We have audited the attached Balance Sheet of Dabur India Limited (''the
 Company'') as at 31st March, 2012 and its Profit & Loss Account and the
 Cash Flow Statement for the year ended on that date annexed thereto.
 These financial statements are the responsibility of the Company''s
 management. Our responsibility is to express an opinion on these
 financial statements based on our audit.
 
 We conducted our audit in accordance with auditing standards generally
 accepted in India. These 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 statement. 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.
 
 i.  As required by the Companies (Auditors'' Report) Order 2003, as
 amended, issued by the Central Government in terms of section 227 (4A)
 of the Companies Act, 1956, 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
 herewith in the annexure a statement of the matter specified therein.
 
 ii.  We have obtained all the information and explanations which to the
 best of our knowledge and belief were necessary for the purpose of
 audit.
 
 iii. 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
 books of account.
 
 iv.  The Balance Sheet and Profit and Loss Account dealt with by this
 report are in agreement with the books of accounts.
 
 v.  Balance Sheet and Profit & Loss Account have been prepared in due
 compliances of Accounting Standards referred to in sub section (3C) of
 section 211 of Companies Act, 1956.
 
 vi.  On the basis of written representations received from the
 directors as on 31st March, 2012 and taken on record by the Board of
 Directors, we report that none of the directors of ''the Company'' is
 disqualified for the Office of the director within the meaning of
 section 274 (1) (g) of the Companies Act, 1956.
 
 vii. In our opinion and according to the information and explanations
 given to us, the said accounts read in conjunction with Schedules 1 to
 22 and read with other notes appearing in Schedule 23 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 Balance Sheet, of the State of Affairs of ''the
 Company'' as at 31st March 2012; and
 
 b) In the case of Profit and 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 AUDITORS'' REPORT AS REFERRED TO IN PARA I OF THE SAID
 REPORT OF EVEN DATE.
 
 1.  a. ''The Company'' has maintained proper records showing full
 particulars including quantitative details and situation of fixed
 assets.
 
 b.  The fixed assets have been physically verified by the management at
 reasonable intervals. As informed, no material discrepancies between
 book records and the physical inventories have been noticed on such
 verification.
 
 c.  Fixed assets disposed of during the year were not material enough
 to affect the going concern identity of the Company.
 
 2.  a. The inventories have been physically verified at reasonable
 intervals during the year by the management.
 
 b.  The procedures of physical verification of inventories followed by
 the management are reasonable and adequate in relation to the size of
 the Company and the nature of its business.
 
 c.  On the basis of our examination of the records of inventory, we are
 of the opinion that ''the Company'' is maintaining proper records of
 inventory. The discrepancies noticed on verification between the
 physical stocks and book records were not material and have been
 properly dealt with in the books of accounts.
 
 3.  ''The Company'' has neither granted nor taken any loans, secured or
 unsecured to/from companies, firms, or other parties covered in the
 register maintained under section 301 of the Companies Act ,1956.
 
 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
 purchase of inventory and fixed assets and on the sale of goods. During
 the course of our audit no major weakness has been noticed in the
 internal controls. We have not observed any failure on the part of the
 Company to correct major weakness in internal control system.
 
 5.  a. Based on audit procedures applied by us and according to the
 information and explanations provided by the management, we are of the 
 opinion that contracts or arrangements referred to in section 301 of 
 the Act have been entered in the register maintained under that section.
 
 b.  In our opinion and according to the information and explanations
 given to us, the transactions made in pursuance of such contracts or
 arrangements have been made at prices which appear reasonable as per
 information available with ''the Company.
 
 6.  ''The Company'' has not accepted any deposits from the public.
 
 7.  In our opinion ''the Company'' has an internal audit system
 commensurate with it''s size and nature of its business.
 
 8.  On the basis of records produced we are of the opinion that prima
 facie cost records and accounts prescribed by the Central Government
 under section 209 (i) (d) of the Companies Act, 1956 in respect of
 products of ''the Company'' covered under the rules under said section
 have been maintained. However we are neither required to carry out nor
 have carried out any detailed examination of such accounts and records.
 
