1.  We have audited the attached Balance Sheet of DLF Limited, (the
 Company) as at March 31, 2011, and the Profit and Loss Account and
 also the Cash Flow Statement for the year ended on that date annexed
 thereto (collectively referred as the Financial Statements). 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 (the
 Order) (as amended), issued by the Central Government of India in
 terms of sub-section (4A) of Section 227 of the Companies Act, 1956
 (the Act), we enclose in the Annexure a statement on the matters
 specified in paragraphs 4 and 5 of the Order.
 
 4.  Without qualifying our opinion, we draw attention to Note No. 29 of
 Schedule 25 of the accompanying financial statements in respect of
 certain income tax and other matters. Based on the advice from
 independent experts on the respective matters, management is confident
 that no liabilities or other obligations resulting in a financial
 impact, other than those already recognised, will devolve on the
 Company. There exists however uncertainty in respect of the final
 resolution of these material matters, and the resultant financial
 adjustments if any, will be recorded in the periods in which these
 matters are resolved.
 
 5.  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 appears from our examination of those
 books;
 
 c) The financial statements dealt with by this report are in agreement
 with the books of account;
 
 d) On the basis of written representations received from the directors,
 as on March 31, 2011 and taken on record by the Board of Directors, we
 report that none of the directors is disqualified as on March 31, 2011
 from being appointed as a director in terms of clause (g) of
 sub-section (1) of Section 274 of the Act; and
 
 e) In our opinion and to the best of our information and according to
 the explanations given to us, the financial statements dealt with by
 this report comply with the accounting standards referred to in
 sub-section (3C) of Section 211 of the Act and the Rules framed there
 under and 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, in the case of:- i)
 the Balance Sheet, of the state of affairs of the Company as at March
 31, 2011; ii) the Profit and Loss Account, of the profit for the year
 ended on that date; and iii) the Cash Flow Statement, of the cash flows
 for the year ended on that date.
 
 Annexure to the Auditors Report of even date to the members of DLF
 Limited, on the financial statements for the year ended March 31, 2011
 
 Based on the audit procedures performed for the purpose of reporting a
 true and fair view on the financial statements of the Company and
 taking into consideration the information and explanations given to us
 and the books of account and other records examined by us in the normal
 course of audit, we report that:
 
 (i) (a) The Company has maintained proper records showing full
 particulars, including quantitative details and situation of fixed
 assets.
 
 (b) A major portion of the fixed assets has been physically verified by
 the management during the year. In our opinion, the frequency of
 verification of the fixed assets is reasonable having regards to the
 size of the Company and nature of its assets. No material discrepancies
 were noticed on such verification.
 
 (c) In our opinion, a substantial part of fixed assets has not been
 disposed off during the year.
 
 (ii) (a) The inventory includes land, completed buildings, construction
 work in progress, construction and development material and development
 rights in identified land. Ph ysical verification of inventory (except
 stocks represented by development rights, confirmations for which have
 been obtained) have been conducted at reasonable intervals by the
 management.
 
 (b) The procedures of physical verification of inventory followed by
 the management are reasonable and adequate in relation to the size of
 the Company and the nature of its business.
 
 (c) The Company is maintaining proper records of inventory and no
 material discrepancies were noticed on physical verification.
 
 (iii) (a) There are ten companies of DLF Limited covered in the
 register maintained under Section 301 of the Act to which the Company
 has granted unsecured loans.  The maximum amount outstanding during the
 year was Rs. 754,656.07 lacs and the year-end balance was Rs. 552,453.57
 lacs.
 
 (b) In our opinion, the rate of interest and other terms and conditions
 of such loans are not, prima facie, prejudicial to the interest of the
 Company.
 
 (c) In respect of loans granted, the principal amount is repayable on
 demand in accordance with the terms and conditions, and payment of
 interest has been regular in accordance with such terms and conditions.
 
 (d) There is no amount overdue in respect of loans granted to
 companies, firms or other parties listed in the register maintained
 under Section 301 of the Act.
 
 (e) The Company has not taken any loans, secured or unsecured from
 companies, firms or other parties covered in the register maintained
 under Section 301 of the Act. Accordingly, the provisions of clauses
 4(iii) (f) and 4(iii)(g) of the Order are not applicable.
 
