1.  We have audited the attached Balance Sheet of NATIONAL ALUMINIUM
 COMPANY LIMITED, as at 31st March, 2011, the Profit and Loss Account and
 the Cash Flow Statement of the Company for the year ended on that date,
 both 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.
 
 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 misstatements. 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 the 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.
 
 3.  As required by the Companies (Auditor''s Report) Order, 2003 (CARO)
 issued by the Central Government in terms of Section 227(4 A) of the
 Companies Act, 1956, 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 it appears from our examination of
 those books;
 
 c.  the Balance Sheet, the Profit and Loss Account and the Cash Flow
 Statement dealt with by this report are in agreement with the books of
 account;
 
 d.  in our opinion, the Balance Sheet, the Profit and Loss Account and
 the Cash Flow Statement dealt with by this report are in compliance
 with the Accounting Standards referred to in Section 211(3c) of the
 Companies Act, 1956/
 
 e.  In terms of Government of India, Ministry of Finance, Department of
 Company Affairs, Notification No.GSR 829 (E) dated 21st October,2003,
 Government Companies are exempt from the applicability of provisions of
 Section 274 (1) (g) 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 significant
 accounting policies and notes on accounts appearing in Schedule Y and
 Schedule Z respectively 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 & 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
 (REFERRED TO IN PARAGRAPH (3) OF OUR REPORT OF EVEN DATE)
 
 1.  (a) The company has maintained records showing full particulars
 including quantitative details and situation of fixed assets.
 
 (b) The company has a programme of conducting physical verification of
 non-movable assets at an interval of three years, which in our opinion
 is reasonable having regard to the size of the company and nature of
 its assets. All the movable assets were physically verified during the
 year. As informed to us, no material discrepancies were noticed on such
 verification wherever reconciliations have been carried out and the
 same has been adjusted in the books.
 
 (c) In our opinion and according to the information and explanations,
 the Company has not disposed off substantial part of fixed assets
 during the year.
 
 2.  (a) In respect of its inventories as explained to us, all
 inventories except stocks relating to expansion project, stocks lying
 with third parties and stocks in-transit, have been physically verified
 by the management at reasonable intervals during the year.
 
 (b) In our opinion and according to the information and explanations
 given to us, the procedures for 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. The discrepancies noticed on physical stock and book
 records relating to shortages have been dealt with in the books of
 account, while excesses have been ignored.
 
 3.  (a) According to information and explanations given to us, the
 Company has neither granted nor taken any loans, secured or unsecured,
 to/from Companies, firms or other parties listed in the Register
 maintained under section 301 of the Companies Act, 1956. Consequently,
 clauses (iii)(a) to (g) of paragraph 4 of the order are not applicable.
 
 4.  In our opinion and according to the information and explanations
 given to us, there is an adequate internal control system commensurate
 with the size of the Company and the nature of its business with regard
 to purchases of inventory and fixed assets and the sale of goods and
 services. During the course of our audit, we have not observed any
 major weakness in the internal control system.
 
 5.  According to information and explanations given to us, the Company
 has not entered into any contracts or arrangements which require to be
 recorded in register maintained under section 301 of the Companies Act,
 1956.
 
 6.  The Company has not accepted any deposits from the public during
 the year.
 
 7.  In our opinion, the Company has an adequate internal audit system
 commensurate with the size and nature of its business.
 
 8.  We have broadly reviewed the books of accounts maintained by the
 Company, pursuant to the rules made by the Central Government for the
 maintenance of cost records under section 209(1) (d) of the Companies
 Act., 1956 in respect of manufacturing activities 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 and
 complete.
 
 9.  According to the information and explanations given to us and on
 the basis of our examination of the books of accounts, the Company is
 generally regular in depositing undisputed statutory dues including
 Provident Fund, Investor Education and Protection Fund, Income Tax,
 Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise duty, Cess and
 Electricity Duty with the appropriate authority.
 
 According to the information and explanations given to us, no
 undisputed amounts are payable in respect of Income Tax, Sales Tax,
 Wealth Tax, Service Tax, Custom Duty, Excise duty, Cess and other
 material statutory dues in arrears as at 31st March, 2011 for a period
 of more than six months from the date on which they become payable.
 
 According to the information and explanations given to us, there are
 disputed statutory dues which have not been deposited are given herein
 below:
 
 Statute       Nature of Dues     Amount   Amount    Forum where
                                 disputed deposited  disputes are
                                  Rs. in 
                                   Crore    Rs. in 
                                            Crore    pending
 
 Sales Tax     Sales Tax          141.11     17.02   Commissionrate
 
                                  309.46     73.76   Tribunal
 
                                    5.04      4.21   High Court
 
                                  455.61     94.99
 
 Entry Tax     Entry Tax           36.14     13.47   Commissionrate
 
                                   30.48     21.55   Tribunal
 
                                    8.46      4.1    High court
 
                                   75.08     39.13
 
 Central Excise 
 Act,1944       Excise Duty        63.31      2.54   Commissionrate
 
                                   36.42      0.59   Tribunal
 
                                   99.73      3.13
 
 Customs Act,
 1962           Customs Duty        0.06      0.06   Commissionrate
 
                                    0.06      0.06
 
 Income Tax 
 Act,1961       Income Tax        193.68    201.83   Commissionrate
 
                                   82.82     82.33   Tribunal
 
                                  276.50    284.16
 
                                  906.98    421.47
 
 10. The Company does not have accumulated losses at the end of the
 financial year. The company has not incurred cash losses during the
 financial year covered by the audit and in the immediately preceding
 financial year.
 
 11.  In our opinion and according to the information and explanations
 given to us, the Company has not defaulted in repayment of dues to
 financial institutions, banks and debenture holders.
 
 12. Based on our examination of the records and the information and
 explanations given to us , the Company has not granted any loans
 advances on the basis of security by way of pledge of shares,
 debentures and other securities.
 
 13.  In our opinion the Company is not a chit fund/nidhi/mutual benefit
 fund/ society. Therefore, the provisions of clause (xiii) of paragraph
 4 of the order are not applicable to the company.
 
 14.  The Company is not dealing or trading in shares , securities,
 debentures and other investments. Therefore the provisions of clause
 4(xiv) of the order are not applicable to the company.
 
 15.  According to the informationand explanations given to us, the
 Company has not given any guarantee for loans taken by others from
 banks or financial institutions.
 
 16.  Based on our examinations of the records and the information and
 explanations given to us, the Company has not raised any term loan
 during the year under audit.
 
 17. According to the information and explanations and on an overall
 examination of the Balance Sheet of the Company, we report that no
 funds raised on short-term basis have been used for long- term
 investment of the company.
 
 18. According to the information and explanations given to us, the
 Company has not made any preferential allotment of shares to Companies,
 firm or other parties covered in the register maintained under section
 301 of the Companies Act, 1956.
 
 19.  Based on our examination of the records and the information and
 explanations given to us, the Company has not issued debenture during
 the year.
 
 20.  TheCompVnThas not raised any money by way of public issue during
 the year.
 
 21. To the best of our knowledge and belief and according to the
 information and explanations given to us, no fraud on or by the Company
 has been noticed or reported during the course of our audit.
 
 For P.A. & Associates                   For C.K.Prusty & Associates
 
 Chartered Accountants                       Chartered Accountants
 
 FRN 313085E                                       FRN 323220E
 
 (CAS.S.Poddar)                                 (CA C.K. Prusty)
 
 Partner                                             Partner
 
 Membership No.51113                           Membership No.57318
 
 Place: New Delhi 
 
 Date : 30th May,2011