 9.  a. According to information and explanations given to us, ''the
 Company'' is regular in depositing with appropriate
 
 authorities undisputed statutory dues including provident fund,
 investor education and protection fund, employees state insurance ,
 income tax, sales tax, wealth tax, service tax, custom duty, excise
 duty, cess and other statutory dues to the extent applicable to it.
 According to the information and explanations given to us, no
 undisputed amounts payable in respect of the aforesaid dues were
 outstanding as at 31st March, 2012 for a period of more than six months
 from the date of becoming payable.
 
 b.  There is no disputed due on account of wealth tax and cess. Dues on
 account of Sales Tax/ Income Tax/ Excise Duty /Service tax disputed by
 the Company and not being paid, vis-a-vis forums where such disputes
 are pending are mentioned below:-
 
 Name of     Nature of the dues   Amount  Period to 
                                          which           Forum where 
                                          dispute          is pending
 
 the Statute                      (Rs.in 
                                  Lacs)   the amount
 
                                          relates
 
 Sales Tax  Classification of 
            L.D.M.                19.72   1990-91   Pending with High 
                                                     Court
 
 --do--     Classification of 
            L.D.M.                34.19   1991-92   Pending with High 
                                                     Court
 
 --do--     Classification of 
            L.D.M.                35.08   1992-93   Pending with High 
                                                     Court
 
 --do--     Sales Tax on Stock 
            Transfer              28.60   1991-02   Pending before High 
                                                    Court, Patna
 
 --do--     Classification of 
            Hajmola Candy         27.78   1996-97   Pending before High 
                                                    Court, Calcutta
 
 --do--     Classification of 
            Hajmola Candy & 
            Tablet                61.67   1997-98   Pending before 
                                                    Tribunal
 
 --do--     Classification of 
            Hajmola Candy & 
            Tablet                25.96   1998-99   Pending before 
                                                    Tribunal
 
 --do--     Classification of 
            Hajmola Candy & 
            Tablet                39.92   1999-00   Pending before 
                                                    Tribunal
 
 --do--     Classification of 
            Hajmola Candy          9.58   2000-01   Pending before 
                                                    Appellate & 
                                                    Revision Board
 
 --do--     Classification of 
            Hajmola Candy         11.66   2001-02   Pending before 
                                                    Appellate & 
                                                    Revision Board
 
 --do--     Classification of 
            Hajmola Candy          4.44   2002-03   Pending before 
                                                    Appellate & 
                                                    Revision Board
 
 --do--     Classification of 
            Hajmola Candy          5.53   2003-04   Pending before 
                                                    Appellate & 
                                                    Revision Board
 
 --do--     Non submission of 
            Form C                 0.85   2003-04   Pending before 
                                                    Appellate & 
                                                    Revision Board
 
 --do--     Classification of 
            Hajmola Candy          5.65   2004-05   Pending before 
                                                    Appellate & 
                                                    Revision Board
 
 --do--     Classification of 
            Hajmola Candy & 
            Tablet                24.47   2005-06   Pending before 
                                                    Tribunal
 
 --do--     Classification of 
            Hajmola Candy & 
            Tablet                81.71   2006-07   Pending before 
                                                    Tribunal
 
 --do--     Disallowed of Export 
            Sales                  2.17   2006-07   Pending before 
                                                    Tribunal
 
 --do--     Disallowed of Export 
            Sales                  0.37   2007-08   Pending before 
                                                    Appellate & 
                                                    Revision Board
 
 --do--     Disallowed of Export 
            Sales                  5.63   2008-09   Appeal pending 
                                                    before Asstt. 
                                                    Commissioner
 
 --do--     Classification of 
            Chywanprash & Isabgol 11.47   2008-09   Appeal pending 
                                                    before Add. 
                                                    Commissioner
 
 --do--     Entry Tax matter       0.49   2003-04   Appeal pending 
                                                    before Asstt. 
                                                    Commissioner
 
 --do--     Entry Tax matter       0.70   2004-05   Appeal pending 
                                                    before Asstt. 
                                                    Commissioner
 
 --do--     Form F not considered  0.77   2010-11   Appeal pending 
                                                    before Asstt. 
                                                    Commissioner
 
 --do--     Classification of 
            Hajmola Candy          7.25   1993-94   Writ Petition 
                                                    filed before 
                                                    High Court
 
 --do--     Classification of 
            Hajmola Candy          7.03   1994-95   Writ Petition 
                                                    filed before 
                                                    High Court
 
 --do--     Classification of 
            Hajmola Candy          7.32   1997-98   Writ Petition 
                                                    filed before 
                                                    High Court
 
 --do--     Classification of 
            Hajmola Candy         13.15   1998-99   Writ Petition 
                                                    filed before 
                                                    High Court
 
 --do--     Disallowed of Export 
            Sales                  6.79   2006-07   Pending before 
                                                    Appellate & 
                                                    Revision Board
 
 --do--     Form F matter          0.33   2006-07   Pending before 
                                                    Appellate & 
                                                    Revision Board
 