 (iv) In our opinion, 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.
 
 (v) (a) In our opinion, the particulars of all contracts or
 arrangements that need to be entered into the register maintained under
 Section 301 of the Act have been so entered.
 
 (b) In our opinion, the transactions made in pursuance of such
 contracts or arrangements 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 prevailing market prices at the
 relevant time.
 
 (vi) Based on an independent legal opinion obtained by the Company and
 relied upon by the auditors, the debentures issued by the Company to a
 private Company are exempt under Section 58A and 58AA of the Act and
 the Companies (Acceptance of Deposits) Rules, 1975. Accordingly, the
 provisions of clause 4(vi) of the Order are not applicable.
 
 (vii) In our opinion, the Company has an internal audit system
 commensurate with its size and the nature of its business.
 
 (viii) We have broadly reviewed the books of account maintained by the
 Company pursuant to the Rules made by the Central Government under
 Section 209(1)(d) of the Act for the maintenance of cost records in
 respect of generation and sale of electricity from the Companys wind
 power operations and are of the opinion that, prima facie, the
 prescribed accounts and records have been made and maintained. However,
 we have not made a detailed examination of the records with a view to
 determine whether they are accurate or complete.
 
 (ix) (a) 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 material statutory dues, as applicable, have generally been
 regularly deposited with the appropriate authorities, though there has
 been a slight delay in a few cases. No undisputed amounts payable in
 respect thereof were outstanding at the year end for a period of more
 than six months from the date they became payable.
 
 (b) There are no amounts in respect of sales tax, income tax, customs
 duty, wealth tax, service tax, excise duty and cess that have not been
 deposited with the appropriate authorities on account of any dispute
 except for the amounts mentioned below.
 
 Name of the statute          Nature of dues            Amount unpaid
                                                        (Rs. in lacs)
 
 Income tax Act, 1961      Demand under section 143(3)      53.89
 
 Income tax Act, 1961      Demand under section 143(3)      93.22
 
 Income tax Act, 1961      Demand under section 143(3)     115.19
 
 
 
 Name of the statue   Period to which the   Forum where dispute is pending
                       amount relates
 
 Income tax Act, 1961  Assessment year       Income tax Appellate Tribunal
                        1997-98                          (ITAT)
 
 Income tax Act, 1961  Assessment year       Income tax Appellate Tribunal
                       1999-2000                       (ITAT)
 
 Income tax Act, 1961  Assessment year       Income tax Appellate Tribunal
                        2000-01                        (ITAT)
 
 
 
 Name of the statute          Nature of dues            Amount unpaid
                                                        (Rs. in lacs)
 
 Income tax Act, 1961     Demand under section 144         13,975.89
 
 Income tax Act, 1961     Demand made under section         8,014.58
                          143 (3)/142 (2A)
 
 Income tax Act, 1961     Demand made under section        54,675.17
                          143 (3)/142 (2A)
 
 The Finance Act, 2004    Demand of service tax on             17.13
 and Service tax rules    import of service
 
 The Finance Act, 2004    Demand of service tax on            143.18
 and Service tax rules    property transfer charges
                          received from customers
 
 The Finance Act, 2004    Denial of service tax input         356.22
 and Service tax rules    credit on service tax paid on
                          imported services
 
 The Finance Act, 2004    Denial of service tax input       1,592.08
 and Service tax rules    credit
 
 The Finance Act, 2004    Denial of service tax input       1,523.93
 and Service tax rules    credit
 
 The Finance Act, 2004    Denial of service tax input         323.95
 and Service tax rules    credit
 
 The Finance Act, 2004    Demand of service tax on            988.85
 and Service tax rules    sponsorship fee paid
 
 The Finance Act, 2004    Demand of service tax on             15.74
 and Service tax rules    property transfer charges
                          received from customers
 
 The Finance Act, 2004    Demand of service tax on            824.05
 and Service tax rules    sponsorship fees paid
 
 The Finance Act, 2004    Demand of service tax on             10.58
 and Service tax rules    property transfer charges
                          received from customers
 
