HCL Technologies

1.  We have audited the attached Balance Sheet of HCL Technologies
 Limited, as at June 30 2008, 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 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 Order), 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 June 30, 2008 and taken on record by the Board of
 Directors, none of the directors is disqualified as on June 30, 2008
 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 June 30, 2008;
 
 (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 AUDITORS REPORT
 
 [Referred to in paragraph 3 of the Auditors Report of even date to the
 members of HCL Technologies Limited on the financial statements for the
 year ended June 30, 2008]
 
 1.  (a) The company is maintaining proper records showing full
 particulars including quantitative details and situation of fixed
 assets.
 
 (b) The fixed assets 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.
 Pursuant to the programme, a portion of the fixed assets has been
 physically verified by the management during the year and no material
 discrepancies between the book records and the physical inventory have
 been noticed.
 
 (c) In our opinion and according to the information and explanations
 given to us, a substantial part of fixed assets has not been disposed
 of by the company during the year.
 
 2.  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 Act. Consequently, clauses
 (iii)(b), (iii)(c), (iii)(d), (iii)(f) and (iii)(g) of paragraph 4 of
 the Order are not applicable.
 
 3.  In our opinion and according to the information and explanations
 given to us, having regard to the explanation that certain items
 purchased are of special nature for which suitable alternative sources
 do not exist for obtaining comparative quotations, there is an adequate
 internal control system commensurate with the size of the company and
 the nature of its business for the purchase of fixed assets and for the
 sale of services. The activities of the Company do not involve purchase
 of inventory and the sale of goods.  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.
 
 4.  (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 Act 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
 arrangements entered into the register in pursuance of Section 301 of
 the Act and exceeding the value of Rupees Five Lakhs in respect of any
 party during the year, are in respect of items of special nature and in
 respect of which alternative quotations are not considered necessary by
 the Company.
 
 5.  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.
 
 6.  In our opinion, the company has an internal audit system
 commensurate with its size and nature of its business.
 
 7.  The Central Government of India has not prescribed the maintenance
 of cost records under clause (d) of sub-section (1) of Section 209 of
 the Act for any of the products of the company.
 
 8.  (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 generally regular in depositing the undisputed statutory dues
 including provident fund, investor education and protection fund,
 employees state insurance, income-tax, sales-tax, wealth tax, service
 tax, customs duty, cess and other material statutory dues as applicable
 with the appropriate authorities. As explained to us, the Company did
 not have any dues on account of excise duty.
 
 (b) According to the information and explanations given to us and the
 records of the company examined by us, there are no dues of wealth tax,
 service tax, sales tax and cess as at June 30, 2008 which have not been
 deposited on account of dispute other than income tax and custom duty,
 which are as follows-
 
 Name of            Nature of        Amount
 the statute        dues             (Rs.)
 
 Income Tax         Income Tax       47,949,416
 Act, 1961
 
 Income Tax         Income Tax        2,432,594
 Act, 1961
 
 Income tax         Income Tax      254,308,170
 Act, 1961
 
 Income tax         Income Tax       14,443,922
 Act, 1961
 
 Income tax         Income Tax        3,477,963
 Act, 1961
 
 Income tax         Income Tax        7,378,994
 Act, 1961
 
 Customs Act,       Custom Duty       2,775,156
 1962
 
 Period to       Forum where
 which the       the dispute
 amount          is pending
 relates
 
 2002-2003       Karnataka
                 High Court
 
 1997-1998       Income
                 Tax Appellate
                 Tribunal
                (ITAT)
 
 2004-2005       Income Tax
                 Appellate
                 Tribunal (ITAT)
 
 2004-2005       Income Tax
                 Appellate
                 Tribunal (ITAT)
 
 2001 -2002      Income Tax
                 Appellate
                 Tribunal (ITAT)
 
 2001-2002       Karnataka High
                 Court
 
 2003-2004       Custom, excise
                 and service tax
                 Appellate
                 Tribunal,
                 Bangalore
 
 9.  The company has no accumulated losses as at June 30, 2008 and it
 has not incurred any cash losses in the financial year ended on that
 date or in the immediately preceding financial year.
 
 10.  According to the records of the company examined by us and the
 information and explanation given to us, the company has not defaulted
 in repayment of dues to financial institution as at the balance sheet
 date. The company has not issued any debentures. Further the Company
 does not have any dues payable to bank as at the balance sheet date.
 
 11.  The company has not granted any loans and advances on the basis of
 security by way of pledge of shares, debentures and other securities.
 
 12.  The provisions of any special statute applicable to chit fund /
 nidhi / mutual benefit fund/societies are not applicable to the
 company.
 
 13.  In our opinion, the company is not a dealer or trader in shares,
 securities, debentures and other investments.
 
 14.  In our opinion and 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 during the year.
 
 15.  The company has not obtained any term loans during the year.
 
 16.  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.
 
 17.  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.
 
 18.  The company has not raised any money by public issues during the
 year.
 
 19.  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.
 
 20. Clauses, (ii) and (xix) of paragraph 4 of the Order are not
 applicable in the case of the company for the current year, since in
 our opinion there is no matter which arises to be reported in the
 aforesaid order.
 
                                    Kaushik Dutta
                                    Partner
                                    Membership Number:   F-88540
 
                                    For and on behalf of
 Place: Gurgaon, India              Price Waterhouse
 Date :  01 August 2008             Chartered Accountants