 --do--     Disallowed of Export 
            Sales                  1.51   2007-08   Pending before 
                                                    Appellate & 
                                                    Revision Board
 
 --do--     Short Tax deposited    4.59   2000-01   Under Assessing 
                                                    Authority
 
 --do--     Short Tax deposited    0.82   2001-02   Under Assessing 
                                                    Authority
 
 Sales Tax  Short collection of 
            Export Certificates    2.31   2003-04   Pending before 
                                                    Appealate & 
                                                    Revision   
                                                    Board
 
 --do--     Dispute on Tax Rate   18.28   1999-00   Pending before 
                                                    Dy. Commissioner
 
 --do--     Dispute on Tax Rate   30.12   2000-01   Pending before Dy. 
                                                    Commissioner
 
 --do--     Sale Enhancement       1.38   2005-06   Pending before 
                                                    Appellate & 
                                                    Revision Board
 
 --do--     Disallowed of Export 
            Sales                  6.32   2006-07   Pending before 
                                                    Appellate & 
                                                    Revision Board
 
 --do--     Disallowance of Form C 0.78   2002-03   Appeal pending 
                                                    before Asstt. 
                                                    Commissioner
 
 --do--     Disallowance of Form C 1.89   2003-04   Appeal pending 
                                                    before Asstt. 
                                                    Commissioner
 
 --do--     Disallowance of Form C 2.80   2004-05   Appeal pending 
                                                    before Asstt. 
                                                    Commissioner
 
 --do--     Interest on Turnover 
            Tax & Surcharge        2.85   2001-02   Pending before 
                                                    Tribunal
 
 --do--     Interest on Turnover 
            Tax & Surcharge        3.70   2002-03   Pending before 
                                                    Tribunal
 
 --do--     Interest on Turnover 
            Tax & Surcharge        0.47   2003-04   Pending before 
                                                    Tribunal
 
 --do--     Tax on free issue of 
            CHD Products          13.06   2005-06   Appeal filed 
                                                    with J. 
                                                    Commissioner
 
 --do--     Tax on free issue of 
            CHD Products          12.04   2006-07   Demand raised 
                                                    by D. Commissioner
 
 --do--     Tax on free issue of 
            CHD Products           1.63   2007-08   Demand raised by D. 
                                                    Commissioner
 
 --do--     Form related issues    5.64   2008-09   Demand raised by D. 
                                                    Commissioner
 
 --do--     Dispute on taxability 
            on Chyawanprash       34.72   2006-07   Pending before Dy. 
                                                    Commissioner Appeal
 
 --do--     Dispute on taxability 
            on Chyawanprash       39.71   2006-07   Pending before Dy. 
                                                    Commissioner Appeal
 
 --do--     Dispute on coconut 
            oil                    3.95   2005-06   Pending before State
                                                    High Court - 
                                                    Uttaranchal
 
 --do--     Dispute on coconut 
            oil                    0.92   2005-06   Pending before State  
                                                    High Court - 
                                                    Uttaranchal
 
 --do--     Dispute on coconut 
            oil                    3.64   2006-07   Pending before State 
                                                    High Court - 
                                                    Uttaranchal
 
 --do--     Dispute on coconut 
            oil                    3.52   2007-08   Pending before State 
                                                    High Court - 
                                                    Uttaranchal
 
 --do--     Dispute on coconut 
            oil                   54.53   2008-09   Pending before State 
                                                    High Court - 
                                                    Uttaranchal
 
 --do--     Dispute on coconut 
            oil                    3.26   2009-10   Pending before State 
                                                    High Court - 
                                                    Uttaranchal
 
 --do--     Dispute on tax rate 
            of Juices            111.44   2004-05   Pending before Delhi 
                                                    Trade & Taxation 
                                                    Authority
 
 --do--     Dispute on Tax Rate    0.14   2008-09   Pending before Delhi  
                                                    Trade & Taxation 
                                                    Authority
 
 --do--     Dispute on Entry Tax   0.30             Appeal filed with Dy. 
                                                    Commissioner Appeals
 
 --do--     Security deposited at 
            Check Post             1.13   2011-12   Pending before the 
                                                    Assessing Authority
 
 --do--     Truck detainted at 
            check post.            1.38   2007-08   Pending before Dy. 
                                                    Commissioner-appeal
 
 --do--     Dispute on Form 18A    0.45   1999-00   Pending before Dy. 
                                                    Commissioner-appeal
 
 --do--     Dispute on Local Tax 
            of FEM products        2.00   2008-09   Pending before UP 
                                                    Trade & Taxation 
                                                    Authority
 