 The Finance Act, 2004    Denial of service tax input         550.88
 and Service tax rules    credit
 
 The Finance Act, 2004    Demand of service tax on            824.05
 and Service tax rules    sponsorship fees paid
 
 
 Name of the statue   Period to which the   Forum where dispute is pending
                       amount relates
 
 
 Income tax Act, 1961  Assessment year      Appeal before CIT(A), Order
                       2006-07              received with a relief of
                                      Rs. 40,910.47 lacs, effect of which
                                            is pending
 
 Income tax Act, 1961  Assessment year      CIT (Appeals)
                       2007-08
 
 Income tax Act, 1961  Assessment year      CIT (Appeals)
                       2008-09
 
 The Finance Act, 2004
 and Service tax rules April, 2003 to     Additional Commissioner-Service
                       June, 2005                      tax
 
 The Finance Act, 2004
 and Service tax rules 2003-04 till 
                       December,          Commissioner Service Tax
                       2008
 
 The Finance Act, 2004
 and Service tax rules April, 2007 to     Commissioner Service Tax
                       September, 2009
 
 The Finance Act, 2004
 and Service tax rules 2007-08            Commissioner Service Tax
 
 The Finance Act, 2004
 and Service tax rules 2008-09            Commissioner Service Tax
 
 The Finance Act, 2004
 and Service tax rules April, 2009 to     Commissioner Service Tax
                       September, 2009
 
 
 The Finance Act, 2004
 and Service tax rules 2008-09            Commissioner Service Tax
 
 The Finance Act, 2004
 and Service tax rules January, 2009 to   Commissioner Service Tax
                       September, 2009
 
 The Finance Act, 2004
 and Service tax rules  2009-10           Commissioner Service Tax
 
 The Finance Act, 2004
 and Service tax rules  October, 2009 to  Commissioner Service Tax
                        September, 2010
 
 The Finance Act, 2004
 and Service tax rules  October, 2009 to  Commissioner Service Tax
                        September, 2010
 
 The Finance Act, 2004
 and Service tax rules  2010-11           Commissioner Service Tax
 
 (x) In our opinion, the Company has no accumulated losses at the end of
 the financial year and it has not incurred cash losses in the current
 and the immediately preceding financial year.
 
 (xi) In our opinion, the Company has not defaulted in repayment of dues
 to a financial institution or a bank or debenture holders during the
 year.
 
 (xii) The Company has not granted any loans and advances on the basis
 of security by way of pledge of shares, debentures and other
 securities. Accordingly, the provisions of clause 4(xii) of the Order
 are not applicable.
 
 (xiii) In our opinion, the Company is not a chit fund or a nidhi/
 mutual benefit fund/ society. Accordingly, the provisions of clause
 4(xiii) of the Order are not applicable.
 
 (xiv) In our opinion, the Company is not dealing in or trading in
 shares, securities, debentures and other investments.  Accordingly, the
 provisions of clause 4(xiv) of the Order are not applicable.
 
 (xv) In our opinion, the terms and conditions on which the Company has
 given guarantee for loans taken by others from banks or financial
 institutions are not, prima facie, prejudicial to the interest of the
 Company.
 
 (xvi) In our opinion, the term loans were applied for the purpose for
 which the loans were obtained, though idle/ surplus funds which were
 not required for immediate utilization have been invested in liquid
 investments, payable on demand.
 
 (xvii) In our opinion, no funds raised on short-term basis have been
 used for long-term investment.  (xviii) The Company has not made any
 preferential allotment of shares to parties or companies covered in the
 register maintained under Section 301 of the Act. Accordingly, the
 provisions of clause 4(xviii) of the Order are not applicable.
 
 (xix) The Company has created security in respect of debentures issued
 during the year.
 
 (xx) The Company has not raised any money by public issues during the
 year. Accordingly the provisions of clause 4(xx) of the Order are not
 applicable.
 
 (xxi) No fraud on or by the Company has been noticed or reported during
 the period covered by our audit.
 
                                        for Walker, Chandiok & Co
 
                                            Chartered Accountants
 
                                    Firm Registration No: 001076N
 
                                                  per David Jones
 New Delhi                                                Partner
 
 May 24, 2011                                Membership No. 98113