1.  We have audited the attached Balance Sheet of JUBILANT LIFE
 SCIENCES LIMITED (''the Company'') as at 31st March, 2011 the related
 Profit and Loss Account for the year ended on that date annexed thereto,
 and the Cash Flow Statement of the company for the period ended on that
 date, which we have signed under reference to this report. 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 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 issued
 by the Central Government of India in terms of Section 227 (4A) of the
 Companies Act, 1956, and on the basis of such checks as considered
 appropriate and according to the information and explanation given to
 us during the course of our audit, we enclose in the Annexure hereto a
 statement on the matters specifed in paragraphs 4 and 5 of the said
 Order.
 
 4.  Further to our comments mentioned 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 such
 books;
 
 c) The Balance Sheet, Profit & Loss Account and Cash Flow Statement
 dealt with by the report are in agreement with the books of account of
 the Company;
 
 d) In our opinion, the Balance Sheet, Profit & Loss Account and Cash
 Flow Statement dealt with by this report comply with the mandatory
 Accounting Standards referred to in Sub-Section 3 (c) of Section 211 of
 the Companies Act, 1956.
 
 e) According to the information and explanation given to us and on the
 basis of written representations received from the directors as on 31st
 March, 2011 of the Company and taken on record by the Board of
 Directors, we report that none of the directors is disqualifed, as on
 31st March, 2011, from being appointed as a director in terms of clause
 (g) of Sub Section (1) of Section 274 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 Accounts, and read together with
 the notes and significant Accounting Policies 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:
 
 (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 of the
 Company for the year ended on that date; and
 
 (iii) In the case of the Cash Flow Statement, of the cash flows of the
 Company for the year ended on that date.
 
 ANNEXURE TO ThE AUDITORS'' REPORT Re: JUBILANT LIFE SCIENCES LIMITED
 (Formerly Jubilant Organosys Limited) Referred to in paragraph 3 of our
 report of even date on the accounts of the Company for the year ended
 31st March, 2011.
 
 i) (a) The Company has maintained proper records showing full
 particulars, including quantitative details and situation, of fixed
 assets.
 
 (b) As explained to us, physical verifcation of fixed assets has been
 carried out in terms of the phased programme of verifcation of its fixed
 assets adopted by the Company and no material discrepancies were
 noticed on such verifcation.  In our opinion the frequency of
 verifcation is reasonable, having regard to the size of the Company and
 nature of its business.
 
 (c) During the year the Company has not disposed off any substantial/
 major part of fixed assets except transfers, in terms of the Court
 Sanctioned Scheme of Demerger of certain units to Jubilant Industries
 Ltd, however, the same has not affected its going concern basis.
 
 ii) (a) The inventory has been physically verifed, during the year, by
 the management at reasonable intervals.
 
 (b) In our opinion and according to the information and explanations
 given to us, the procedures of physical verifcation 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 inventory records, in our
 opinion, the Company is maintaining proper records of inventory.  In
 our opinion, discrepancies noticed on physical verifcation of stocks as
 compared to book records were not material in relation to the
 operations of the Company and the same have been properly dealt with in
 the books of account.
 
 iii) (a) There are only two Companies (Subsidiaries) covered in the
 register maintained under section 301 of the Companies Act,1956 to whom
 the Company has granted loans. The maximum amount involved during the
 year was Rs. 1,929.75 million (including the opening balance) and the
 year end total balance of loans granted to such parties was Rs. 1,929.75
 million.
 
 (b) In our opinion the rate of interest (wherever leviable) and other
 terms and condition on which loan were granted to the said Companies
 listed in register maintained under section 301 of the Companies Act,
 1956 are not prima facie, prejudicial to the interest of the Company.
 
 (c) None of the parties have repaid principal amounts as no demand was
 raised and the parties were regular in the matter of payment of
 interest, wherever applicable.
 
 (d) There is no overdue amount of loan granted to the said companies.
 
 (e) The Company had taken short term loan from one company covered in
 the register maintained under section 301 of the Companies Act, 1956.
 The amount involved were Rs. 160 million and the maximum balance was Rs.
 100 million during the year and the year end balance was Rs. Nil, as the
 loan were repaid during the year. The rate of interest and terms of
 such loan, prima facie, are not prejudicial to the interest of the
 Company.
 
 iv) In our opinion and according to the information and explanations
 given to us, there are adequate internal control systems commensurate
 with the size of the company and the nature of its business with regard
 to purchase of inventory and fixed assets and for the sale of goods and
 services. During the course of our audit, we have not observed any
 continuing failure to correct major weakness in internal control
 system.
 
 v) (a) Based on the audit procedures applied by us and according to the
 information and explanations provided by the management, we are of the
 opinion that the transactions that need to be entered into the register
 maintained under Section 301 have been so entered.
 
