Lupin

1.  We have audited the attached Balance Sheet of Lupin Limited as at
 31st March, 2009, the Profit and Loss Account and also the Cash Flow
 Statement for the year ended on that date annexed thereto. 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 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 in terms of Section 227 (4A) of the Companies
 Act, 1956, we enclose 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 the
 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 comply with the accounting standards referred to in
 sub-section (3C)of Section 211 of the Companies Act, 1956;
 
 e) On the basis of the written representations received from the
 directors as on 31st March, 2009 and taken on record by the Board of
 Directors, we report that none of the directors is disqualified as on
 31st March, 2009 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 read with the
 significant accounting policies and 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:
 
 i) in the case of the Balance Sheet, of the state of affairs of the
 Company as at 31st March, 2009;
 
 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
 
 Re : Lupin Limited (Referred to in paragraph 3 of our report of even
 date)
 
 (i) In respect of its fixed assets
 
 (a) The Company has maintained proper records showing full particulars,
 including quantitative details and situation of fixed assets.
 
 (b) The Company has physically verified certain assets during the year
 in accordance with a programme of verification, which in our opinion
 provides for physical verification of the fixed assets at reasonable
 intervals. According to the information and explanations given to us,
 no material discrepancies were noticed on such verification.
 
 (c) In our opinion and according to the information and explanations
 given to us, the Company has not made any substantial disposal of fixed
 assets during the year.
 
 (ii) (a) As explained to us, inventories were physically verified
 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 verification of inventories
 followed by the management were reasonable and adequate in relation to
 the size of the Company and the nature of its business.
 
 (c) In our opinion and according to the information and explanations
 given to us, the Company has maintained proper records of its
 inventories and no material discrepancies were noticed on physical
 verification.
 
 (iii) The Company has not granted or taken any loan secured/unsecured,
 to/from companies, firms or parties covered in the register maintained
 under section 301 of the Companies Act, 1956. Accordingly, clause (iii)
 of Paragraph 4 of the Companies (Auditors Report) Order, 2003 is not
 applicable to the Company.
 
 (iv) In our opinion, and according to the information and explanations
 given to us, there is an internal control system commensurate with the
 size of the Company and nature of its business for 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 weaknesses in the internal control system.
 
 (v) In respect of particulars of contracts or arrangements and
 transactions entered in the register maintained in pursuance of section
 301 of the Companies Act, 1956;
 
 (a) To the best of our knowledge and belief and according to the
 information and explanations given to us, particulars of contracts or
 arrangements that needed to be entered into the register have been so
 entered.
 
 (b) According to the information and explanations given to us, each of
 the transactions in pursuance of such contracts/ arrangements in excess
 of Rs. 5 lakhs in respect of any party during the year, have been made
 at prices which are reasonable having regard to the prevailing market
 prices at the relevant time, where such prices are available.
 
 (vi) In our opinion and according to the information and explanations
 given to us, the Company has complied with the provisions of Sections
 58A, 58AAand other relevant provisions of the Companies Act, 1956, and
 the rules framed there under with regard to the deposits accepted from
 the public in the earlier years and remaining unclaimed at the year
 end. The Company has not accepted any public deposits during the year.
 
 (vii) In our opinion, the internal audit functions carried out during
 the year by firms of Chartered Accountants appointed by the management
 have been commensurate with the size of the Company and the nature of
 its business.
 
 (viii) We have broadly reviewed the books of account and records
 maintained by the Company relating to the manufacture of bulk drugs and
 formulations, pursuant to the order made by the Central Government for
 the maintenance of cost records under Section 209 (1) (d) of the
 Companies Act, 1956 and are of the opinion that prima facie the
 prescribed accounts and records have been made and maintained. We have,
 however, not made a detailed examination of the records with a view to
 determining whether they are accurate or complete.
 
 (ix) (a) The Company, during the year, has been generally regular in
 depositing with the 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 any other material statutory
 dues as applicable to the Company. According to the information and
 explanation given to us, no undisputed amounts payable in respect of
 aforesaid, were in arrears as at 31st March, 2009 for a period of more
 than six months from the date they became payable.
 
