In our opinion and according to the information and explanations
 given to us, the Company has not accepted any deposit from the public
 within the meaning of sections 58A, 58AA or any other relevant
 provisions of Companies Act, 1956 and the Companies (Acceptance of
 Deposits) Rules, 1975.
 
 7.  In our opinion, the Company has an internal audit system
 commensurate with its size and the nature of its business.
 
 8.  We have broadly reviewed the books of account maintained by the
 Company pursuant to the Rules made by the Central Government for the
 maintenance of cost records under section 209(1)(d) of the Companies
 Act, 1956 in respect of its products and are of the opinion that, prima
 facie, the prescribed accounts and records have been made and
 maintained. However, we have not carried out a detailed examination of
 the accounts and records with a view to determine whether these are
 accurate or complete.
 
 9.  a.  According to the information and explanations provided to us
 and the records of the Company examined by us, in our opinion, the
 Company was regular in depositing undisputed statutory dues including
 Provident Fund, Investor Education and Protection Fund, Employees''
 State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax,
 Customs Duty, Excise Duty, Cess and other material statutory dues
 applicable to it with the appropriate authorities. There were no
 undisputed arrears that were outstanding as at 31st March 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 based
 on the records of the Company examined by us, as on 31st March 2011,
 there were no dues in respect of Wealth Tax, Service Tax, Customs Duty
 and Cess that have not been deposited with the appropriate authorities
 on account of dispute.
 
 The particulars of dues towards Excise Duty, Sales Tax and Income Tax
 that have not been deposited on account of dispute as at 31st March
 2011 and the forum where these disputes are pending are as follows:
 
 Name of the statute Nature of dues Financial 
                                    years to   Forum where the   Amount
                                    which the 
                                    matter     dispute is 
                                               pending           Rs. in
                                                                 crore
                                    pertains
 
 The Central 
 Excise Act,         Excise Duty    2002-03 to CESTAT/ 
                                               Commissioner      49.23
 1944                               2009 - 10  (Appeals)
 
 State Sales 
 Tax Acts            Sales Tax    2001 - 02 to State Sales Tax 
                                               Tribunal           4.02
                                   2008 - 09
 
 Income Tax Act, 
 1961                Income Tax    2008 - 09   Commissioner of   73.99
                                               Income Tax 
                                              (Appeals)
 
 10.  The Company does not have accumulated losses at the end of the f
 nancial year and has not incurred cash losses in the financial year
 under report or in the immediately preceding financial year.
 
 11.  According to the information and explanations given to us and
 based on our audit procedures, the Company has not defaulted in
 repayment of dues to any financial institutions or banks.
 
 12.  According to the 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, debentures and other securities.
 
 13.  In our opinion, the Company is not a chit fund or a nidhi mutual
 benefit fund/society. Therefore, the provisions of clause 4(xiii) of
 the Order are not applicable to the Company.
 
 14.  In our opinion and according to the information and explanations
 given to us, the Company is not a dealer or trader in shares,
 securities, debentures or other investments. Accordingly, the
 provisions of clause 4(xiv) of the Order are not applicable to the
 Company.
 
 15.  According to the information and explanations given to us and the
 representations made by the management, the Company has not given any
 guarantee for loans taken by others from banks or financial
 institutions.
 
 16.  The Company has not obtained any term loans. Accordingly, the
 provisions of clause 4(xvi) of the Order are not applicable to the
 Company.
 
 17.  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 funds raised on short term basis have been used for long term
 investment.
 
 18.  The Company has not made preferential allotment of shares during
 the year to parties and companies covered in the Register maintained
 under section 301 of the Companies Act, 1956.
 
 19.  The Company has not issued any debentures during the year.
 
 20.  The Company has not raised any money through public issue of
 securities during the year.
 
 21.  During the course of our examination of the books of account and
 records of the Company, and according to the information and
 explanations given to us, no fraud on or by the Company has been
 noticed or reported by the Company during the year.
 
 
 For V. Sankar Aiyar & Co.,                     For R.G.N. Price & Co.,
 
 Chartered Accountants                          Chartered Accountants
 
 Firm Reg. No. 109208W                          Firm Reg. No. 002785S
 
 V. Mohan                                               R. Rangarajan
 
 Partner                                                      Partner
 
 Membership No.17748                             Membership No. 41883
 
 Mumbai, 29th June 2011                        Mumbai, 29th June 2011