 --do--     Dispute on taxability 
            on odonil              2.21   2001-02   Pending before Dy. 
                                                    Commissioner-appeal
 
 --do--     Dispute on taxability 
            on odonil              3.87   2000-01   Pending before Dy. 
                                                    Commissioner-appeal
 
 --do--     Dispute on taxability 
            on odonil              0.90   2001-02   Pending before Dy. 
                                                    Commissioner-appeal
 
 --do--     Damage destruction 
            disallowed and         0.48   2001-02   Pending before Dy. 
                                                    Commissioner-appeal
                                                    brand issue
 
 --do--     Dispute on .
            Stock Transfer Price  13.61   2001-02   Pending before Dy. 
                                                    Commissioner-appeal
 
 --do--     Dispute on Stock 
            Transfer Price         0.58   2002-03   Pending before Dy. 
                                                    Commissioner-appeal
 
 --do--     Dispute on taxability 
            on odonil              0.22   2002-03   Pending before Dy. 
                                                    Commissioner-appeal
 
 --do--     Transporter related 
            issue                  4.20   2006-07   Pending before Dy. 
                                                    Commissioner-appeal
 
 --do--     Truck detainted at 
            check post             2.28   2010-11   Pending before Dy. 
                                                    Commissioner-appeal
 
 --do--     Classification of 
            Hajmola Candy &       19.24   2005-06 & 
                                            06-07   Pending before Dy. 
                                                    Commissioner-appeal
                                                    Chyawanprash
 
 --do--     Classification of 
            Hajmola Candy          5.52   2007-08   Pending before Dy. 
                                                    Commissioner-appeal
 
 --do--     Truck detained at 
            check post.            2.23   2004-05   Pending before Dy. 
                                                    Commissioner-appeal
 
 --do--     Truck detained at 
            check post.            1.45   2005-06   Pending before Dy. 
                                                    Commissioner-appeal
 
 --do--     Truck detained at 
            check post.            1.45   2005-06   Pending before Dy. 
                                                    Commissioner-appeal
 
 --do--     Truck detained at 
            check post.            1.45   2005-06   Pending before Dy. 
                                                    Commissioner-appeal
 
 --do--     Dispute on VAT 
            charged on Glucose    26.97   2006-10   Pending before Dy. 
                                                    Commissioner-appeal
 
 --do--     Dispute on VAT 
            charged on Glucose     4.44   2005-10   Pending before Asstt.
                                                    Commissioner
 
 --do--     Dispute on Excise 
            Information           40.01   2000-01   Pending before High 
                                                    Court
 
 --do--     Penalty on Stock 
            Transfer Price        40.00   2000-01   Pending before 
                                                    Tribunal
 
 --do--     Deposit against 
            Penalty Order         10.07   2008-09   Pending before Addl.  
                                                    Commissioner
 
 --do--     Deposit against 
            Penalty Order          9.23   2009-10   Pending before Addl. 
                                                    Commissioner
 
 --do--     Dispute on Tax 
            Invoices              25.97   2008-09   Appeal filed with Addl. 
                                                    Commissioner
 
 --do--     Non submission of 
            Form C                15.17   2006-07   Appeal filed with Dy. 
                                                    Commissioner
 
 --do--     Non submission of 
            Form F                25.06   2006-07   Appeal filed with Dy. 
                                                    Commissioner
 
 --do--     Truck seized at Sales 
            Tax Barrier            1.08   2008-09   Appeal filed with 
                                                    Sales Tax Board
 
 --do--     Dispute on interest 
            on Entry Tax          52.00   2010-11   Stay from High Court
 
 Income Tax Demand u/s 143(3)      1.40   2008-09   CIT (A), Delhi
 
 -do-       Demand u/s 158 BFA     7.76   1996-97 to CIT (a) Mumbai
 
                                          2002-03
 
 --do--     Demand us/ 201(1A)     0.22   2006-07   -do-
 
 --do--     -do-                 286.44   2006-07   -do-
 
 --do--     -do-                   2.46   2008-09   -do-
 
 --do--     -do-                   1.37   2009-10   -do-
 
 --do--     -do-                  19.31   2010-11   -do-
 
 --do--    Classification of 
           Anmol Coco-nut Oil    514.60   1993-2001 Dy. Commissioner 
                                                        Appeals
 
 
 
 Excise 
 Duty      Modvat on Capital 
           goods                   0.82   1996      Dy. Commissioner
 
 --do--    Modvat on in-puts (57H) 2.42   1998      Tribunal
 
 --do--    Hajmola Candy         113.07   2004-05   Commissioner Appeals 
                                                  / High Court
 
