We have audited the attached Balance Sheet of Henkel India Limited as
 at March 31, 2012, the Profit and Loss Account and also the Cash Flow
 Statement for the period 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. 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.
 
 As required by the Companies (Auditor''s Report) Order 2003, issued by
 the Department of Company Affairs on June 12, 2003 and as amended under
 Notification dated November 25, 2004 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 paragraph 4 and 5 of the said
 Order.
 
 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 purpose of the
 audit;
 
 ii.  In our opinion, proper books of accounts have been kept as
 required by law so far as appears from our examination of those books;
 
 iii. The Balance Sheet, Profit and Loss Account and Cash Flo Statement
 dea'' with by this report are in agreement with books of account;
 
 iv.  In our opinion, 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
 Companies Act, 1956 to the extent applicable.
 
 v.  On the basis of written representations received from Directors, as
 on March 31, 2012 and taken on record by the Board of Directors, we
 report that, none of the Directors are disqualified as on March 31,2012
 from being appointed as a Director in terms of clause (g) of
 sub-section (1) of Section 274 of the Companies Act, 1956.
 
 vi.  In our opinion and to the best of our information and according to
 the explanation given to us, the said accounts together with the notes
 thereon, 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, the state of affairs of the Company
 as at March 31, 2012.
 
 b.  in the case of Profit and Loss Account, of the Loss for the period
 ended on that date and
 
 c.  in the case of Cash Flow Statement, of the cash flows for the
 period ended on that date.
 
 Annexure referred to in paragraph 3 of the repon ot even aate of the
 Auditors to the Members of Henkel India Limited on the accounts for the
 period ended March 31, 2012
 
 i) a) The Company is maintaining proper records, showing full
 particulars including quantitative details and situation of fixed
 assets.
 
 b) The Company has a programme of physical verification of fixed
 assets, which in our opinion is reasonable having regard to the size of
 the Company and the nature of its business.
 
 c) None of the fixed assets have been revalued during the period.
 
 d) A substantial part of the fixed assets have not been disposed of
 during the period.
 
 ii) a) Physical verification of inventory was conducted at reasonable
 intervals by the management during the period.
 
 b) In our opinion, procedures for physical verification of inventory
 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 the
 discrepancies noticed on verification were not material.
 
 iii) a) The Company has taken unsecured loan ofRs. 26,395/- lacs during
 the year fron a party listed in the Register maintained under Section
 301 of the Companies Act, 1956. The year end balance is Rs.14,204/- lacs
 and the maximum outstanding amount during the year is Rs.26,395/-. No
 loans have been granted to any such parties.
 
 b) In our opinion rates of interest and other terms and conditions are
 not prejudicial to the interest of the Company.
 
 c) The repayment of the principal amounts and interest wherever
 applicable are regular.
 
 d) The loans taken by the Company are repayable on demand and therefore
 the question of overdue amounts does not arise.
 
 iv) In our opinion, and according to the information and explanations
 given to us, there are adequate internal control procedures
 commensurate with the size of the Company and the nature of its
 business with regards to purchase of inventories and fixed assets and
 for the sale of goods. During the course of audit no continuing failure
 to correct major weaknesses in internal control system was observed.
 
 v) a) According to the information and explanation given to us, we are
 of the opinion that the particulars of contracts or arrangements that
 need to be entered into a Register in pursuance of Section 301 of the
 Companies Act, 1956 have been duly entered.
 
 b) In our opinion and according to the information and explanation
 given to us, transactions exceeding Rs. 5 lacs in respect of each party
 which have been made in pursuance of contracts or arrangements entered
 in the Register maintained under Section 301 of the Companies Act, 1956
 have been made at prices which are reasonable, having regard to the
 prevailing market prices at the relevant time.
 
 vi) The Company has not accepted any Fixed Deposits from the public
 during the period and therefore, the question of compliance with the
 directives issued by the Reserve Bank of India and the provisions of
 Section 58A and 58AA or any other relevant provisions of the Companies
 Act, 1956 and the rules framed thereunder does not arise.
 
 vii) The Company does not have an adequate Internal Audit commensurate
 with the size and nature of its business.
 
 viii) The cost accounts and the records prescribed by the Central
 Government under clause (d) of sub-section (1) of section 209 of the
 Companies Act, 1956 have been made and maintained.
 
 ix) a) According to the records of the Company, undisputed statutory
 dues including Provident Fund, Employees Siate Insurance Fund,
 Income-tax, Wealth tax, Service tax, Sales tax, Customs duty, Excise
 duty, Cess and other statutory dues have been deposited regularly
 during the period with the appropriate authorities. According to the
 information and explanation given to us, there are no undisputed
 amounts payable which are outstanding as on March 31, 2012 for a period
 of more than six months from tne date they became payable.
 
 b) The following amounts have not been deposited with respective
 authorities because of disputes.
 
                                                     Forum where 
 Statute              Year            Amount (Rs.)   pending
 
                      1990-2000 to                   Commissioner
 Income Tax                            32,82,050
                      2001-02                       (Appeal)
 
 Income Tax Total                      32,82,050
 
 Central Excise-      1996-1997 to                   CESTAT
 KKL                  2002-2003        15.52,086 
 
 Ambattur             2003-2004         4,36,187     CESTAT
 
 Excise Total                          19,88,273
 
 Sales Tax-MP         2000-2001 to     18,47,888     CT0
                      2002-03
 
 Grand Total                         1,18,45,119
 
 x) At the end of the financial period, the accumulated loss of the
 Company is less than 50% of its Net worth. The Company has incurred
 cash loss during the financial period but not in the immediately
 preceding financial period.
 
 xi) The Company has not defaulted in repayment of dues to Banks during
 the period.
 
 xii) No loans or advances have been granted by the Company against
 pledge of Shares and Debentures and other securities.
 
 xiii) The Company is not a chit fund or a nidhi mutual benefit
 fund/society.
 
 xiv) The Company is not dealing in or trading in Shares, Securities,
 Debentures and other instruments.
 
 xv) According to the information and explanation given to us, the
 Company has not given any Corporate Guarantee during the period.
 
 xvi) The Company has received long term loan during the period and has
 applied it for the purpose for which it has been raised.
 
 xvii) According to the information and explanations given to us by the
 management, the funds raised on short term basis have not been used for
 long term investment.
 
 xviii) During the period the Company has not made any preferential
 allotment to parties and companies covered in the register maintained
 under Section 301 of the Companies Act, 1956.
 
 xix) The Company has not issued any debentures during the period and
 therefore the question of creation of security or charge does not
 arise.
 
 xx) During the period, the Company has not raised any money by way of
 public issue and the question of disclosing the end use of money by the
 management does not arise.
 
 xxi) According to the information and explanations given to us, no
 fraud on or by the Company was noticed or reported during the course of
 our audit.
 
                                    For CNGSN & ASSOCIATES
 
                                     Chartered Accountants 
 
                                       F.R. No. 04915S
 
                                       C.N. GANGADARAN
 
 Place : Chennai
 
 Date : May 22,2012                        Partner
 
                                        Memb. No. 11205