 (b) According to the information and explanations given to us, the
 disputed dues that have not been deposited on account of matters
 pending before respective authorities are as under:
 
 Name of the Statute              Nature of                   Amount
                                   the Dues        (Rs. in millions)
 
 Income Tax Act, 1962           Income Tax                      8.9
 Central Excise Act, 1944      Excise Duty                     45.2
                                                                5.2
 Central and various             Sales Tax                     16.7
 StatesSales Tax Acts                                          4.8
                                                                3.7
                                                                7.7
                                                               21.2
 
 Period to which    Forum where dispute
 amounts relate     is pending
 
 2003-2004          CIT Appeals
 1997-2006          Customs, Excise and Service Tax Appellate
                    Tribunal (CESTAT)
 1998-2009          Commissioner of Central Excise (Appeals)
 1992-2003          Commissioner of Sales Tax (Appeals)
 1998-2006          Deputy Commissioner of Sales Tax (Appeals)
 1992-2003          Sales Tax Tribunal
 1994-1995 and      Appellate Commissioner of
 2005-2006          Commercial Taxes
 2001-2008          High Court, Jabalpur
 
 (x) The Company has no accumulated losses at the end of the financial
 year and has not incurred any cash losses during the current financial
 year and in the immediately preceding financial year.
 
 (xi) Based on our audit procedures and on the basis of information and
 explanations given by the management, we are of the opinion that the
 Company has not defaulted in the repayment of dues to financial
 institutions, banks and debenture holders.
 
 (xii) According to the information and explanations given to us, the
 Company has not given any loans and advances on the basis of security
 by way of pledge of shares, debentures and other securities and hence
 the question of maintenance of adequate records for this purpose does
 not arise.
 
 (xiii) In our opinion and according to the information and explanations
 given to us, the Company is not a chit fund or a nidhi / mutual benefit
 fund / society. Therefore, the provisions of clause (xiii) of paragraph
 4 of the Companies (Auditors Report) Order, 2003 are not applicable to
 the Company.
 
 (xiv) In our opinion and according to information and explanations
 given to us, proper records have been maintained of the transactions
 and contracts and timely entries have been made therein in respect of
 the transactions of dealing or trading in shares, securities,
 debentures and other investments. The shares, securities, debentures
 and other securities have been held by the Company in its own name.
 
 (xv) In our opinion and according to the information and explanations
 given to us, the terms and conditions of the guarantees given by the
 Company for the loans taken by subsidiary companies from banks and the
 counter guarantee given by the Company for loan taken by other party
 from a financial institution, are not prima facie prejudicial to the
 interest of the Company.
 
 (xvi) To the best of our knowledge and belief and according to the
 information and explanations given to us, the term loans taken by the
 company were, prima facie, applied for the purposes for which they were
 raised.
 
 (xvii) According to information and explanations given to us, and on an
 overall examination of the Balance Sheet of the Company, funds raised
 on short term basis have, prima facie, not been used for long term
 investment.
 
 (xviii) The Company has not made any preferential allotment of shares
 to parties and companies covered in the Register maintained under
 Section 301 of the Companies Act, 1956 and hence, the question of
 whether the price at which shares have been issued is prejudicial to
 the interest of the Company does not arise.
 
 (xix) According to the information and explanations given to us and the
 records examined by us, the Company has issued short term privately
 placed secured debentures during the year, which have been repaid prior
 to creation of security in favour of the debenture holders.
 
 (xx) The Company has not raised any money by public issue during the
 year. However, in respect of the money raised by public issue of
 Foreign Currency Convertible Bonds in an earlier year, the management
 had disclosed the end use of the money so raised in note no. 21 of
 Schedule 18 (B) which has been verified by us with the relevant records
 together with the information/ explanations given to us.
 
 (xxi) To the best of our knowledge and belief and according to the
 information and explanations given to us, no material fraud on or by
 the Company was noticed or reported during the year.
 
                                           For Deloitte Haskins & Sells
                                                  Chartered Accountants
 
                                                    M. S. Dharmadhikari
 Place:   Mumbai                                                Partner
 Dated:   May 13, 2009                             Membership No. 30802