 --do--    Classification on 
           Animal Feed           174.75   1994-2003 Commissioner Appeals
                                                    supplement
 
 --do--    Post manufacturing 
           expenses                0.38   2004-05   Commissioner
 
 --do--    Classification of 
           Janma Ghunti           79.86   1994-2000 Commissioner
 
 --do--    Kewra Water             3.00   01/00-
                                          02/02     Tribunal
 
 --do--    S Tax on Royalty      125.61   04/01-
                                          03/05     Tribunal
 
 --do--    Service tax on ISD    176.77   05/05-
                                          06/06     Tribunal
 
 --do--    Service tax on FO      73.47   04/04-
                                          12/08     Commissioner 
                                                    Appeals
 
 --do--    Classification of 
           Processed Tamarind     84.85   2004-05   Tribunal
 
 --do--    Mahachandanadi Tail/
           Erand Tail/Stimilux     3.00   05/98-
                                          02/02     Tribunal
           (Suo Moto Credit)
 
 --do--    Post Manufacturing 
           Expenses              442.96   2002      Commissioner 
                                                    Appeals
 
 --do--    Capital Goods Removal  30.22   2005-06   Tribunal
 
 --do--    Valuation of Docetaxel
          /Paclitaxel            498.34   1997-2003 Tribunal
 
 --do--    Freight on Wt average   1.91   08/01-
                                          10/02     Commissioner
 
 --do--    MOT Charges             4.60   04/03-
                                          03/08     Commissioner 
                                                    Appeals
 
 --do--    Classification of 
           Gulabari/Kewra Water/2261.50   04/07-
                                          10/10    Tribunal
           Shilajit Caps
 
 --do--    Valuation of Odomos 
           Cream                 332.64   01/07 - 
                                          04/08    Tribunal
 
 --do--    Chyawanprash 
           Classification       2463.34    1988-
                                           2010    Tribunal
 
 --do--    Gulabari/Keora 
           Water/Shilajit          8.60    2006    Tribunal
 
 --do--    PME                     0.34    2006    Commissioner 
                                                   (Appeal)
 
 --do--    Modvat on Capital 
           Goods                   0.33    1996    - do -
 
 --do--    Refund of Edu/S H Educ 
           Cess                   68.04    10/07-
                                           07/08   Commissioner 
                                                   Appeals
 
 10.  ''The Company'' does not have accumulated losses at the end of the
 financial year. ''The Company'' has not incurred cash losses in the
 financial year and in the immediately preceding financial year.
 
 11.  Based on our audit procedures and as per the information and
 explanations given by the management, we are of the opinion that ''the
 Company'' has not defaulted in repayment of dues to any financial
 institution, bank or debenture holder.
 
 12.  ''The Company'' has not granted any loan or advance on the basis of
 security by way of pledge of shares, debentures and other securities.
 
 13.  In our opinion and according to the information and explanations
 given to us, ''the Company'' is not a Chit Fund/ Nidhi/ Mutual Benefit
 Fund/ Society. Accordingly, paragraph 4 (xiii) of the order is not
 applicable.
 
 14.  Based on our examination of the records and evaluations of the
 related internal controls, we are of the opinion that proper records
 have been maintained of the transactions and contracts relating to
 shares, securities, debentures and other investments dealt in by ''the
 Company'' and timely entries have been made in the records. We also
 report that ''the Company'' has held the shares, securities, debentures
 and other investments in its own name except for those pending transfer
 in Company''s name.
 
 15.  ''The Company'' has given guarantees for loans taken by others from
 banks or financial institutions. The terms and conditions there-of are
 not prima facie prejudicial to the interest of the Company.
 
 16.  The term loans taken by ''the Company'' have been applied for the
 purpose for which they were raised.
 
 17.  No short term fund has been applied for long term purpose.
 
 18.  ''The Company'' has made preferential allotment of shares under
 their ESOP Scheme to the parties covered in the register maintained
 under section 301 of the Companies act 1956 during the year. The price
 at which these shares were issued are not prima-facie prejudicial to
 the interest of the Company.
 
 19.  ''The Company'' has not issued any secured debentures during the
 year.
 
 20.  ''The Company'' has not raised any fund through public issue during
 the year.
 
 21.  Based on information and explanations furnished by the management,
 which have been relied upon by us, there were no frauds on or by ''the
 Company'' noticed or reported during the year.
 
                                                     For G BASU & CO
 
                                                 Chartered Accountants 
                                         Firm Registration No. 301174E
 
                                                          ANIL KUMAR
 
 Place : New Delhi                                           Partner
 
 Date : 30th April, 2012                           Membership No. 9390