 (b) In our opinion and according to the information and explanations
 given to us, the transactions made in pursuance of contracts or
 arrangements entered in the register under Section 301 have been made
 at prices which are reasonable having regard to prevailing market
 prices, to the extent comparable prices were available, at the relevant
 time.
 
 vi) In the case of public deposits received by the company, the
 directives issued by the Reserve Bank of India and the provisions of
 Section 58A, 58AA or any other relevant provisions of the Companies
 Act, 1956 and the Companies (Acceptance of Deposit) Rules 1975 have
 been Compiled with. No order has been passed by the Company Law Board
 or National Company Law Tribunal or Reserve Bank of India or any Court
 or any other Tribunal.
 
 vii) In our opinion, the company has an internal audit system
 commensurate with the size of the company and the nature of its
 business.
 
 viii) The Central Government has prescribed maintenance of the Cost
 Records under section 209(1)(d) of the Companies Act, 1956 in respect
 of certain products of the Company. 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 the cost records, and are of
 the opinion that prima facie the prescribed accounts and records have
 been maintained. We are, however, not required to and have not carried
 out any detailed examination of such accounts and records.
 
 ix) (a) According to the records examined by us, the company is regular
 in depositing with appropriate authorities undisputed statutory dues
 including provident fund, investors education and protection fund,
 employees state insurance, income tax, sales-tax, wealth tax, service
 tax, custom duty, excise duty, cess and other statutory dues wherever
 applicable. According to the information and explanations given to us,
 no undisputed arrears of statutory dues 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 records of the Company, the dues of sales tax,
 income-tax, customs, wealth-tax, service tax, excise duty, cess which
 have not been deposited on account of disputes and the forum where the
 dispute is pending are as under:
 
 Name of the
 Statute         Nature of the Dues        Amount   Period to which the
                                          (Rs. in 
                                          million)   amount relates
 
 1 Central Excise 
 Act,            Excise Duty                1.26    April 2001 to March
 1944                                               2002
 
                 Excise Duty                3.70    April 2004 to July
                                                    2005
 
                 Excise Duty                0.42    March 1997
 
                 Excise Duty                1.27    February 2003 to
                                                    September 2004
 
                 Excise – EOU               0.31    April, 2007 to
                                                    November 2007
 
 2. Customs Act, 
 1962            Custom Duty   Interest    63.99    April, 2002 to
                                                    October , 2005
 
                 Custom Duty   Interest     3.47    August, 2004 to
                                                    February, 2009
 
                 Custom Duty   Interest     6.11    2002-2008
 
                 Custom Duty   Interest     0.46    2004-2007
 
                 Custom Duty   Interest     2.50    Oct 2005
 
 3. Service Tax, Service Tax                0.35    April, 2003 to March
 Finance Act, 1994                                  2004
 
                 Service Tax               30.52    April 2004 to May,
                                                    2006
 
 4  Central Sales 
    Tax,         Sales Tax Demand           2.83    2000-01 to 2007-08
    Act, 1956 and
    Sales        Sales Tax Penalties        0.31    2008-09
    Tax Acts of
    Various
    States
 
 
 
 Name of the Statue         Forum Where dispute is
                            pending
 
 Central Excise Act,
 1944                       Joint Commissioner, Pune
 
                            Additional Commissioner,
                            Pune
 
                            Additional Commissioner
                            Meerut
 
                            Commissioner, Meerut
 
                            Deputy Commissioner
                            Hapur
 
 Customs Act, 1962          A. C. Custom ICD
                            Tuglakabad
 
                            A.C. Customs, Mumbai
 
                            Additional Commissioner,
                            Delhi
 
                            Deputy Commissioner,
                            Mumbai
 
                            Deputy Commissioner,
                            Delhi
 
 Service Tax ,
 Finance Act, 1994          Asstt. Commissioner,
                            Hapur
 
                            Tribunal, New Delhi
 
 Central Sales Tax,
 Act, 1956 and Sales
 Tax Acts of Various
 States                     D.C. Hasanpur
                            Additional Commissioner,
                            Moradabad
 
 The above table excludes the disputed cases pertaining to the
 businesses demerged into Jubilant Industries Ltd pursuant to the Scheme
 of Amalgamation and Demerger as sanctioned by Hon''ble Allahabad High
 Court.
 
 x) There are no accumulated losses of the Company as at 31st March
 2011. The company has not incurred cash losses during the financial year
 covered by our audit and in the immediately preceding financial year.
 
 xi) Based on our audit procedures and on the basis of the information
 and explanations given to us 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 holders.
 
 xii) Based on our examination of the records and the information and
 explanations given to us, the Company has not granted any loans and/ or
 advances on the basis of security by way of pledge of shares,
 debentures and other securities. Hence, paragraph 4(xii) of order is
 not applicable.
 
 xiii) In our opinion, the Company is not a Chit Fund/Nidhi/Mutual
 Fund/Society. Therefore, the provisions paragraph 4(xiii) of the Order
 are not applicable to the company.
 
 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 Companies (Auditor''s Report) Order,
 2003 are not applicable to the Company. However, all investments have
 been held by it in its own name or its nominees.
 
 xv) According to the information and explanations given to us, Company
 has given guarantees for loans taken by others (by the step down
 subsidiary companies) from Banks and the terms of such guarantees are
 not prejudicial to the interest of the company.
 
 xvi) According to the information and explanations given to us, the
 term loans raised during the year have been applied, to the extent
 used, for the purpose for which they were raised and the balance moneys
 are lying in Current Accounts/Deposits with the banks.
 
 xvii) According to the information & explanation given to us and on an
 overall examination of the Balance Sheet of the company, we report that
 the 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
 during the year to parties/companies covered in the register maintained
 under section 301 of the companies Act, 1956.
 
 xix) During the year covered by our audit report the Company has not
 issued secured debentures.
 
 xx) The company has not raised money by Public Issue during the year.
 
 xxi) Based upon the audit procedures performed and as per the
 information and explanations given by the management to us, we report
 that no fraud on or by the Company has been noticed or reported during
 the course of our audit for the year ended 31st March, 2011.
 
                                        For K.N. Gutgutia & Company
 
                                  Firm Registration Number: 304153E
 
                                              Chartered Accountants
 
 Place: Noida                                           B. R. GOYAL
 
 Date : 10th May, 2011                                      Partner
 
                                               Membership No. 12172